Zethyr Finance - Crypto Academy / S4W8 - Homework Post for @fredquantum.

What is Zethyr Finance?

Zethyr finance is a decentralized finance application powered by the TRON blockchain. It's the number one DEFI protocol on the TRON blockchain which allows users to lend and borrow assets on the network profitably. It enables users to supply their TRON-based tokens for lending on the exchange with respect to a particular APY as specified in the market. Simultaneously, it also offers borrowing features for users. By supplying assets to the exchange, users are entitled to rewards in the form of interest rates paid by borrowers. The regulation of the interest rates works in such a way as to protect the assets of the lenders and make it easy for the borrowers to repay at the same time. Here, borrowers are expected to put up some assets as collateral just as the typical bank functions, this feature is put in place to prevent situations where users abscond with borrowed funds. After putting up collaterals, assets put up by lenders are accessible to borrowers who are in turn given the freedom to repay borrowed assets at any time before the specified deadline.

In a situation where a borrower refuses to repay the borrowed assets, the interest due would be compounded on the part of the borrower and with each progression may eventually result in the liquidation of borrowers' collateral.

Although it is run on the TRON blockchain, it isn't owned by TRON. It's one of the first platforms to support the TRON lending as a lending platform.
It has a governance token named ZTR which allows users/stakers to take active participation in the governance of the Zethyr ecosystem. This token can only be obtained through trades on the Zethyr platform.

What are the features of Zethyr Finance? Discuss them. What's your understanding about DEX Aggregator?

Lending/Borrowing pools

One of the prominent feature of Zethyr is the availability of a money market protocol where users can lend and borrow assets. The lend function allows users to let out their funds for use by borrowers which would then be prepared at a later date with interest fees. This is done by utilizing the supply function in the protocol. By loaning assets on Zethyr, lenders gain profit in the form of the interest rates paid by the borrower.

The borrow feature on the other hand makes assets readily available in the form of loaned assets to users. To be eligible to borrow assets on Zethyr, users are expected to deposit assets and enable them as collateral. Assets currently accepted on Zethyr include USDT, TRX, WIN, BTT.

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After collateral assets have been deposited, users are eligible to borrow assets relative to their collateral value. The cap on the amount receivable is measured by obtaining the relative value of the collateral value in USDT to the Loan + Interest value in USDT.

Collateral value in USDT/ Loan + interest value in USDT

Zethyr has a liquidation protocol set in place to protect lenders' principal. This protocol is put in effect whenever a borrower's total borrowing exceeds his total credit. This scenario is often attributed to fluctuation in prices or interest accumulation due to unpaid debts as at when due. To protect lenders' principal, the deposited collateral of the borrower is liquidated just enough to cover the sum of debts and returned to the lending pool.

Liquidity for flash loans and withdrawals
Although supplying tokens on the part of lenders can help to make profitable gains, in the long run, it can also lead to a decrease in returns. This is as a result of the fact that it can reduce both the amount of liquidity available to zethyr borrowers who require an immediate credit line and also the returns that accrue to lenders who withdraw frequently. To prevent this from happening, A trade-off is made which necessitates that an initial 5% of the total supply would be made idle to facilitate flash loans and withdrawals.

Zethyr exchange

This is another great feature of Zethyr. It possesses a decentralized exchange that facilitates the swapping of TRX for other assets of choice.
In the screenshot below there's a usecase of the swap feature highlighted where I intend to swap 75 TRX for ETH. For an amount of 75 TRX, a total of 0.001765 ETH is made available after exchange at fee of 18.115019 TRX.

Stable swap

One other great feature that zethyr finance possesses is the ability to swap stable coins across different chains and networks. The only available stable coin on the platform to use this feature with is USDT.

with this feature users can swap USDT - trc20 to USDT- erc20 at a transaction fee of 10 USDT. This might seem costly to users with small transactions however the fixed transaction fee can be exploited when dealing with large transactions making it a very cheap way to swap across chains.

DEX Aggregator

The DEX Aggregator on Zethryr is a fully decentralized DAPP that aggregates various decentralized exchanges and swaps in order to determine the best possible prices for users. Recent updates saw the zethyr and zethyr swap merge to become the DEX aggregator. The order book function was deemed redundant for new age decentralized developments and as such has been completely removed from the aggregator.

A user who intends to perform a swap using this feature would get his orders executed at the best possible prices amongst other exchanges at zero fees.
From the image below, Zethyr is matched with Uniswap which is the highest and best possible price for trade currently.

Users are therefore presented with a range of options in exchange rates to choose.

Explore the Zethyr Finance Markets and show your observations in terms of profitability of Supply and Borrow

On Zethyr, only four markets are currently being traded which are USDT, TRX, BTT, and WIN.

Profitability of supply markets

Lenders are able to let out their funds for use via the supply markets and by doing this receive rewards from the interest rates.

Each market on Zethyr possesses its respective APY (Annual Percentage Yield0 and interest on assets supplied are distributed with respect to the APY of the market.

Each of the markets available for supply and their respective APY's are as follows"
USDT-
TRX -
WIN-
BTT-
From the respective APY. its more profitable to supply = as it offers the highest APY and also its least profitable to supply - as it offers the least APY.

Profitability of borrow markets

Funds supplied by lenders are let out to borrowers in the borrow market, payable with accrued interest fees. Each of the markets available for borrow and their respective APY's are as follows"
USDT
TRX -
WIN-
BTT-

From the respective APY. it's more profitable to borrow = as it's offering the least APY and also it's least profitable to borrow - as it's offering the highest APY.

Show the steps involved in connecting the TronLink Wallet to Zethyr Finance.

Connectin Zethry finance to the tronlink wallet. In doing this, users can either make use of the web-based extension or the Dapps function of the tronlink wallet.

