Interaction between Orcus Finance, Starlay and user’s capital
What is the definition of “capital efficiency” in traditional markets? Is a term that is frequently used to describe the amount of money that a corporation needs to spend in order to obtain a given return. It refers to the return on investment that a corporation obtains for a certain investment, product, or service. This word is frequently used in marketing. The way we think about capital efficiency in the crypto market, particularly for stablecoins, is fundamentally different. But let’s look at our case.
Starlay is a non-custodial lending protocol on Astar Network. Depositors can provide liquidity to earn interest as a stable passive income, while borrowers can leverage their assets without selling them out.
Astar Network aims to be the biggest hub for the multi-chain era by bridging with Ethereum, Cosmos, and others. With Starlay Finance, the Astar ecosystem will be a huge marketplace for storing all kinds of tokens on any kind of chain.
Starlay’s key features:
- Basic Depositing / Borrowing
- Flashloan functionality
- Makai (loop function for repeating deposits and borrows)
Capital efficiency through collateral depositing
When the user deposits USDC to mint a new oUSD stablecoin, his collateral not just lies on the contract — it passively works behind the public eye! Orcus Finance is built in such a way to generate income in the loop cycle and this income will profit the user itself.
To produce passive income, the protocol automatically invests up to 85% of USDC collateral in the lending protocol — Starlay Finance in our case. Earned profit will be used to buy back $ORU token from the open market. The execution flow is immediate and also the most efficient in sustaining the $ORU price in a permanent way.
Who benefits and how?
- Starlay Finance receives additional deposits automatically;
- Passive income is used to buyback $ORU;
- Buybacks push the token price up, which is positive for holders;
- $ORU stakers become rewarded by newly bought tokens.
In addition to the benefits above, the collateral investment has the potential to produce a high income. Both principal and interest can organically grow ECR and assist the system’s stability over time. The re-balancing process will run every day at 12 am (UTC) to adjust the investment amount to 85% of the total.