The Single Finance team dropped by to talk with our team about the exciting stuff they have been working on. Their responses were shared via a Q&A format on Twitter, as found in this thread. To celebrate their Q&A, Single Finance gifted us 10 Autotickets to give away to our audience. The giveaway ends 2/27 and can be found on our Twitter.
Q1 What is Single Finance?
Single Finance is a revolutionary yield farming protocol that offers capital protection in terms of USD value. What makes this protocol truly unique is its intuitive auto-rebalancing market neutral vault and historical farming database, offering investors security and flexibility previously unseen in the industry.
Recognizing that many yield farmers are being misled by the promise of sky-high APY during yield farming but are unaware of the corresponding risks, Single Finance was created to provide smooth yield farming experiences and protect users’ interests to the best of our ability. We offer fully flexible products tailored to the individual needs of our users.
Q2 What are the killer features of Single Finance on top of other yield aggregator protocols?
- Double-sided borrowings of farming pairs
- Easy setup for long / short / market-neutral yield farming strategies
- AutoVault – Automated Delta Rebalancing Vault
- Capital Protection based on USD
- Up to 3x leverage
Q3 What are the main risks associated with yield farming, in your opinion?
Yield farmers normally suffered from the promising sky-high APY, turning the tool of yield farming into speculation on the token price, thus the main risk associated with yield farming is the unaware and hidden price risk. Apart from that, liquidation risk is also a key risk in leveraged yield farming, especially in a volatile market. Single Finance mitigates these two main risks with pseudo-market-neutral yield farming setup and capital protection bot.
Q4 What is the development roadmap of Single Finance in the coming year?
- 2023 Q1
- Integrate with DefiLlama to list on the “Yield” dashboard
- Implement Governance
- Integrate with additional DEXs
- Add hot and profitable LP pairs
- Research and develop on cross-chain development of both Single Finance and AutoVault
- Partner with Wallets to expand our ecosystem
Q5 Knowing that you have recently launched a NFT collection, can you let us know more about it?
We have launched the AutoTicket collection recently which is listed on Ebisu’s Bay, Minted Network, and Moonflow. AutoTicket is a collection of 2000+ utility-enabled PFP that can be staked to unlock more quota of using the AutoVault. AutoTicket has its special economic utility on top of just an artwork NFT.
Q6 What is the difference between Single Finance and AutoSingle?
Single Finance is a single-click solution platform with leverage yield farming and pseudo-market-neutral strategies, settings, and conditions are manually setup while AutoSingle aims to optimize farmers’ experience with yield farming with fully back-tested Autobots to minimize losses due to price effect and impermanent loss in an automated way.
Q7 What exactly is the newly launched AutoVault doing?
AutoVault is a kind of market-neutral yield farming strategy.
When one uses the borrowed non-stable token putting into yield farming, one is not holding any of the non-stable token and thus the position value is not significantly affected by the price change, this is how market-neutral is formed.
In our research, the market-neutral effect diminishes when the price changes to a high extent. There is a true need to rebalance the yield farming position so as to reset the market-neutral setup and stabilize the position value.
Automated Delta Rebalancing Vault makes the rebalancing decision for you at optimal timing. The algo is proven by severe backtest using real data under various market situations.
This is a vault generating real yield in USDC with the auto-compound bot, auto-rebalancing, bot, and capital protection bot. It gives an attractive real yield of 8.4% in USDC even in the bearish market of 2022.
Q8 What is the expected return of AutoVault? Will the users receive some Altcoins as their returns?
No. Automated Delta Rebalancing Vault is USD denominated, meaning users inject USDC and receive USDC as the sole return.
Q9 What is the lockup period and fee associated with using AutoVault?
There is no lockup period for using AutoVault, or we should say it is not necessary as we are not locking the token for the purpose of supporting the token price. Instead, we are earning the real trading fee and auto-compounded farming yields associated with DEX yield farming, in the meantime applying auto-rebalancing to control the downside risk.
