Sense Protocol Guarded Launch

Last week we revealed the permissionless nature of Sense v1, and now we’re excited to announce the upcoming launch of the Sense Protocol.

Here is the tl;dr:

• Sense Protocol will go live by next week on Ethereum Mainnet
• The first supported assets are stETH and cUSDC at 1mo and 3mo series
• We’re conducting a Guarded Launch, meaning Sense will impose limited issuance caps and support only whitelisted protocols (stETH & cTokens)
• Upon the conclusion of the Guarded Launch, Sense will become fully permissionless, allowing anyone to onboard any yield-bearing asset and create new yield primitives
• Sense has undergone four security audits: Spearbit, Kurt Barry, ABDK, and Peckshield

Why Guarded Launch?

Two inherent features of DeFi make open launches for new protocols risky. First, users can face financial consequences even from day one of live operation. Second, decentralized smart contracts can attract capital (and therefore put capital at risk) whether or not you’ve officially “launched” unless you enforce risk management with your code.

Our solution to this is to do a “Guarded Launch,” where Sense launches with self-imposed caps to reduce risk during its early days on mainnet.

Guarded Launch Plan

Because Sense is designed as permissionless infrastructure, there are limitations to the Sense team’s ability to enforce risk controls over the core contracts, even from the moment of deployment. What we can have a hand in is:

1. Which adapters we deploy ourselves
2. How we cap our own adapters
3. What we surface in the Sense Portal UI

In light of this, our guarded launch plan is to start with just two series (1mo and 3mo) for two assets (cUSDC and wstETH). To create these series, we’ll deploy adapters capable of up to 12mo term structures for each of those yield-bearing assets. But, to start, each of those adapters will have ~$100K soft caps for issuance, and the team will only sponsor and surface 1mo and 3mo series on the UI.

Once the soft caps are reached, we plan to raise them each to a hard cap of $400k (within 24 hours), as long as the protocol is behaving as expected. Hard caps will be removed once each adapter has gone through a full lifecycle (including settlement).

Going forward, we plan to whitelist different types of yield-bearing assets at a steady clip.

Any series that is sponsored through a verified adapter will be surfaced on the Sense Portal through a TBD process.

Supercharging yield

Alongside mainnet deployment, Sense will deploy its own Fuse pool, allowing users to earn extra yield and amplify their position’s risk/return.

The Fuse pool permits:

• Borrowing/Lending of PTs and their respective yield-bearing assets
• Use of PTs, yield-bearing assets, and Space AMM LP shares as collateral

The Fuse pool is a win-win for all users, improves price discovery, and unlocks leveraged liquidity within Sense’s markets.

Collateral factors in the Fuse pool will start conservatively at 50%, and be raised in the near future to collateral factors in line with other popular money market protocols.

Last-mile to mainnet

As we approach mainnet launch, we’ll continue to put final touches on the Sense Portal & documentation, and kick off a stream of Sense Twitter threads on use cases and core concepts!

If questions still exist, join us for a Discord AMA with Sense co-founders, Josh and me. Drop in your questions in our #ama discord channel, and we’ll answer as many as we can on Friday, Mar 11th, at 3 pm EST.

Join our community on Discord as we prepare for launch, and follow us on Twitter for a stream of Sense.