Never heard of it? Not your fault, this site is now worth USD500m and is just 3 days old. In a span of 3 days, the site has amassed over USD500m of TVL (total value of crypto "locked" on the platform). 3 days sounds crazy, but I realised nothing is that crazy in crypto.
Link: https://benqi.fi/
Amounts on the platform as at 22 Aug:
How safe is this?
This question never gets old. There's only a recent hype for the Avalanche blockchain (it's literally hyping up as I type now), and how safe... I wouldn't be a good judge of it. There's an incentive program currently active, with the Avalanche team putting in USD3m to Benqi. Some may consider this a vouch. Whether the Benqi team will rug-pull, it's anybody's guess. This seems to be operated by an anonymous development team (nothing came up based on my quick search), so that may be a deal-breaker for some of us here. There's barely much news (ignoring the USD3m incentive that's popping up everywhere) aside from their self-generated Medium sites and twitters given its young age so it's prudent for you to gauge your risk appetite before venturing on this.
Please do your own research; here's the link to the documents that Benqi provides. Link to docs: https://docs.benqi.fi/risks
On another note, there's a huge incentive program to bring onboard Aave and Curve as well. Before these big names come onboard, I do believe Benqi will see some growth before the more conservative people start migrating over to Aave, which is well established on multiple blockchains. Of course, this is assuming Benqi is a legit team.
How does Benqi works?
If you've been on Aave, congrats - you are already familiar with this type of protocol. Benqi is a lending and borrowing protocol that is native to Avalanche. For such protocol, the key advantage are for the first movers whereby you are rewarded to both lend and borrow. Lending is pretty common, and works the same as traditional deposits. Borrowing, on the other hand, usually comes with an expense. In the early stages, there may be instances that you are paid to borrow (which is the current case for Benqi). This is the same case for Aave when it launched on Polygon but most of the crypto that you lend now requires you to pay an interest already.
Below is the extract of the current rates to supply (you deposit on Benqi), and to borrow (you borrow from Benqi). The total APY is your current rewards level, and these are currently fluctuating.
How to get to Avalanche?
Refer to the article I wrote previously on the bridge to use: https://www.publish0x.com/kopiarticle/bridging-to-avalanche-riding-on-the-avalanche-rush-xwwyrxm
How expensive is it?
To be honest, if you are a small fry and have experienced the gas fees of Polygon, it isn't that worth it with AVAX (native token for Avalanche) currently rising up in price. A typical transaction range from 0.02 to 0.07, and at the price of USD50, it works out to be USD1 to USD3.50. I ventured onto Avalanche with a small capital of USD500 and that makes it very costly compared to the Polygon interface - with MATIC (native token for Polygon) at a price of USD1.50, it's at least 30 times more expensive.
Affordability is subjective, so do what's comfortable for you.
In summary, Avalanche is getting a lot of attention now. If you want a new blockchain to ape into, you can consider this before the hype blows over and yields start declining.
Photo credit: Benqi Finance
