Oxygen is a DeFi prime brokerage service built on Solana and powered by Serum's on-chain infrastructure. Built to support 100s of millions of users, it serves as a permissionless, cheap, and scalable protocol that democratizes borrowing, lending, and trading with leverage and allows you to make the most of your capital.With Oxygen, you can earn yield, borrow from peers, trade directly out of your pools, and get trading leverage against a portfolio of assets. It provides a more efficient way to manage capital and is unique from other borrow lending protocols in three ways:
- Multiple uses of the same collateral. Oxygen enables you to generate yield on your portfolio through lending out your assets and borrowing other assets at the same time.
- Cross-collateralization. You can utilize all of your portfolio as collateral when you want to borrow other assets, meaning a lower margin call and liquidation risk for your portfolio.
- Market-based pricing. Oxygen protocol is order-book based instead of following a pre-set market model that needs to be manually adjusted.
Oxygen is 100% decentralised, 100% non-custodial, and 100% on-chain. All transactions are purely peer-to-peer with no involvement from a centralized operator. Oxygen protocol never has access to your private keys at any point.
Prime Brokerages services are central to traditional financial markets. They connect various market participants—hedge funds, institutions, pension funds, insurance companies, asset managers and liquidity providers—for a more efficient market and price discovery, as well as facilitating leveraged trading.
Oxygen is designed to provide the best properties of this financial infrastructure to DeFi. Borrow/lending is just the beginning: our vision is to provide all the trading and investment-linked services traditionally provided by investment banks, and make them accessible to everyone, all while maintaining full trustlessness.
Oxygen.org is possible today because of the Solana blockchain and Serum Ecosystem. Solana is a future-proof blockchain currently supporting 50,000 transactions per second, for less than $0.00001 each. Serum’s 100% on-chain orderbook is at the core of Oxygen protocol, helping match borrowing and lending orders. By building on Solana, Oxygen will be able to offer our users quick transactions at a low cost.
For more information, please see our whitepaper.
- Download Oxygen Wallet from the app store.
- Generate new or import existing Ethereum and Solana wallets.
- Fund your Solana wallet with SOL.
- Visit https://app.oxygen.org/ and connect your wallet.
- Create a new pool.
- Deposit your assets.
- Lend: mark which assets you want to lend out and on what terms. You’ll automatically match with borrowers and generate yield. Lent assets still count as collateral!
- Borrow: select which assets to borrow against your portfolio (as collateral). You will get matched against lenders.
- Trade: trade directly from your pool, gaining no-hassle access to leverage on Serum DEX markets.
- Withdraw: you can withdraw assets from your pool, including borrowed ones if you’re sufficiently collateralized!
It’s that simple.
See our detailed guide on how to use the product.
Oxygen Token (OXY)The OXY token powers the Oxygen Protocol:
- 100% of net generated fees go to the OXY token ecosystem (buy and burns, yield, or otherwise)
- OXY is used for protocol governance
- OXY holders benefit from reduced fees
The protocol charges fees on matches made in its borrow/lending market. Ownership of OXY reduces these fees.
|OXY held||Lending rate (% of Clearing Rate)||Borrow rate (% of Clearing Rate)||Example lending rate*||Example borrow rate*|
|1 000 000||7.50%||7.50%||4.63%||5.38%|
*Example rates assume a market-clearing rate of 5%.
As we continue to build, the protocol may charge fees on additional services, which will also contribute to OXY buy and burns:
- Trading directly from your pool
- Pool asset management
- Liquidation fees
Each token represents one vote and the token holders will vote on binding governance initiatives related to Oxygen Protocol.
How it works
Note that your Solana wallet needs to be funded with SOL.
Depositing and earning yield
See here for a practical guide on how to deposit and earn yield.
You can connect your wallet, create a pool with the click of a button, and deposit funds. Your funds are stored in a program-controlled vault that you can withdraw from.
Lending and earning yield
When depositing, you can indicate which assets you’d like to lend out and at what rate.
Any unlent funds you’ve turned on lending for will be placed on a borrow/lending orderbook with your desired parameters. The yield you receive is determined by the market-clearing rate on that orderbook, minus protocol fees.
Lending out an asset means you are exchanging your asset today for an IOU to receive the asset one day after matching (longer duration loan terms are coming soon).
The IOU is collateralized by borrower assets in their respective pools in accordance with the same risk management rules applied to all users (see our Collateral and Liquidation section below). Because Oxygen protocol allows for multiple uses of the same collateral, you can still use your lent assets as collateral to borrow other assets
After depositing, you can opt-in or out of generating yield by toggling yield on or off on your pool management page.
See here for a practical guide on how to withdraw assets from a pool.
If you have lent assets, you can recall them by toggling yield off. Your funds will be available to withdraw at the expiry of your existing lending contracts.
The maximum you can withdraw is the ( Value of Pool Assets ) - ( Value of Liabilities / Initial LTV of the pool after withdrawal).
Note that you may only withdraw all of your assets if you do not have any borrowed assets in your portfolio.
See here for a practical guide on how to borrow assets against your pool.
Once you’ve deposited assets to your pool, you can borrow other users’ assets which they’ve lent out. When borrowing, you can indicate which assets to borrow and the maximum rate you’d like to borrow at.
Borrowing assets against your pool as collateral helps you maximize capital efficiency and reduce liquidation risk due to portfolio diversification.
