Introducing: The Swivilian Ubiquitous Term of the Week
Swivilian Term of the Week #0: Capital Efficiency
In our most recent Developer Blog, our tech lead Rob Robbins discussed Ubiquitous Language and how seriously we take it here at Swivel.
A shared and ubiquitous language is the heart and soul of any DAO. From the Swivilian to CEO, a common language facilitates collaboration and cooperation, and for that reason we’re starting a new series to share our language with the SWIV community: The Swivilian Ubiquitous Term of the Week!
Think of this as a recurring weekly blog post that will help teach you about fixed-yields, DeFi lending, and how to communicate fellow Swivilians when discussing all things fixed-rates and Swivel!
Without further ado, I would like to share with you the first of many ubiquitous vocabulary words to come.
Ubiquitous Term of the Week #0: Capital Efficiency
Traditionally, Capital Efficiency refers to the ratio of capital expenditure to production addition. In other words, how much capital does it take to accomplish your goal?
In DeFi, Capital Efficiency most commonly refers to the amount of capital it takes to provide a given amount of liquidity.
E.g. A User trades 10,000 USDC against equivalent Uniswap-v3 and Uniswap-v2 pools, both with 150,000 USDC in liquidity. A Uniswap-v3 pool with .3% slippage could be considered 10x more capital efficient than a Uniswap-v2 pool with 3% slippage.
Capital Efficiency & Swivel
Swivel is the most capital efficient protocol for fixed-yields.
With only a few million in TVL, our protocol is able to provide lending quotes that are more competitive than our competitors and represent a roughly 25-30x improvement in relative capital efficiency.
Unlike all other fixed-rate protocols, Swivel utilizes an orderbook that offers 0 cost limit orders, as well as the professional LP experience necessary for effective liquidity provision.
For a more in depth dive on our orderbook and all its benefits, check out our founder’s article on “So, Why An Orderbook?”
And for more information about liquidity provision in fixed rates in general, check out our more recent blog on “Market Making in Yield Markets”!
About Swivel Finance
Swivel is the protocol for fixed-rate lending and tokenized cash-flows.
Currently live on Rinkeby and on Mainnet, Swivel provides lenders the most efficient way to lock in a fixed rate as well as trade rates, and liquidity providers the most familiar and effective way to manage their inventory.