November 5, 2021
Inside Clarity Universe Vol 4:
Double DeFi Feature
by Caitlin Eckvahl on November 5, 2021
Last week in Clarity Universe, we took a look at some of the most promising NFT and metaverse use cases within the Stacks ecosystem. To follow it up this week we then dove deep into Bitcoin DeFi as Arkadiko’s massive launch ($50M TVL) had Clarity students are wondering how they can put their skills to the test in the quickly growing DeFi world.
Introducing Arkadiko
Having reached peak buzz leading up to launch, students were eager to hear from Philip De Smedt, co-founder of Arkadiko. Their session with him showed students how his team created the first self repaying loan platform for Bitcoin.
As Clarity students know, smart contracts are used for every transaction that takes place on the blockchain once certain conditions are met. In the case of Arkadiko, once you decide to take out a loan, STX tokens are deposited into a Vault as collateral where they begin Stacking. Usually when you begin Stacking, your tokens are locked for a period of time and you are not able to use them outside of the Stacking cycle. With Arkadiko, however, you’re issued a stablecoin called USDA (USD Arkadiko) to utilize while your STX are locked. Meanwhile, because the Stacking yield on the collateral Stacks is more than the loan interest rate, the loan effectively pays itself off.
Clarity contracts play a huge part in automating the self-repaying aspect of the loan. This means that once the conditions of the loan + Stacking are met, Clarity automatically executes the payment process by taking the BTC yield from the STX being Stacked and puts it toward the loan payment.
Students saw how Clarity combined with Stacking and Proof of Transfer can be powerful building blocks for all kinds of decentralized Bitcoin-based financial products and services. It’s clear that this is only the start of the Bitcoin DeFi movement.
As Clarity students know, smart contracts are used for every transaction that takes place on the blockchain once certain conditions are met. In the case of Arkadiko, once you decide to take out a loan, STX tokens are deposited into a Vault as collateral where they begin Stacking. Usually when you begin Stacking, your tokens are locked for a period of time and you are not able to use them outside of the Stacking cycle. With Arkadiko, however, you’re issued a stablecoin called USDA (USD Arkadiko) to utilize while your STX are locked. Meanwhile, because the Stacking yield on the collateral Stacks is more than the loan interest rate, the loan effectively pays itself off.
Clarity contracts play a huge part in automating the self-repaying aspect of the loan. This means that once the conditions of the loan + Stacking are met, Clarity automatically executes the payment process by taking the BTC yield from the STX being Stacked and puts it toward the loan payment.
Students saw how Clarity combined with Stacking and Proof of Transfer can be powerful building blocks for all kinds of decentralized Bitcoin-based financial products and services. It’s clear that this is only the start of the Bitcoin DeFi movement.
Introducing twin flame, ALEX
If Bitcoin DeFi had children, ALEX and Arkadiko would be its beautiful twins. Both share a soul connection with Bitcoin and show the promises of a financial future where Bitcoin is the bedrock.
ALEX will be the first full service DeFi platform on Bitcoin. With Arkadiko mastering loans and Stacking, ALEX complements with a slate of DeFi tools including token creation, yield farming, and lending and borrowing tools. ALEX was created by two female co-founders, Chiente Hsu and Rachel Yu, who both came from the traditional financial world where they developed quantitative trading strategies for major Wall St. banks.
Chiente saw firsthand how the traditional financial system was orchestrated in a way that hindered many people who didn’t have access to everyday financial tools like debit cards, and leaned into crypto as a solution to bridge wealth building opportunities. With ALEX, folks will now have the ability to make their crypto holdings work for them without intermediaries and other hurdles.
ALEX will be the first full service DeFi platform on Bitcoin. With Arkadiko mastering loans and Stacking, ALEX complements with a slate of DeFi tools including token creation, yield farming, and lending and borrowing tools. ALEX was created by two female co-founders, Chiente Hsu and Rachel Yu, who both came from the traditional financial world where they developed quantitative trading strategies for major Wall St. banks.
Chiente saw firsthand how the traditional financial system was orchestrated in a way that hindered many people who didn’t have access to everyday financial tools like debit cards, and leaned into crypto as a solution to bridge wealth building opportunities. With ALEX, folks will now have the ability to make their crypto holdings work for them without intermediaries and other hurdles.
On the Horizon
While some still think that DeFi is just an Ethereum game, it is clear that the tides are shifting toward Bitcoin. With tools like Clarity, Stacking, and Proof of Transfer, Clarity students have everything need to create new financial paradigms and reinvent the system as we know it.
Stay tuned for the season finale of Inside Clarity Universe next week as students receive their diplomas and prepare to enter the Clarity workforce.
Stay tuned for the season finale of Inside Clarity Universe next week as students receive their diplomas and prepare to enter the Clarity workforce.
Caitlin is the Communications Lead at the Stacks Foundation where she provides PR and communications support to Stacks builders. Previously, she worked as a communications consultant at Wachsman where she worked with prominent crypto and blockchain companies including Stacks, Rally.io, Rarible, Qredo, Value Technology Foundation, Status.IM, Binance Charity, and others.
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