Until now, leverage in DeFi has been monotonous. It was simply a way to increase positions by borrowing assets from lending protocols like Aave or Morpho. However, Gearbox (@GearboxProtocol) has proposed a new approach.
Gearbox is building a ‘leverage middleware’ for DeFi, and furthermore, a universal ‘leverage infrastructure.’
In other words, it aims to create a single leverage layer that encompasses the entire DeFi space without being confined to specific pools or exchanges. If Aave was the ‘lending infrastructure,’ then Gearbox is the ‘leverage infrastructure.’
While existing lending protocols relied solely on the liquidity of their internal pools, Gearbox operates on the global liquidity of DeFi as a whole, including Uniswap, Curve, and others.
In fact, during the market crash on October 11, there were no large-scale liquidations. This was because Gearbox's leverage does not depend on its own liquidity but operates based on the overall liquidity of DeFi.
Users can not only borrow assets from Gearbox but also design their own strategies. Various strategies such as 2x long, delta neutral, staking loops, and leverage restaking can be executed with a single click. A risk management model evaluates the health of the portfolio in real-time to support this.
The key is the ‘Credit Account.’ Users can borrow a single asset (e.g., USDT0) through this account and utilize multiple collaterals to implement complex strategies. Leverage can be operated using collaterals like Ethena's sUSDe and Pendle PT.
Now, DeFi users have entered an era where they can enjoy the effect of $10 with just $1. Gearbox is pioneering a new money market within the DeFi space as a universal leverage middleware. Personally, I find Gearbox to be an attractive project, especially considering that despite a TVL of $450M and steadily increasing trading volume, the token has already been fully distributed, with an FDV of only about $43M. Show originalThe content on this page is provided by third parties. Unless otherwise stated, OKX is not the author of the cited article(s) and does not claim any copyright in the materials. The content is provided for informational purposes only and does not represent the views of OKX. It is not intended to be an endorsement of any kind and should not be considered investment advice or a solicitation to buy or sell digital assets. To the extent generative AI is utilized to provide summaries or other information, such AI generated content may be inaccurate or inconsistent. Please read the linked article for more details and information. OKX is not responsible for content hosted on third party sites. Digital asset holdings, including stablecoins and NFTs, involve a high degree of risk and can fluctuate greatly. You should carefully consider whether trading or holding digital assets is suitable for you in light of your financial condition.
