This bull run is indeed a bit different, not like the past 'endless internal funds and frequent zone rotation' situation. The market is no longer focused on one direction, the only consensus seems to be 'no dumb buying.' After enduring the long bear market, liquidity in the encryption market was already dry. Finally, when the bull market arrived, instead of a flood, we unexpectedly encountered even more severe liquidity diversion.

As an integral part of the encryption market, the Decentralized Finance sector naturally cannot escape this round of Liquidity curse:

Each protocol's liquidity is scattered, and decentralized exchanges also cannot provide users with the most comprehensive trading experience due to the lack of liquidity.

In the face of the Liquidity dilemma that Decentralized Finance is currently facing, Elixir, a decentralized market maker protocol, has something to say.

Elixir aims to improve the liquidity dilemma in the field of Decentralized Finance through Decentralization, integrating Decentralized Finance protocols to consolidate liquidity and provide users with an efficient, secure, and transparent trading environment.

Elixir has already integrated with over 30 Decentralized Finance protocols and will launch the Mainnet in the second half of this year, while also launching the Decentralized US dollar deUSD.

This article will explore Elixir in detail, helping readers understand how Elixir works with multiple Decentralized Finance protocols through innovative mechanisms and technologies to solve existing Liquidity problems, as well as the mechanism, advantages, and future of Elixir's decentralized dollar deUSD.

Decentralized Finance is not only the struggle, but also the suffering.

As the hub of value exchange in the Decentralized Finance world, the demand for DEXs is becoming increasingly strong in the market. From the initial 'rough and ready as long as it works' to the present 'speed and product experience are indispensable', various DEXs are gradually starting to 'internalize' in order to retain old customers and attract new ones.

As one of the solutions, the decentralized order book, with its excellent Liquidity supply architecture, provides users with a smooth and low-slippage trading experience. In the current environment where on-chain trading experience is increasingly emphasized, the decentralized order book exchange's position in the market is becoming more important.

However, with the market's attention scattered, various Decentralized Finance projects are fighting each other. In this situation of contention, the precious Liquidity in the market is being divided and subdivided. It seems that relying solely on market makers to provide Liquidity is no longer able to meet the smooth trading needs of a large and low Slippage, and it is not easy to effectively integrate the divided Liquidity.

Similarly, for a large number of native Decentralized Finance users, using a Decentralized exchange is not just for trading, but the additional income beyond value exchange is the essence of Decentralized Finance. Although the order book is good, the profits from providing Liquidity are taken away by invited market makers. Many users see the market of Decentralized order book exchanges growing, but they are unable to benefit from it and can only be anxious.

Elixir saw the natural match of dual-end demand, 'protocol needs fundraising, and users need more income growth points,' and found its own position - guiding users' funds to various Decentralized Finance protocols.

Elixir, the master of on-chainLiquidity

How does Elixir perceive market demand?

As a modular DPoS network, Elixir relies on its unique network architecture and Liquidity management Algorithm to open the invisible barrier between on-chain users and Dex. This allows users to directly provide Liquidity to multiple order book Dex, while also providing on-chain users with new financial profit points, enabling every on-chain user to experience the feeling of being a market maker, achieving a win-win situation for the protocol and users.

The original intention and vision of Elixir are very good, and its actual performance is indeed outstanding. Since its launch, Elixir has maintained high-level development and has shown considerable performance in various dimensions.

Since the launch of the Elixir protocol, nearly 200 million US dollars have been deposited into the protocol, with a total of over 261 million transactions processed.

Team Background and Financing

The birth of Elixir, full of imagination, with its keen sense and excellent execution ability, is inseparable from a team of elite individuals who work together.

Founder Philip Forte

Formerly a partner at BlockVenture and an advisor to Solana, Moonbeam, Flow Network, and Magic.

Partner Cole Petersen

Forbes's Decentralized Finance author, investor in 3AC, Neuralink, and 20 other startups.

CTO Chris Gilbert

Former Chief Engineer at Tokensoft and IDEXX.

COO: Tim Wang

Tim Wang has led encryption investments at Hudson River Trading. With over 10 years of TradFi experience, including investment banking at J.P. Morgan, private sale equity business at Lightyear Capital, and venture capital business at Eniac Ventures. Angel invested in more than 30 encryption projects.

At the same time, Elixir's potential to improve the field of Decentralized Finance has long been recognized by the Primary Market: 01928374656574839201

In March 2024, Elixir announced that it has secured $8 million in funding led by Maelstrom Capital and Mysten Labs, with participation from institutions and individuals such as GSR and AmberGroup. Combined with the previously disclosed rounds of funding, the total funding amount reaches $17.6 million.

longer recognized, Elixir's powerful partnership map

Currently, Elixir has partnered and integrated with more than 30 leading DEXs, such as Vertex, RabbitX, Bluefin, Apex, Orderly, etc. Through Elixir, users can provide Liquidity to order book DEX trading pairs. With Elixir LP incentives or LP incentive programs provided by collaborating protocols, LP providers can earn diverse stake rewards.

