Defrost Finance

Smart Pools

The super vaults are 'smart' enough to constantly chase higher yields, benefiting from both leverage trading contracts and interoperated protocols.
Super vaults integrate lending protocols like AAVE and Benqi on Avalanche. Rewards from these protocols ensure contributors will enjoy a basic yield, equivalent to depositing assets on AAVE and Benqi (a small compounding fee will be collected by Defrost V2), even if there are no leveraged traders.
When traders open their positions, an equivalent amount of assets will be withdrawn from other yielding positions and lent to the margin contract. Normally, the rewards accrued in the leverage trading contracts will be higher, leading to higher rewards being passed into the super vaults.
Moreover, the interoperated protocols for extra basic rewards can be switched if the yield becomes significantly higher on one of them. Upon inception, the interoperated rewards can be switched between AAVE and Benqi.
These features make sure that the super vaults are constantly chasing higher yields for users, with the underlying mechanisms coded in the contracts and operated in a decentralized way. We would like to call these super vaults 'smart pools'.