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Ionic: Grab the Max of Crypto Yield

By Notum

Jun 11, 20245 min read

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About Ionic

Ionic is a money market, offering a non-custodial, capital-efficient asset management platform, without compromising security and user-friendly experience. The platform aims to democratize lending and borrowing with good interest rates on Mode and Base networks by providing a one-stop permissionless liquidity management solution.

Ionic’s thoroughly designed its tokenomics to ensure steady and long-lasting growth delivering all participants with the collective benefit of every stakeholder.

Key Features:

  • Shared revenue: a portion of the platform's fees and a portion of SFS rewards are delivered to users every week, according to their stake.
  • Wide asset support: a fruitful variety of supported assets on Mode and Base networks, including LRTs, LSTs, and all of the major tokens with an opportunity to add new asset classes as new protocols onboard onto the networks.
  • Looping: one-click looping to open a leverage position on the assets you’re interested in.
  • Yield Compounding: yield compounding across multiple assets to empower seasoned DeFi strategies and earning opportunities.

Yield-Bearing Assets: LRTs & LRTs

Ionic allows any yield-bearing asset integration in the Ionic market, to further boost the Mode and Base ecosystems composability and "unlocking liquidity" behind yield-bearing assets. 

Thanks to the ERC-4626 integration, users can deposit such assets as collateral and stay exposed to the yield and points the assets bring, creating a loan that pays itself.

LSTs

LSTs (Liquid Staked Tokens), are ETH staked through protocols such as Lido, Rocket Pool, etc. These protocols run a network of nodes and will use your deposited ETH in their nodes. 

Thanks to that, you get exposure to Ethereum Proof-of-Work yield without staking it yourself as well as clearing away the minimal entry for node from 32 ETH to any ETH you are ready to stake. 

By holding the LST you are getting ETH yield. Supplying and collateralizing your LSTs on Ionic, empowers you to earn with other DeFi strategies and keep exposure to the price of ETH and ETH yield.

LRTs

LRTs (Liquid Restaked Tokens) are liquid representations of restaked LSTs on EigenLayer (EL). A user can restake their LSTs into EL. Keep in mind that by doing this, you couldn’t withdraw your tokens for an undisclosed time, to be more "liquid" and use your assets in LRTs like Ether.fi, Renzo, etc. were created.

You can stake your ETH and LST and mint a liquid derivative from it in the form of an LST. Minting an LST makes it possible to be exposed not only to the whole EigenLayer ecosystem and its points but also to yields of validation, ie staked ETH. Besides, the majority of LRT protocols have their own points program on top of EL, so you can get points from both protocols.  

Supplying and collateralizing your LRTs on Ionic makes it possible to earn all of those points, and the ETH yield, while using borrowed assets.

Check the currently available assets in the app and their respectable 0x in the docs.

How to Earn Ionic’s Points?

Ionic Points

If you have interacted with the protocol and helped it grow, you get rewards. Points help to track quantitative contribution to the app and its ecosystem’s success, that’s why the protocol takes up this evolving feature and gives its users to earn them in 4 ways. 

  • Supply

You can supply your assets (and use them later as collateral) to get a stable supply of APY + Ionic & Mode points. 

  • Borrow

Borrows are the main driver of the protocol’s success. Therefore, borrows are rewarded more than a simple supply on every dollar borrowed.

  • Supply idle stablecoins

Provide idle stablecoin liquidity supplied into Ionic to the Steer pool to get an additional 3x Ionic points + transaction fees (See details on the earning page).

  • Stake $ION on Velodrome

Supply and stake WETH/ION LP position on Velodrome and get an additional 3x Ionic points (See details on the earning page).

  1. Double counting: the supply and borrow points are counted separately and stacked.
  2. Special promotions: All Base deposits get 3x Ionic Points. All the borrows across all the markets get 3x Ionic Points. 

Ionic: Main Use Cases

  • Leveraged Assets

Leveraged lending provides deeper liquidity, less money-oriented LPing, higher TVL, and more utility.

  • Yield Optimization

You can compound and boost earning yields by using Ionic's money market infra - battle-tested, improved, and audited for full security.

  • Ecosystem Scalability

Robust lending and borrowing for the OP (Optimism) Superchain ecosystem (which includes Mode and Base networks) helps to enhance your earnings by providing liquidity for the network environment.

How Safe Is Ionic?

Ionic’s contracts, oracles, and pools were audited by Zellic. 

The Zellic team focused on basic coding mistakes, business logic errors, complex integration risks, and code maturity. 

As for the Ionic protocol, no critical issues were found. The audit revealed 2 issues of medium impact, 2 of low impact, and 2 of informational. All the issues were resolved and recommendations were implemented by the Ionic team. Here’s a full report.

Follow Ionic on Socials

Website | dApp | Discord | Telegram | X

Disclaimer: Notum does not provide any investment, tax, legal, or accounting advice. This article is written for informational purposes only. Cryptocurrency is subject to market risk. Please do your own research and trade with caution.

FAQ

  1. What is Ionic?

    Ionic is a decentralized non-custodial money market protocol, supported by a comprehensive security monitoring and failsafe systems.

  2. How does Ionic work?

    Ionic's lending operations are fully code-centric oriented, making it possible to remove intermediaries and streamline the lending process. It has an automated system that adjusts lending and borrowing rates based on set criteria, such as changes in the pool's capital utilization rate.

  3. What are the key features of Ionic?

    Revenue sharing means that a portion of the platform's fees + a portion of SFS rewards to users weekly. Wide asset support with the biggest variety of supported assets on Mode and Base networks. Upcoming looping feature that provides users with one-click looping to open a leverage position on the assets.

  4. What are the fees for using Ionic?

    Since Ionic is a lending protocol that earns its main revenue, there is the interest paid by borrowers.

  5. Does Ionic have a token?

    Yes, $ION is tradable on Velodrome on Mode Network and Gate.io

  6. How to earn Ionic points?

    You can do that through supplying & borrowing (borrowing gives more points though). You can also participate in the additional earn strategies on the dedicated page, and get a higher points multiplier for that.