During week 3 of polygon fellowship, we explored and learned about new definitions of freedom bought by defi paradigms in great depth. All fellows were required to build a decentralized borrowing/lending dapp during the third week and research several protocols and present them in a presentation next week.
I was asked to present the protocol Opyn, which is basically a defi options trading platform. To fully understand the concepts involved with it, I conducted a thorough study of it and spoke with community members for resources. After getting to know how the protocol works, the understanding can be briefed. It basically uses convexity protocol for trading options contracts, and the options contracts are derivatives of sqeeth(which is nothing but eth^2). The options contracts are traded as oTokens(Nice guess options tokens). Each oToken is defined according to strike price, collateral, expiry date, american/european and option price. Users can hedge their crypto investments with this option contract or trade these oTokens among themselves.
In addition, I developed a borrowing dapp that allows users to deposit some ether and receive stable coins in return. To put the architecture into perspective when a user deposits some ethers the contracts triggers the stable coin contract to mint some stable coins(in my case you will receive NSST(NotSoStable 😅) coins. Users who deposit ether receive stable coins pegged to USD dollar according to the chainlink oracle's current ether to USD price. The stable coin corresponding to the withdrawal amount is burned when the user tries to withdraw ether from it.
We also had a really fun mentorship session with our mentor Rodrigo Carraresi (Rod), during which we discussed potential projects we would like to build during this fellowship, talked about some fun facts, and much more.
PS: Sneak Peak of dapp i built you can use it here:
#WAGMI