Thank you for your feedback regarding the proposed deployment of the WLFI Protocol on the Aave v3 instance. We understand your concerns about the 20% fee to Aave and the potential benefits of exploring alternative platforms like Venus.io on BNB Chain. Here’s our perspective on these points:
1. Transaction Fees and Network Considerations:
- Ethereum Mainnet Advantages: While Ethereum’s gas fees can be higher, the Ethereum mainnet offers significant advantages in terms of user base, liquidity, and security. Aave’s deployment on Ethereum ensures access to a large and active user community, which is crucial for the success of the WLFI Protocol. The higher transaction costs are a trade-off for these benefits. Additionally, Ethereum will serve crypto-native users and institutional clients, where the higher transaction fees are less of a deterrent.
- BNB Chain Considerations: BNB Chain provides lower transaction fees, which can enhance user experience. However, it’s important to note that Aave is not currently available on BNB Chain or Solana, limiting the options for leveraging Aave’s established infrastructure and security features on these networks.
2. Security and Trust Factors:
- Aave’s Security Measures: Aave has demonstrated a strong commitment to security through extensive audits and a robust risk management framework. The protocol has undergone multiple audits by leading security firms, ensuring a high level of trust and reliability.
- Venus.io’s Security Measures: Venus Protocol has also undergone audits by reputable firms and employs continuous monitoring practices. However, it’s important to consider that Venus operates on BNB Chain, which may have different security dynamics compared to Ethereum. Additionally, Venus’s security measures, while robust, may not match the extensive track record and community trust that Aave has established over time.
3. Platform Availability and Ecosystem Integration:
- Aave’s Ecosystem: Aave’s presence on multiple networks, including Ethereum, Polygon, and Avalanche, provides a diverse and integrated ecosystem. This multi-network approach enhances liquidity and user engagement, which are vital for the WLFI Protocol’s success.
- Venus.io’s Ecosystem: Venus is primarily focused on BNB Chain, which may limit its reach and integration with other DeFi platforms. While BNB Chain has its advantages, the broader ecosystem and liquidity available on Ethereum and other networks may offer more opportunities for the WLFI Protocol.
4. Layer 2 Deployment for Retail Users:
To address concerns around transaction fees and provide an optimized experience for new retail users, we will also be deploying a separate Aave instance on a Layer 2 network. This deployment will help lower transaction fees significantly, making it more accessible for first-time DeFi users. While Ethereum Mainnet will serve crypto-native users and institutional clients, the Layer 2 instance will cater to retail users who are more sensitive to gas costs.
Conclusion:
While exploring alternative platforms like Venus.io on BNB Chain is a valid consideration, the combination of Aave’s established security measures, extensive ecosystem, and alignment with Ethereum’s user base and liquidity make it a compelling choice for the WLFI Protocol’s deployment. The 20% fee to Aave reflects the value derived from leveraging Aave’s infrastructure and user community, which are essential for the protocol’s growth and success. Additionally, the Layer 2 deployment will help address the concerns around gas fees for retail users.
We hope this clarifies our position and addresses your concerns. Thank you again for your valuable input!