Authored by: @hetty-rowan
DEFI can´t be ignored
Nowadays you can no longer ignore the DEFI. When you talk about crypto, you talk about DEFI. 2020 was already a big year for the DEFI, but 2021 will certainly not be any less. More and more people know how to find their way to the world of the DEFI, although pitfalls and problems always arise. For starters, the lack of regulation is a potential pitfall and floods the market with plenty of opportunities to participate in DeFi. The question is therefore: where and how do you start investing? Bella Protocol therefore wants to simplify access to DeFi for everyone by offering a 'one-click crypto banking' where all financial services are collected on one platform.
So that's the introduction, now on to the part you want to know. Because WHAT is the Bella Protocol?
Bella Protocol (BEL) wants to take the step towards an open and accessible DeFi platform where all financial services are within reach. A 'one-click crypto banking' as they say. Despite the growing popularity of DeFi's ecosystem, the number of users is growing slowly. This is due to the high gas fees, the time-consuming transaction times and the rather poor user-friendliness. Bella therefore innovates in order to allow users to discover all the benefits the world of DeFi has to offer in the most accessible way possible.
The protocol is an aggregated user interface for existing DeFi protocols. It is built on the ARPA project and aims to simplify the user experience of existing DeFi protocols. In this way, users can make their digital assets available and earn the most attractive interest possible in an easy way.
Bella's goal is accessibility on a large scale. Regardless of whether you are familiar with blockchain technology, every individual has the right to access these financial services. The protocol is still in the beta testing phase. A stable currency base is expected to emerge in the last quarter of 2021. By this we mean a solid supply of different coins that you can stake or mine in the platform.
The Bella Protocol is an ARPA ecosystem project. It is a secure computer network that is compatible with other blockchains and thus functions interoperably. It has a layer 2 blockchain built on the Ethereum network and uses MPC, multiparty computation, which enables interoperability. ARPA also uses cryptographic private contracts where the project is perfectly scalable thanks to computational shardings.
Scalability is often a pain point in the further development of crypto projects. The first blockchains do not use sharding, so transactions are slow. This makes scalability quite difficult, which means that the project cannot grow further. With sharding, not every node is responsible for processing the transactions in the network. In this peer-to-peer network, each node only keeps information related to its shard. This information can be shared further with other nodes, keeping the ledger decentralized and secure because transparency is still guaranteed.
In September 2020, Binance introduced the first project on their launch pool. This Binance launch pool is a new feature on the platform where users can safely farm and stake digital assets. By implementing this new feature, Binance hopes to bring DeFi to the platform. Striking a particular crypto with another coin as a reward is characteristic of the DeFi ecosystem.
New protocols can introduce themselves to the general public. By staking certain crypto in this pool, you will receive tokens from the protocol as a reward. Which tokens you can stake is predetermined and each also has a different APY.
The Bella Protocol had three different pools to bet in, namely: BNB, BUSD and ARPA tokens. The staking took place over a period of 30 days starting on September 9, 2020.
The total of 5 million tokens was distributed among the 3 different pools:
- BNB: 4,500,000 BEL tokens as a reward (90% of the total share)
- BUSD: 450,000 BEL tokens as a reward (9% of the total share)
- ARPA: 50,000 BEL tokens as reward (1% of total share)
Providing liquidity to a particular pool is part of the DeFi ecosystem. Liquidity mining, or yield farming, uses decentralized exchanges to provide liquidity. These decentralized exchanges use automatic market makers (AMMs) that work like a smart contract. This allows you to trade with other users of the protocol.
By providing the project with sufficient liquidity, investors often receive a very attractive interest rate. The protocol provides three different trading pairs with which you can provide liquidity.
The APY depends on the liquidity available and the size of the pools. Currently, the protocol provides for an annual reward of 101.25% when BEL/USDT is discontinued.
Please note that these percentages are subject to fluctuations and impermanent loss.
- BEL / USDT
Flexible savings V2
V2 is an application of flexible savings, in which this way you guarantee the highest returns via smart pools. These choose the highest return support for various crypto and stablecoins. It allows users to earn attractive returns. All you have to do is deposit stablecoins and tokens and the protocol will automatically divide your assets into mining pools, which will give you the highest return. The protocol is constantly re-evaluating, upgrading and implementing the best strategies.
