DeFi project 1inch Network launched the investment product 1inch Earn — a set of pools applying the concentrated-liquidity concept. The first of them was deployed on the Ethereum network with the USDC/USDT pair, ForkLog representatives said.
1inch Earn previously bore the name Trading Strategy and was first proposed in September 2021. The product is a set of liquidity pools operating on a model similar to Uniswap V3’s range orders. The latter has been optimised for stablecoins.
At launch, APY of the USDC/USDT pool is estimated at 5-10%. The developers emphasised that in the future the metric may vary depending on market conditions.
Swaps will be made by arbitrage traders, trading bots and individual protocol users — Earn pools are integrated with the 1inch Pathfinder algorithm as liquidity sources.
“The idea of 1inch Earn is to use capital more efficiently in AMM-based pools. In a standard pool, liquidity is distributed evenly across the entire price range from zero to infinity. As a result, a large part of it is never used. […] 1inch Earn allows liquidity providers to concentrate their assets in smaller price ranges,” the developers noted.
In the future, 1inch Earn will add more liquidity pools, including with tokens other than stablecoins.
Earlier in January, 1inch Network deployed liquidity-aggregation protocols from decentralized exchanges and limit-order operations on the Avalanche and Gnosis Chain networks.