Hyperdrive is Now on Base!
It’s another big week with important news to share! Today, the Hyperdrive Protocol (developed by DELV; this instance operated and managed by the Element DAO) has officially been deployed to Base, along with a new asset integration: Coinbase Wrapped Staked ETH (cbETH).
“This deployment is a major leap forward in bringing DeFi opportunities to a wider community. Base’s commitment to delivering user-friendly ways for anyone to build onchain aligns perfectly with our own values,” said Charles St. Louis, CEO of DELV. “We’re always looking for more ways to empower Hyperdrive users and to build a stronger bridge to the future of finance. Deploying on Base goes a long way toward reaching that goal.”
Hyperdrive on Base
Why Base?
Base is a Layer 2 network built on top of Ethereum. It was developed by Coinbase, one of the largest and most trusted cryptocurrency exchanges, with the goal of bringing the next billion users into the global onchain economy. Base’s mission is to make a decentralized future more accessible for everyone by increasing innovation, creativity, and freedom.
Base offers secure, low-cost, builder-friendly solutions, and it’s designed to be fully compatible with the Ethereum ecosystem. Thanks to higher throughput and network efficiency, Base promises reduced gas fees and faster transaction speeds than Ethereum’s Layer 1. That makes it easier and more cost-effective to engage in DeFi lending, borrowing, and staking.
What is cbETH?
Coinbase Wrapped Staked ETH (cbETH) is the tokenized version of staked ETH on Coinbase’s staking platform. When users stake ETH on Coinbase, they can receive cbETH in return, and cbETH may accrue value over time.
It’s also an ERC-20 token that’s compatible with Ethereum-based DeFi platforms, so users can participate in lending, borrowing, trading, or liquidity pools without needing to wait for the Ethereum unstaking process.
Unlike traditional staking, in which assets are locked, cbETH can be traded, transferred, or used in DeFi platforms, providing liquidity while still accruing staking rewards. Traders can also leverage cbETH to find arbitrage opportunities.
cbETH will be available to Hyperdrive users at an initial fixed APR of 3%.
How to get started with cbETH on a Hyperdrive pool
As a liquidity provider on Hyperdrive, you’ll be able to access PnL from balancing market activity and enjoy no pool expiry or rollovers.
Here’s how to get started:
- Acquire cbETH by staking ETH on Coinbase or purchasing it directly through an exchange like Coinbase, Uniswap, or 1inch.
- Access the Hyperdrive app.
- Deposit your cbETH by navigating to the LP tab.
- Participate in Hyperdrive's optimized liquidity pools.
Meanwhile, trading cbETH on Hyperdrive lets you access principal-protected fixed rates, multiplied variable rates, and the ability to set terms on-demand.
If you’re a trader, here’s how it all works:
- Acquire cbETH by staking ETH on Coinbase or purchasing it directly through an exchange like Coinbase, Uniswap, or 1inch.
- Access the Hyperdrive app.
- Deposit cbETH on Hyperdrive.
- Open a long position at a fixed rate or a short position at a variable rate.
We’ve got many more announcements left to go, so be sure to check back in to learn about upcoming opportunities and integrations.
Missed our earlier posts? Check out Part 1, Part 2, Part 3, Part 4, Part 5, and Part 6 to learn about our other integrations. Plus, take a look at our kickoff announcement for more details (including our role as a non-exclusive service provider to the Element DAO).
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Note: This blog post is general in nature and for informational purposes only. It is not legal, tax, investment, financial or other advice, nor is it a comprehensive or complete statement of the matters discussed. It is not a recommendation of an investment strategy and should not be used as the basis of any investment decision.
All transactions and investments involve risk, and past performance does not guarantee future results. Certain complex strategies carry additional risk and are not appropriate for all users. As with any DeFi or crypto position, you may incur losses. You alone are responsible for evaluating the benefits and risks associated with any decision to use Hyperdrive and the risks or concerns with any underlying yield source.
Hyperdrive is not currently available in certain jurisdictions, such as the USA and the UK.