DeFi has opened a new gate for the financial sector by providing decentralized, transparent, and efficient financial services through blockchain technology. Unlike traditional finance, DeFi eliminates intermediaries, allowing for peer-to-peer transactions and a more inclusive financial system. Amidst this evolving DeFi ecosystem, new DeFi platforms come with some major solutions every day, as does the Seamless Protocol.
Seamless Protocol represents a significant advancement in the DeFi space, offering automated features designed to enhance the user experience and optimize returns. Its key features, such as auto-compounding, auto-rebalancing, and Integrated Liquidity Markets (ILMs), streamline DeFi activities, making them more efficient and cost-effective with the SEAM token that facilitates this protocol governance and incentivizes user participation.
What is the Seamless Protocol?Seamless Protocol is a decentralized, non-custodial platform built on the Base network focused on automated lending and borrowing. It offers features like auto-compounding, auto-rebalancing, and integrated liquidity markets (ILMs) to optimize DeFi growth strategies. Users can lend, borrow, bridge, swap, deposit, and earn rewards efficiently and with low fees without leaving the app. To run these protocols, the app is designed to follow “Integrated Liquidity Markets” (ILMs), where liquidity from various sources is pooled together to facilitate efficient lending and borrowing. By integrating multiple liquidity sources, the protocol ensures better availability of funds, optimized interest rates, and reduced slippage for transactions. This ILM setup enhances the overall user experience by providing more stable and reliable access to liquidity for DeFi activities. The platform also utilizes the SEAM token for community participation and governance.
BackgroundThe Seamless Protocol was founded in 2023 and has no public members, but it is supported by a diverse group of teams and individuals passionate about advancing the Web3 user experience and enhancing DeFi capital efficiency. Contributors come from various communities, including DeFi blue chips and NFT projects, with examples like Seashell, RNG Labs, and Loreum Labs. Advisors and collaborators hail from top DeFi platforms like Ampleforth and Uniswap and organizations such as Coinbase, Google, Robinhood, and CertiK. This collective expertise drives the protocol’s development, despite having no publicly named members. Governance polls, conducted via platforms like Typeform and DeForm, allowed the community to actively participate in decision-making.
FeaturesSeamless Protocol provides every possible feature experience for both sides of the market, liquidity suppliers and liquidity borrowers. The features aim to optimize DeFi strategies, unlock undercollateralized borrowing through the innovative concept of integrated liquidity markets, and provide a seamless user experience.
Enhanced securitySeamless Protocol liquidity mining farms leverage Ampleforth’s Geyser v2 contracts, offering extensive composability and flexibility. The Geyser is a smart contract developed by Ampleforth that facilitates liquidity mining by distributing tokens to users who provide liquidity to decentralized exchanges. This setup allows for infinite combinations of farms, enabling users to farm various tokens. The distributed rewards can include any existing non-rebasing ERC-20 tokens.
FarmsSeamless Farms are based on a Geyser v2 contract that allows users to add LP tokens from other DEX pools such as the SEAM/USDC pool on Soswap to earn SEAM rewards. Users earn additional SEAM rewards by providing liquidity to these pools and staking the corresponding LP tokens in Seamless Farms. The program also features a multiplier effect, where the longer users participate in farming, the larger the multiplier applied to their rewards, incentivizing long-term commitment and liquidity provision.
Auto-CompoundingAuto-compounding in the Seamless Protocol refers to the automatic reinvestment of earnings to maximize users’ returns. Instead of manually reinvesting earned interest or rewards, the protocol automatically compounds these earnings back into the user’s investment. Gains earned from magnified staking fee rewards are incorporated back into a user’s ILM position, meaning gains compound right from the start.
Auto RebalancingAuto-rebalancing is a feature of the Seamless Protocol that helps maintain optimal asset allocation within a user’s portfolio. Because smart contracts manage ILM, rebalancing occurs automatically. Auto-rebalancing automatically adjusts the distribution of assets to the user’s desired investment strategy. This ensures users do not need to actively manage their debt positions to stay within targeted leverage ratios. This feature is particularly useful for maintaining long-term investment strategies without needing constant manual adjustments.
Low FeesThe smart contract of Seamless Protocol is designed to minimize transaction costs for its users and is performance-based, and distributed across all participants. By reducing fees, the protocol makes DeFi activities like lending, borrowing, and trading more accessible without impacting a user’s broader P/L performance, especially for frequent traders or those with smaller investments.
