Overview

Problem & Opportunity

Solution

Fix the absence of structured asks against the long-only products and leverage issuance in crypto, and solve for the facilitation of working capital during demand spikes.

Summary

Concrete unlocks downside protection for users in crypto by enabling the distribution of fixed-rate and term credit during periods of volatility or liquidity demand. The creation of these instruments unlocks a dynamic credit derivatives market.

Coverage terms are derived from a series of quantitative methodologies to price and size the relative position, while a series of novel contracts afford Concrete to actively engage and manage positions of leverage that the protocol protects.

Concrete can interface in a permissionless or embedded design with any protocol issuing leverage, such as defi lending protocols, perps exchanges, NFT finance, and leverage yield farming solutions.

At scale, Concrete will afford any issuer or holder of leverage the ability to compose and tender their own market position for leverage to those willing to take the other side of the position. Through this, Concrete allows the market of leverage in DeFi to find its price.

Overview

1. User A takes on a leverage position with intrinsic upside but no downside protection.

2. User A enables Concrete to generate a contract based on the temporal strength of the assets and the agreement structure taken on with the debt issuer. The user can then approve the terms, and Concrete can tender the contract.

3. The contract is added to the portfolio and prospectively funded by one of the liquidity pools.

4. Pools are funded by those taking short-side exposure to the market or in P2P auctions, the individual willing to fund at the most competitive APR.

5. When a contract is triggered, liquidity is drawn from the respective pool and automatically deposited within the original position held at the issuer.

User Example (V1)

Bobby and Steph both borrow against $100 of ETH on AAVE today. The liquidation threshold is 70% loan to value (LTV), and they both decide to borrow at 60% LTV.

Bobby decides not to protect their position and does not create a Concrete contract, but Steph does.

Steph creates a Concrete contract by paying $5 upfront (0.5% of the $100) and agreeing to pay 22%APR on credit issued. Steph is provided the use of an automated $13 credit line if the position approaches liquidation at 69.5% LTV.

Bobby and Steph take their $60 and now $55 respectively, and invest it across the market in various strategies, some successful and some not so much.

Three weeks go by; ETH has depreciated, and their $100 bases are now worth $90, placing them at 66.7% LTV.

ETH then drops in price, pushing both of the original positions over the 70% LTV:

Bobby enters the automated liquidation process, and a liquidator purchases their ETH.

Steph never reaches 70% LTV. Instead, the Concrete contract auto-deposits $13 into her position at 69.5% LTV, and although the original $100 of ETH is currently worth $82 which would place the position at a 73.1% LTV, the reflected LTV is 63.1%.

Steph now has a buffer of ~10% in ETH price performance before the position would be in any danger of foreclosure by the Concrete protocol.

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Concrete customer types

Defi Prosumer

• $50K - $3M on chain

• native on chain

• risk inclined, not full-time in crypto

Emerging Fund Manager

• small to mid-cap liquid funds

• likely have a yield farming strategy

• may have accumulated heavily during the bear market

• looking for infrastructure to use and manage borrowing + risk control

Go To Market Strategy