Decentralized finance (DeFi) is beneficial but still complicated.
This is why the Etherspot and Li.Fi teams have created a new cross-chain approach, bringing DeFi users to the forefront of investing while keeping it simple along the way.
The challenge with DeFi protocols
With DeFi, investors can bypass centralized corporations and brokers to avoid high service fees: For instance, KlimaDAO offers 1,000% APY for staking KlimaDAO (KLIMA).
However, issues still persist for cross-chain investing opportunities.
A downside is complexity: When Bitcoin (BTC) arrived on the scene, it was complicated for non-technical and non-developer users.
The main focus should be to remove complexities and offer a simple, intuitive journey in decentralized application (DApp) use.
Bridging the chasm of a cross-chain user experience
Many DeFi and regenerative finance investing strategies retain the complexity mentioned above, limited by specific chain exclusivity. The mechanics of actually investing with multiple DApps to go cross-chain can be overwhelming and expensive for users — a notable obstacle to adoption. Also, projects can’t always afford liquidity for multiple chains and are forced to stick with only one. The chasm of cross-chain investing needs to be bridged.
What’s the solution?
The Etherspot and Li.Fi teams’ partnership lets users perform several cross-chain transactions at once on the same DApp without remote procedure call-network switching.
The app supports cross-chain deposits for a Klima staking contract that will make staking KLIMA simpler and permit Klima staking on multiple chains with retained liquidity on a chosen blockchain. This simplifies DeFi investing for projects and users going forward.
“You can take any Ethereum Virtual Machine (EVM) chain and stake Klima on it. It’s mind-blowing. I went from [the] Ethereum [network] all the way to staked Klima. It’s super cool [and sophisticated]. This allows us to go cross-chain — without having to go cross-chain. It allows us to remain on Polygon and people come to us for things,” said Archimedes, co-founder of KlimaDAO.
The tool uses the Etherspot SDK to sign cross-chain transactions from any network without switching RPCs while bundling or batching transactions with Li.Fi’s cross-chain aggregation protocol.
Users can perform any action on any EVM-compatible chain by merely signing transactions on their wallets.
This 100% removes the complexity in staking KLIMA tokens with KlimaDAO.
Normally this process would involve several steps:
- Connect a wallet to Gnosis Chain.
- Bridge wrapped Ether (wETH) to Polygon with available Dai for transaction fees.
- Add the Polygon mainnet to the wallet’s RPC networks.
- Switch the wallet network from Gnosis to Polygon.
- Connect the wallet to a decentralized exchange (DEX), such as SushiSwap.
- Buy Polygon (MATIC) to cover Polygon transaction fees.
- Swap wETH for USD Coin (USDC) in SushiSwap’s KLIMA-USDC pool.
- Swap USDC for KLIMA.
- Connect to the KlimaDAO app.
- Stake KLIMA for staked KLIMA (sKLIMA).
Instead, the app by Etherspot and Li.Fi offers convenience:
- Approve the token.
- Sign a transaction on Gnosis to bridge to the Polygon network.
- Sign a transaction on Polygon to swap and stake KLIMA.
Everything else is done in the background — no more switching networks and only two transaction fees to stake KLIMA. Test it out here.
This streamlining of the cross-chain investing process will stir ripples in the DeFi space. Imagine depositing to Yearn from any EVM chain or interacting with Trader Joe without needing the Avalanche network. Another possibility is chain-specific play-to-earn games opening their platforms to EVM users.
Both teams are proud of what has been achieved and look forward to expanding the world of DeFi investing for all.
Who’s involved?
Li.Fi is an advanced bridge and DEX-aggregation platform for cross-chain bridging, swapping and messaging.
Etherspot is a smart-contract SDK that gives projects access to the best features, such as batched transactions, nonfungible tokens, Ethereum Name Service, and payment channels for the Ethereum blockchain and EVM-compatible chains.
KlimaDAO is a decentralized autonomous organization (DAO) and DeFi protocol driving climate action via a carbon-backed, algorithmic currency — KLIMA.