Zaros is a groundbreaking protocol that empowers Liquid Staking Tokens (LSTs) holders to boost their rewards by lending their liquidity for the creation of perps markets.🐲 The protocol introduces USDC and #LSTs collateral Vaults and an over-collateralized #stablecoin: zrsUSD.🧵

First, here are the website and technical article links if you want to check them out, but this thread will be a TLDR:

A quick overview of the main gears and features of the protocol: 1. Outcomes for Liquidity Providers 2. Outcomes for Traders 3. How the LPing modules work 4. How the trading modules work 5. Synchronous #liquidity and #interoperability 6. Vaults debt 7. Soft Liquidations 👇🏼

1. Outcomes for LPs: LSTs represent 40% of DeFi TVL with an average of 3.8% APY at the time of writing, but is it the best risk vs reward option? #Zaros can boost its rewards up to an estimated 10% APY by supporting them to bootstrap highly liquid leverage trading markets.

2. Outcomes for #Traders: - Leverage trading on a wide range of assets - Smart Funding Algorithm - Deep liquidity through our eClusters system. - Low-latency trading Let’s break it down 👇🏼

Leverage trading on a wide range of assets: Zaros overcomes the limitations of DeFi trading by offering a wide range of oracle-based perps markets. We prioritize user experience, providing an easy-to-use platform for traders while supporting professional-grade tooling.

Smart Funding Algorithm: Enables quick liquidity allocation to new markets, balancing the risk with more or less aggressive funding rates on dynamic scenarios, taking into account off-chain volatility provided by custom @chainlink functions and our eCluster risk parameters.

Deep liquidity via eClusters: Zaros’ LPing model allows supplying markets in groups so liquidity is not fragmented among just a few assets. This enables listing a wider variety of perps markets since many of them can be grouped at the same risk and available liquidity range.

Low-latency trading: Orders are settled by @chainlink's onchain price feed in combination with a partner's low-latency Oracle that enables: - Faster order execution; - Better settlement price; - Front-running protection.

3. How the liquidity provisioning modules work: LPs collateral is sent to one of the supported Vaults, and it's used to back zrsUSD, our over-collateralized #stablecoin. Perps markets use the zrsUSD credit to spin up liquidity for traders, paying trading fees to each Vault.

4. How the trading modules work: Traders deposit collateral to their margin account calling the Perps Vault contract enabling them to create leveraged positions on any of the supported Perps contracts, either isolating their risk per market or enabling the cross-margin mode.

5. Synchronous #liquidity and #interoperability Zaros leverages @Chainlink's CCIP to enable cross-chain communication between its L1 liquidity engine and L2 perps markets (lower gas fees). This will enable the protocol to provide deep liquidity to traders and boost LP rewards.

6. Vaults debt: Liquidity Providers’ collateral is used to back trading activity on Zaros’ markets. Each collateral is allocated to its respective Vault, which needs to maintain a healthy C-Ratio pre-defined by a risk analysis.

7. Soft liquidations (SL): Once a position in a Vault reaches the liquidation threshold, the protocol enters SL mode, allowing arbitrageurs to acquire collateral at a discount (defined by Zaros’ decay curve), having the Vault act as a custom Protocol Pool at the @Balancer Vault.

Do you want to be one of the first members of our community of traders and LPs? Access our discord, the link is in our bio.