It is flexible in nature, so you can choose to reclaim your currency from protocol at any time. The protocol uses the smart pool route in which it searches for the most attractive interest rates in the market. For example, the protocol wants to be a simple central tool where you as an investor do not have to look for the best interest yourself. They themselves make the comparison with a hedge fund, but in a more transparent, efficient and, above all, decentralized way.
As an investor, you receive bTokens that serve as proof of ownership of your tokens in the protocol. Suppose you decide to discontinue USDT, you will receive bUSDT for this. These serve as LP tokens that we know from the world of decentralized finance.
Bella protocol uses a minimum fee of 0.25%, which is lower than the average fee in the crypto landscape. When holding your assets, you determine in advance for how long you want to hold them. If you exceed this period, or you want to extend this period, they will automatically be redistributed in the most favorable pools.
This gives you a compound effect. The protocol then looks for the most favorable rates and then automatically divides your currency into these pools.
It is important to know that not all interest income goes entirely to the Token holders. The project itself takes a minimal part of this to enable further developments.
The distribution is as follows:
- 0.25% of the bTokens goes to management
- 20% of the interest from flexible savings goes to the team as a risk reserve fund and serves as a fund for the further development of the protocol.
- 4% of the interest income is used to purchase BEL tokens at a market price, which are then allocated to investors who are staking BEL.
- $4 of the interest income will also be used to buy BEL tokens at a market price, but these tokens will be burned permanently.
You can also participate in farming in the protocol. Have you previously made your tokens available through flexible savings? Then you can use these bTokens to receive extra BEL tokens. This is seen as an additional way to earn interest on your current interest. Each of these bTokens will provide you with more BEL tokens at another very attractive APY. Currently there are only a few bTokens available, but as the protocol grows and develops, it is intended that more and more trading pairs will become available and therefore more bTokens that you can then farm.
Bella Protocol was founded by Felix Xu (CEO) and Yemu XU (CGO) in 2020 in Beijing, China. Felix Xu was introduced to the world of crypto in 2018. Yemu, on the other hand, bought his first Bitcoin (BTC) already in 2016. This was also the start of his crypto adventure. Other protocol team members also have rich backgrounds in finance, cryptography and blockchain engineering. Felix Xu also co-founded a computer network specializing in privacy preservation called ARPA, which is also fully compatible with blockchain technology. ARPA is therefore an essential part of the protocol.
The reason for the development of the protocol was the apparent shortcoming of the DeFi market, including high transaction costs and poor user-friendliness.
Felix Xu herself says:
We want to bring your everyday banking experience to crypto. A majority of crypto holders cannot participate in DeFi due to high cost and poor user experience, with Bella, users can save the gas fee and time, enjoy high yield from sophisticated strategies and leave all heavy lifting to us. We aim to become the BlackRock of crypto and bring 10x more users to the DeFi ecosystem
Bella Token ($ BEL)
The protocol uses their own native token. These ERC20 tokens serve as a utility token with a governance function. Users can vote on the future of the protocol. This all happens in the application of the protocol self. Here you can also consult which proposals have taken place in the past and which can be voted on. Before you can vote, you must connect your wallet to the protocol to prove that you own BEL tokens.
The tokens are used for collecting fees, reward for hodling this coin as well as you will be rewarded for staking BEL tokens. At the time of writing, in May 2021, the protocol has a market capitalization of 100 million tokens of which 31.5 million are in circulation. Only 5% was distributed on the Binance Launchpool.
Today´s price for $BEL is $1.77
Part of their roadmap for 2021 is a further expansion of their current plan, in particular more transparency and accessibility of the DeFi ecosystem where they want to enter into more partnerships to integrate the protocol into new projects.
The Bella Protocol, as part of DeFi, can no longer ignore the hype of NFTs. They are currently exploring the possibilities of various NFT use cases to see if integration is possible. To make NFTs accessible to everyone, they want to integrate them with various blockchains such as Binance Smart Chain (BSC). This will remarkably lower gas fees and thereby lower the barrier for any user to learn and use NFTs. The near future will show how these NFTs come about in the Bella Protocol.
Wish you all a happy Monday, and tomorrow ... the contest!