High EfficiencySeamless Protocol’s high borrowing efficiency is driven by community-added strategies coded into smart contracts. These strategies leverage the Integrated Liquidity Markets (ILMs) directly connected to Seamless’s asset pool. This integration allows the borrowing strategies to access capital at preferential rates, optimizing returns. By utilizing automated and community-driven strategies, the protocol ensures efficient capital usage, maximizes profitability for users, and enhances the overall efficiency and effectiveness of the borrowing process.
How do ILMs of Seamless Protocol work?Integrating integrated liquidity markets (ILMs) with Seamless’s asset pool ensures efficient capital usage, reduced transaction slippage, and competitive interest rates. When users deposit assets into the pool, the ILM automated growth strategies are securely embedded within smart contract code, ensuring trustless and tamper-proof execution. This is how the leveraged wstETH/ETH looping ILM strategy works:
A user deposits wstETH into the ILM and receives an LP token, signifying their position in the strategy.ETH is borrowed in accordance with the strategy, which will eventually be used to magnify a user’s wstETH position. This ETH is borrowed from the supply side of the Seamless Protocol lending & borrowing markets.This borrowed ETH is swapped on a DEX for additional wstETH, achieving a 3x leveraged ratio.As wstETH generates staking fee rewards, its price will grow relative to the price of ETH. As wstETH grows, it will naturally fall outside of the targeted 3x leveraged ratio; when this happens, additional ETH will be automatically borrowed and swapped for wstETH. This process of continuously monitoring the leveraged ratio of debt to equity is called rebalancing and is fundamental to ILMs.
The above example illustrates a potential implementation of ILM, but ILMs are customizable and composable, and the community of SEAM governance token holders can vote in an endless set of new strategies and markets.
SEAM TokenSeamless, or SEAM, is a native fungible token of the Seamless Protocol built on the Base L2 chain. It is a transferable representation of governance and utility functions specified in the protocol’s code. The SEAM token aims to support the entire ecosystem economically, including protocol, contributors, and users. It rewards users for their actual usage, activity, and efforts, ensuring that only those who actively engage with the platform receive SEAM incentives. SEAM is integral to the Seamless Protocol, as it motivates users to expend resources and participate in activities that benefit the entire ecosystem. Without SEAM, there would be no incentive for user engagement and service provision.
Token name: SeamlessSymbol: SEAMUse type: UtilityChain: Base chainType: ERC20Maximum supply: 100,000,000 SEAM
Tokenomics
The SEAM token is a utility token for Seamless Protocol governance. The holders of SEAM tokens can participate in decision-making processes related to protocol upgrades, changes, and governance. Additionally, SEAM tokens are used to incentivize user participation, including lending, borrowing, and providing liquidity. The protocol also has an escrowed version of the SEAM token called the esSEAM token. esSEAM retains the same utilities and functionalities as SEAM, including delegated voting power for governance activities. There are two types of delegation: self-delegation and delegation to another address, but both require the same process. In self-delegation, a SEAM token holder delegates voting power to their own address, while delegating to another address requires selecting a recipient address. Each esSEAM token corresponds to one SEAM token held in escrow, maintaining a 1:1 ratio. Although esSEAM is an ERC-20 token, it cannot be transferred in its escrow form, and users can only get esSEAM tokens by interacting with the Seamless Protocol. The SEAM tokenomics model is designed to ensure the sustainable growth and development of the protocol by aligning the incentives of users, developers, and other holders. The total supply of SEAM tokens is 100,000,000 and is distributed in the following categories:
Claimable esSEAM token
How do I Buy SEAM Tokens?
Go to Gate.io Exchange and create an account by entering your email ID and password.Set up your fund password by entering settings; this password will be asked during fund withdrawal.To buy SEAM tokens, you must complete KYC with the proper documents.After KYC, go to Spot Trade, search for SEAM, and select.After opening the new page, fill in the amount in SEAM or USDT you want to buy, and click the buy button.After a successful buy, go to the Wallet > Withdraw page.Here, select SEAM, and then enter the wallet address.It will ask you for your fund password, 2FA, and email code; enter them correctly and submit. Your SEAM will arrive in your wallet after a few confirmations.
ConclusionThe Seamless Protocol aims to provide an integrated liquidity and borrowing solution with decentralized, transparent, and peer-to-peer transactions for enhanced capital efficiency. These features ensure users can maximize their returns while minimizing manual intervention and transaction costs. It also addresses the challenges of liquidity fragmentation and high fees, offering a seamless and user-friendly experience in the decentralized financial system.