Leverage 2.0 is composable!
Quick overview of what is possible with Gearbox Protocol's Credit Accounts.
The way we are used to leverage is having a "short BTC" button on an exchange, where you put your assets as collateral and get a liquidation price which you can adjust by adding funds or closing the position. That's cool and easy, everyone knows it, but then... that's it? Feels too restricted. Your short is just sitting there and you can't utilize the position further.
Gearbox Protocol doesn't give you 2 slick buttons "long" or "short". It gives you more capital to work with, which then YOU DECIDE where to deploy into. For example:
You basically get a short which then makes you money yield farming, and the yield farming LP tokens you can potentially utilize for something else. The lego building blocks can all happen within Credit Accounts!
Gearbox only limits you within the boundaries of security according to AllowedList policy, to make sure funds are not syphoned out by known attacks. Apart from that, you as a user decide what complex strategies and trades you want to execute thanks to Gearbox leverage.
Gearbox is your leveraged DeFi wallet. Continue doing what you love, but with more capital ❤
Here is one more:
Flash loans make it possible to arbitrage a peg within one block. Gearbox allows you to do so even if it takes more time. However, with stablecoins it's generally easier as there are other avenues to borrow from. But not for all pegged assets!
This is why we call it leverage 2.0 and value composability so highly!
This also reimagines how undercollateralized loans can work, because such a system can potentially calculate on-chain values of many things, be it: tokens you trade, LP positions, your reputation score if it's liquid, your vested investments, and so on. If the value of social interactions also becomes liquid and tradeable, like some try to do with social tokens, then undercollateralized loans don't even need to exist per se: Gearbox would potentially be able to calculate the price of any such interaction. It's potentially a new way of how credit can be managed.
Check out what more is possible:
Last modified 3mo ago