The emergence of Levva
Marginly evolves to Levva with the introduction of Vaults functionality.
With Marginly, we’ve created two-sided isolated lending markets, which we call pools. These pools act as side pools to existing AMM liquidity. Marginly supplies pools with useful periphery including oracles, adapters, and the interest rate model, so the end-user use case may be highly customizable and tailored to a specific need.
With Levva we integrate Marginly pools into the automated Vault management protocol. Now users may supply a single asset to a Levva Vault. This Vault will automatically manage a DeFi portfolio by interacting with pools and 3rd party DeFi protocols. Such a setup allows us to concentrate liquidity inside the vault and have it target a certain liquidity portfolio based on current market conditions and its objective function of maximizing yield.
We’ve completed a Vault functionality audit and gladly share details with our community.
The security audit
The audit encompassed a comprehensive review of Levva’s vault smart contract. Hashlock’s analysis uncovered 5 findings with 1 being critical. All of the issues were promptly resolved and the final report reflects this fact. Let’s dive into some of the details of the Vault functionality which has been audited.
Levva Vaults
Levva Vaults are ERC-4626 types of vaults that offer built-in share (LP token) functionality and support single asset deposits. To facilitate Levva’s use case Vaults have roles with two primary roles being: customer (public) and vault manager (private).
Customers or public users may deposit liquidity to Vaults and earn passive income. People’s earnings are reflected in the appreciation of the price of the Liquidity Provider token (LP token) in relation to the Vault’s asset liquidity.
Vault managers may invest Vault assets by selecting a pre-approved list of pools and DeFi single-sided liquidity protocols that offer yield-earning opportunities. Managers may be automated. As a matter of fact, first live Vaults will have an automated manager that targets a certain portfolio allocation. Consider an example for a hypothetical WBTC Vault:
The automated Vault manager then monitors the state of the demand for WBTC across connected pools and rebalances either once per epoch (1 week) or when deviation from the target allocation is more than 5%.
Good things come in threes
The Hashlock audit report marks the 3rd audit for Levva’s core technology. This achievement underscores our unwavering dedication to upholding the highest standards of security and reliability for our users.
The future is bright for Levva
The successful completion of the third audit directly facilitates our newest use case and associated products: Automated Liquidity Management across DeFi. Looking ahead we will work on:
- Cross-chain liquidity optimization: People should be able to earn irregardless of the chain they keep their liquidity on.
- Decentralized Vault management: AVS on EigenLayer or another L3 solution to facilitate DeFi portfolio management.
- New zappers, adapters, and oracles to expand on the supported assets and protocols.
- New borrow strategies: imagine creating Ethena-like delta-neutral stablecoin strategies or building custom liquidity profiles in concentrated liquidity pools to maximize fees earned. Or think of using your favorite LRT as collateral, borrowing USDT, and farming sUSDe on Pendle.
The possibilities and strategies are endless! These customized trades and deal flows will happen using special-purpose yield optimization solvers!
