Notional has created an absolute landmark by taking DeFi lending to the very next level with the introduction of Notional V3. This, in turn, is the most highly boosted protocol ever witnessed by DeFi. Notional V3, on its part, delivers the prime money market, which in actuality happens to be the new and conventional variable-rate lending and the borrowing market of Notional. This will provide the opportunity for the protocol to get further boosted and also be available to all DeFi users. The entity’s core value proposition in terms of a fixed-rate lending protocol will get stronger in the bargain.
The prime money market integrates directly with the fixed rate markets of Notional in order to increase yields as well as UX, to the ultimate advantage of fixed rate users and LPs. It is also supplying new variable-rate activities at the same time. Lenders and LPs will be exposed to higher rates as a result of the prime money market’s overall impact on consumers. There will be an improvement in UX for fixed-rate borrowers. Moreover, interest rate trading will be implemented. In addition, users will be required to access a previously occupied vault for a variable rate. The Notional V3 possesses a vast array of new features in addition to the necessary enhancements. In addition, the use of multi-currency vaults and a bolstered AMM must be considered. There is also the issue of increased integration malleability.
The fundamental operation of the prime money market enables the lending of unused supply funds to other money markets. If there are insufficient borrowers on Notional, it is possible to lend excess supply funds to other money markets to generate yield. In the case of variable-rate borrowers, there is no negative impact while all of this is occurring. In terms of unused supply, it also ensures that the top lenders obtain superior returns. As in the prime lending premium, the prime lending rate is viewed as a premium over the rate obtained by Notional funds on other money markets.
Users of Notional V3 can borrow at a variable rate from the prime money market. It can also lend at a fixed interest rate by purchasing fCash. This item is collateral for Notional. The prime money market allows users to speculate on the relationship between Notional’s fixed rates and the entity’s prime rates.
In the case of leveraged vault users, they have the option of borrowing at variable rates to fund their vaults, in addition to the current fixed rate choices. There is also the possibility of multicurrency leveraged vaults. One of the objectives of Notional V3 is to increase LP returns and the efficiency of LP capital. This is made possible with an enhanced fixed-rate AMM curve. The demand for Compound V2 has been eliminated, but it still remains very durable.
At the present moment, the Notional V3 happens to be code complete, and Xiaoming90 and Oxleastwood are doing an audit. As per their plans, Notional V3 will be positioned on Arbitrum in a couple of months, followed by positioning on the mainnet.