Key takeaways:
- Alpaca Finance, the largest leveraged yield farming (LYF) lending protocol, has integrated Open DeFi Notification Protocol on both BNB Chain and Fantom
- The Open DeFi Notification Protocol is a community-led initiative to provide users with decentralized and free mobile notifications for on-chain events
- After successfully integrating the app, adding its widget to its UI, and creating educational content for users, Alpaca has made the Notification app popular within its community, supporting over 1,000 active notifications at the moment
- By providing 24/7 real-time notifications for DeFi users, the protocol helps them to manage risks and optimize their DeFi trading strategies
Problem
It is now common knowledge in the crypto world that lending protocols have become the biggest powerhouses in the DeFi space. Projects like Aave, Alpaca Finance, Compound, MakerDAO, etc., have billions of dollars in TVL (Total Value Locked).
The rising popularity of DeFi lending protocols is majorly due to the fact that they offer different investment products. Leveraged Yield Farming (LYF) by Alpaca Finance is one good example.
In spite of all the goodies they offer, taking a loan from lending protocols has attendant risks. The risk of liquidation is the most prominent. The fact that the crypto market is extremely volatile makes risk or liquidation super-important. It becomes pertinent that every user should enjoy continuous monitoring of a loan’s health factor.
As it stands, Alpaca Finance is the largest lending protocol supporting leveraged yield farming on BNB Chain and Fantom. It currently has over $500 million in TVL. Users of the protocol can access undercollateralized loans for LYF positions, using them to boost their asset base and increase potential yields.
To help users keep a tab on their investment activities, Alpaca calculates the safety buffer. This value tells users how close they are to potential liquidation – once it gets to zero, the user gets liquidated.
Thanks to the transparent nature of decentralized finance, every data is recorded on the ledger and made easily accessible. The biggest problem users face is notifications. There has never been a dependable mobile notification service for DeFi users – not until now.
Solution
The Open DeFi Notification Protocol was created to solve the problem above. It is an open initiative to offer decentralized and free mobile notifications to DeFi users, covering every on-chain event. It is powered by the Orbs Network.
True to its name, the Open DeFi Notification Protocol is fully open. Any user can contribute a new notification by implementing a simple JaveScript web3 class that extracts the notification from on-chain data.
Alpaca Finance recently joined the growing list of lending protocols to integrate the Notification Protocol. It started with the BNB Chain and followed almost immediately with Fantom too. With this protocol, Alpaca Finance users can set up what is called a “position health” notification. This set notification will issue an alert anytime the safety buffer drops below a specified threshold.
By setting up position health notifications, Alpaca users will enjoy 24/7 monitoring of their position health. They will be able to take instantaneous actions once they are notified of a low safety buffer. They may add collateral, for instance, to boost the safety buffer and manage the risk of liquidation properly.
To make life easier for their users, Alpaca Finance has implemented the Notification Widget on their Portfolio Page UI. This significantly improves app accessibility for users. Actually, the entire process of downloading the app and setting up an alert is super easy and fast. The video below shows just how easy and user-friendly it can be:
To make sure that users benefit from this update, Alpaca Finance has spent time and effort announcing the tool to its community. It included some educational content that explains the benefits of the Notification app, especially its efficiency in mitigating liquidation risks. The effort and commitment were instrumental in bringing about the wide adoption of the app within the community.
Results
Within the Alpaca Finance community, there are approximately 1,000 active notifications. This is considered a successful rollout of the Notification app and is attributable to the steps taken by the Alpaca team after integrating the app.
Current data shows that Alpaca Finance is the most active protocol in the Open DeFi Notification Protocol. It is ahead of all lending protocols and every other project available on the app.
Conclusion
When it comes to money matters, real-time notifications are critical. For DeFi users, the attendant risks make notifications super-useful and helpful. The Open DeFi Notification Protocol ensures that users never miss a single important alert, enabling them to make time-sensitive moves to protect their investments.
Integrating Open DeFi Notification Protocol is very easy. All it takes is 30 minutes on Github, and any DeFi project will start providing time-sensitive, free mobile notifications to all users. It can cover all kinds of on-chain events, including near liquidation, price swings, stop loss, accumulated pending rewards, contract upgrades, new governance mode, etc.
From the Alpaca Finance scenario, we can imagine how useful the Open DeFi Notification Protocol can be to the entire DeFi sector. By successfully integrating the protocol on both BNB Chain and Fantom, adding the app’s widget to its UI, and providing educational content to users, Alpaca Finance has been able to equip users with a powerful tool to manage risks and boost yield potentials.
Of course, any DeFi project can take the same basic steps taken by Alpaca Finance to provide its users with useful alerts. They can also take further steps to reach more users as the Open DeFi Notification Protocol can play a huge role in managing risks and optimizing DeFi trading strategies.
