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đ  Voltz
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âšī¸Â Intro to Voltz - Learn Web3
đ Down the Rabbit Hole
<aside> âŗī¸ Voltz is a non-custodial AMM for Interest Rate Swaps. It offers Variable and Fixed Takers options for the users to swap their assets, based on what suits them the best. Furthermore, the Liquidity Providers supply liquidity as required by the takers to trade, and in return earn some rewards. In Fixed Takers options, you can initiate a swap for fixed return rates for a specified period, and in variable takers option you do that for a variable return rate. The Voltz Protocol implementation is open source and is viewable here.
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<aside> âŗī¸ To offer the traders a choice to select a fixed taker option or the variable taker option for interests while locking their assets, thus offering them a better and more secure IRS.
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Fixed Takers (FTs):
Set Takers replace fluctuating rates with fixed rates. For example, you might possess a variable-rate-of-return asset, such as cDAI. You can initiate a swap on Voltz if you don't want the risk of a variable interest rate on your DAI and instead want a set rate of return.
Variable Takers (VTs):
Variable Takers make the switch from fixed to variable rates of return. You're effectively "selling" a fixed rate to gain leveraged exposure to variable yield in this case. You'd do this if you think the variable rate of return on Voltz AMM will be higher throughout the term than the current fixed-rate pricing. We expect VTs to have a higher risk tolerance than FTs, but VTs also have the potential for significant profit growth.
Liquidity Providers (LPs):
Liquidity Providers supply the liquidity that Voltz AMM requires for FTs and VTs to trade. It also ensures that Voltz AMM has a larger liquidity pool within its preferred fixed-rate bands. When transactions are made utilising their liquidity, LPs are paid a fee.