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Hubble Protocol: Building the Future of DeFi on Solana

Hubble Protocol Crypto Projects

Introduction

DeFi is a relatively new financial system, and as it grows, innovative developers strive to adapt to the changing market and create solutions that will help DeFi become a global source of financial services.

Since Decentralized Finance (DeFi) debuted, many developers have been tasked with the responsibility of utilizing the protocol to bring more sustainable innovations that will not only solve the crucial needs of the tech world but also proffer solutions to the daily problems of individuals.

DeFi is well on its way to breaking into the mainstream with Solana paving the road for widespread adoption of blockchain technology by offering a network with exceptionally low fees and insanely fast speeds when compared to other Layer 1 blockchains currently available.

Today, a DeFi protocol built on Solana is on a mission to democratize and make viable DeFi services available to the world. Dubbed Hubble Protocol, this project aims to become a leader in the next generation of DeFi services, taking advantage of Solana’s low latency and low cost to benefit its consumers as well as onboard the future of DeFi mass adoption.

Hubble Protocol: A New Solana-based DeFi Project

Hubble is a new Solana-based decentralized finance (DeFi) project. Hubble is a DeFi system in its early stages of development that mints USDH against a variety of assets, letting users access the liquidity in their HODLed tokens via zero-interest borrowing on Solana.

USDH is a Solana-native SPL token that can be used for anything stablecoins can: pairing for liquidity on AMMs, bonding for tokens, or holding as a store of value. Users can deposit USDH in the Hubble Stability Pool to earn a share of liquidations during market downturns.

Hubble offers cryptocurrency investors the opportunity to make their coins earn yield for them instead of just holding it in a wallet by offering low-cost and capital-efficient borrowing. At the moment, Hubble’s operations are at its Phase 1 level and will subsequently expand its services with Phase 2 and Phase 3 where it will introduce structured products and undercollateralized lending.

The protocol started as a project in the Solana Hackathon and eventually got the support of top Solana ecosystem investors. Hubble wants to explore the universe of DeFi possibilities on Solana, which entails working on new features and finding new ways to encourage the Hubble community’s DeFi engagement.

HBB Tokenomics

HBB is Hubble’s native token with a Total Supply of 100,000,000 tokens. HBB can be staked to generate fees from the Hubble protocol. Staking HBB earns users 85% of the revenue generated by Hubble Protocol’s services.

Hubble’s revenue is derived from a 0.5% charge deducted from collateral deposits used to borrow USDH, with the remainder being returned to the community. All other revenue streams, or 95.5% of all possible revenue streams on the platform, go to the users that stake HBB and USDH on Hubble.

In the future, HBB will be used to vote on improvement proposals as Hubble DAO’s governance token. Stakeholders in HBB will be exposed to new revenue streams as the protocol grows. Hubble will offer structured products and customized lending to its community, creating customized yield and fees for HBB token holders, based on the borrowing protocol.

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Borrowing on Hubble Protocol

Hubble starts its DeFi adventure with an emphasis on borrowing and minting USDH in its first phase of development. SOL, BTC, ETH, etc. holders can spend USDH and earn yield elsewhere by borrowing up to 110% of their collateral while keeping their tokens locked in the Hubble vaults.  in USDH by depositing a variety of crypto assets such as SOL, BTC, ETH, and others.

Once the USDH loan has been collected and invested in other stablecoin-paying protocols, the borrower can return to Hubble and repay the loan once they have completed that investment. Not to mention, you get your collateral back at the end of the procedure, as well as the profit from your stablecoin. If the value of your collateral has improved, you have benefited from it as well. This implies users can earn interest on their deposits while borrowing.

To highlight, here are some of the key features of the Hubble Protocol:

  • Mint USDH, a 100% decentralized stablecoin on Solana
  • Deposit multi-asset collateral (SOL, BTC, ETH, etc.)
  • Zero-interest borrowing
  • 110% collateral ratio on loans, 11x leverage
  • 7% yield on SOL deposits
  • Yield interest on deposits while borrowing
  • 85% of fees distributed to HBB stakers
  • Democratized liquidations through Stability Pool

The Value Hubble Provides to Its Users.

85% of Hubble’s revenue is shared with its users that stake HBB or USDH, a 100% decentralized stablecoin in the protocol. The remaining 15% is allocated to Hubble’s treasury. Of note, the community will be in charge of the treasury and may amend the figures after Hubble decentralizes governance and establishes a DAO.

Hubble currently charges a 0.5% one-time fee for minting USDH and a 0.5% redemption fee for discounted collateral when USDH falls below 1:1 with USD. The 0.5% fee for redeeming USDH means that there is no economic incentive to arbitrage when USDH is valued between .995-.999 USD.

The more USDH is minted or redeemed, the more HBB stakers can earn. The execution of these redemptions, which burns USDH as it is received, helps quickly raise USDH’s value back to parity with USD. Additional services will generate new revenue streams for HBB shareholders in the future.

Hubble has also enabled users to split the earnings from liquidations. When a borrower’s collateral ratio (CR) falls below 110%, each user gets their fair part of liquidated assets by donating USDH to the Stability Pool.

This means borrows are backed by a USDH Stability Pool, which is composed of Stability Pool providers who pay off bad loans and profit from the 10% difference in liquidated assets. HBB, Hubble’s governance token, is given to users that deposit USDH in the Stability Pool.

The Hubble team is committed to providing long-term DeFi services that will provide the groundwork for DeFi’s growth on Solana, the world’s fastest and most scalable blockchain to date. Hubble chose to develop its user-centered protocol on Solana because we share the same values of creating a future for DeFi that is inclusive rather than exclusive.

Hubble Roadmap

Hubble’s mission is to provide a one-stop-shop for important DeFi services, leveraging Solana’s network’s speed and efficiency. Hubble is the result of years of FinTech experience and a desire to bring DeFi to the masses around the world.

Phase 2 of its mission, which is set to start in Q2 2022 will offer DeFi structured products, filling a gap in the DeFi market that is now unfilled.

Hubble hopes to offer undercollateralized DeFi loans in Phase 3, a groundbreaking move in DeFi lending that might help bring DeFi use cases even farther into the mainstream.

Disclaimer: The views and opinions expressed in this article are solely the author’s and do not necessarily reflect the views of CoinQuora. No information in this article should be interpreted as investment advice. CoinQuora encourages all users to do their own research before investing in cryptocurrencies.

Juliet is an ardent reader and a devoted writer who talks behind her keypads. She relishes her thoughts through writing articles, creative writings, and press releases.