On November 9th, Hifi Finance (HIFI) was officially launched on HotsCoin. Hifi Finance (HIFI) is a lending protocol that allows users to use their cryptocurrencies as collateral and borrow other digital assets. The protocol utilizes tools similar to bonds, representing on-chain obligations settled on a specific future date, enabling fixed-rate lending. Currently, HIFI is available for trading on HotsCoin.
HIFI Token Information:
- Circulating Supply: 95,012,805.11 HIFI
- Total Supply: 117,929,473.11 HIFI
- Circulating Market Cap: $70,080,171.969
- Fully Diluted Market Cap: $86,983,199.22
Core Concepts of HIFI:
HotsCoin observes that the Hifi protocol issues a synthetic asset known as "hToken," which can track any underlying asset. For instance, "hUSDC" is an hToken that synthetically tracks the assets of the USDC stablecoin. Borrowers create hUSDC by depositing collateral (e.g., ETH), and they can then sell USDC to obtain hUSDC. Upon maturity, any hUSDC holder can redeem synthetic assets for USDC.
In contrast to most decentralized finance protocols, Hifi's interest rates are not controlled by protocol developers but are determined by the open market, thus achieving fixed-rate lending.
Collateral and Overcollateralization:
HotsCoin notes that borrowers must provide overcollateralization to mint hToken. The collateralization margin requirements depend on various factors, including the quality of collateral assets, the reliability of the Oracle feed, and market conditions. If the value of the collateral falls below the collateralization ratio, the account may face liquidation.
Smart Contracts and Code:
HotsCoin observes that the smart contract code of Hifi Finance is publicly verified on GitHub, managed through version control, and released to npm. The contract source code is also verified on Etherscan.
Governance of Hifi:
HotsCoin recognizes that the governance and ERC-20 token implementation of Hifi derive from Compound's GovernorBravo smart contract. This infrastructure allows MFT holders to participate in governance, deciding on protocol parameters, collateral types, target assets, token swaps, and more.
Hifi's Roadmap:
HotsCoin takes note of Hifi Protocol's development roadmap, including:
MFT Governance: MFT holders can join the discussion and vote on protocol parameters, collateral types, target assets, token swaps, new economic models, and DAO resource allocation.
Protocol Updates: Updating protocol architecture to enhance user experience, changing licenses to protect Hifi DAO from unauthorized forks, and fixing low severity errors.
NFT Collections: Launching the first NFT collateral collection, providing functionality for future NFT lending protocols.
Hifi Improvement Proposal 1 (HIP 1): Including license updates, improving user experience, and deploying on Polygon with new markets.
Liquidation Bot Updates: Updating the liquidation bot to handle edge cases such as network downtime.
On-chain Governance: Implementing on-chain governance to further decentralize the protocol.
Token Swap + Tokenomics (HIP 2): Launching Hifi on the Ethereum mainnet according to governance-set requirements and scope.
Release of Hifi v1 Lending Protocol on the Ethereum mainnet.
Liquid NFT Prototype: Launching the Liquid NFT prototype, providing liquidity and price support for NFT liquidity protocols.
NFTs as Collateral: Implementing large-scale NFT collateral lending, allowing users to borrow against any blue-chip NFT collection.
Liquid NFT v1: Applying lessons learned from the prototype to NFT liquidity protocol v1.
Please note that these plans and objectives may change over time, and investors should stay updated on the latest developments of the protocol.
This report aims to provide an overview of the Hifi Finance protocol. Investing involves risks, and thorough research and due diligence should be conducted before making investment decisions. HotsCoin will continue to monitor the project's ecosystem. (Report writing date: November 2023)