Wolfonaire Chatbox : AMA With VALK (27th April, 2022)
Hello! Wolfonaire Family & Crypto Enthusiasts
We recently hosted an AMA With VALK Protocol 27th April, 2022 at 02:00 PM UTC. This session was phenomenal. If you have missed then here is the precious AMA transcript, for those who missed the live session this will enlighten you for sure…
Guest Speakers :
Mr. Antoine Loth | CEO, VALK
Mr. Elie Azzi | CPO, VALK
(Note: This is the transcription of the event. Please note that the transcript was edited for comprehensibility and coherency, while the content was not changed.)
Antoine : VALK has been around since early 2019, founded by Antoine Loth (CEO, ex-Private equity and investment banking), and Elie Azzi (CPO ex-Blockchain architect of BNP Paribas). We both had various issues with the industry that we were working in; I didn’t understand why Finance (particularly private markets) wasn’t digitising, and Elie wanted to apply the knowledge and experience of tech and blockchain into his own products.
We realised the growth and opportunity of digitisation in finance came from DeFi, which we saw grow exponentially during 2020. We knew that DeFi couldn’t spread or get into the hands of (1) everyday investors or (2) traditional asset managers unless portfolio management was simple and understandable. Yet, there are few products out there that allow an investor to view their portfolio on a dashboard and be able to compare their positions and understand the relative success related to yield, PNL and more. We came from delivering high quality TradFi solutions to asset managers and fund managers, all with high expectations of how portfolio management should be handled.
We are building products to last that both provide investors with the necessary information they need about their own trades in a simple and understandable dashboard, whilst giving them the tools to make informed and calculated decisions about future trading strategies.
Wolf : For our members who are not already familiar with the project, can you give us a very high-level overview of what #VALK is and what competitive edge it brings to the Crypto Universe?
Antoine : Currently, when investing in DeFi protocols, a user finds it hard to track any profit/loss they make compared to their initial investment. Platforms like Aave only show the net worth of the user’s portfolio or a breakdown per currency and the value that is displayed is equivalent to their aToken. As for Compound when supplying a currency a cToken is received by the user and the price of this cToken increases with each new block. However, when the investment is made into a non-stablecoin, 2 variables come into play: the yield received in the token (e.g. ETH) that is invested and the token’s price compared to the USD.
A specific example: a user deposits 1 ETH into a lending protocol, with the ETH price at $3000 and yield at 1%. After a year the user should have an equivalent of 1.01 ETH, but if the price of ETH decreases to $2500 it would show as a loss in USD but gain in ETH.
In early 2021, we developed our multi-phase plan to bring DeFi to everyone, from newbies to institutional asset managers. We thought the entire market needed and deserved high quality portfolio management solutions in order to fully benefit from DeFi. So we came up with our 2 phase plan:
Merlin: allowing investors to view and understand their DeFi positions across multiple protocols, calculating yield, P&L, NAV and more, all on one interface
Our DeFi aggregator: an interface from which investors can access and trade on different protocols without leaving it. These trades include both simple (lend, borrow, withdraw) transactions, as well as complex (flash loans, arbitrage, leverage boost) transactions. This will be combined with Merlin’s data indexation tools to allow comparison of strategies, back-testing and yield optimisation.
Wolf : How does Marlin help DeFi traders on their daily trading?
Elie : Merlin is called our DeFi smart wallet as it is able to read and understand all information related to an investors wallet address (whether that is Metamask, or Coinbase wallet). It can distinguish between assets held inside the wallet vs assets being lent/borrowed on major protocols such as Aave/Compound/Trader Joe, and provide institutional-grade reporting and accounting in one single place. Other major features include:
Overview of all transactions, recent and historical
Profitability of yield earned vs NAV. Merlin is able to track the date at which the investor deposited the staked tokens, the price at that point, the yield earned during that time period and the current price of the token in question. This way, it can calculate whether there has been a profit or loss related to that staking action.
