Title: [RFC] Deploy Euler on Polygon
Author(s): Jack Melnick
Submission Date: 2/7/2022
Submitted in the format laid out in [RFC] Formalizing Multichain Deployment
Point of Contact: Jack Melnick, DeFi Business Development Lead @ Polygon Labs
Two Sentence Summary: Over the past ~year, Euler has established itself as a premier permissionless DeFi lending market through implementation of its unique Tiered Lending system. To help in its growth trajectory, we would like to invite the team to launch Euler on Polygon zkEVM, following its deployment at the end of Q1, which is in line with Euler’s goal of an April multi-chain expansion
Proposal Overview: Polygon is the leading blockchain development platform, including solutions like Polygon PoS and Polygon zkEVM (first public EVM compatible L2 ZK rollup live on testnet). Polygon’s scaling solutions have seen widespread adoption with tens of thousands of decentralized applications hosted, 2.2B+ total transactions processed, 180M+ unique user addresses, and $2B+ in assets secured.
Through a combination of 400k+ active weekly wallets on the PoS chain and collaboration with mainstream brands like Robinhood, Polygon’s aim is to deploy dApps like Euler into broader and better-rounded markets. Reinforcing this goal, Polygon’s DeFi ecosystem has experienced consistent growth, irrespective of the market conditions, and continues to be the preferred destination for DeFi. From Ethereum blue chip protocols, like Aave, Uniswap v3, Curve, and LIDO to Prominent Polygon-native projects, such as QuickSwap, QiDao,and Gains Network, the success stories speak for themselves.
Additionally, Polygon’s DeFi ecosystem has already become self-sustainable. We effectively stopped the majority of liquidity mining incentives more than a year ago, yet continue seeing constant capital and user inflows, showing a clear path toward sustainable growth for deploying dApps.
Motivation, Rationale, and Key Goals:
Increase distribution and dApp discovery pathway: Users enable volume, and volume generates revenue for the protocol. Web2 giants like Robinhood have chosen Polygon to build their non-custodial wallets to enable dApp discovery, and enable dApps to capture more users (1.5M+ signups) through Polygon.
Marketing Support: Polygon brings vibrant marketing support to help you showcase the product and capture a large audience base. Through this support, we can help GMX establish a global brand presence.
zkEVM Launch: Polygon zkEVM will be launching by the end of Q1, allowing developers to easily port over EVM codebases onto a true Layer Two zero-knowledge scaling solution, the ‘holy grail of scalability’. On the testnet, over 84,000 wallet addresses have already been created, with ~300,000 transactions. You can find more info in the docs and zkEVM testnet explorer.
stMatic - Euler can include the staked version of Matic. The underlying PoS yield will help provide sustainable lending rates, uncorrelated with bear market conditions. Liquid staking on Polygon has grown from 5m MATIC staked to 90m, and continues to grow as more use cases arise for MATIC liquid staked derivatives (LSDs).
Resilient and sticky liquidity - Polygon natively has resilient and sticky liquidity. Pools will have deep liquidity, with no need to worry about porting liquidity from mainnet. This Report from Messari gives an in-depth overview of the state of Polygon’s liquidity.
- TVL on the Chain: $1.75b
- Amount of protocols on the chain: 1729
- (#) of unique addresses on the chain: 3,395,847, in the last month
- (#)of new users joining in the past 90 days: 6.47mn
- (#) of successful transactions per day: 2,865,756/day, 7 day moving average
- Average gas fee in the past 30 days: Median gas fee over the last month has ranged between 60-163 gwei, having steadily increased over that period as PoS activity has risen. That said, even at a gas fee of 165 gwei, with a priority fee of 30 gwei, transaction fees are ~0.003 MATIC (~ 0.3 cents).
Upon deployment to zkEVM, the chain will switch to an LX-LY bridge.
More complete information on zkEVM, and its current state on testnet can be found in the developer documentation here.
Polygon’s DeFi Team has experience supporting and onboarding new protocols into the ecosystem. As part of that process, the Euler team would have any necessary developer and marketing support to ensure a smooth and successful move.