CeDeFi — A New World
The feud between traditional finance and cryptocurrencies is quite popular. But, even within the crypto world users are torn between centralized finance (CeFi) and decentralized finance (DeFi). It is true that DeFi is preferred these days but before the infamous DeFi boom, CeFi was the go-to option for trading crypto.
Both DeFi and CeFi share the same end goal — to let users buy, sell, and trade crypto. However, the way in which they achieve this goal is quite different. In CeFi users trust a centralized exchange (CEX) to manage their assets and in DeFi, they trust a technology. Both sides have advantages and disadvantages of their own. But, there is a way to end this feud and bridge the gap between CeFi and DeFi. Enter CeDeFi (Centralized Decentralized Finance).
CeDeFi is a technology that brings together the best features of CeFi and DeFi. By doing this, it ensures that all the main functionalities of DeFi like token trading, swapping are provided to users with the flexibility and security of CeFi. But, where it really makes an impact is in the case of yield farming.
The core of MoonFarm includes MoonFarm Vaults and MoonFarm Yield Optimization Strategies (YOS).
MoonFarm Vaults are investment instruments that employ a specific set of strategies for yield farming. MoonFarm vaults make use of automated farming strategies to continually invest and reinvest deposited funds in order to achieve high compounded interest for users.
MoonFarm Yield Optimization Strategies (YOS): YOS is a set of farming strategies implemented in smart contracts, which utilize the funds deposited in MoonFarm Vaults to generate high interests from farming on different applications on different DeFi applications. It’s worth noting that, thanks to YOS, users only need to deposit single assets in the vaults without having to learn the different (and challenging) steps in DeFi yield farming.
MoonSwap: Similar to other swap pools, MoonSwap allows users to swap from one asset to another asset. However, the difference is in the way swap is done. MoonSwap does not only use DEX liquidity as in Uniswap or Pancake, but also uses liquidity from centralized exchanges such as Binance. MoonSwap can be considered as a liquidity bridge where users can get the best swap rate.
How is Moonfarm’s Yield Strategies
What is a MoonFarm Vault?
In a vault, users can earn more of the asset the users stake in it For example, when a user stakes CAKE in the CAKE vault, the system uses the CAKE staked to farm in the best APR farm such as CAKE-BNB (APR 70%), and CAKE Pool (APR 140%). It will result in more CAKE over time, effectively growing user share in the vault and thus allowing for more and more rewards over time. Each vault can either refer to a single token in a pair invested in liquidity pools, or a single token invested in lending platforms or single stake reward pools.
In the future, the system will allow MFO holders in the community to build a new vault and submit the proposal to governance for voting.
Summarizing, MoonFarm Vaults can:
Efficiently execute yield farming strategies.
Compound rewards into the initially deposited token amount.
Use any asset as liquidity.
Put any asset to work to generate a yield.
Reinvest earned profits.
Yield Optimization Strategies
MoonFarm Yield Optimization Strategies (YOS) is a set of smart contracts that implement different farming strategies that utilize the deposited assets to generate best yields to users. The implementation of the strategies basically moving assets from one farming application to another one with higher interest. This will be mostly done automatically based on our system, which automatically monitors and tracks the best farming applications with high yield and low risks.. Rewards/profits generated by YOS are regularly updated, harvested, and swapped for the original vault asset, and deposited again for compound farming. Each vault has a unique strategy and the strategy will be improved constantly based on the observations of our AI based monitoring engines.
By having YOS, users only need to deposit single assets and let the strategies generate profits from the funds. While this sounds familiar with centralized finance, the difference is the profit that MoonFarm YOS generates for users.
MoonFarm automates the whole compounding process, making it as close to optimal as possible. The compounding frequency depends on different variables in the system such as Total Value Locked (TVL), Annual Percentage Rate (APR).
In our initial version, MoonFarm Vaults will be harvested multiple times every day and profits are automatically reinvested (compounded). Rewards distribution will be operating on a daily basis. The larger value a vault is, the more frequent the vault is harvested.