Aggregate transaction fees (particularly important when gas fees are volatile)
Impermanent loss on liquidity pools such as Uniswap, as well as the range and the ratio of the tokens within the liquidity pool to see if the investment has gained or lost money. Additionally, Merlin will very soon allow the investor to claim any fees that they have earned from liquidity provision
Merlin provides analysis of all transactions and investments, allowing an investor to view historical value of APYs and pool behavior + comparison between them.
Merlin’s data provision means that strategies can be back-tested to allow future optimisation of investment returns in terms of versus other strategies. Different strategies over time can be compared with others, allowing full coverage and the ability to plan and optimize for future investment strategies.
Wolf : Have you met all your goals in the roadmap till now? And were there any difficulties that you didn’t expect and were not prepared for?
Elie : The last 6–12 months have been incredibly busy since Merlin requires a lot of data indexation using the Graph, but our development mode has been growing strongly!
Merlin has been in various types of beta mode, with the first version out early this year. However, this was very private, and mainly used internally to check for bugs and UI issues. The other main issues we saw were:
1) Being able to understand different DeFi strategies by end users
2) Implementing the correct way to calculate PNL
However, through trial and error and fantastic feedback from early users, as well as 100s or even 1000s of iterations from our fantastic product team, we have ironed them out and are almost ready to launch. More recently, in the last week, we have opened beta mode to more users, although this isn’t 100% public yet. These include over 600 users who had previously registered on a website and 40+ institutions (DeFi funds, asset managers etc.). We aim to be live by mid-May.
Wolf : Can you please give us a short tutorial on how even a nontech guy can easily use and enjoy your platform?
Elie : Sure! We aim to deliver this product to both institutional investors and retail investors so whilst the solution is institutional-grade, we want the product to be available for all DeFi users, as our objective is to build better and easier DeFi solutions for all.
To use Merlin:
- Enter the app
2) Paste your wallet address into the landing page or directly connect using MetaMask/Wallet Connect/Coinbase Wallet
3) On ‘wallet’, view an overview of:
Your net worth, the distribution and holdings of assets in your wallet and asset allocation by protocol
Yield earned across assets, PNL, total debts, transaction fees
Claimable events (action button to ‘claim fees’ coming soon)
4) On ‘transactions’, view:
Timestamped transactions & investments, which can be micro-analysed to distinguish yield, size and success of strategies
Filters to view investments depending on asset, protocol, or strategy used
Further analysis on position ratio, liquidation price, transaction fees, block number and transaction type
Specific information related to liquidity provision on Uniswap such as liquidity, range, impermanent loss, unclaimed/claimed fees and ratio.
I’ll add a screenshot for Wolfonaire community 😉
Let’s move for twitter round
- There are few products on the market today that are able to allow investors to view their portfolio from a single dashboard and allow them to see a variety of features. So what kind of features or information will users be able to see in your product?
Ans. There are other products that do allow investors to view their portfolio from a single dashboard, such as Zapper, Debank and Zerion. The difference between Merlin and these others is that Merlin’s data provision is more dynamic; what this means is that it compares current positions versus past performance. Whether that is through a chart determining the change in the wallet’s net worth in the last 6 months, or total yield generated from Aave, or which LP has been most successful on Uniswap. There are very few, if any, products that allow calculation of PNL and yield (in USD, % or ETH) of a DeFi position, even on those conventional wallet trackers.
We want to provide a product that delivers to investors what fund administrators deliver to their clients in the TradFi space — easy and understanding reporting of key performance metrics such as net asset value, profit vs loss of certain investments, yield optimisation strategies so that users of Merlin, whether they are retail or institutional, have the best chance of making informed decisions about their DeFi trades.
2. We all know that DeFi cannot reach mass adoption among both mainstream investors and traditional asset managers unless portfolio management is simple and understandable. So how simple, friendly and understandable is Merlin? How long did it take the team to build the product?