In the future, Elixir will also integrate with a series of well-known Decentralized Finance protocols such as Pancakeswap, Paradex, Synfutures, and the ecological map of Elixir continues to expand, which is worth looking forward to in the future.

The number of partners does not affect the quality of Elixir's Liquidity supply.

Through excellent Liquidity integration and ecological collaboration capabilities, Elixir has provided a funding capacity of over 1.25 billion US dollars to various order book exchanges, and even provided close to or even more than 50% Liquidity to popular decentralized order book exchanges such as Bluefin, Rabbitx, Orderly Network, and Vertex.

The performance of Elixir so far also proves that its vision of improving Decentralized Finance Liquidity is not just talk. Such impressive data is inseparable from the support of Elixir's unique technical architecture.

Liquidity management is at hand, Elixir has amazing technical advantages

Efficient Liquidity integration cannot be achieved without Elixir's unique and complex network architecture. Elixir's network architecture is divided into off-chain and on-chain systems.

Off-Chain System (Off-Chain)

Firstly, the exchange data source is responsible for obtaining market data from various exchanges. These data sources hold read-only credentials for the exchanges and subscribe to an update stream to obtain real-time market data from the exchanges. The data is then broadcasted to the data aggregator.

The data aggregator collects data from multiple exchange data sources and combines these data into a deterministic data framework. Then the data aggregator signs the data with encryption to ensure the integrity and immutability of the data. Finally, the signed data is broadcasted to validators and audit Nodes.

The validators network operates through the Delegated Proof of Stake (DPoS) mechanism. Validators are responsible for verifying the correctness of the data and need to achieve 66% of the consensus to confirm the validity of the data. End users delegate their stakes to validators, and the validators with the most stakes will receive the largest share of rewards and participate in the consensus. The validators network ensures the system's decentralization and security.

The Relay infrastructure utilizes secure enclaves technology (which will be replaced by Multi-Party Computation (MPC) infrastructure in the long term) to process Secret Keys related to exchanges. The Relay Node checks if the encryption order proposal has obtained 2/3 Consensus, then signs these orders with Secret Keys and sends the signed orders to the exchange. The Relay infrastructure serves as a bridge between off-chain and on-chain systems, ensuring that all transactions are verified and signed.

On-Chain System (On-Chain)

The audit Node receives data frames and order proposals from the data aggregator and Relay Node. The audit Node executes policies to verify the correctness of the order proposals. If a malicious order proposal is detected, the audit Node invokes the on-chain function in the controller for corresponding actions. The audit Node ensures the accuracy of data and transactions.

The controller is a Smart Contract responsible for managing Staking, rewards, and penalties. In the event of a dispute, the controller will check 2/3 Consensus of the active validators and penalize malicious validators. The controller executes on-chain operations through Smart Contracts to ensure the fairness and security of the system.

The Elixir network architecture ensures the efficiency of data processing and the security of transaction verification through the close integration of off-chain and on-chain systems. The validator network achieves decentralization and consensus through the DPoS mechanism, while the Relay infrastructure ensures the integrity and tamper resistance of data and transactions. Audit nodes and controllers provide additional security guarantees and fair execution. Through this multi-layered architecture design, Elixir is able to provide efficient, secure, and reliable services in a decentralized environment.

Figure: Elixir Network Architecture Workflow

At the same time, Elixir uses advanced Algorithm market making technology to manage and optimize Liquidity supply. The main strategies include variants of the infinite Avellaneda-Stoikov Algorithm, which determines quote time through random walks, creating an experience for traders that is almost similar to CEX, and providing the best LP experience for Liquidity Providers.

At the same time, in order to prevent market manipulation and gamification, Elixir introduces random elements in its Algorithm and uses SGX secure enclave to generate random numbers. These random numbers are synchronized among validators through verifiable random functions.

Through a unique network architecture and dual management of AlgorithmLiquidity, Elixir provides an innovative Liquidity supply model, ensuring the liquidity and security of funds while serving as a bridge between different Decentralized Finance projects, enhancing interoperability and Liquidity.

Elixir plans to launch the collateralized synthetic asset DecentralizationUSD (deUSD) in the near future, aiming to further improve the Liquidity situation of partners and increase the returns of Liquidity contributors.

