Copra Finance helps defi protocols issue capital-efficient loans that can promote their growth. We would like to propose a loan to support the TVL of USDs and its Demeter pools. Beginning with a loan size of $100k and a tenor of 1 month, and scaling up the size and duration as our lender network becomes more familiar with the capabilities of Sperax protocol.
Our loans are capital efficient and require little upfront cost, can be rearranged between whitelisted pools in our smart contracts, and can generate additional income for the Sperax treasury.
If Sperax is interested, please have a representative sign up for our Beta using this link to our landing page, where you can also sign up as a lender if interested.
Copra Finance proposes a 1 month, $100k USDC loan to boost the TVL of Sperax protocol’s USDs stablecoin which could also be deployed to USDs Demeter pools.
The loan interest will be decided upon after a due diligence process, but e.g. 15% APR loan interest implies a monthly interest of 1.25% (i.e. $1,250 per month). The loan interest will be paid in the same currency as the loan principal i.e. USDC. Any yield earned beyond the interest rate will be given to Sperax protocol upon settlement.
The security deposit will likely be 5-10% of the loan principal. For a $100k loan, the deposit would be $5k - $10k.
Loans are secured by our liquidity warehouse smart contract and hence funds can only be distributed to pre-determined, whitelisted pools.
Use Cases of Copra Loans for Sperax
Our loans are capital-efficient, we are not a money market. Borrower protocols typically offer up a treasury deposit, typically 5-10% of the loan principal depending on the loan’s interest rate.
Any protocol-owned liquidity (POL) you have deployed can be used to make the deposit, hence another use case of our loans for Sperax could be to help liberate any deployed POL.
Our loans offer protocol managed liquidity, protocols can interact with our liquidity warehouse contract to rearrange liquidity between whitelisted pools during the loan. This allows borrower protocols to maximize the yield earned on the loan principal. Following our due diligence process, certain Demeter pools can be whitelisted in the liquidity warehouse contract and the loan can be rearranged between these pools throughout the loan.
Finally, our loans can offer the Sperax treasury an additional source of income. Any yield generated by the loan principal beyond the loan interest can be kept by Sperax. The current USDs yield alone should easily cover the loan interest.
Future Use Cases
Loans can be scaled up over time to further increase the TVL of USDs.
In addition to providing collateral for USDs, Copra loans could also be used to boost the liquidity of USDs Demeter pools. Additional liquidity would support the growth of the Sperax stablecoin across the Arbitrum network and generate additional yield for the protocol treasury.
Copra Links and Blurb
If you are interested, please check our docs for more details on the loan format and follow us on X (@CopraFi) to stay up to date with our protocol developments.
Docs: For Protocols - Copra: Docs
Website link: above in Proposal Outline, please sign up for our Beta.
Copra aims to enable ‘The Internet Corporate Bond’ by building the on-chain debt market for protocols. The initial use case of our loan is to help DeFi protocols raise protocol-managed liquidity that they can flexibly deploy to better promote growth. The loan is not overcollateralized yet fully secured on-chain, made possible by a liquidity warehouse mechanism and further backed by protocol-level resources.