Ans. Making DeFi accessible and user friendly is our priority at VALK. As mentioned, Merlin as a very simple and understandable user interface; we have published a brochure and user guide, and our medium explains all concepts effectively. We also have a team on hand on our telegram and a willingness to speak directly and answer feedback from our community. Our product has been in the works for over one year now.
3. According to what I’ve read, Valk is an information supplier to defi investors that helps them to have a better monitoring of the Crypto markets, but can you tell us exactly what these tools are that give you a better in terms of position terms than a regular exchange?
Ans. Our data indexation tools will allow investors to have a better understanding of their portfolio and each position inside the portfolio. As mentioned, this includes allowing investors to view and understand their DeFi positions across multiple protocols, calculating yield, P&L, NAV and more, all on one interface. This is for DeFi positions, rather than CeFi, so regular exchanges do not exist in the same way, hence there are very few fund management or reporting/monitoring tools available for DeFi investors.
4. The #VALK Merlin DeFi Smart Wallet has some really cool sounding features like added transaction fees and impermanent loss signaling. How can users track their gas fees and temporary loss of liquidity funds? Can you explain these features in more detail?
Ans. Merlin is able to read the wallet address, pull data from Etherscsan and the GraphQL, as well as build sub-graphs. Merlin is querying and pulling data that has been verified and validated on-chain already and simply delivering it to the platform for the investor to read in an understandable way. So data such as the price of ETH exactly 24hrs ago, or the total yield earned in a Maker vault since last week according to the APYs currently shown, can only come from within the blockchain and protocols living on the blockchain. The same logic can be applied to liquidity pools and other major protocols. We do this by fetching and querying data from sub-graphs that we have built ourselves, for each protocol we integrate with, meaning that there is a constant and uninterrupted stream of data points we have indexed, giving Merlin exact data provision at all times. This way, it is possible to aggregate total gas fees and calculate more complex data behind liquidity pools such as impermanent loss, liquidity and range.
5. Valk Tech’s technology is excellent, and I believe it has the ability to go much further, hence, aside from the Avalanche chain, does Valk Tech have plans to integrate with other Blockchain ecosystems such as Ethereum, BSC, or Polygon?
Ans. If you would like to register and apply to be in Beta testing for Merlin, or be prioritized on the list as an early user, fill out the form below, and make sure to include WOLFONAIRE as the community code so we can recognise and reward you as a valued early adopter 😉
Google Form to Fill Out: https://docs.google.com/forms/d/1AMSXUCmypU3slOBcclftD2Qkq52y4b0pG57R6daSb0g/edit
Merlin is actually blockchain agnostic. We aim to serve DeFi investors across the board and therefore integrate with protocols with the highest TVL. Therefore current protocols on Merlin are on both Ethereum and Avalanche, and we will listen to feedback from our users to prioritise new integrations of protocols.
Let’s move for the community round
Q1. You say that Valk will have a DeFi asset management panel that connects investors with the main DeFi protocols without leaving the interface, but can you really tell us which DeFi protocols will be available? and we will have to link the application with those protocols?
Ans. We are integrated with most of the major protocols as we speak ( aave, maker, compound, trader Joe, uniswap) and will soon be covering the majority of protocols.
Q2. Where i can get all the latest news about ? Do you have Twitter/Telegram/Discord community? If yes can you share the link here because there is a lot of fake telegram/twitter groups?
Ans. 💻 Website: https://defi.valktech.io/
📱Telegram announcement channel: t.me/valkdefinews
Q3. What solutions does wallet Merlin provide to help DeFi investors?
Ans. This feature is coming soon but in a nutshell it will allow you to diversify your yield farming strategies with Yield coming from Tradfi !
Q4. I read that users will have to connect their DeFi wallet to Merli to mine all their information. Now, could you mention any of the digital wallets that you recommend using? Will user information be displayed in real time? Tell us a little more about your connection with Merli.
Ans. we want to be compatible with all providers in the long run :).
Now the session ends with lots of thanks to our Guest Speakers…
Here are some important links of VALK