- Summary:
- Sommelier, a DeFi blockchain protocol, has launched its first “Cellar”, a DeFi yield management solution. We discuss the implications.
Sommelier, the automated platform for managing DeFi portfolios, has announced that it has launched its first Cellar. “Cellars” are community-controlled, dynamic investment vehicles used on this platform. Designed by the Sommelier team, the first Cellar on the platform takes advantage of lending positions on Aave to earn interest. The approach takes into account a number of different aspects. These aspects include the stable currency with the highest rate of return, the coin with the highest interest rate, the coin with the best mining incentive for liquidity, and others.
What the Cellar brings to Sommelier
Using machine learning, the Stablecoin Lending Cellar automatically moves assets between multiple stablecoin lending positions. Once the Cellar has achieved a suitable level of liquidity, it will take care of everything else. Sommelier has the ability to offer a wide range of strategies for attracting financing as more Cellars join the platform.
The first-ever Aave Cellar has successfully passed many audits and will continue to do so over the course of a longer period. Furthermore, the Cellar can only trade assets on Aave between a predefined selection of stablecoins. Because of this, consumers can have the reassurance that they are the only ones who can withdraw their monies to their wallets.
In addition, Sommelier is non-custodial. Furthermore, to access the Cellar’s protocols, users must contribute assets to the Cellar via the DeFi protocols. As a result, the Sommelier blockchain and any bridge are not necessary for users to add or take funds from Cellars. Cellars’ major changes are totally under the authority of the Sommelier community.
Sommelier enables retail customers to participate in sophisticated DeFi investing strategies that might otherwise be out of their reach. This class of investment strategies has only been accessible until recently to the largest institutional investors. When competing with whales for liquidity in various DeFi protocols, DeFi retail investors have faced impermanent losses and transaction fees. With Cellars, they have access to the most up-to-date DeFi investment methods available today.