With our Cosmos-Arbitrum integration being launched, we are also excited to announce that cGLP, our first product on Arbitrum has arrived!
Our cGLP vault provides the purest and simplest yield experience for GLP holders by auto-compounding all native ETH yield earned by GLP, with no vault fees or withdrawal fees, so that you earn more with less effort.
What is Demex?
Demex (Decentralized Mercantile Exchange) is a cross-chain DEX that launched in 2020, with CLOB-based perps, liquidity pools, money market, etc, and is designed to support any type of financial asset imaginable.
It is a fully permissionless and non-custodial platform, allowing any user to list new markets, tokens, and participate in DeFi, giving control back to users for a frictionless trading experience that rivals CEXs.
What is GLP?
GLP is a token minted to liquidity providers on GMX. On Arbitrum, it represents an index of assets consisting of WBTC, ETH, LINK, UNI, and various Stablecoins. These assets are used for leverage trading and swaps on the GMX platform.
This index of assets can be viewed on GMX's dashboard here.
You can mint GLP using any of the index assets, and to redeem any of the index assets, you will burn your GLP again.
Get GLP on GMX on Arbitrum here: https://app.gmx.io/#/earn
What are the benefits of GLP?
GLP holders provide liquidity for leverage traders, profiting from the losses that a leverage traders make, and overall time traders tend to lose money.
However, if leverage traders profit, GLP holders make a loss. In a long-term crab market (we're not in a full bull market yet right..?) these Vaults basically bet that traders lose money while holding a stable index position.
Additionally, GLP receives 70% of GMX’s protocol revenues, including fees from swaps & borrowing.
In fact, some analyses suggest that GLP currently has the strongest risk-adjusted yield farming returns in DeFi!
What is cGLP?
The token cGLP stands for Carbon GLP, but you can also think of it as Cosmos or Compounding GLP, as it will be the first GLP that comes to Cosmos.
The cGLP smart contract is fully open sourced and audited, has been live for over a month. You can view the contract code here.
After obtaining GLP, to use the product and receive all the benefits outlined above, you can deposit your GLP for cGLP at our GLP auto compounder.
As cGLP autocompounds, it is a yield-bearing asset that grows in value, similar to an LSD. When depositing GLP for cGLP, the deposit will not be 1:1 due to the compounding nature of cGLP. This means that cGLP will always be more valuable than GLP as the vault compounds rewards.
When redeeming back to GLP from cGLP, you will be able to realize the gains from this compounding and will receive more GLP in return.
Remember to connect your Metamask and change it to Arbitrum as it's an Arbitrum smart contract!
You can always redeem your underlying GLP whenever you wish. There is also no 15 minutes transfer cooldown and also no fees to redeem cGLP for GLP.
To make this the purest yield, there are also no fees taken on the yield. This can be changed in the future through governance if the community demands.
Why use cGLP?
It's the highest utility autocompounding GLP token that can help you earn more yield. Let's go through some examples:
- Autocompounding: As mentioned, the vault automatically adds the ETH fees back into cGLP, so it grows in value against GLP overtime, making it a yield-bearing token, similar to an LSD.
- Zero fees: Unlike other autocompounding GLP that charge usually a 10% performance fee, Carbon has decided to make cGLP autocompounding a public good with absolutely zero fees of any kind.
- Earn more yield: You can lend out cGLP directly on Nitron and earn more real yield if anyone is looking to borrow it
- High capital efficiency: You can borrow against your yield-bearing token and do more DeFi strategies. As cGLP is a relatively stable asset with about 50% of it in stablecoins that continues to grow in value, this allows you to use it as collateral with a greater peace of mind than ETH which is far more volatile. The current LTV is set at 50% but can be increased.
- Incentivized: During the start of cGLP's launch, cGLP lending and LPing will be incentivized with additional $SWTH rewards to give you even higher APR!
Getting cGLP into Nitron for more Yield
Step 0: Acquiring GLP
You will need GLP to convert into cGLP. If you do not currently have GLP on Arbitrum, you can get it on the GMX website here.
Step 1: Wrapping GLP into cGLP
Once you have GLP, stake it into the Arbitrum cGLP autocompounding vault on Arbitrum by going to the GLP compounder page here.
The cGLP token will accrue GLP's real yield fee rewards into itself currently.
Public Good: Most autocompounder charge some kind of fee, such as a 10% performance fee or withdrawal fee. Carbon's cGLP is the only autocompounding vault with zero fees, no deposit or withdrawal fees, no penalties, etc.
Step 2: Depositing cGLP to Carbon Network
Once you have gotten cGLP, deposit cGLP from Arbitrum to Carbon network using this deposit link.
It should take about 5-10 minutes due to security reasons.
Step 3. Deposit cGLP into Nitron for more yield
Now that you have some cGLP, deposit it on Demex's Money Market, Nitron and enable it as collateral (ticked by default). Now you have borrowing power (health factor) to start trying out various yield strategies.
Bonus: Carbon is encouraging cGLP deposits by having temporary $SWTH incentives, giving an extra yield of over 10% as of this writing, on top of the real yield APR that GLP is earning.
Now that you have cGLP as a collateral, here are some strategies to help you can earn even more return on your GLP!
How does Demex's cGLP strategy work?
The strategy works as follows:
- Users stake GLP in Demex's GLP Compounder Vault
- Demex claims and stakes all earned fees, esGMX, GMX, multiplier points
- Fees are claimed every 6 hours to mint more GLP and earn more fees
- This results in an auto compounding and value accruing nature to cGLP
- Deposit cGLP on Nitron to unlock more DeFi strategies
Congratulations! Now enjoy the highest earning yield on your GLP in Cosmos.
Note: GLP rarely receives esGMX incentives, and Multiplier Points only go to GMX stakers, not GLP holders. Hence the bulk of the rewards will come from the ETH fees accrued when holding GLP.
If you want additional yield strategies on cGLP, read our article here: https://blog.switcheo.com/earn-the-highest-yield-on-arbitrum-glp-with-demex/
With GMX and GLP becoming a household name in DeFi, it is time to bring its success to the people of Cosmos!
We're thrilled to announce the launch of cGLP today. However, we won't slow down - there's more exciting news regarding cGLP coming soon.
Keep an eye out for future collaboration with GMX, upcoming Osmosis listing, lending and borrowing of cGLP and GMX on Demex's money markey, as well as...*drum roll* the first ever perps for GLP!
Not financial advice
The information and publications are not intended to be and do not constitute financial advice, investment advice, trading advice or any other advice or recommendation of any sort offered or endorsed by Switcheo. Switcheo does not take into account your personal investment objectives, specific investment goals, specific needs or financial situation and makes no representation and assumes no liability to the accuracy or completeness of the information provided here. Switcheo also does not warrant that such information and publications are accurate, up to date or applicable to the circumstances of any particular case.
About Switcheo Labs
Switcheo Labs is an experimental think tank that combines the brightest minds with a cutting-edge software development lab. We focus on nurturing ecosystems that are forming the foundation of a new, decentralized world — one that thrives even without trust.
With this goal in mind, the team developed a blockchain solution where finance is truly censorship-resistant and decentralized — Carbon, a custom Layer 2 cross-chain protocol that acts as a building block for DeFi. A promising use case for Carbon is seen in Demex, a reference trading UI for Carbon and the world’s first fully decentralized derivatives platform.
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