To link your accounts, open your tronlink wallet and click Discover located at the bottom of the interface.

• In the next interface, under the tab named popular. Click on more to bring out the dapp list and navigate to the Exchange tab. From here click on Zethyr exchange.

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Once the above steps have been completed, Zethyr should now be linked to tronlink account. To confirm the link, your tronlink address should display at the top right corner of the zethyr exchange.

Give a detailed understanding of ztoken and research a token of another project that serves the same purpose as it.

ZTOKEN
Ztoken are tokens on Zethyr which are obtainable upon the supply of a token on the zethyr exchange. They are pegged in a ratio 1:1 to the underlying tokens deposited. Ztokens are transferrable with ease and they can also be freely moved around, traded and stored. Ztokens has a protocol similar to other wrapped tokens where in the event of a user redeeming assets they get burned and whenever assets are deposited in lending pools they get minted.

Ztokens are receives by users who deposit in the lending pool of any the four tradeable assets on the platform. These issuance of ztokens enables a user to enjoy the benefit that accrues to the underlying deposited token without having to withdraw them.

One other token that serves a similar purpose as ztoken is the native token of the justlend platform jtoken which is issued with every deposit to the platform. A transfer of an amount of trx to the justlend platform would bring about jtrx pegged to the initial deposit value to get minted for user to enjoy the underlying benefit of deposited tokens.

Perform a real Supply transaction on Zethyr Finance using a preferable market. Show it step by step. Show the fees incurred.

all images in this task are gotten from zethyr finance and tronlink mobile wallet

Making use of zethyr finance, ill proceed to perform real supply transaction using the TRX market.

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This will take us to the supply page. Its observed that the supply and borrow balance as well as the borrow limit currently shows zero as i haven't performed any transaction on the exchange before. If we scroll down a little we can see the supply markets below, each with its own APY%.

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I currently have TRX in my balance so I will be supplying to that market. However, before we can supply TRX to the zethyr protocol we'll have to enable it first. This is done by clicking on the market you wish to supply to (TRX) and clicking on enable.

Note: You should have energy in your tronlink wallet to perform this action or else TRX will be burned as transaction fees.

After clicking enable, you'll be prompted to enter your tronlink password to complete the process.

Once supply has been enabled, you'll be able to supply to the TRX market. To do this, click on the TRX market and enter the amount you intend to supply. In this case I'll be supplying 15 TRX. Next click supply and input your tronlink password. Once supply is complete, the supply balance would indicate the amount in USD of assets supplied.

Details of the transaction observed from the trasaction include:

HASH - 4b90b83f73bc17bd54c3cfb09d7936771c2de72c94a6e2806290e542a8dea954

Block - 35000411

Bandwidth consumed: 350 bandwidth
Energy consumed - 114,245 energy

_{Image taken from TRONSCAN}

Collateralize your asset to Borrow on Zethyr Finance, repay the borrowed asset and withdraw your supply. Show the steps involved and your observations (like the fees incurred).

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In order to perform the action of borrowing assets on Zethyr, its necessary to first collaterize the supplied asset. To do this, making use of the supplied trx in the previous explanation. Click on the collaterize button as indicated below. In the next interface, click on Use TRX as collateral

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You'll be required to complete the transaction by inputting your tronlink wallet password and once that is done the transaction will be completed.

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I increased the amount of TRX supplied from 10 ($0.97)to a total of 28($2.71 in order to bypass the minimum $1 borrow limit of the zethyr exchange.

Now that assets have been collaterized, we can proceed to borrow assets. I intend to borrow USDT with an APY of
To do this, scroll down to the borrow markets, click on USDT and enable it. Next input the amount of USDT you intend to borrow and input your tronlink wallet password to complete the transaction.

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The borrow feature seemed to not be functional at the moment. Upon observation of the details from the hash
4ab36325a48f9a57632aee49a1b7555cebf185df50c01fc500c5e8333063a443

Block - 35006724
Energy consumed - 178678 Energy
Bandwidth consumed- 345 bandwidth
Total TRX consumed - 50 TRX

image gotten from TRONSCAN

From the image above, the result displays fail out of energy even though a sum of 50 trx was collected by Zethyr as fee for energy. The platform seems to be unable to provide the energy to finance the transaction therefore it's highly likely that users with sufficient energy on their own might be able to go through with this transaction.

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Repaying borrowed assets

This task is done with the assumption that the borrow transaction was successful. therefore i have USDT in the borrow market
To repay borrowed assets on zethyr, navigate to the borrow markets. Assuming we were able to borrow USDT successfully, it would show up there.

Next click on USDT and select REPAY, enter the amount of USDT to repay. To get through the process of determining the exact amount to pay, just click on safe max located at the top right. Once this is done you'll be required to confirm the transaction by inputting your tronlink password and it will be initiated.

Conclusion

Zethyr finance is a pretty great platform, offering so many features which I really find useful. The ability for users to enjoy extra benefits in deposited tokens by being able to borrow and repay is wonderful. Also, the cross-chain stable coin swap with a fixed transaction fee makes it extremely cheap and fast to perform bulk transactions at a fixed sum of 10 USDT.

The issuance of ztokens for deposits functions as a good incentive/reward for depositors. Asides the transaction issues experienced lately by steemians wheres the platform is unable to supply energy for transactions upon collection of fees, zethyr remains a great system on the TRON protocol open for further development.

I've done my research and tried to tackle the advanced course for the week. I was able to learn new things through the course of this task and I must admit, this task is one I really enjoyed doing. I apologize for any mistake I might have made in the course of doing this task and I'd appreciate it if the professor could kindly point them out for me if any.

Much thanks to crypto professor @fredquantum and the steemit team for this amazing lecture.

Note- all images used in this task are gotten from tronlink mobile wallet and zethyr finance