# COVER PAGE

*TODO:
Project Title
Your Name / Organization Name
Contact Information (Email, Phone Number, Address)
Grant Program Name (if applicable)
Date of Submission*

# Yearn Finance Lending Alternative with Yield-Waiving Borrowers and Vanilla Asset Depositors

## Objective
To develop a novel DeFi lending platform that allows borrowers to supply Yearn vault tokens (yTokens) as collateral and waive their yield in exchange for borrowing assets with a 0% interest rate. Depositors would provide vanilla assets (ETH, BTC, USDC, USDT, and DAI), which borrowers can use, and receive the yields generated from the borrower's collateral.

## Background
The traditional DeFi lending model involves borrowers providing collateral and paying interest on the assets they borrow. This proposal aims to create an alternative solution that benefits both borrowers and depositors by leveraging Yearn vault tokens.

## Key Features

Borrowers supply yTokens as collateral and waive their yield for the right to borrow assets at a 0% interest rate.
Depositors provide vanilla assets, which borrowers can use, and receive the yields generated from the borrower's collateral.

## Benefits

* Borrowers have access to 0% interest loans, increasing their capital efficiency.
* Depositors can earn potentially higher returns than traditional DeFi lending platforms.

## Challenges

* Ensuring a balance between the number of borrowers and depositors to maintain a healthy ecosystem is crucial. To address this challenge, we propose implementing a governance token model that provides additional incentives for both borrowers and depositors. When the platform's utilization is at target levels, we will incentivize borrowers to repay their loans by offering them our governance token emissions. This approach encourages borrowers to return the borrowed assets, which in turn helps maintain a healthy balance between borrowers and depositors. The token model would also offer various benefits for depositors with significant holdings of our governance tokens, making the platform more attractive for both parties.
* Attracting sufficient users to achieve a network effect and establish a sustainable lending market.
* Maintaining a competitive edge against existing DeFi lending platforms while offering unique value propositions for users.

## Roadmap

* Develop a detailed technical specification for the proposed lending platform, including smart contract design, user interfaces, and integration with Yearn vaults.
* Assemble a development team with expertise in DeFi, smart contract development, and user experience design.
* Implement a prototype of the platform for testing and validation purposes.
* Conduct thorough security audits to ensure the safety of user funds and the overall stability of the platform.
* Launch a beta version of the platform to gather user feedback and iterate on the product.
* Promote the platform through marketing efforts, targeting both potential borrowers and depositors.
* Continuously refine and expand the platform based on user feedback and market demand.

## Supplementary Material

We have prepared an additional document containing examples and case studies that demonstrate the potential benefits and use cases of our proposed lending platform. This document will provide insights into various scenarios and help showcase the effectiveness of our approach in maintaining a healthy ecosystem between borrowers and depositors.

Please refer to the following link to access the supplementary material:

*TODO: insert the link here, that link should have the contents of the miro board*

## Budget

The budget for this project would cover development costs, security audits, marketing, and other associated expenses. A detailed breakdown of the budget will be provided upon request.

## Conclusion

This proposal aims to create a unique DeFi lending platform that leverages the benefits of Yearn vault tokens while offering 0% interest loans to borrowers and potentially higher returns to depositors. By addressing the challenges of maintaining a balanced ecosystem and attracting users, we believe this platform can provide significant value to the DeFi space and become a sustainable, competitive lending solution.

We appreciate Yearn's consideration of this proposal and look forward to the opportunity to collaborate on this exciting project.