Stable prices and diverse returns, synthetic asset deUSD is worth your follow

As Decentralized Finance becomes an important hub for on-chain prosperity, the importance of synthetic assets is gradually becoming apparent. In the on-chain world, synthetic assets directly anchor the value of other assets, saving users many complicated intermediate steps, as well as the fees and wear and tear of asset exchanges. As a good use case for encryption users to avoid wear and tear, synthetic assets have deeply rooted in the encryption world, and its Market Cap continues to rise, becoming widely recognized in the encryption ecosystem. Various on-chain protocols also regard synthetic assets as an important part of Liquidity source.

Synthesizing dollar-denominated assets can better manage liquidity and coordinate the problem of inadequate interaction between various protocols. Although your Decentralized Finance protocols are different, synthetic dollars, as encryption tokens anchored 1:1 to the value of the dollar, are universally accepted.

Elixir 正是看到synthetic asset对于 Decentralized Finance Liquidity管理的闪光点，即将推出完全抵押的合成美元 deUSD。

Not subject to market Fluctuation, the price stability mechanism of deUSD

Currently deUSD is collateralized by stETH, and will later support a wider range of collateral assets. The impressive aspect of deUSD's design mechanism lies in its use of Delta neutral strategy and dynamically adjusting asset composition to mitigate the risk of collateral asset price Fluctuation.

How does the Delta neutral strategy work?

First of all, anyone can mint deUSD by collateralizing stETH, and each collateralized stETH will be used to short an equal amount of ETH in the market. The short position can also capture the market positive interest rate, bringing additional income to deUSD.

When the funding rate is negative, deUSD will dynamically adjust its asset composition ratio based on the balance of OCF (open collateral fund used to support the value of deUSD) to maintain price stability.

As follows:

In the environment of negative interest rates, market borrowing behavior increases, and OCF balance gradually decreases.

As OCF gradually declines, the asset composition of deUSD will also be gradually adjusted, reducing the proportion of long-term base income and increasing the proportion of sDAI / other stable income assets.

For example, when the OCF reaches the 100% high water mark, the asset composition ratio of deUSD is '80% long-term strategy portfolio + 20% sDAI/other income stable assets'.

When the OCF reaches the 75% high watermark, the asset composition of deUSD dynamically adjusts to "70% long-term strategy portfolio + 30% sDAI / other income-stable assets".

Visible, unlike the widely known 'stablecoin', deUSD was born with a unique stable mechanism, aiming to provide a better ecosystem experience for users and partners. Users have a sense of security when adding Liquidity, and the protocol in cooperation with Elixir enjoys less worry when enjoying Liquidity, no matter how the market price fluctuates, the stable Liquidity is always stable and running smoothly.

Elixir protocol加持，deUSD 真的Decentralization

The powerful validators network is the core of the Elixir protocol. The Elixir validators network consists of over 13000 independent nodes distributed globally, with each node participating in transaction validation and Consensus Mechanism. The decentralized validators network has no single point of control, ensuring that the protocol is free from any form of centralized intervention, guaranteeing the transparency and security of the protocol.

With the support of the Elixir validators network, users can complete the minting/redeeming operations of deUSD by interacting with the Smart Contract, without any centralized approval process. The user's right to mint is completely in their own hands, ensuring full Decentralization throughout the entire process.

As the core product of the future Elixir protocol, deUSD has strong support from the Elixir validators network behind every transaction, making it a truly decentralized and stable digital asset.

Figure: Current number of Elixir global validation Nodes

In addition to the powerful validators network, the Elixir protocol also leaves plenty of room for imagination for its core asset deUSD. The highly interoperable protocol allows deUSD to freely circulate among protocol applications on different chains, bringing broad application scope and excellent value capture ability to deUSD. The high scalability of the protocol also enables deUSD to iterate with the continuous upgrading of user and market demand, ensuring the long-term and stable operation of deUSD.

Positive flywheel, with DEUS Elixir, it just can't 'stop'

Provide users with easy and diverse income options

Combining the powerful resource integration of Elixir, deUSD abstracts products and exchanges from different public chains into a single income asset, reducing the complexity of operations between different blockchains and exchanges for deUSD holders, making it easier for them to manage assets and converting more institutions and individuals into potential liquidity providers. deUSD is like a pass in the Elixir cooperative ecosystem, allowing participation in stake interactions on multiple platforms and even multiple chains simply by using deUSD, thus fulfilling the multi-chain requirements through Elixir.

protocol is more willing to accept Collateral with stable prices

Compared to volatile assets like ETH, deUSD with a price stabilization mechanism may be more welcomed by Decentralization exchanges, as this 'stability' is not only a reflection of the platform itself, but also a responsibility to its users. Several partners have already accepted deUSD as collateral, and in the future, deUSD will also become the main asset for order book liquidity on the Decentralization exchange ecosystem.

