Spool’s LBP and the Promise of Accessible Yield Optimization
Yield optimization platforms have become one of the hallmarks of the DeFi industry. The problem with most of these solutions, however, is that they’re not accessible to everyday users. While at the core of their functionality is the ability to automate yield farming operations, they don’t always deliver on user experience nor composability.
This is the need that Spool is looking to meet. The new project has recently announced a December 13 Fair Launch using Balancer’s Liquidity Bootstrapping, or LBP, via the Copper platform. The project will distribute 5% of its total supply by opening a weighted SPOOL:DAI liquidity pool that will eventually reach 50:50 over the 3-day period. This way, the SPOOL token will start at a price of 2.44 DAI.
The middleware protocol enables the creation of customizable, diversified, and risk-managed DeFi portfolios that fit users’ risk appetites. It acts as an easy and accessible yield optimization tool that combines farming in multiple DeFi strategies via a single deposit. Likewise, the funds in these farms are dynamically rebalanced to optimize for yield and risk. This kind of solution didn’t exist in the Ethereum ecosystem.
The initiative for this kind of service was started by the Spool DAO. The decentralized autonomous organization consists of over 40 firms including F2Pool, Genesis Block Ventures, JRR Group, DFG, DigiStrats, CMS, Barnbridge, and Faculty Group. All of whom are leaders in the DeFi space.
Genesis Block Ventures’ Leslie Tam commented on the protocol’s potential. “Spool’s middleware solution allows us to create custom strategies that can be integrated in DeFi applications via SDKs. As a fund that is actively ‘farming’ and holding a firm interest in DeFi, this is a toolset that we believe has been missing from the market and we look forward to deploying Spool to provide superior risk-mitigated outcomes for our fund strategies.”
Moreover, investors have been keen on backing Spool for its potential to serve the ecosystem as a whole. As a middleware toolkit, it can become a building block solution that connects to other DeFi projects who seek to build better user-facing products. In this sense, Spool can become an essential component to DeFi by offering a white label solution to a whole generation of DeFi apps and 3rd party User Interfaces that can leverage the power of Spool and make simple, diversified yield optimization accessible to everyone.