Your indicative borrows will be placed on a borrow/lending orderbook with your desired parameters. The interest you pay is determined by the market-clearing rate on that orderbook plus protocol fees.
The maximum amount you can borrow overall is equal to the Initial LTV for the pool after the borrow transaction (%) * value of the pool after the borrow transaction. This is also capped at the amount lent by peers.
See here for a practical guide on how to repay your borrows.
You can repay the principal + interest from the pool management page.
Collateral and liquidation
Where there’s borrowing, there must also be risk management. As the prices of the underlying assets vary, the value of the loans and borrow also vary. Therefore, we require a liquidation and risk management engine that can make sure that all loans are properly asset-backed.
This section describes how funds collateralize borrowed assets and the conditions under which a pool can be liquidated.
Value of Pool Assets: the sum of the value contribution from each asset in the pool: balance * (price, as implied by the Serum DEX).
Value of Pool Liabilities: the sum of liability value contribution from each asset borrowed in the pool: (borrowed size) * (price, as implied by the Serum DEX)
Current Loan-to-Value (LTV) ratio: Value of pool liabilities / Value of pool assets. This can be thought of as the amount borrowed as a fraction of total assets. This is the central metric used for pool risk management.
Initial LTV: the initial maximum allowable amount of debt as a percentage of total assets in order to take a new position. It is a value-weighted average of Initial LTVs of all the assets in the pool. You can keep borrowing or withdrawing as long as LTV < Initial LTV.
Critical LTV: the maximum allowable amount of debt as a percentage of the Value of Pool Assets in order to maintain an existing position. It is a value-weighted average of Critical LTVs of all the assets in the pool. If LTV > Critical LTV, your pool is in default and will become liquidatable.
Initial and Critical LTVs of portfolios may change depending on portfolio composition.
A pool is in default becomes liquidatable when its LTV exceeds its Critical LTV. The purpose of liquidations is to return the pool’s Current LTV to Initial LTV. The protocol implements this by allowing others to buy the pool’s assets at a discount to take over the pool’s debt positions.
The user that notices and transitions another pool into a liquidating state has one-minute exclusivity to buy pool assets (proportionally). They can do so at a discount (based on the pool’s weighted-average liquidation discount) in exchange for also taking on one or several debts that the pool owes. The liquidator can continue until the pool’s Current LTV is below the Initial LTV.
After the first minute, any other user can act as a liquidator and also buy pool assets at a discount in exchange for one or several tokens that the pool still owes.
After the current LTV of the pool is below the initial LTV, the default is cured and the state of the pool returns to a normal state.
Each asset in the Oxygen Protocol has specific risk parameters. They influence how assets are lent and borrowed. See below for the latest values:
|Symbol||Eligible Collateral||Initial LTV||Critical LTV||Liquidation Discount|
The Alpha version of Oxygen Protocol relies on Serum DEX for market data. Asset prices are calculated as the average of the best bid and best ask on the DEX. Note that LTV and other computations are valid for 30 seconds only. The computations will refresh after 30 seconds.
Percentage (%) away from critical
The percentage by which value of pool assets needs to fall to trigger
% away from critical LTV = 1 - ( Current LTV / Critical LTV )
Amount Available to Withdraw
The maximum you can withdraw is the ( value of pool assets ) - (value of liabilities / initial LTV of the pool after withdrawal).
The sum of each asset value contribution: (deposited or lent balance) * (price, as implied by the Serum DEX).
The annual interest rate for borrowing
The total amount of borrows for the pool.
Buying power is the additional amount of assets with the current pool composition that you can buy by borrowing against the current pool. ( Total assets - Total liabilities ) / ( 1 - Initial LTV ) - Total assets
Collaterals are any assets (including assets that are lent out) that can be used as collateral to borrow other assets.
The maximum allowable amount of debt as a percentage of total assets (asset tokens plus lending amount) in order to maintain an existing position.
LTV or Current LTV
Value of pool liabilities as a percentage of the value of pool assets.
The initial maximum allowable amount of debt as a percentage of total assets in order to take a new position.
Equity value is the value of assets in the pool minus the value of borrows in the pool.
The rate at which you want to lend out an asset. It can either be at market (market clearing APR) or limit (you can set the minimum lending yield (APY)).
Total borrows for a pool.
Liquidation is the process of selling assets in the pool to repay debt. It happens when the pool is in default. It can be caused when the pool LTV > critical LTV or when borrows have matured and not yet repaid.
Pool equity. Total assets (including deposits and asset loans) minus the total borrowing for the pool.
Net interest accrued over a given period of time. Borrowing results in a negative contribution to Net Yield while lending results in a positive contribution to Net Yield.
Prime Brokerage is a core building block of financial markets trading business in the “real-world” investment banking. It connects various market participants - hedge funds, institutions, pension funds, insurance companies, asset managers, and liquidity providers - for a more efficient market and price discovery, as well as facilitating leveraged trading. It enables clients to custody, borrow, lend and trade assets in one place.
Post liquidation, the pool’s LTV needs to be brought down to the reset LTV for it to return to a normal state. In the current version, Initial LTV = Reset LTV.
Term of Borrowing
Length of borrowing
The total value of assets (including deposits and loans) in a pool.
Annual compounded interest rate for lending.