In addition, the long-term plan of the Elixir protocol is to extend this stake mechanism to Centralized Exchanges that accept deUSD as Collateral, allowing users to not only utilize deUSD in Decentralization exchanges, but also trade and borrow deUSD in certain Centralized Exchanges to gain more profits and opportunities.

deUSD brings new use cases to Elixir, providing users with stable and diverse income channels, greatly enhancing the overall liquidity and market competitiveness of the Elixir protocol and its partners.

The Elixir ecosystem has a promising future, how can we participate now?

Perfectly aggregating a large amount of Liquidity, and planning synthetic US dollar assets, it seems that Elixir has fully prepared for the new future of Decentralized Finance. So as an on-chain user, how can you participate in the future of Elixir?

Apothecary

In March this year, Elixir launched the Apothecary event, motivating users to contribute to the Elixir Liquidity network by distributing points rewards (Elixir of Immortality). It's not too late to participate in stake now, with the Mainnet launch imminent.

Users can participate in Apothecary by completing personal information, providing Liquidity, etc. Please refer to the Apothecary introduction page for details.

Complete personal information:

• Go to the Apothecary participation page
• Connect Wallet
• Connect social media account and get welcome points as a reward after completion

Provide Liquidity:

• Go to the Liquidity page of Elixir https://agg.elixir.xyz
• Connect Wallet
• Click on the currency pair and provide Liquidity

deUSD stake rewards (coming soon)

When the Mainnet is officially launched, users can freely choose to withdraw the staked ETH in the protocol or directly mint the staked ETH into deUSD. Any unwithdrawn ETH in the contract will be automatically minted into an equivalent amount of deUSD.

Elixir also allocates generous stake rewards for deUSD, increasing Apothecary's point rewards from 20 million to 50 million. Among them, deUSD stakers will receive triple point rewards, and users who provide Liquidity for deUSD/USDC on Curve will receive five times the point rewards.

When deUSD is officially launched, the 8-week deUSD Farming will also be launched, achieving lucrative stake rewards for deUSD stakers in a short period of time.

New partner?

Back in a tweet back in April, Elixir posted a playful teaser image with Pendle's logo looming in the image. It is significant that before this official Elixir had already repeatedly "clearly hinted" at the upcoming partners through the same form.

It seems that the integration of Elixir and PENDLE is already a done deal. Combined with the upcoming deUSD, it is reasonable to speculate that PENDLE will accept deUSD as collateral, and the TVL of deUSD is worth looking forward to.

Similarly, Elixir has recently released a mosaic version of the dYdX logo in its latest tweet. Combined with the upcoming Elixir Mainnet, it seems that Elixir is also about to integrate with dYdX. With the addition of dYdX, it is foreseeable that Elixir's partnership network will continue to expand, connecting more high-quality projects to expand the future of Decentralized Finance.

Conclusion

In this atypical Bull Market, due to limited Liquidity and scattered attention in the market, there seems to be no decent 'zone rotation' trend. The various tokens that were once so diverse and creative continue to remain silent with their respective visions.

Despite the lack of significant zone effects to pump up the coin price, on-chain finance has never stopped after the Decentralized Finance Summer. It's just that Decentralized Finance no longer maintains the central position it had in the last bull market. After being tested by time and the market, Decentralized Finance has gradually evolved from a gold rush experience for everyone to a source of income that many on-chain players and even whales are reluctant to give up.

As an important component of Decentralized Finance, Elixir has witnessed the glory and plight of Decentralized Finance, and has the potential to rejuvenate Decentralized Finance in the visible future, constantly refreshing the market's expectations for Decentralized Finance.

The introduction of deUSD will also bring more Liquidity, users, and open interest to the exchanges and Decentralized Finance protocols cooperating with Elixir, ultimately making Decentralized Finance "Great again".

In the face of a world of encryption where danger and opportunity coexist, any innovation and improvement are never afraid of being late.

Learn more:

Elixir official website: https://www.elixir.xyz/

Elixir official Twitter: https://x.com/elixir

Elixir Telegram official community:

https://t.me/elixir_network

Elixir official documentation: https://docs.elixir.xyz/

Apothecary Event:

https://www.elixir.xyz/apothecary

Statement:

1. This article is reproduced from [Shenzhen TechFlow], the copyright vesting original author [Shenzhen TechFlow], if you have any objections to the reprint, please contact [Gate Learn](https://www.gate.io/questionnaire/3967 team, the team will handle it as soon as possible according to the relevant process.

2. Disclaimer: The views and opinions expressed in this article are solely those of the author and do not constitute any investment advice.

3. The other language versions of the article are translated by the Gate Learn team, and the translated articles may not be copied, disseminated, or plagiarized without mentioning [Gate.io](​http://Gate.io).