Degen protocol is one of the most revolutionary DeFi protocols that enables margin trading with liquidity providers.
The protocol is extremely customizable, allowing participants to make changes with which they will feel the most comfortable.
It also split its participants into four key roles, thus ensuring that everyone will know their worth to the project.
Degen protocol is a unique protocol in the DeFi sector that has created an interesting structure, separating its participants into four key groups, each with its own role.
Degen protocol is the revolutionary DeFi protocol with the bi-pool at its core. Bi-pool is a smart contract for margin trading, and it allows the creation of a new bi-pool for the desired AMM or Uniswap pair.
As the bringer of decentralized margin trading to the crypto industry, Degen was noticed quite quickly, and it quickly started seeing a rise in usage and popularity. Naturally, it is fully decentralized and extremely customizable. It currently operates on both, BSC and Ethereum chain, with some slight variations between the offered features and the structure of its fees.
However, one thing that remains the same is its four key roles that separate participants into different groups, responsible for different things. These four groups include Traders, Stakers, Lenders, and Pool Creators. Each of them is crucial for the project to continue functioning, and so far, this method of organizing its community has served Degen quite well.
What Does Each of the Groups Do?
As mentioned, each of the groups has its own unique role within the ecosystem. Traders, for example, get to use the tokens stored within the pools and try to turn a profit with them. After succeeding, they return the tokens that they borrowed and also compensate those who provided the tokens by paying them a fee. Traders can choose pretty much any of the offered trading pairs, and then choose the margin pool by rating, liquidity, open positions, lender interest, and more. They can also use some additional functionalities, including stop-loss and take-profit.
Then, there are Stakers, who are a very important part of the Degen community. These are the users who choose to stake their tokens, and in return, they get to play a certain role in the project’s governance. As with other staking protocols, they also receive compensation for staking, which is a good way to make a passive profit and not expose themselves to the same risks as traders.
Lenders are a group that is just as important, if not more so, as they include people who own coins but don’t necessarily wish to trade them. They can provide tokens to trading pools for existing pairs, and offer them to interested traders. They are also the ones whose money is being borrowed and used for trading, and in return for providing it, they receive compensation from traders, as explained before.
Finally, there are Pool Creators. As the name suggests, these are the community members who create pools for various trading pairs that they expect might be attractive to traders. Lenders provide the funds to the pools, traders borrow them and return them with fees, so Pool Creators and Lenders can get paid for their contributions.
In the end, it all seems to function rather well, with both Degen and its community making the best of it.