Banker Joe, Flexible DeFi on the Trader Joe Platform
Introduction
It’s nearly here…we are incredibly excited to announce the much-anticipated launch of Banker Joe, Trader Joe’s decentralized lending protocol. Banker Joe offers investors the ability to lend or borrow against whitelisted assets, enabling the deployment of flexible DeFi investment strategies on the blazingly fast, low-cost Avalanche network.
Setting the scene
This marks the dawn of a new era for Trader Joe as we continue to build on the promise of providing a one-stop-shop DeFi trading platform. Banker Joe will be the first platform to offer a fully-fledged, in-house DEX and Lending protocol on the Avalanche ecosystem, unlocking the next step in achieving our vision of pushing the frontiers of DeFi innovation.
Co-founder - 0xMurloc: “Banker Joe is an essential step towards our vision of turning Trader Joe into a one-stop-shop DeFi trading platform”
By combining Trader Joe’s friendly UI with the multi-functionality of the platform’s dual protocols, investors can expect a seamless user experience. With Banker Joe, users will now be able to lend and borrow assets expanding the range of investment strategies to include single asset yield, leveraged longs, leveraged farming, and open short positions.
Sounds good — But what can you do in the Bank of Joe?
- Instead of holding tokens in your wallet, you can lend your tokens to Banker Joe to earn yield with no exposure to IL.
- Using your current tokens as collateral, you can take on leverage in your portfolio by borrowing another token.
- Borrow and sell tokens you expect to decline in value, creating an open short relative to the token you hold in its place.
Co-founder - Cryptofish: “Banker Joe gives you added flexibility for your DeFi investment strategies”
Still unsure about the use-case for Lending?
Look no further, Co-founder Cryptofish expands on the uses of Lending and why diversification on your DeFi strategies is an important consideration for any budding DeFi pioneer.
So how does Banker Joe work?
Supplying
To engage with Banker Joe’s services, users will navigate to the Lending page on the website and deposit one of the whitelisted tokens. In return, we’ll provide them with a receipt, e.g. user deposits AVAX and they receive jAVAX in return. The interest accrued will be increasing over time (this works in the same way as xJOE). When the user returns the jAVAXreceipt to Banker Joe, they will receive their original AVAX + the additional earned AVAX on top.
Borrowing
As well as supplying an asset, users can also borrow against that asset which is used as collateral. For example, a borrower can supply ETH to the jETH contract and then borrow AVAX from the jAVAX contract. The amount of AVAX the borrower can borrow is defined by the collateral factor of ETH. If for example, the borrower has supplied 1 ETH as collateral and the collateral factor of ETH is 65%, then he can borrow up 0.65 ETH worth of AVAX.
The protocol would have safety measures to restrict users from taking actions (borrowing more tokens or withdrawing collateral) that may exceed their borrowing limit.
Repayment
Borrowers can repay tokens to Banker Joe up to the borrowed balance. If partial repayment is made, the borrow balance may be non-zero, and continue to accrue interest. Repayment is a transfer of tokens from the borrower back to the token market.
Protocol Features
Risk Management
It is important to point out that the above use-cases for Banker Joe do not come risk-free. Borrowers of tokens risk liquidation if they are unable to keep a leveraged trade open, which in turn places lenders at risk of being unable to withdraw their deposit. In the event of a shortfall, which is when a borrowing balance exceeds that of the borrowing limit, a portion of the borrower’s collateral will be liquidated to return the account to good standing. If your account is in a shortfall position, a liquidator can liquidate it to return your position to a balanced position; liquidation comes with a discount to help incentivize proper risk management for users of the protocol.
Want more information on liquidations? Check the below Tweet thread
Price Oracle
The integration of a reliable price feed is another key element in establishing the fidelity and integrity of Trader Joe’s data and security. Banker Joe will utilise the existing, market-leading Oracle on the platform to ensure that all data is accurate, helping with the management of lending pool positions. The official announcement for this market-leading Oracle will follow soon.
Audits
Banker Joe will be double audited prior to launch, by Paladin and Hashex. We are also engaging with more auditors to double down on our stance of ensuring the highest standards of security, for the protocol and the Avalanche community.
What assets will be available?
On launch, whitelisted assets (WETH, USDT, DAI, AVAX, LINK, WBTC, USDC) will be available. However, we’ll be adding more tokens in the near term (yes this means xJOE at some point) and this list will also grow to potentially include Liquidity Pool tokens.
Whitepaper
If you’d like some more granular details, we invite you to read the whitepaper linked here: Banker Joe - DeFi Lending
The familiar and friendly UI that users Love
Visit Banker Joe anytime, anywhere, on any device
Finance can be fun!
…And you can bet that the Banker Joe experience will be sleek, fun, and retain that familiar feel you know and love on the Trader Joe platform.
Mobile UX is equally as important as Desktop UX. Nearly 50% of new users landing on the platform come via a mobile device. So you can expect the same level of quality and seamless experience, across any and all devices you use.
Wider Significance for the Trader Joe Platform
Receive Protocol Fees as xJOE holder
A percentage of Banker Joe protocol fees earned from the borrowing interest and liquidations will go to xJOE holders. This will be enabled after launch — more details on this will be announced at a later date. Expect it to come ‘soon’.
Platform Innovation
Once Banker Joe has launched, our roadmap opens up and we can address the development of some expected product lines such as Leveraged trading, Derivatives (Options, Futures), and limit orders. Truly owning the ‘Trading platform’ title.
If you joined our earlier AMA, you will have heard our co-founders address the roadmap as something that is flexible based on market opportunities at the time. The core roadmap is flexible, not fixed. So product development in the longer term is not set and will be decided based on the current opportunities at the time.
For the shorter term, we will be sharing an updated vision soon. One of the big requests is NFTs and yes they will be coming, you can expect an innovative approach from the team.
Wrapping Up
Whats next? Well … ‘Joe Rush’ will launch in mid-October (very soon).
A total of $20m worth of incentives ($JOE + $AVAX) will be deployed on the Trader Joe platform. The rewards will be deployed over a 3 month period, with a good portion of these incentives strategically deployed into the Banker Joe protocol. More details on the exact incentive plan will be shared soon.
All signs point to the successful realization of Trader Joe’s vision, providing a one-stop shop for all your DeFi needs. We welcome all our supporters, new and OG, as together we break new ground in building the future of DeFi.
Happy farming friends.
About Trader Joe
Trader Joe is a one-stop-shop decentralized trading platform native to the Avalanche blockchain. Trader Joe builds fast, securely and aims to serve the community at the frontier of DeFi. The long-term vision of the team is to make Trader Joe an R&D-focused platform for new DeFi primitives not yet seen on any blockchain.
