Timeswap V2: An Improved Version of Decentralized Money Market in DeFi
Timeswap is a fully decentralized money market in DeFi that provides non-liquidatable loans without oracles or third-party dependencies. Timeswap V1, the first version of the platform, was launched in March 2022 and has been successful in attracting significant user traction and volumes. However, after conducting research and gathering feedback from users, the team discovered some issues that needed to be addressed. As a result, Timeswap V2 was designed to improve the user experience and increase the capital efficiency of the platform by 4x-5x.
One of the key findings from the research was that lenders and liquidity providers wanted to have the option to exit the pool before maturity. Timeswap V2 addresses this issue by allowing lenders/LPs to exit the pool anytime they want, but with some slippage. In addition, assets repaid by borrowers before maturity can now be further lent out, leading to higher capital efficiency and better price discovery of APR and CDP.
Timeswap V2 is a 3-variable AMM like V1, but the AMM has changed to a hybrid AMM that allows a pool for any pair of ERC20 tokens to be created for a given maturity date and a fixed risk-profile or strike. Symmetricity has been introduced between lenders and borrowers by using ERC-1155 implementation to represent positions of lenders and borrowers, which allows for the optionality of early exit for lenders/LPs.
The improved version of Timeswap aims to maintain its base layer properties of being highly capital efficient, permissionless, and oracleless while providing greater flexibility for users. The platform will also offer other new exciting features that will be revealed in the coming weeks. The Timeswap team is excited to launch Timeswap V2 and take a step closer to their vision of being the Uniswap of lending/borrowing.
In summary, Timeswap V2 is an improved version of Timeswap V1 that addresses issues identified from user feedback and research. It aims to increase the capital efficiency of the platform by 4x-5x while maintaining its base layer properties of being highly capital efficient, permissionless, and oracleless. The platform provides greater flexibility for lenders, liquidity providers, and borrowers, including the option to exit the pool before maturity and utilize repaid assets. The team is excited to launch Timeswap V2 and introduce other new features in the coming weeks.