Breakdown of Gro Protocol, its objectives and products.
As expressed seamlessly by the project leads, Gro Protocol is a stablecoin yield aggregator that tranches risk and yield.
What are Stablecoins?
Stablecoins are cryptocurrencies whose value rely on stable reserve assets such as fiat currencies or gold. The main object behind stablecoins is to reduce the volatility associated with digital assets such as Bitcoin.
Being pegged to reserve assets, stablecoins have relatively stable prices. Some examples of stablecoins include Tether (USDT), Paxos Standard (PAX), Binance USD (BUSD) and all these solely rely and is backed by the US dollars.
Objectives of Gro Protocol
The main object of the Gro Protocol is to provide a platform where users can create and share reliable wealth. This they propose to achieve by combining decentralized and traditional finance methods. Relying on their core products which uses value propositions from user DeFi experiences and finance consumer tech.
Gro as a Yield Aggregator
In more detailed terms, this means Gro is a protocol that creates a thriving environment for yield farmers by segmenting a pool of securities in a detailed way, to show the risks and rewards associated with each investment; thus, helping them optimise earning opportunities while investing in stablecoins.
What is Yield Farming?
Yield farming is a blockchain/crypto-based terminology that refers to a way of earning rewards via cryptocurrency holdings. This involves staking or lending crypto assets in DeFi pools or protocols to produce high returns in interest. This process is also known as locking.
The reward can be anything, high returns in interest, incentives or a cyptocurrency, depending on the underlying conditions of the smart contract. Yield farming is similar to traditional bank investments with yearly APR
Other Things to Expect from Gro
Asides opening yield farmers to opportunities, Gro Protocol delivers one of the best DeFi yields. Market strategies such as lending income, trading fees from Automated Market Makers, and protocol incentive farming are part of the underlying structure it utilizes.
Another unique thing about Gro is its Risk Balancer. Risk Balancer provides you with a systemic view of protocol and stablecoin exposure that covers many layers of nested protocols and stablecoins, compounding risk through AMMs.
With all these features, you can say Risk Balancer is the perfect module for risk tranching, because it distributes smart contract and stablecoin risks in a professional way. It clearly gives the you the best view of the available risks and reward in an investment. Matter of factly, this is the technological innovation that powers Gro protocol and its two main products; PWRD stablecoin and Vault.
The first two products built on the Gro Protocol are the PWRD stablecoin with deposit protection and yield, and Vault with leveraged stablecoin yields. Here is a summary of these products.
PWRD — This is low-risk savings product designed to offer a safe pass to access to DeFi yields, tokenised as a stablecoin with built-in yield and protection. Its value is backed by three of the most traded stablecoins on the market — DAI, USDC, and USDT — but also protected against problems with any of them.
Gro Vault — Gro Vault is the second product on the Gro Protocol supported by Gro Risk Balancer. It is designed to offer the best yield farming services and currently, it stands out as the highest-yield stablecoin vault on the market. Its service is interwoven with the fabrics of PWRD, a similar product on the protocol. Both of these products jointly offer the best yield farming opportunities to users of the Gro Protocol.