Notional Monthly Update 🗓️ December 2021

Kyle Long
Kyle Long

Welcome to the latest edition of the Notional Monthly Update! You can also follow the latest news on Twitter or join the Notional community on Discord.


🗒 Summary Notes

-Analytics dashboard is live
-$NOTE Staking proposal - APPROVED
-Our first V2 Quarterly Market Review
-V1 deprecation notice


📊 Monthly Protocol Stats

-Total Value Locked:  $525,000,000
-Total loan Volume: $74,300,000
-Current Lend (USDC 6m) APY: 9.356%
-Current LP (USDC) APY: 10.25% (3.17% variable + 7.08% NOTE)
-Protocol Revenue: $499,000 (103,000 fees generated + $396,000 COMP accrued)


$NOTE Staking Proposal (Governance)

Voting is closed on the first Notional Improvement Proposal ever and the results are in: 75% voted in favor of creating a staking module for $NOTE. Here's a snippet of what the yes vote means for token holders:

The creation of a staking module for NOTE holders that will enable NOTE holders to earn returns on their tokens while simultaneously providing value to the protocol by way of providing liquidity for NOTE and insurance for funds on the protocol.  This also means that part of the protocol's revenue will be used to buy back NOTE and give it to the sNOTE holders as rewards.

  • Stakers will stake 80/20 NOTE/WETH Balancer lp tokens instead of NOTE tokens.
  • sNOTE holders will earn rewards denominated in these Balancer LP tokens. One sNOTE will be redeemable for an ever-increasing number of Balancer LP tokens.
  • Staking will be open-ended. There won’t be any fixed term lengths with the exception of a mandatory 15 day cool-down period upon redemption.

We explain below the rationale behind these changes as well as other relevant details of this proposal. Continue reading for full proposal text.


Quarterly Market Review

We recently released a full quarterly review - check it out if you missed it. Here's a few excerpts:

-Notional V2 was only live for two months of the last quarter, but in that time, we executed over $244M of loans!
-Overall, activity on the platform was skewed to borrowing. We saw a lot of interest to borrow at fixed rates which resulted in the interest rates offered on Notional to reach as high as 12% on DAI and USDC before lenders pushed them back down.  
-Although there was more borrowing than lending, volumes were still decently well balanced, with a grand total of $130.2M borrowed vs $114.1M lent.

System-wide (USD):
Total value locked: 559.6M
Total loan volume: 244.3M
Total borrow volume: 130.2M
Total lend volume: 114.1M

Per currency loan volumes (USD):
USDC loan volume: 131.8M
DAI loan volume: 107M
ETH loan volume: 2.1M
wBTC loan volume: 3.4M


🐛Don't Forget: Nexus Mutual Cover Available at 2.6%

We’re pleased to announce that Notional Finance is the latest DeFi protocol to be covered by Nexus Mutual, a premium insurance provider in the DeFi ecosystem. This decision reaffirms our confidence in the safety and reliability of V2 and gives our borrowers, lenders and liquidity providers an option to manage the smart contract risk of Notional V2.

Notional users who have DAI/ETH/WBTC/USDC deployed in a liquidity pool or used in an active fixed rate lend or borrow position can purchase Nexus Mutual coverage to get reimbursed for smart contract issues resulting in loss of funds. Note that coverage is specific to smart contract risk only, and does not extend to credit or liquidation risk. More information can be found via Nexus Mutual’s Notional program page.

If you'd also like to read the results of our other V2 audit processes, you can check them out here:

ABDK Consulting | Nov 01, 2021

Certora Formal Verification | Nov 1, 2021

Code Arena | Oct 10, 2021

Open Zeppelin, Governance Contracts | Jun 10, 2021


Notional V1 Deprecation Notice

With the launch of Notional V2 in November, we will deprecate support for Notional V1 by January 31st, 2022.

  • We will turn off liquidation bots for Notional V1 on January 31st, 2022.
  • Any accounts with unpaid debts will be settled by having their collateral purchased on January 31st, 2022. If you are borrowing USDC against ETH, your ETH will be sold in exchange for USDC to repay your debt. This will be done to ensure that all remaining liquidity providers can withdraw their funds.
  • If you want to swap your borrow to Notional V2 in a single transaction, you can do so at https://notional.finance/swapBorrow

There will be no time limit for users to withdraw their liquidity or assets, you can go to https://v1.notional.finance to withdraw or repay your debts.


📞 Community Calls

We had our last community call on 12/7 - if you missed it, check out the recording below. We'll post on Twitter as soon as we have a date set for our January call!


Notional Analytics Dashboard

Our analytics dashboard is now live and it has just about everything you would want to keep tabs on what's going on behind under the hood. Check it out at info.notional.finance


🗞️Notional in the News

A roundup of Notional media mentions and appearances by the core team.

FIAT DAO AMA Series - Notional Finance | Dec. 1st, 2021 | RSS Podcasting | RSS.com Podcasting
Max speaks with Notional Finance co-founder Teddy Woodward about how he got his start in DeFi during the most recent Crypto Winter; the launch of the protocol’s V2 this past November; and what’s excited him about DeFi the most in the past year.---Check out Notional Finance: https://notional.financeL…

About Notional Finance📈

Notional is the first decentralized, Ethereum-based protocol for borrowing and lending at fixed rates and fixed terms. With variable rate lending, DeFi can only serve a small segment of the crypto lending market because variable interest rates don’t provide the certainty that lenders and borrowers require. Notional fixes this by creating a true market for lenders and borrowers that empowers individual investors, business owners and institutional investors.

After raising a $10 million Series A in May 2021 from some of the top VC firms, including Coinbase Ventures, Notional’s protocol was relaunched on 11/1 with a host of new features as well as the NOTE governance token. Notional is now a top 10 DeFi lending protocol, with more than $500M in total value locked.

To find out more, follow Notional on Twitter @NotionalFinance, subscribe to the newsletter, join the Discord, or check out the website to learn more.

Kyle Long

Head of Marketing