Alez Labs has offered a product opportunity for Polygon POS Bridge Funds
Alez Labs has submitted a Pre-Polygon Improvement Proposal (PIP) to create approximately $1.3 billion in potential yield opportunities for stablecoins held in Polygon's proof-of-stake (PoS) Portal bridge.
According to the proposal, stablecoins — Dai (DAI), Tether's USDT (USDT) and Circle's USDC (USDC) — could generate about $70 million a year in revenue from sitting idle.
The authors propose to deposit USDC and USDT stablecoins in Morpho Vaults, which are owned by Polygon and developed by Alez. Decentralized lending protocol Morpho creates production on these stablecoins due to the lack of native wrappers for these products.
This product leads to a decentralized finance (DeFi) protocol, which manages an ecosystem incentive program in a separate Polygon ecosystem vault for each stablecoin asset. Yairn deploys incentive rewards on Polygon's proof of stake and project development on the AggLayer DeFi ecosystem.
An example that breaks down the idea from Alez Labs. Source: Merlin Egalite
Related: Ethena USDe Beats DAI to Become 3rd-Largest Stablecoin
Decentralized Finance 2021 High Score Recovery
Following a slowdown in market activity between April 2022 and March 2024, decentralized finance, which is experiencing a renaissance, is a major component of securitization and acceleration of funding.
According to Defillama, the total value locked (TVL) of the decentralized financial sector will reach $136 billion as of December, with a low of $36 billion in 2023 and a high of nearly $176 billion in 2021.
Defy's total value is locked. Source: Defillama
Decentralized exchange Curve reported $37 million in annual revenue in November — a 23 percent gain from the previous month. A Curve spokesperson told Cointelegraph that the increase in Diffie activity is a response to Donald Trump's election victory in the United States.
Recent defi activity is due in part to the rise of tokenized Bitcoin (BTC) products, which allow asset owners to increase yield on Bitcoin and deploy the asset in decentralized financial protocols within the Ethereum ecosystem.
As the DeFi sector matures, industry executives predict it will begin rolling out financial products that compete with traditional banks.
Magazine: MakerDAO plans to bring back ‘DeFi summer' – Rune Christensen
