Each week, we host top names in DeFi on the CertiK Security Leaderboard Live AMA. The CertiK Security Leaderboard is your one-stop shop for everything security related in DeFi. Head over to CertiK.org and check out the ranking of dozens of projects, their security scores, Skynet statistics, and much more data.
This week we had the pleasure of speaking with George Groshkov, the CEO of Relite Finance. George has a background in media, specifically media entrepreneurship, and then started working as a consultant for IT businesses before working as a consultant for blockchain startups and crypto companies. Relite is a decentralized, cross-chain lending protocol built on Polkadot. George and the other founders discovered the inefficiency in the DeFi lending space and created Relite to improve the DeFi lending landscape and make it more equitable for users.
If you missed the chat, don’t worry: here’s a recap of some of what was discussed.
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What separates Relite from other lending protocols such as Compound or AAVE?
George: Relite is designed from day one to be a cross-chain to connect them, so what we really want is to connect the liquidity and tackle big problems which means different assets sitting on different chains via bridges. The idea of Relite is to bring them together. We also really want to focus on better fees and better collateral which means the loan value you will get will be better than our competitors with our loan to value being 80–85%. We will have a reserve fund which also works as a mitigator or safety cushion against shortfall but also helps to lower the collateral and decrease the fees as well. We also have various pools with our partners, exploring the NFT space, and all sorts of mix-and-match of collateral to give users more freedom to choose.
What state of the development or launch are you in?
George: We recently released a road map which is a more detailed and updated way to see where we are at. In August or September we will have the “farming phase” which is a simple phase where users can take the LP tokens from Uniswap or PancakeSwap and stake them with Relite and earn APY. After that we will move towards the so-called initial liquid provision which is when we gather USDC and DAI as well as initial liquidity for the landing where users can lock their stable assets to earn yield and APY. Then soon after we can take that liquidity and do the MVP Lending Launch in October. After that, in Q4, is a quite interesting period for Relite when we start phase one of the Reserve Fund, implement DOT Lending, and utilize the insurance protocols with our partners. Then we will explore more cross-chain approaches and multi-chain with Reef as well. So Q4 is a very interesting and exciting time.
You mentioned Shield and Reef partnerships. What is the nature of those partnerships?
George: Yes, so both of them are very interesting. With Shield they help us with the reserve fund, meaning that at some point in a very extreme situation when the market falls and we need to liquidate part of the very early token reserve fund then there will be a price guarantee which could then be utilized by the Shield Finance protocol. This means that we’ll have, let’s say, stable coins aside to cover any kind of liquidations. For Reef, it’s also very interesting because we’re moving to a motor chain and they will have their partner DEX’s as well there which are interesting. We will have pools for both Reef and Shield so users can lend and borrow.
So at this point it appears that you chose Polka Dot over ETH or BSC due to the para chains and bridges that they are enabling, is that the main reason?
George: We’re not excluding anyone at the moment and Relite’s nature is to remain open to multi-chain approach, but Polka Dot’s architecture at the moment is something that we really like. The bridges as well as the communication between the assets and the bridge in the power chain and you can also easily communicate with the relay chain as well. Things still need to be tested on there, but we are pretty strongly moving towards Polka Dot.
What is the purpose of the Relite token and the ecosystem?
George: Governance is first and foremost. When the lending and borrowing is live, you can decide upon what kind of tools to be open, what kind of fees, and particular ways to be structured. We know and believe that token holders have to be very actively participating and play a major role in the decision making of the company. The token is also part of the reserve fund so it is capital that could be used as a recapitalization mechanism. You can stake the LP tokens and earn additional yield as well. Essentially we want to give users who hold it to be able to decide the future of the company and empower the people, which is the real value of the token.
What problems are your project trying to solve and do you think the problems are not yet noticed by others in the DeFi space?
George: They are, but for some reason they’re not quite yet well enough tackled. When you first land on a lending platform, where do you click? Do you go to borrow? Do you go to lend? Do collateralize, and if so, when? What is the liquidation ratio? These things take time to learn, and novice users trust me. People keep asking the same questions so these kinds of questions have to be explained. People have to understand the risk as well, so on the Relite platform we’ll explain the risk, we’ll explain the liquidations, and we are also expanding the Relite edu and the Relite real-life education content to get people the understanding of what they can do and why it works like that. Another problem is the lack of cross-chain and the lack of liquidity emerging, there none there really and many of the protocols at the moment have really monolithic code structure and they cannot innovate fast and do that real multi-chain approach.
Can you give an overview of the Relite Finance tokenomics?
George: We actually have to update the token metrics, but there will be a cap of 182 million. There are currently 228 million in circulation, which is absolutely fine because we need to distribute it to investors we also need to give some early as well for market making for exchanges, and also keep the liquidity rewards in check, but very importantly there will be no more than 182 million varieties and that’s that’s a must and that’s in the control.
You guys are extremely transparent compared to many other DeFi projects. Your team is fully doxxed on the website, you have a tokenomic breakdown, a public roadmap, etc. Why is transparency important to you?
George: This is how we want to participate in a project as well. We also sometimes participate as investors in projects and partners and we ask the same questions as the ones that are tackled in the landing page. Users are a part of the community, as are we, and we feel the need to communicate effectively with them the same way we would want a project to communicate with us when we invest. When there is a problem we tell them, the same way we do when something good happens! Transparency is very important to us and we definitely consider it more of a teamwork rather than just service providers versus the users.
What factors will influence future demand for your project and what steps are you going to take to boost adoption?
George: There are two main factors that will contribute to the adoption of Relite; one is business development or product development and the other is marketing. When the community asks for a particular pool or particular feature, when you develop it it opens up the market for more users to come. At the same time, it creates a nice story for marketing. Marketing is the next step, including content writing, good education about lending space, explaining to novice users on what they need to do, talking to communities in Asia in their native language, and more will drive the adoption. Also to create rewards, not massive or enough to cause inflation, but enough to have creative awards to keep people engaged. Getting people to stake in the liquidity and have them join as part of the community is the bigger vision. But overall, it does come down to those two components of business/product development and marketing.
Moving on to the security side, why did you choose CertiK for your audit and what made you decide to implement the Shield and Skynet solutions?
George: Well you guys are the leader in the space and that’s why we approached you. Our advisor Marco told us we should talk to CertiK and we did just that. We had a very quick response time and the audit was very good as well, checking all the code line by line and communicating on how issues can be fixed. The transparency was very clear. Of course the Shield is there, I think it is a must-have for a project, especially in the beginning because it helps give more confidence to the community. We will have more small smart-contracts that need to be checked and once the project expands we will need to do another.
What measures have you guys taken to limit your exposure to exploits? For example, rug pulls or flash loan attacks.
George: Yeah so this goes back to security. What we can do is to just test, test, test and continue to do so. We also set a very interesting structure for testing the contracts. Through this and doing the audits with the best of the best, we can help reduce the chance. If somebody’s gonna maliciously overuse the flash phone then we just need to just have all those use cases tested, and again this is part of the security team and we have another great coming aboard. In terms of a rug pull, we are very transparent with anything we do and the team is all doxxed.
Where did the name Relite come from?
George: That’s a good question! We wanted to REdefine how we lend and borrow and we wanted it to be LIGHT so that it is easy to use, so we combined those to together and got Relite.
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That wrapped up this week’s AMA with George from Relite Finance. For more AMA sessions and whole AMA videos with top DeFi and crypto projects, keep an eye on our social channels and subscribe to our YouTube channel.
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This interview has been edited for clarity and concision.