Aloe gives you a margin account that can interact with Uniswap V3. You get to manage positions and keep profits, but the protocol retains custody. This drastically reduces collateralization requirements. With up to 20x leverage, everyone can operate and hedge more efficiently.
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Nope! The core Aloe software lives on the Ethereum blockchain, and we (Aloe Labs) couldn't charge fees for it — even if we wanted to! However, Ethereum does charge transaction fees. These vary based on how many people are using the network. Optimism and Arbitrum often have lower fees, so we plan to publish our software there too.
Anyone! You don't need permission to use the core Aloe software. That said, certain features on our (Aloe Labs') web app may not be available in certain jurisdictions. Always check local regulations before dealing with magic internet money!
Every borrower has an Aloe smart wallet which holds their assets and keeps track of their liabilities (debt). As long as the value of assets > liabilities + wiggle room, the borrower is free to HODL, trade, or market-make with the funds in their smart wallet. However, if Aloe software detects that the wiggle room is shrinking too much, it seizes control of the smart wallet and allows other people (liquidators) to close out the borrower’s positions and repay lenders. Liquidators get a small reward for their trouble.
Ultimately there are no guarantees here, but since Ethereum is a public blockchain, you yourself could keep an eye on borrowers' activity and liquidate them if necessary.
Interest rates change over time, based on supply and demand. If many people lend and few borrow, interest rates will be low. If few people lend and many borrow, interest rates will be high.
There are two big differences:
1. On other platforms, you're forced to deposit into one big pool containing 10+ cryptocurrencies. If even one asset fails, the entire pool suffers. Worse yet, they can add/remove assets from the group without your consent. Aloe solves this by letting you pick exactly which assets you trust, and it'll never override your decision.
2. When borrowers ask for money, other platforms give it to them outright. This sounds great, but it means that to borrow $50 of ETH, you'd have to post $100 of collateral. Sometimes useful, but kinda silly! Aloe solves this by giving borrowers smart wallets. If they do reckless things, Aloe can veto them. This means Aloe can safely give out much larger loans, opening up new use-cases like leveraged market-making.