Preon & Chronos AMA Recap

By Medium July 19, 2023 In DeFi, Staking

Greetings again from Preon, the innovative CDP lending protocol within the Sphere Ecosystem. We recently had an engaging and insightful AMA session with our partners at Chronos Finance. In this article, we’ll discuss key highlights from the AMA, provide a brief overview of Chronos and the Sphere Ecosystem, and delve into our exciting partnership.

A Glimpse into Chronos

Chronos is a cutting-edge ve(3,3) Decentralized Exchange (DEX) operating on Arbitrum Layer 2. It’s known for its unique maturity-adjusted liquidity pools (maLPs), which reward long-term liquidity providers with increasing $CHR emissions. This mechanism serves to accomplish two things:

  • Aligns long-term incentives;
  • Cultivates sticky liquidity.

Chronos V2 is set to introduce concentrated liquidity pools, among other enhancements. Dyson, the yield maximizer and CL manager protocol within the Sphere Ecosystem, will support Chronos V2 as its Active Liquidity Management partner, supplementing the existing solution that Dyson had previously built for Chronos through the Liquid Market solutions, $spCHR.


The Sphere Ecosystem

Sphere Finance is a trailblazer in building a community-owned infrastructure that provides revolutionary solutions for DeFi problems. It comprises synergistic protocols and disruptive DeFi solutions within the Sphere Ecosystem. The goal is to create interacting and compounding DeFi building blocks that build upon each other, unlocking various benefits for users, including:

  • Improved capital efficiency,
  • Heightened security,
  • Reduced fees.

Dyson x Chronos

The partnership between Dyson’s ALM solution and Chronos’ concentrated liquidity (CL) pools will be a game-changer for Chronos, the Sphere Ecosystem and the DeFi world as whole.

Dyson will rebalance Chronos positions, maintain liquidity in range, and maximize the $CHR boost for maLPs. Swap fees collected from the ALM pools can be used to bribe $veCHR holders, which will be profitable as, typically, $1 paid in bribes results in >$1 in emissions.

Dyson’s unique value propositions include:

  • Off-chain calculations for protection against front-running,
  • Rebalancing via 1inch to mitigate slippage,
  • Full utilization of liquidity.

Preon x Dyson

Dyson and Preon will also have a great deal of synergy between them — having interconnected protocols under the umbrella of the Sphere Ecosystem allows us to test novel ideas and bring them to the forefront, while optimizing and compounding the solutions that each protocol provides.

Preon will also allow users to farm yield on the protocol, and Preon’s farm vaults will accept LP tokens. Farmers will be able to earn $oPREON emissions on top of the underlying DEX’s swap fees and rewards. $vePREON holders will participate in the Gauges, redirecting $oPREON emissions, and deciding the vAPR for each vault.

This mechanism opens the door for Dyson to be integrated with Preon in unique ways — for example, through gated vaults on Preon. Certain vaults will accrue the maximum boosted $oPREON yield without considering a user’s $vePREON holdings. This system can drastically amplify the farmer’s yield and will help to compensate against impermanent loss of actively managed positions, because $1 in bribes for voters typically provides > $1 in emissions for farmers.

To learn more about this unique synergy, explore the thread linked above!

Chronos & $STAR Liquidity

Sphere Finance was an early launch partner of Chronos, and through Dyson’s liquid wrapper solution, Dyson has amassed noteworthy governance over Chronos. This allows Sphere to use Chronos as the liquidity hub for $STAR. Upon launch, $STAR liquidity on Chronos will be significantly incentivized with Sphere’s $veCHR holdings and further incentivized through bribes. This strategy will create a $STAR liquidity sink on Chronos, leading to improved execution, increased volume, and higher returns.

With the introduction of CL pools, the stability of the $STAR peg will become cost-effective. Dyson will manage these CL pools, enabling the use of swap fees to bribe $veCHR holders, incentivizing them to vote for $STAR pools. This illustrates the liquidity flywheel in action.

Preon, LSDfi & Balancer

Preon will support Balancer’s LSDfi Balancer Pool Tokens (BPTs) as collateral in exchange for the $STAR token, and as leverage by making them yield-bearing, which will be further optimized through Aura Finance. This move unlocks a suite of new opportunities within the Sphere ecosystem, marking Preon as the first protocol to leverage BPTs at zero-percent interest.

These partnerships and collaborations will ensure ample incentivization for $STAR, driving its utilization and adoption. We’re also actively working on enabling more blue-chip collateral options.

To learn more about our partnership with our friends at Chronos, check out the article below!

In conclusion, the future of DeFi shines bright as Preon, Chronos, and the entire Sphere ecosystem continue to innovate and synergize. Our recent AMA was a testament to the collaborative spirit of our community and the disruptive potential of our products. Stay tuned for more updates as we continue to push the boundaries of DeFi.

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