Welcome to xBank
The Non-custodial Liquidity Market Protocol on StarkNet
xBank is a decentralized non-custodial liquidity market protocol, written natively in Cairo & Solidity. xBank manages deposits for lenders and facilitates lending of the deposited asset for borrowers while conducting appropriate risk management to protect the lenders from risks of illiquidity and insolvency. The lenders earn passive interest income from the algorithmically derived interest rate while the borrowers take out a loan of the supplied assets in an overcollateralized & perpetual manner by paying a floating interest rate as determined by the supply and demand for the asset.
As a decentralized protocol, xBank’s ledger is publicly-verifiable, ensuring transparency for all key stakeholders.
The Decentralized Finance (DeFi) sector has grown exponentially in the last several years, especially on Ethereum, the primary chain for DeFi, whose TVL has grown to ~US$121Bn, making up roughly 60% of all value within in the DeFi industry (as of 02/2022).
However, albeit its strong growth, one of the key issues that many DeFi users face today is accessibility. As more users join the world of DeFi, the network has become congested, increasing the gas fees and transaction time in the process, making it inaccessible to the general population.
One of DeFi's key ethos is that it should provide access to financial opportunities to those who are unbanked. However, with such an expensive financial barrier from gas fees, it seems as if only those who are financially strong are able to afford to participate in financial opportunities on Ethereum. In other words, Ethereum is for the whales, not the financially weak like the underbanked or unbanked.
At xBank, we want to provide a liquidity platform that provides accessible financial opportunities to all, a platform where anyone, regardless of their financial strength, can participate in. This has led us to the decision to launch xBank, a decentralized non-custodial liquidity market that will be accessible to all regardless of their financial strength. xBank will be launched on StarkNet, who offers highly inexpensive gas fees. You can find more details about why we've selected StarkNet in the section below.
The DeFi industry has come a long way since the first lending protocol, MakerDAO, was launched and UniSwap came up with the first AMM model, the XYK. Since then, we have seen multiple narrative shifts within DeFi such as the concept of Protocol Owned Liquidity (POL) and Protocol Controlled Value (PCV) by Frax, Tokemak, and OlympusDao, to the applications of veTokens by Curve & Convex. Even UniSwap has already iterated its first AMM model and has released its v3 contracts.
Our team was fortunate to have been a part of DeFi from the start as both builders and users. We would like to leverage our vast amount of knowledge and the experiences we have accumulated over the years to design, build and bring to the market a top quality product is an improved version of the current options already available in the market as well as tokenomics model that appropriately aligns the interest of different platform participants.
xBank will launch first as a clean product to allow to team to focus first on building a strong foundation and will introduce its governance token once the core product has been battle-tested. More details on our launch here.
As mentioned in the section above, we believe expensive gas fee is one of the biggest barrier towards achieving accessibility to financial opportunities in DeFi. Many alternate L1s are able to offer lower gas price to users, but many times, that come at the expense of security and decentralization.
We believe that StarkNet is best-positioned to tackle this accessibility problem given its ability to optimize for both low transaction fee and high degree of security. Below, we highlight the four primary reasons for choosing StarkNet to be the home base for xBank:
- 1.Usability: StarkNet uses the zkRollup technology which compresses transactions and send the them back to Ethereum (L1) for validation, allowing for fast interoperability between L1<>L2 interaction and thereby significantly shortening the confirmation time.
- 3.Decentralization: Although StarkNet is much faster and cheaper than other L1’s, it does not sacrifice security and still possesses the same degree of decentralization as Ethereum.
We want to dedicate this section to our supporters who made the development of xBank possible. We would like to especially express our gratitude towards StarkWare who has provided us with invaluable guidance and a grant to support xBank’s early development efforts.