Beta Finance

• Beta Finance is a protocol that enables DeFi users to have access to a scalable and accessible money market where tokens can be listed permissionlessly and automatically, as well as to an effective, easy-to-use short selling tool. We encourage users to interact with our protocol and leverage new DeFi strategies that are now possible with an accessible on-chain short selling solution and permissionless listing. Beta Finance is live on Ethereum Mainnet and Avalanche C-Chain networks. To enable the support of more volatile assets, Beta Finance has an isolated collateral model, meaning there is no cross-collateralization. For example, given 10 ETH used as collateral, with 5 ETH allocated to borrowing $ALPHA, and 5 ETH allocated to short selling $MATIC. If $MATIC spikes in price, and you're at risk of liquidation, only the 5 ETH allocated to your $MATIC position is at risk of liquidation. The other 5 ETH associated with your ALPHA position is safe and will not be liquidated. You can reference our Risk Framework section for more information.

• Lenders will be able to lend assets for any money market that exists on Beta Finance to earn additional yield from the lending interest rate. Interest is paid to lenders from the borrowers and short sellers who pay the borrow interest rate, for borrowing assets for leverage or short selling assets for trading and DeFi strategies. There is a single lending pool for each token, so lenders are guaranteed to be earning the maximum possible yield on Beta Finance for their deposited token at all times. Assets deposited on Beta Finance's money markets are managed as an ERC-20 token balance. Upon deposit, a lender will receive bTokens, representing the lender's stake to the interest accruing share of the underlying token. For example, depositing ETH will cause the user to receive bETH in return. There are 2 simple steps for lending crypto assets on Beta Finance.

Select the token money market for which you would like to and click the "Deposit" button. Users will also be able to search for specific tokens by contract address.

Enter the amount of the underlying token you wish to deposit for lending, and receive bTokens from your deposit.

The above is a simple example. On the dApp only Beta Verified Markets will be surfaced directly to users, unverified markets will need to be explicitly searched for using the token address. Additionally, users will be able to favorite any market by clicking the star to always see those specific markets in their dashboard for easy access.

• Borrowers are able to use supported collateral to initiate borrow positions on Beta Finance. When initiating a borrow position, the loan-to-value (LTV) ratio must be below the safety thresholds defined in the risk parameters for the asset tier of the borrowed token.

• Requiring the initial position to be below the safety LTV threshold is to protect users from immediate liquidations. The Debt Share Value, represents the amount of outstanding tokens the borrower owes, and is the principal borrowed plus accrued interest to be paid. The Collateral Size is the amount of collateral that is posted for the position. For example, say you used 1000 $USDC (assuming 1 USD) to initiate a borrow position for an A tier asset. Given the current configuration, you would be able to borrow 0.9 * 0.65 * 1000 = 585 USD worth of that asset at most upon initiating a position. To initiate a borrow position on Beta Finance, users follow 3 simple steps:

Select the token money market for which you would like to and click the "Borrow" button. Users will also be able to search for specific tokens by contract address.

Select the supported collateral you wish to use from the dropdown and enter the desired amount you wish to use for your position. In addition to metrics, the dApp provides convenient buttons that populate fields based on percentages of your current collateral holdings for collateral amount, and percentage of collateral for borrow amount.

Click the Borrow button to initiate the position.

• Short sellers are able to use supported collateral to initiate short positions on Beta Finance. Short selling on Beta Finance is in principal leveraging a Borrow on Beta and immediately selling the borrowed token, and thus follows the same collateral and LTV requirements as a borrow.
• On the surface, short sellers interacting with Beta Finance's "1-Click Short" tool only need to enter the amounts of the underlying token to be shorted and collateral, select the DEX to swap through, and click a button to initiate the position.
• Behind the scenes, the process begins where Beta Finance will borrow the underlying token from its respective money market for you, checking sufficient collateralization. The borrowed token is then swapped through the specified DEX (currently supporting Sushiswap, Uniswap V2, and Uniswap V3) to the collateral token used. The newly swapped collateral token is then staked with the principal collateral used in the short position.

For short sellers on Beta Finance, there are 3 simple steps to follow to initiate a position:

Select the token money market for which you would like to and click the "Short" button. Users will also be able to search for specific tokens by contract address.

Enter in the amount of collateral to be used and the amount of token to be shorted. Beta will directly provide metrics, such as the LTV, slippage, and price impact directly in the interface for you. Beta will also calculate the best DEX (Sushiswap or Uniswap) to swap through by default.

Click “Short”.

Refilling on Beta Finance means to add additional collateral to a current borrow or short position. Users are able to add more of the existing collateral used to the position in order to decrease the loan-to-value (LTV) percentage to avoid liquidation.

To add additional collateral to an existing position follow 2 simple steps:

Enter in the amount of collateral you would like to add, and click "Refill". Metrics regarding the change in LTV after the added collateral are available directly in the UI.

Unlike on existing money markets, where users need to use the underlying asset to repay their debts. Beta Finance will enable users to either repay their debt using the collateral or borrowed/shorted token. When repaying with the borrowed/shorted token, users will need to specify the amount of borrowed/shorted token to repay. When repaying with the collateral asset, Beta will automatically deduct the full debt from the collateral and execute a swap on a DEX to obtain the borrowed/shorted asset for repayment on behalf of the user.

For repaying with borrowed/shorted token:

Select to pay with the borrowed/shorted token and enter the repay amount. The debt does not have to be fully repaid when directly paying with the borrowed/shorted token.

Click the buttons to approve the token for repayment and repay the debt.

Fore repaying with collateral:

Select “Pay with Collateral” on the right side. When repaying with collateral, Beta Finance will automatically use the collateral associated with the position to swap to the borrowed/shorted token through the optimal DEX to repay your debt.

Click the button to repay your debt, close your position and retake your collateral.

By navigating to the My Positions tab at the top of the navigation bar, users will be able to see a dashboard that enables them to easily manage their positions. Through the dashboard, lenders will be able to update their deposits or withdraw their lended assets by clicking "Deposit" and "Withdraw", respectively. Borrows and short sellers will be able to add additional collateral to their positions by clicking ‘Refill’ and close or decrease their positions by clicking ‘Repay’.

Total Deposits represents the total value of the assets currently being lended out on the protocol. The total debt is the sum of the interest accruing debt across all of the users borrow and short positions. Users are able to see how much collateral is being isolated for each position, and easily 'Refill' or 'Repay' their position with collateral if the LTV becomes too high.

Beta Finance enables anyone to create a money market for any token permissionlessly and automatically as long as a Uniswap V3 WETH pool exists for the token on Ethereum. Permissionlessly created markets are by default configured to the "C" tier, and can be upgraded right now by reaching out to the team.

To create a new market:

Enter the token address in the search bar.

Click "+ Create Asset".

Initialize the cardinality of the Uniswap V3 pool to 150 slots if prompted.

Wait ~30 minutes for the cardinality to initialize, then click "Create New Market".