DeFi veterans take stock of new projects: Curve founder builds BTC pool, AC wants to build an all-round exchange

Author: Ash

Compilation: Deep Tide Founder of TechFlow

@CurveFinance@newmichwill is launching @yieldbasis,

A Bitcoin AMM liquidity platform with no impermanent loss (IL, impermanent loss, refers to the losses you may suffer when you provide funds to AMMs as a liquidity provider compared to simply holding these tokens);

At the same time, @AndreCronjeTech, the founder of @yearnfi and the god of DeFi, is building @flyingtulip_, a unified AMM + CLOB (Deep Tide Note: Automated Market Maker + Central Limit Order Book, AMM provides continuous liquidity and automated pricing, and CLOB provides more precise price discovery and order execution on the exchange).

Two different attempts to solve the same problem - how to make on-chain liquidity really work:

Yield Basis ($YB): A Curve-native AMM that eliminates impermanent loss for BTC liquidity providers by holding a constant 2x leveraged BTC-crvUSD liquidity pool (LP's value remains 1 with BTC). :1, earning transaction fees at the same time). Users can mint ybBTC (yield-bearing BTC).
Flying Tulip ($FT): An on-chain unified exchange (including spot, lending, perpetual contracts, options, and structured yield), a hybrid AMM+CLOB architecture based on volatility-aware, combined with a slippage-aware lending mechanism, and ftUSD (a delta-neutral dollar equivalent) as the core of incentives.

Yield Basis

Traditional AMMs allow BTC liquidity providers to sell when prices rise, or buy when prices fall (√ exposure, deep tide note: market risk exposure measured in square root of price), resulting in impermanent losses that often exceed the fees of providing liquidity earnings.
The specific mechanism of Yield Basis will be explained in detail later, but the core is: users deposit BTC into the platform, and the protocol borrows an equivalent amount of crvUSD to form a 50/50 BTC-crvUSD Curve liquidity pool and operate with 2x compound leverage.
A releveraged AMM and virtual pool keeps debt equal to approximately 50% of the liquidity pool's value; Arbitrageurs make profits by keeping leverage constant.
This allows the value of the liquidity pool to change linearly with BTC while earning transaction fees.
Liquidity providers hold ybBTC, a yield-bearing BTC receipt token that automatically compounds BTC-denominated transaction fees.
The platform also offers a governance token, $YB, which can be locked as veYB for voting purposes (such as choosing liquidity pool reward distributions).
Yield Basis is primarily aimed at BTC holders who want to unlock productive BTC and earn fees in protocols that address impermanent loss.

Flying Tulip's

user experience and risk settings on traditional decentralized exchanges (DEXs) are often static. Flying Tulip aims to bring centralized exchange (CEX)-level tools on-chain by adjusting the AMM curve based on volatility and the loan-to-value ratio (LTV) of lending based on actual execution/slippage.
Its AMM adjusts the curvature based on the measured volatility (EWMA) – i.e., flattening (close to the constant sum) with less fluctuation to compress slippage and impermanent loss; More product characteristics in the case of large volatility to avoid liquidity depletion.
ftUSD tokenized delta neutral liquidity pool position generation and used for incentives and liquidity programs.
The platform token $FT may be used for revenue buybacks, incentives, and liquidity programs.
Flying Tulip is a DeFi super app: an exchange that supports spot, lending, perpetual contracts, and options at the same time.
Execution quality relies on accurate volatility/impact signals and robust risk control in stressful environments.

The two projects look forward to

Yield Basis hoping to become a platform for BTC liquidity; Flying Tulip, on the other hand, aims to be a platform for all on-chain native transactions. In the current era where perpetual contract decentralized exchanges (Perp DEXs) are the mainstream, the launch of Flying Tulip seems to be timely. Frankly, if it delivers the best execution, Flying Tulip can even channel future BTC traffic to a pool like YB. If the Yield Basis is successfully implemented, ybBTC could become Bitcoin's "stETH" primitive: BTC exposure + liquidity provider (LP) transaction fees with no impermanent loss. Flying Tulip has the potential to launch its integration stack, giving users access to centralized exchange (CEX)-level tools; Try "one-stop trading for all DeFi". While there is cautious optimism about these two projects, it is important to note that the projects of these OG founders and top teams are still untested, and the founders need to juggle the development of other protocols such as Curve and Sonic.

The above image is compiled by TechFlow as follows:

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