Notional Finance Tutorial by DeFi Dad

Before we get started, this is not a recommendation or endorsement to buy NOTE.

Last week, I wrote about the growth of fixed income protocols in DeFi and how FIATDAO is solving for how to leverage fixed yield positions in protocols such as Notional Finance.

Launched in the fall 2020, Notional Finance became one of the earliest DeFi protocols to offer fixed interest lending with terms ranging from a few months to 1 year. Notional v1 was a successful proof of concept that DeFi can offer fixed interest rates for borrowers and lenders with fixed terms. However, the protocol was mostly under the radar, with stagnant growth until about November 1st, 2021 when they announced Notional v2.

One major update in Notional v2 is you no longer have to lend ETH, WBTC, USDC, or DAI for a fixed yield during a specific term such as 3 months, 6 months, or 1 year, unless of course you prefer locking in a high fixed interest rate. Now, it’s possible to lend these 4 assets to all borrowing markets at once, which has helped Notional to grow their available capital (TVL) for borrowers to borrow more, for longer periods.

Then about 2 weeks ago, Notional launched their anticipated governance token NOTE. For now, NOTE is like most DeFi protocol tokens, for voting on upgrades and proposals to the protocol. I’m highlighting this because NOTE has enabled Notional to launch a liquidity mining program rewarding NOTE to those who provide one of 4 major tokens the protocol lends to borrowers.

How to Earn Up to 21% Lending

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