Homora is excited to share the next growth phase for Homora V2 and what it will become in the upcoming quarter of 2022.
Ever since Homora first launched back in DeFi summer of October 20th, 2020, the protocol has undergone major changes in order to adapt to different market conditions, including the recent bear market. Each change was filled with challenging obstacles that caused us to revisit Homora as a protocol and figure out ways to adapt. Despite the uncertainties, Homora has been able to demonstrate and showcase the protocol’s versatility and ability to withstand market volatility with its product offering reaffirmed multiple times by the community.
Throughout 2022, we have seen a lot of events that impacted the crypto industry as a whole. This hardship was especially evident during the recent bear market as it was a challenging trial for many protocols to test their survivability. There was a large outflow of capital from the crypto ecosystem, causing many DeFi protocols to take a huge hit. Despite the drastic drop in TVL across almost all DeFi protocols, including major players like Uniswap and AAVE, Homora V2 still showed its endurance and broke through. However, the market also served as a wake-up call for us to not only double down on what we’re good at but also begin exploring other strategies to increase protocol resilience corresponding to the changing market condition.
As the market pace slowed, we took the time to connect and build a deeper relationship with Homora V2 users as well as explore what Homora can improve on. During this period, we got a chance to dig into our community to better understand user needs and user demographic. As we connected with several types of users, it gave us clarity on what we need to work on and how we can support and onboard core users of Homora even better than before. We believe the next best step that will benefit all users will be a big shift in our narrative and what we focus on.
Improving User Needs
The unique concept of leveraged yield farming offered by Homora has brought about many yield opportunities across multiple L1 key chains and now expanding to L2s with Optimism being the first. The lucrative yields are also supported by high security measures, thus have attracted different levels of yield hunters all the way to institutional users. With the ability to not only earn high returns securely, but also its customization ability regardless of the market condition, Homora V2 became a top choice especially evident with institutional users.
On the institutional side, funds actively use Homora both on the lending and farming side. For lending, generally these funds are seeking safer strategies with lower risks on Homora V2. On the farming side, these funds are seeking higher returns with higher risks or using Homora V2 as a part of their hedging strategies that utilize multiple protocols. There are currently several institutional users whom we continue to work with closely to help provide customized support.
One of the users incorporating Homora V2 is Midas Investment, a custodial crypto-investment platform that combines CeFi and DeFi. Currently, Homora V2 is utilized in one of their investment products as part of their CeDeFi strategy, a soft LONG on ETH. The aim of the outcome is a strategy with an overall 1x exposure on ETH and roughly 25-30% APY from farming with 2x leveraged on Homora. Midas has chosen Homora to deploy as their first launch strategy. There are a lot more users like Midas we are actively working with to help them achieve desirable yields through Homora.
Expansion To Increase Utility Through New Integrations & Partnerships
As we collected more feedback and approached more users like Midas, we realized the unpredictability of the market was one of the major concerns users face when farming. Whether the market condition becomes bearish, bullish, or side-way, they all have different risks associated with the strategy deployed. Therefore, we begin to ask ourselves, “how can we make users feel more secure while farming on Homora V2 that accounts for external factors, such as market volatility as much as possible?”. We came to a realization that Homora V2 can become the core building block for the DeFi ecosystem while collaborating with other protocols to enhance their usability in their own domain.
For example, we are currently working with protocols like Aperture Finance and Weave Financial who specialize in curating a one-stop strategy platform to help minimize risks while maximizing returns for users without the additional manual complexity. These collaborations demonstrate not only to increase efficiency in terms of double downing on what each protocol is good at, but also providing a safer alternative for users.
Thus, we will continue to expand and seek collaborations across all chains to become the go-to hub for those looking for high yield opportunities. There are already multiple integrations in the pipeline including other vaults and strategy options that build on top of Homora V2
Next Growth Phase of Homora
Each crypto cycle is a testament to showcase a protocol’s strong will towards the long-term goal of making finance fully decentralized. During the last bull cycle, projects focused heavily on “speed” to be able to stand out from the competition. Now that we are in the current bear cycle, it's time to consolidate all the past key learnings and shift focus to work on enhancing the strengths of each protocol. As our Project Lead, Tascha, mentioned, “Speed was key in the last cycle. Edge will be key in the next…”
Now we are all hands on deck to focus on reimagining leveraged yield farming to the next level by building the next growth phase of Homora. Our goal will be to become the go-to DeFi hub that manifests and offers the best yields, highest security, and with the most variety of strategies to farm with.
On the build side, Homora will act as a DeFi building block that enables higher yields and flexible borrowing for all parties whether it be from farming directly through Homora or using integrated products that build on top of Homora. Homora will strive to become the go-to trusted, secure, and versatile protocol.
On the user side, Homora will continue to research and connect with various players who are long-term believers and users of Homora. This will include listening to feedback on what’s lacking and types of features needed to tackle the changing market landscape.
The product offering from Homora V2 has proven to be beneficial to major players in the DeFi world, from retail to institutions and even to other protocols. The market gap that Homora seeks to close has offered opportunities to those seeking for high yields HODLing onto their assets and those trying to maximize yields through liquidity providing. We will continue to work on making Homora V2 available to more users across other chains and expand on more utilities on ways to capture the highest yields.
[Edit v2] Our Uniswap v3 expansion to Ethereum will be temporarily paused due to internal changes. The launch is expected to resume sometime during Q1 2023.
About Alpha Venture DAO (Previously Alpha Finance Lab)
A Builders’ DAO. We explore and innovate at the fringes of Web3 and drive significant value to Web3 users, and ultimately, alpha returns to the Alpha community.