Before we get started, this is not a recommendation or endorsement to buy any token(s) mentioned.
This week, we cover the top lending and borrowing app in the fast-growing TON DeFi ecosystem!
Found in 2018 by the cofounders of Telegram, Nikolai and Pavel Durov, The Open Network (TON) is composed of the TON Blockchain, TON DNS, TON Storage, and TON Sites. The TON Blockchain represents the core protocol that connects TON’s underlying infrastructure together to form the greater TON Ecosystem.
With clever integrations and distribution of TON apps and wallets via Telegram, TON is designed to process millions of transactions per second (TPS), with the goal of eventually reaching hundreds of millions of users.
The TON Mainnet launched in 2022 and only started seeing substantial growth in onchain liquidity at the start of 2024 with just over $14M. Since then, TON has grown over 46X and sits now at just over $654M deposited in DeFi smart contracts.
One of the few DeFi protocols on TON to find real product-market is EVAA lending protocol, a platform for borrowing and lending. EVAA supports assets such as TON, stTON, jUSDT, jUSDC, and USDT. Similar to Aave, users can participate as lenders to earn interest or as borrowers to access loans by collateralizing their crypto holdings.
EVAA Interest rates are determined by the available supply of a particular asset and the current demand for loans. Meanwhile, borrowers are required to maintain an overcollateralized loan or else face liquidation, where third party liquidators may repay up to 50% of a loan by selling the corresponding amount of collateral to earn an extra 15% on the liquidated sum as a bounty to help maintain the protocol health.
As of this post, EVAA has over $35.4M supplied and over $15.4M borrowed. EVAA is also running a rewards program called EVAA XP Mining, where users earn XP for every dollar supplied or borrowed. The expectation among users is that EVAA will reward users eventually for their XP with an EVAA airdrop upon token generation.
In the meantime, I’ll cover how I can earn passive yield lending to borrowers on EVAA and potentially a future airdrop!
How to Lend on EVAA Protocol on TON Blockchain
Before we get started, please be aware of these risks.
- Smart contract risk in EVAA
- Front-end spoof attack on the app frontend
- Oracle risks
- An economic design exploit
- Colluding signers on any multisig
- Bad debt if loans aren’t properly liquidated
- Stablecoins can depeg can go to $0
Here’s how I get started!
- First, I go to the Markets tab here on EVAA and connect my TON wallet. For newcomers to TON, I personally prefer the Tonkeeper wallet but there’s lots of options to choose from here.
- Then, I choose an asset I’m holding in my TON wallet like USDT to lend. I’m choosing USDT earning 21.5% APY because there’s so little jUSDT liquidity I won’t be able to easily withdraw, even though it’s earning 112% APY. So I click on the USDT option here instead.
- Lastly, I click Supply and follow the prompts to specify how much USDT and click Supply to deposit.
That’s it! I can now return to the EVAA Dashboard in the future to monitor my interest earned, plus any future airdrop.
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DeFi Dad is one of the earliest power users of DeFi, having worked with early Ethereum startups going back to 2018, including Zapper.
