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TL;DR - A new money market is challenging Aave and Compound.
Euler is a decentralized money market where users can collateralize and borrow against their assets. Euler utilizes a tiered system when listing new assets, where tokens are assigned either an isolation tier, cross-tier, or collateral tier rating. Any isolation or cross-tier asset can be lent or borrowed while only assets in the collateral tier can be used as collateral. This structure allows Euler to support borrowing the long-tail of assets, many of which are used to short or hedge yield farming positions, while not increasing the solvency risk for the protocol. Euler also has several other unique features, such as soft liquidations and built in UI support for entering different strategies such as long/short pair trades. The protocol generates revenue by taking a cut of the interest paid to lenders, and is governed by the EUL token, which is also used to vote on gauge emissions to different markets.
Euler has generated $1.2M in revenue over the past six-months, and grew its TVL 150.4% from $105.5M to $264.2M. The protocol spent $3.0M incentives over these two quarters, putting its bottom line at $-1.8M for the period.
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