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FAQ

Basic​

What is Deepr Finance?​

Deepr Finance is a decentralized finance (DeFi) platform built on IOTA EVM and Shimmer EVM that allows users to lend and borrow cryptocurrencies without the need for a centralized intermediary. Deepr Finance offers a way for users to earn interest on their cryptocurrency holdings, as well as for borrowers to access capital without going through a traditional financial institution.

What functionalities does Deepr Finance provide?​

Deepr Finance offers a number of features, such as:

  • Lending and borrowing: Deepr enables users to earn interest on their holdings while lending the platform their crypto assets. Users can also borrow assets from the protocol by pledging the assets deposited as collateral.

  • Market-driven interest rates: The assets available on Deepr are in demand and supply, which affects interest rates. The platform makes use of a dynamic interest rate model that responds to market situations in real-time.

  • Over-collateralization: A strategy used by Deepr to make sure that borrowers have enough collateral to support their loans. Users must deposit more assets than the amount of the loan they want.

  • Immediate access: There are no minimum deposit or withdrawal requirements for users to deposit into or withdraw from Deepr at any moment.

To indicate a user's balance of lent or borrowed assets, Deepr issues dTokens. Real-time interest in the future Deepr's governance structure will allow users to take control of the decentralized platform. Users who own DEEPR tokens will have the ability to vote on protocol update proposals, such as adjustments to interest rates or collateral specifications.

Which wallets is Deepr integrated with?​

Currently MetaMask, Coinbase Wallet, Bloom Wallet and Trust Wallet, as well as any wallet supported by Wallet Connect. This covers a wide range of the existing wallet clients in the Web3 ecosystem.

What smart contract platform is Deepr Finance built on?​

Deepr Finance is built on top of IOTA EVM as well as Shimmer EVM. We will explore opportunities to migrate to other chains in the future if it adds value to our platform and stakeholders (users, liquidity providers, investors, team).

How do I add funds to Deepr Finance?​

You can deposit assets into Deepr Finance, which can be enabled as collateral within a lending pool, generating passive income and may also be used to secure an over-collateralized loan.

Will there be a deposit/debt position limit?​

Initially there may be limits to ensure the safety of the platform. The team behind Deepr Finance is experienced and wants to ensure mitigating any risk to the users, as the ecosystem matures and assets become more stable with increased liquidity limits might be lifted.

Lend/Borrow​

What asset lending markets does Deepr Finance support?​

Deepr Finance plans to support assets with the highest level of security, price stability and liquidity. Currently, we support SMR and USDT in the Shimmer Network, and wIOTA, USDC.e and wETH in the IOTA EVM Network, but this may change as market conditions evolve.

How does borrowing on Deepr Finance work?​

Borrowing on Deepr Finance works through a collateralized borrowing system. This means that borrowers need to deposit collateral in the form of supported cryptocurrency assets before they can borrow any other assets from the platform. Here's how borrowing on Deepr Finance works:

  • Deposit collateral: The borrower deposits a supported asset and accepts it as collateral into Deepr Finance. The amount of collateral required has to be greater than the value of the loan the borrower wishes to receive.

  • Borrow assets: Once the collateral is deposited, the borrower can borrow other supported assets from Deepr Finance. The maximum amount a borrower can borrow is determined by their collateral ratio.

  • Repay loan: The borrower can repay the loan at any time, in part or in full. Interest is accrued on the outstanding balance of the loan in real-time, and is charged when the loan is repaid.

  • Withdraw collateral: The borrower can withdraw collateral, as long as it sufficiently covers the over-collateralized debt position. If the value of the collateral falls below a certain threshold against the debt position, the borrower may need to add more collateral or repay all/part of the debt to maintain their collateral ratio and avoid liquidation.

  • Liquidation: If the value of the collateral falls below a certain threshold, the borrower risks being liquidated. When a borrower is liquidated, their collateral is sold at a discount to repay their outstanding loan balance.

How do I monitor the safety of my debt position?​

It's important to note that borrowing on Deepr Finance requires the user to monitor their collateral against their debt position, as the value of cryptocurrency assets can be volatile and the protocol's collateral requirements can change in response to market conditions. To assist our users we have created an easy to follow tool called Lighthouse within the dashboard which provides a simple visual metric for users to follow. In the future, we also plan to implement an email alert system for changes in the risk rating of their debt position for our users to be notified if they so choose.

