LPDfi hay Liquidity Providing Derivatives Finance is a tool providing liquidity in the DeFi market by leveraging Uniswap V3. It creates products including Options and Derivatives using Uniswap V3’s Liquid Provider (LP), thereby helping liquidity providers earn more fees.
The DEX market is growing strongly. According to DeFiLlama, Uniswap alone has reached $2.13B in TVL while DEXs is over $8B. In this ecosystem, LPDfi emerges as a potential change. By leveraging Uniswap V3 LP positions, LPDfi has the capability to disrupt the existing DEX sector, laying the foundation for more structured products.
Outstanding projects
Logarithm Finance
Logarithm Finance found that current measures to avoid temporary loss are not optimal for Uniswap V3. It is also the most prominent project in the LPDfi ecosystem.
Logarithm Finance is specifically designed for DeFi native users who want to profit from market-making activities without constantly managing their positions.
- Enjoy market making without Impermanent Loss: Logarithm Finance actively manages LP positions and earns auto-compounding fees on Uniswap-type AMMs, minimizing exposure to volatile assets by creating delta-neutral strategies with short positions on composable decentralized derivative exchanges.
- Nautilus Vaults: Logarithm Finance’s first product is the Nautilus Vault. It connects the Uniswap V3 pool with the GMX decentralized exchange, allowing for balanced liquidity provision. This means that any risk from Uniswap V3 is offset by a short position on GMX.
- Real yield sources and high APR: Farming LP fees on Uniswap with an edge is one of the most rewarding strategies in crypto. Real yield sources come from traders paying fees on Uniswap, while high APR results from managing delta-neutral positions on a narrow range.
Limitless
Limitless is built on the Uniswap V3 which provides a comprehensive solution for participants. Limitless also temporarily resolved losses by optimizing profits for liquidity providers on Uniswap.
Limitless offers a restaking product where Uniswap LPs can generate yield even when their liquidity position is out of range.
KyberSwap
Kyberswap is a decentralized exchange (DEX) aggregator and an automated market maker (AMM) that provides traders with the superior token prices by analyzing rates across hundreds of exchanges.
Panoptic
Panoptic is a DeFi project built on Ethereum which enables the minting, trading, and market-making of perpetual put and call options. All smart contracts are available 24/7 and users can interact with the Panoptic protocol without the need for intermediaries like banks, brokerage firms, clearinghouses, market makers, or centralized exchanges.