In-Depth Analysis: Nolus Money Market’s Early Months
In the evolving landscape of DeFi, Nolus is carving out a niche, not through conventional benchmarks but by pioneering a demand for its novel product offerings. In a mere four-month period, the platform has processed transactions amounting to $5 million via its Earn and Lease functionalities, demonstrating considerable advancement in broadening the variety of DeFi services. Now, let’s take a closer look at the numbers to see just how impactful and far-reaching these offerings have been.
Lender Stablecoin Returns
In less than a month, after the protocol’s genesis, the yield for lenders has matured, primarily due to an increased utilization rate of funds and Nolus’ unique mechanism to limit new deposits when utilization drops below specific thresholds. Consequently, this ensures that the yield consistently remains above 6.40% APY, exceeding the average across the industry. With the targeted utilization level raised, the yield is poised to climb toward the 10.00% APY mark.
DeFi Leases
There have been 1,605 DeFi lease positions initiated, amounting to an approximate value of $3 million. These leases were supported by down payments totaling $1.3 million, resulting in an average leverage that is 125.00% higher than the down payment. This reflects the robust health of the positions, as it would require a nearly 45.00% drop in asset price from the base to initiate the first partial liquidation. Notably, stATOM has emerged as the preferred asset for down payments — 31.00%, followed by USDC (22.00%), AKT (17.00%), and an equal distribution between ATOM, stOSMO, WBTC, and OSMO at around 5.00% each.
40.50% of the total positions were in ATOM (including LSDs), 16.30% in OSMO (including LSDs), with AKT comprising 15.10%, WETH at 13.00%, and WBTC at 11.90%. The remaining share is almost evenly split among JUNO, SCRT, EVMOS, AXL, and CRO.
66 DeFi leases each exceeding $10k were opened, totaling $1.25 million. Notably, the five largest leases, each from distinct wallets, predominantly opted for WBTC after using stATOM as the down payment, with one each in WETH and OSMO. These positions have since been closed, netting an average gain of 35.00%.
The most active days for opening leases were September 9 and October 30. On September 9, loans totaling $79,000 led to $175,000 in DeFi leases, with 80.00% invested in AKT at approximately $1 per token, yielding a 60–80.00% return in under 50 days. On October 30, OSMO buyers invested $80,000 at $0.35 per token, securing about a 100.00% return in just 20 days.
Profitability
Presently, there are 509 active positions on Nolus, with a total of $575,000 in down payments to secure $1.275 million in leases. Each lease, on average, is worth about $2,500. Notably, AKT and stATOM are the most popular choices, each making up 25.00% of all leases, with WETH following at 15.50%. These leases were opened roughly 24 days ago and have seen an impressive average return of 52.00% — that’s more than $1,250 per lease in just 24 days, or an annual rate close to 8 times the original investment. OSMO and AKT have been particularly profitable, with average entry prices of $0.43 for OSMO and $0.95 for AKT.
In terms of lease closures, around $1.6 million worth of leases have been closed, with a striking 80.45% ending in profit. The average profit per lease is 33.00%, with the highest profit reaching a 229.00% ROI from an initial $10.5k down payment in OSMO.
Interest
The annualized interest rate for DeFi leases averages slightly above 15.00%, following the industry mean when compared to other perpetual and margin products in the space.
Liquidations
Only 1.00% of the $3m lease positions have experienced liquidations. This can be attributed to the significantly more favorable liquidation terms offered by the protocol, compared to the average in the market. Approximately 0.50% of these positions underwent partial liquidations, which did not affect the users’ initial down payments, meaning they did not incur any losses. Conversely, in comparable scenarios with other protocols, such positions are usually closed completely, causing a total loss of equity.
Conclusion
Nolus’ journey in the DeFi space has been marked by significant achievements and unique contributions. Its approach to creating demand for previously unavailable products in DeFi demonstrates a deep understanding of market needs and a commitment to innovation. The impressive growth, diversity of assets, and profitability metrics underscore Nolus’s potential in the financial technology sector. As it continues to evolve and expand its offerings, Nolus is poised to play a pivotal role in shaping the future of DeFi.
All data related to these statistics is available on-chain and represents normal operational flow that can be conveniently extracted using a Rust ETL client, accessible here.
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