How does lending on Deepr Finance work?​

Lending on Deepr Finance works by allowing users to deposit supported crypto assets into the protocol and earn interest on their holdings. Here's how lending on Deepr Finance works:

  • Deposit assets: The user deposits supported assets. Each asset has its own interest rate, which is determined by the supply and demand of the asset on the platform.

  • Receive dTokens: When assets are deposited into Deepr Finance, users receive an equivalent amount of dTokens. dTokens are interest-bearing tokens that represent the user's share of the assets they have deposited. For example, if a user deposits 10 WIOTA into Deepr, they will receive 10 dWIOTA in return.

  • Earn interest: Users can earn interest on their dTokens in real-time. The interest earned varies depending on the asset and can change as the supply and demand of the asset changes (utilization rate).

  • Withdraw assets: Users can withdraw their assets and interest at any time by redeeming their dTokens. When dTokens are redeemed, the user receives the underlying crypto asset plus any interest earned.

Are there any restrictions for loans/lending?​

As noted above we may look to limit the amount of collateral/debt position we accept early on as the ecosystem bootstraps and greater levels of liquidity in certain assets become available to ensure risk is managed.

All debt positions must be over-collaterized as detailed above.

How is interest calculated?​

It's based on the utilization rate of the lending pool and is variable as supply and demand increases/decreases.

Deepr Finance takes a fee which varies per lending market and is calculated as a percentage of fees taken from borrowers. The team intends to share a large percentage of this fee with stakers of the DEEPR token in the future.

How long do Deepr Finance loans last?​

Loans on Deepr Finance are open-ended, which means that they do not have a set maturity date or term.

When a borrower takes out a loan on Deepr Finance, they must maintain a certain collateralization ratio to avoid the risk of liquidation. The collateralization ratio is determined by the value of the collateral compared to the value of the loan. If the value of the collateral falls below a certain threshold, the borrower's position may be liquidated to repay the outstanding loan balance.

Borrowers can repay their loan at any time, and interest is charged on the outstanding balance of the loan in real-time. As a result, the duration of a loan on Deepr Finance is determined by the behavior of the borrower, including when and how much they choose to repay.

What happens to my cryptocurrencies that are provided as lending liquidity?​

They earn passive income in the form of interest based on the utilization rate which is variable and is automatically allocated over time.

When can I withdraw my deposits?​

At any time, unless in the unusual circumstance that all funds are being utilized by lenders. Under this unlikely scenario, lenders will be highly rewarded as the interest paid out will be extremely high which will lead to the following behavior:

Debt holders to repay positions as the variable interest being paid will be very high. Lenders are incentivized to provide additional assets as liquidity as they can earn a high return in interest.

Security​

When I deposit in Deepr Finance, where will my money be?​

Your deposits are held in the smart contracts, which have been audited by Hashex and Sherlock. The smart contracts have also been forked from Compound v2 which have been battle-tested (secured $billions of assets over a long period of time with no financial exploits) and audited several times. As noted above you can recall your funds (plus interest and rewards earnt) at any time (except in the unlikely scenario mentioned above).

Who has the key to our liquidity with Deepr Finance?​

The users maintain full custody of their assets, ensuring complete control and ownership over them. In exchange for supplying their tokens, they receive dtokens, which serve as a representation of their positions. These dtokens can be held for as long as the user desires and redeemed at any time. It's important to note the Deepr Finance team does not have access to the lending market smart contracts and, therefore, your assets.

What security features are in place?​

Deepr Finance is a fork of Compound, a protocol well-known for its robust security features and audited multiple times.

Deepr Finance has been audited by Hashex, a leading blockchain security firm, and Sherlock, with a bug bounty of 50,000 USDC, delivering over 45,000 USDC in rewards to independent auditors.

Deepr Finance has a strong team with a dedicated security background. This ensures that security is at top of priority for the platform. Any vulnerabilities or potential threats are identified and addressed quickly.

Deepr Finance actively monitors smart contracts in real time. This means any unusual or suspicious activity is detected and investigated immediately.