Author: VIKTOR DEFI; Translation: Deep Tide TechFlow
The internet we use today is different from the internet in the 1990s. Back then, it was difficult to find online content until Google solved the problem of content discovery through its aggregator.
Now, we are witnessing the rise of aggregator platforms worth billions of dollars that solve important problems on the internet. For example, Amazon is used to find items, Facebook is used to find people, Google is used to find content, and so on.
In order to drive the development of the blockchain industry, there is a need for key aggregator platforms to solve the problem of user discovery. This is where Instadapp comes in. Instadapp aims to become the ultimate aggregation layer in DeFi by aggregating various DeFi protocols.
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Instadapp is one of the leading protocols in DeFi, surpassing other protocols easily by launching products that the industry needs in a timely manner. Want to learn more? Let’s take a closer look.
What is Instadapp
Instadapp is a middleware protocol that simplifies and unifies the frontend of DeFi. Just like the Web2 aggregator mentioned earlier, Instadapp brings together the best DeFi platforms on one platform for users to easily access and have a unified experience. The platform currently integrates eight protocols: MakerDAO, Liquity, Morpho, Aave, Compound, Lido, Uniswap, and Hop Protocol.
Users don’t need to switch between different protocols, they can complete all operations with just a few clicks. The best part is that Instadapp is already live on Ethereum, Polygon, Arbitrum, Avalanche, Optimism, Fantom, and Base, helping users maximize their time and cost on-chain.
The technology behind Instadapp
Instadapp utilizes a new technology called DeFi Smart Account (DSA) to provide users with greater flexibility and accessibility. DSA is a user-controlled smart contract that allows them to execute multiple actions in a single blockchain transaction. DSAs can be seen as sub-accounts for users on Instadapp, allowing them to manage positions and interact with DeFi protocols in a trustless manner.
These DSAs are generated using regular Ethereum accounts. Simply connect your Ethereum wallet to Instadapp Pro to create your DSA account, and instantly you can enter the multi-dimensional universe of DeFi. Interestingly, it allows users to create any number of accounts in a trustless manner without any restrictions. Additionally, users can withdraw funds back to their Ethereum wallet at any time with zero limitations.
Another incredible aspect of DSAs is that connectors can extend them. Connectors enable developers to build more features, operations, and use cases on DSAs. For example, connectors can take the form of protocol-to-identity verification connectors and more.
Through the unified experience of Instadapp, users can perform the following operations:
Multi-protocol refinancing
Lending is one of the main use cases of decentralized finance. Users use multiple lending protocols that suit their strategies to open and finance debt positions. Instadapp’s multi-protocol financing feature allows users to migrate positions and refinance between top-level lending protocols with just a few clicks.
Cross-chain bridge
The existence of blockchain bridges is to transfer crypto assets from one network to another. With Instadapp, users can easily withdraw funds from their DSA accounts to another network, saving gas fees and time.
Sweep Swap
We all have these tokens in our wallets, but either we don’t use them or we get tired of holding them. You can use Instadapp’s sweep swap feature to exchange these tokens for a single token.
Protection Automation
Automation is disrupting every industry, and DeFi is no exception. The Protection Automation feature allows users to automatically repay debts in market uncertainties. Each automated event only requires a fee of 0.3% to 0.4%.
Flash Loan Aggregator
Instadapp’s Flash Loan Aggregator utilizes advanced routing mechanisms to discover the best flash loan rates among major providers such as Aave, MakerDAO, Balancer, and Compound. It starts with seven routes, providing users with wider liquidity and token choices at lower costs.
And that’s not all; Instadapp also manages a flash loan pool, which serves as a funding source for the aggregator. This makes the aggregator a competitive and cost-effective flash loan platform. Since its launch, Instadapp’s Flash Loan Aggregator has maintained stable revenue growth.
Instadapp Lite
Instadapp Lite is a powerful DeFi yield feature of the Instadapp platform. It scans multiple lending platforms to find users the best strategies and annual yields, and users can access all these features with just one click. Accessibility and simplicity are the core features of Instadapp Lite.
Earlier this year, the team launched Lite v2 and introduced an insurance vault that supports only ETH. With the rise of liquidity mining, this vault is strategic and timely. The insurance vault supports Aave v2, Compound’s ETH market, Morpho, and Aave v3, and has accumulated a locked value of over $311 million.
ETH Lite Vaults on Idle Finance
Idle Finance, an automated yield protocol, recently announced its integration with Lite Vaults. Firstly, Idle Finance utilizes a tiered system to provide Lite Vault users with more personalized risk strategies and choices. Secondly, it offers two options for new and existing users to earn real yields based on their risk thresholds.
Advanced tiers are slightly lower risk than standard Lite Vaults and come with customized loss protection mechanisms, while junior tiers cover the advanced tiers by offering higher annualized yields. Individuals and institutions who require an additional layer of asset protection may be inclined to choose advanced tiers, while users with higher risk tolerance may prefer junior tiers.
Avocado
Avocado is Instadapp’s latest innovative product, leading the development of account abstraction. If you have been a DeFi user for a while, you may be accustomed to connecting your wallet to dapps, switching networks, using native tokens of the network to pay gas fees, and adding new chains through Chainlist for interaction on new chains.
But Avocado changes all that. It is an innovative smart contract wallet that allows users to perform multi-network transactions using the Avocado network. This eliminates the need to switch between different networks and also saves on gas fees.
Avocado has its own RPC (Remote Procedure Call). However, it is not a blockchain. Avocado RPC is a network aggregator that searches for available relayers to process transactions on a given chain, as shown in the diagram. The best thing about Avocado is its triple abstraction model: network abstraction, gas abstraction, and account abstraction.
Network abstraction ensures access to all network balances on the dashboard, gas abstraction uses USDC as the native gas fee for transactions, and account abstraction provides higher modularity in design and opens up new use cases for the platform. With these features, Instadapp can easily become a leading abstraction and aggregation layer in DeFi.
Upon connecting to the Avocado RPC network, the platform creates a native Avo wallet address for you. With this wallet address, you can perform all operations and enjoy the same level of security as your externally owned account (EOA) such as Metamask. The team also hinted at some upcoming developments for Avocado, including 2FA security, balance unification, roles, DeFi strategies, and developer incentive programs.
Token Economics
$INST is the governance and utility token of Instadapp. It has a maximum supply of 100 million INST tokens, with a market value of approximately $30 million. 55% is allocated to the community, 23.8% to the team, 12.1% to investors, and 7.9% to future team and advisors.
The current price of $INST is $1.2, which I believe is undervalued. Instadapp’s TVL is $1.9 billion, and the token reached a historical high of $24.40 in the last bull market. Considering the recent and upcoming developments of Instadapp, it is easy to predict higher gains in the next bull market.
Summary
As I mentioned before, we are witnessing the emergence of innovative blockchain aggregators. Like Google and Amazon, their goal is to become intermediaries between DeFi protocols and users, attracting users and driving ecosystem growth.
My research shows that Instadapp is tirelessly establishing itself as the ultimate aggregation layer for DeFi across different verticals. At this rate, it’s only a matter of time for Instadapp to achieve the same network effects as similar Web2 products.
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