Axly is a next-level DeFi protocol combining the power of AMM liquidity pools and a lending platform to maximize capital efficiency. Axly offers users two main options to earn: farming in liquidity pools with leverage and single-asset depositing to get interest on targeted loans.
The idea of leveraged farming is quite simple: the more liquidity provided, the more potential returns are. When you open a farming position of $100 with 3x leverage, Axly appends another $200 utilizing the loan fund, so a total of $300 added to a liquidity pool brings 3 times more rewards than $100. If a liquidity pool generates 50% APY, with 3x leverage you get 150% (minus borrowing interest).
It’s important to mention that the loan fund is not available to outside borrowers. The assets can only be invested in liquidity pools under the full control of the Axly smart contract, which eliminates the risk of non-repayment. That’s why Axly loans do not require collateral.
Built on the Waves blockchain, Axly enables yield farming in featured liquidity pools of Swop.fi and WX Network. Connecting users and DeFi services, Axly will act as a booster for the entire Waves DeFi ecosystem and will give it new impetus to evolution.
How it works
Asset flow in Axly is as follows:
Lenders deposit their assets in the loan fund. The assets are offered to farmers for leveraging up their positions, and the lenders earn Lending APY that comes from borrowing interest paid by farmers.
Farmers provide assets to be added to liquidity pools, open leveraged farming positions, and enjoy higher Farming APY.
Axly provides the complete investment service: takes loans for farmers in the loan fund; exchanges assets to the right ratio; provides liquidity to the pools and stakes LP tokens; claims and reinvests farming rewards; monitors the health of each leveraged position.
If the ratio of debt to position value exceeds the acceptable level (due to unfavorable price movement or increased borrowing interest), Axly partially liquidates the position to protect lenders’ capital. Namely, Axly removes a portion of the liquidity from the pool to partially repay the debt. In contrast to the complete liquidation, the farming position still has the opportunity to grow again if the price goes in the opposite direction. Thereafter, the stop-loss option will be added, allowing farmers to set a stop price in $ for one or both pooled assets, below which the position will be closed automatically.
Key features for Axly farmers
- Auto-compounding by regularly reinvesting farming rewards gained in SWOP or WX tokens.
- Leverage option to provide higher yields on less capital.
- [soon] Stop-loss option based on the pooled asset prices.
Key features for Axly lenders
- Depositing a single asset with no risk of impermanent loss.
- Safe targeted loans fully controlled by Axly.
In summary, the Axly protocol offers users a variety of earning strategies, from conservative to high-yield & high-risk. We strongly believe that leveraged yield farming has the potential for sustainable growth in any market conditions.
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