OT Protocol

Defi, DEX

A new hybrid of AMM + DEX + lending & borrow protocol + stablecoin


OT is a new DeFi protocol allows single token liquidity pools (instead of pool pairs). This is made possible by grouping deposited tokens into a virtual pair with the native OSD stablecoin. Single token liquidity pools are more capital-efficient, resulting in a more optimized experience for all participants including traders, liquidity providers and third party projects.


Problems OT is trying to solve

  • High capital cost for project launch, unlike with AMMs that require two side liquidity provision, projects can launch token with zero extra capital on OT, liquidity providers only have to deposit one token to the liquidity pool using OT.

  • High slippage on traditional AMMs, same size of trading causes much smaller slippage for traders on OT by combing lending/borrow pools with swap pools.

  • Inefficient capital. Traditional AMMs are highly inefficient when it comes to capital usage. With OT, LPs will receive fees for both swaps and borrowing, borrowers can borrow directly from swap pools.

Convoluted smart contract routing results high trading cost for indirect pairs in traditional AMMs, in which case when users want to swap A to D, actual trading route might be A-b-c-d, which results way higher gas and trading fees, plus higher slippage. In OT, all assets are virtually paired with OSD, all non-OSD assets can be traded through OSD, i.e. A-OSD- B, which is charged 0.3% only once with much lower slippage.


What is OSD?

There have been many experimentations on algo stable assets, some of the widely known projects include: Olympus DAO, Fei、Float、Reflexer,Ampleforth(AMPL)、Empty Set Dollar(ESD)、Basis Cash(BAC/BAS)、Frax(FRAX/FXS). None of above projects have made a real impact due to either sharp fluctuation in price or inability to scale.

OSD is the stable coin introduced by OT, OSD works like the glue that holds the protocol together. OSD is a unit of account token for all assets listed on OT. OT solves the capital inefficiencies of liquidity pool pairs(that traditional AMMs such as Uniswap, Sushiswap, etc have) by grouping deposited tokens into a virtual pair with the OSD. This means that liquidity providers only need to deposit one token to the pool instead of two. OSD is backed by all the assets in OT pools that have a positive OSD balance and OT treasury.
When a user creates a new pool, they need to set a starting price for the asset in $. This means that every asset in OT pools expresses their value in OSD. Therefore trading works by forming a similar pricing curve to Uniswap except while they use the ratio between two tokens, we have a starting price and a would be price.