Introducing Hyperdrive

General Discussion
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Hi all,

I want to introduce Hyperdrive, which in my biased opinion is a promising next-gen fixed rate AMM. I’d like to start a discussion to answer any questions people may have, and also explore possibilities for integrating into the Summer.fi ecosystem.

We’ve been building in the fixed rate space since 2021. Back then we were known as Element Finance, with the Element Protocol being the premier PT/YT yield splitter at the time with over $350 million in TVL.

This Hyperdrive background describes our protocol at a high level. Speaking to the Summer.fi team at EthDenver helped us realize ease of integration may be another big benefit of Hyperdrive. We’ve abstracted away the need for managing SY/PT/YT tokens, replacing them with two simple trading primitives: Long and Short exposure. For traders, they’re economically equivalent to PT and YT, but much easier to integrate with fewer function calls to call. Our pools never expire so LP positions don’t have to be rolled, and you never have to worry about governance creating a new pool, while trading activity doesn’t drop off near maturity.

Our developer tooling is robust, with SDKs in Python, Rust, and Typescript, along with an open-source UI.

Open questions:

  1. TVL requirement? We have 8 pools with over 50k liquidity, and 2 around 1 million.
  2. Long or LP? Both position types make sense. A Long gives you a fixed rate, but size is limited by liquidity. LP positions increase liquidity, and act as a substitute for variable exposure. When LPs aren’t backing fixed rate trading, they earn 100% of the variable yield in the underlying yield source. We already have several Hyperdrive pools deployed on Morpho yield sources, and it’s easy to add more. LPs earn points in the Miles program from the HyperVue Foundation.
  3. New or existing vaults? LP positions on yield sources already available in Summer.fi vaults can be stand-in replacements for that exposure. The yield should be higher than the underlying, since you’re also earning fees on Hyperdrive trades, profit from trader losses, and Miles rewards.

I’ll keep it relatively brief for now, and look forward to answering any questions you may have. One thing I’ll look into is digging up historical returns for LP positions in Hyperdrive.

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Hello @mihai673 nice to meet you, and great introduction of Hyperdrive :slight_smile:
Personally, I have no doubts about Hyperdrive’s potential. It would eventually be a great addition to the Lazy Summer Protocol for higher-yielding pools. I would love to hear more thoughts about possible integrations with Hyperdrive pools.

Note: The post was initially flagged as spam for having too many links but it’s all good now.

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