Protocol Comparison
For DeFi users familiar with other protocols like OlympusDAO, MakerDAO, etc, this section provides a section to help you quickly understand what are some of the similarities and differences between Bluejay Finance and some of the more familiar protocols.
vs OlympusDAO
Bluejay Finance's protocol-owned liquidity (POL) is inspired by the success of OlympusDAO, allowing for a more predictable supply of liquidity for our stablecoins users. In addition, Bluejay makes use of existing bonding mechanics from Olympus for the treasury bond where the bonds are priced as a function of the debt ratio and a control variable. However, Bluejay introduces significant changes to how the treasury is used by deploying them as operational capital for a stablecoin issuer.
Similarities
Bonding mechanism (only Bluejay's Treasury Bonds)
Protocol-owned liquidity
DAO controlled treasury
Differences
Simplified smart contracts for bonding
Treasury deployed for stablecoin issuing
Per-second compounding for staked assets (vs per-epoch on OlympusDAO)
Stabilizing bonds for pegging stablecoin prices
Protocol revenue generated from protocol growth and stablecoins' utility
vs MakerDAO
Bluejay Finance's governance model is inspired by the dual-token model of MakerDAO where the stablecoin issued is pegged to a value and the governance token act as an asset for value accrual and governance. Unlike MakerDAO, Bluejay does not impose rent on stablecoins, in the form of a stability fee, but instead collects revenue from swaps on the liquidity pools. In addition, Bluejay simplifies the process of creating stable assets for stakeholders, by managing the risk at the protocol level as opposed to having users manage individual debt positions.
Similarities
Dual-token mechanism
Value accrual on governance token
Governance token to recapitalize issued stablecoins as last-resort
Differences
Multi-stablecoin model
Liquidity backed stablecoins (vs collaterals backed stablecoin on MakerDAO)
Value generated from utility (vs rent on MakerDAO)
Protocol managed positions (vs user-managed position on MakerDAO)
vs Angle Protocol
Bluejay Finance's multi-stablecoin model is inspired by Angle Protocol. Both protocols aim to present different approaches to creating stablecoin issuance platforms that are capital-efficient. The main difference is the way we approach liquidity (protocol-owned or user-owned) and risk (internalizing within the protocol or externalizing to hedging agents)/
Similarities
Multi-stablecoin model
Capital-efficient model that avoids excessive overcollateralization
Differences
Protocol-owned liquidity
Internalizing exchange risk (vs selling to hedging agents on Angle)
vs Frax Finance
Bluejay Finance's capital-efficient model is inspired by Frax Finance. Both protocols optimize the use of capital while balancing capitalization risk. The main difference is that Frax was designed as a fractional reserve model while Bluejay has a more dynamic range for the collateralization ratio.
Similarities
Fractional reserve model
Differences
Multi-stablecoin model
Stabilizing bonds to bring prices to peg (vs minting & redeeming on Frax)
Protocol-owned liquidity & price stabilizer
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