The associated fees are basically:
- (1) Vault performance fee (as a percentage of users’ profits, and only be charged when profit is made), and
- (2) Capital protection fee (at a fixed amount when capital protection happens)
- Please note that the return shown is already factored in the fees, what you see is what you get.
Q10 Security is one critical matter, have these contracts been audited? By which entities?
Single Finance has passed the audit by Certik. Since we launched in Apr 2022, there is no security event happening to us incurring any loss to our users.
How well is the auto-rebalancing protocol tested? What kind of data is being used and how can it give investors confidence that it will work as intended?
2022 is a bloody year that caused chain native tokens like CRO to drop by 90% in value. The turmoil also harmed a lot of LP, sadly. The AutoVault was tested in such a bloody year.
We started with theory, studying in depth the causes and factors that alter the equity value of a yield farming position. Then we conducted backtests with multiple and cross parameters on those factors, tested and adjusted again and again. We only have one goal: to find the optimal moments to rebalance the position so as to deliver stable real yield in the long term.
To stay away from theory only, we adopt real on-chain historical data including LP, yield, interest, swap fee, gas costs, etc, in the backtest simulation.
The simulated performance with AutoVault’s logic gives an outstanding result of 8.4% return in USDC for a period of around 350 days, while CRO dropped from 0.56 to 0.055 simultaneously.
Q11 Why did everyone get a $1000 free quota for using AutoVault? What is the purpose?
Each of the AutoVault comes with a max. cap, that’s why a quota mechanism was established for using AutoVault. At the very beginning, everyone is assigned a $1,000 free quota; to further raise the quota one can earn quota with AutoS or AutoTicket.
The purpose we are giving a free quota is to raise AutoVault’s attention at the very beginning and let new users experience the benefits AutoVault is going to provide and discover more in the Single Finance ecosystem. Once the exposure of AutoVault is raised, funds get into AutoVault and users start to gain from it, AutoS holders will be benefited from the fees generated and price support of a utility but a not rewarding token. Please also beware the free quota will be available for a limited period of time so stay tuned.
Q12 How much total volume will you allow for each different AutoVault?
The max. the capacity of each AutoVault depends on the market depth and size of the farming window. We have to maintain a good balance between reasonable rewards, transactional, related costs and trade feasibility.
Just in case some of the vaults is too hot, we will consider offering an exclusive entry offer to our Auto Asset holders.
Q13 What is the plan to make AutoVault strong and popular in the next year & beyond?
We invest a lot of time and manpower in research and technical development to make AutoVault happen. In the forthcoming, we will expand AutoVault’s scope to various farms, and possibly to more chains, so as to replicate the success. We would also like our users to tell their friends their true thoughts after experiencing AutoVault. We are so confident in the product. That would help a lot.
Q14 Is there a maximum on AutoTicket staking? If so, what is the maximum?
There is no cap on the number of AutoTicket staking, you get your respective quota on proportion.
Q15 What is the AutoVault rate?
According to our backtest based on real on-chain historical data including LP, yield, interest, swap fee, gas costs, etc, the simulated performance with AutoVault’s logic gives a satisfactory result of 8.4% return in USDC for a period of around 350 days, while CRO dropped from 0.56 to 0.055 simultaneously.
Although the future will not be 100% the same as the past, the vault logic works well on stabilizing the position value in various market situations, i.e. upward, downward, sideways, etc. It provides a cushion time for the yield farming position to accumulate juicy yields, on top of that, our bot also helps reinvest the yield to the position to further enhance the performance.
Q16 Other leveraged yield farming protocols also launched AutoVault (AV). Did you look into or refer to their models?
Yes, when we are developing our own AutoVault, we studied the strategy logic and mechanism of other protocols offering automated vaults. There is really a lot to learn from others and I believe this could spark collaboration across protocols, creating a mutually beneficial situation for all involved.
Just one point to emphasize, our rebalancing logic and origin are initiated by the Single Finance team from scratch, we have not to clone any of the logic or copied it from anywhere else. And I hope that you guys will enjoy it.