Dolomite, a DeFi lending protocol, has recently shared details of its latest advancement, Zap. This new collateral solution, tailored for the Arbitrum network, works to refine capital deployment techniques and user experience within the DeFi space:
We’re thrilled to announce the launch of our long awaited ⚡️Zap feature! 🎉
⚡️Zap will change how you use lending protocols, allowing you to borrow, trade, and collateralize all in a single transaction, and paves the way for much more!
Let’s dive in 👇https://t.co/3wrEOU1m70
— Dolomite 🏔️ (@Dolomite_io) August 8, 2023
In traditional DeFi lending landscapes, users aiming to maximize their yield through a technique known as “looping” often found themselves navigating a maze of transactions. The core rationale behind this iterative procedure has been a structured borrowing limit.
This limit is designed to ensure that users maintain an overcollateralized position, preserving the stability and security of the lending platform. However, this kind of configuration, while safeguarding interests, also introduced complexities for seasoned users.
Enter Zap.
With this innovation, Dolomite aims to reduce operational friction and offer a seamless approach. Now, tasks that previously necessitated multiple transactions can be condensed into a single action. This streamlining is expected to enhance efficiency, reduce transaction times, and potentially lead to cost savings:
“Dolomite’s new Zap feature allows this to be achieved in a single step, delivering greater efficiency by removing the need to make multiple transactions.”
Among the many features of Zap, two stand out. Firstly, its capability to empower users to settle their obligations using collateral directly, negating the requirement to reverse out of borrow positions. This is anticipated to be a significant convenience upgrade.
Secondly, Dolomite has ensured that users can diversify their collateral sources. By integrating a DEX aggregator via Paraswap into the process, users can now introduce collateral from a broader range of assets, even if they are not directly held in their portfolios.
This integration seeks to ensure that liquidity constraints on the platform do not hinder user operations.
Dolomite’s first DEX aggregator integration is with @paraswap which enables
💸 Excellent pricing
🧬 Generic routing
💰 A new revenue source for Dolomite in the form of positive slippage
Over time we will be adding support for more aggregators!
— Dolomite 🏔️ (@Dolomite_io) August 8, 2023
Designed to be executed within a single block, this tool is built to assure that user positions remain securely collateralized, balancing innovation with prudence.
