Tokemak

Yield Aggregator

Tokemak is a liquidity aggregator designed to give users the ability to provide liquidity and earn protocol incentives for staking various crypto assets. Users actively vote where to deploy liquidity in order to maximize yield for all depositors.

Risk Rating
Average
Protocol Code Quality
Protocol Maturity
Protocol Design
Summary
What we like
Tokemak strives to create sustainable liquidity within DeFi through its platform design to direct liquidity across top decentralized exchanges (DEXs).
What we like less
The tokenomics is complex and liquidity providers (LPs) on the platform are rewarded only in the TOKE utility token.
What it means for you
Offers you a simple way to earn yield on single-sided deposits for several stablecoins and DeFi assets.
Information
Exploit/Hacks
None
Info
  • Website
  • Token: TOKE
  • Tags: Yield Aggregator
Key Metrics
  • TVL: $35.9M (Rank #104)
  • TVL Ranking by Yield Aggregator: #0
  • Blockchain: Ethereum
  • Chain TVL
    • Ethereum: $35.91M
Risk Assessment
Average
Protocol Code Quality
  • Code reviewed by several experienced auditors including Omniscia and Quantstamp
  • Public team promotes accountability
  • No documented protocol hacks since launch
Protocol Maturity
  • Core protocol launched in 2021; maturity over one year minimizes technical risk as smart contracts are well battle-tested
  • Top 10% by total value locked reduces risk
  • Multisig wallet controls protocol upgrades
  • Multisig consists of at least 4 signers, which means the protocol is less susceptible to centralization risks
  • No timelock exists or no information documented, which mean a malicious actor could approve upgrades without any delay
  • Low voting power concentration reduces risk
Protocol Design
  • Protocol could be susceptible to negative feedback loops
  • This protocol is susceptible to risks related to yield optimizers which deploy custom strategies to automatically manage user funds
  • Tokemak pools funds from investors and runs weekly polls to determine where to allocate those funds to maximize aggregate yield; earnings from such allocations are paid in the protocol`s token, TOKE
Things to know about Tokemak

How Tokemak works

Tokemak wants to serve as the Amazon Web Services (AWS) for Web3 by ushering in a broadband moment for liquidity or value flow in DeFi. Current solutions to solve this liquidity issue are either to engage a centralized market maker or incentivizing users through yield farming. However, these methods can be costly and highly inefficient. Tokemak was designed with this fundamental problem in mind. It is designed to be used primarily by liquidity providers (LPs), DAOs, new DeFi projects, and exchanges. Each asset on Tokemak has its own "token reactor" that accepts a particular asset to be deployed as liquidity across DeFi. TOKE is the native utility token that is used to direct the liquidity for each token reactor. LPs on Tokemak receive impermanent loss protection, with the cost offset by trading fees earned and ultimately backstopped by TOKE holders. Liquidity directors (LDs) utilize TOKE to control liquidity across Tokemak. LDs stake their TOKE in a given reactor and use that stake as voting power to direct liquidity to an exchange of their choosing. Voting power from TOKE is directly proportional to the amount of TOKE staked and the amount of assets in that specific reactor.

How Tokemak makes money

Tokemak earns all trading fees earned from its liquidity provision to various exchanges in return for bearing the risk of impermanent loss. These fees are then retained in the Tokemak treasury as Protocol Controlled Value (PCV). Over time, Tokemak intends to accumulate enough trading fees such that it will be able to direct liquidity independently, without the need for LPs. This point of self sufficiency is referred to as the "singularity". At this point, value accrual for TOKE is driven by the amount of liquidity that each TOKE controls.

How you make money on Tokemak

You can provide single-sided liquidity on Tokemak to earn protocol rewards (paid in TOKE). You can also stake TOKE to earn a proportional share of all token reactor yields (paid in TOKE).

Tokemak Pools
Tokemak ETH Market Making
0.3%
Yield
$5M
TVL
Risk
C
Protocol
Tokemak
Chain
Ethereum