Summer.Fi: The App That Makes DeFi Lending 10x Better

February 1, 2024

In conclusion

Summer.Fi: The app that makes DeFi lending 10x better 

I can confidently say you have once in your lifetime placed an order on Amazon, used an Uber or booked an Airbnb, especially if you’re one of us pre-rich people.

All of these services have one thing in common: They’re all nexus companies bringing private services into a hub with additional value-add that make them the first choice in their respective industries. 

I mean, who stands on the road to hail a yellow cab these days when you can easily book a driver through Uber? Why spend time using staycation villas in a specific area on Google when you can effortlessly book with Airbnb? People don't merely use these services for aggregating options; they use them because these platforms enhance lives by offering more than just service aggregation. For example, Amazon doesn’t just aggregate stores but offers membership exclusives, coordinated delivery, discounts, and side services that hugely benefit customers. 

Now, what if I tell you that this is exactly what Summer.Fi is doing in decentralized finance? Pretty simple to understand now, right? Summer.Fi brings DeFi lending and borrowing under one roof and does not just stop there. 

Like the aforementioned nexus platforms, Summer.Fi allows users to utilize its unique features to multiply their positions, manage risks, and access various money markets with increased earning opportunities using automation mechanisms for a hands-off approach to position management and a comprehensive portfolio overview. 

And if you are finding out about Summer.Fi for the first time, which would be absurd considering that they are near the top of the index for  DeFi platforms in terms of total value locked (TVL)/managed; feel free to refer to our previous article, where we’ve covered what they essentially are all about. 

It’s okay to not just take our word for it, Summer.Fi is like Amazon for DeFi when it comes to convenience. Rather than just draw lines between Summer.Fi and other non-crypto nexus brands you use every day, we will show you how Summer.Fi makes DeFi 10x better using the integrated protocols available on Summer.Fi, as well as the additional side services. 

All of the ways Summer.Fi makes DeFi better

Starting point

The basics of DeFi interaction is owning an asset on a non-custodial wallet in a bid to interact with protocols. Let’s say, for example, that asset is stETH, and the asset does nothing but sits idle in the wallet. Let’s also assume that the holder does not like overleveraging on positions and is satisfied with reasonable yields that are almost risk-free. 

How does Summer.Fi top this absolutely boring way of holding an asset? 

Firstly, Summer.Fi integrates Debank API to help make the holder’s portfolio much smarter, allowing such asset holders to effectively monitor their positions without switching from one protocol to another. And so you can hold or store your assets on Summer.Fi, make swaps, send and receive assets without leaving the protocol. 

And if said holder wants additional yield that doesn’t potentially cost them an arm and a leg, Summer.Fi allows such a holder to leverage their stETH by supplying it to low-risk vaults to earn additional yield. But this isn’t even the best part. 

DeFi-Savvy user

Having described how Summer.Fi is for the average, low-risk, no-leverage Joe, you might want to find out about a more informed specimen, the DeFi savvy user, who might be in search of more yield and not as risk-averse as the other guy above. 

Let’s say this user also holds stETH and would like to leverage their asset for a lot more yield than a less risky vault would offer. Summer.Fi reduces the burden of searching for these yield opportunities by integrating a number of protocols (AAVE, AJNA, MAKER, SPARK, MORPHO BLUE). Beyond this, Summer.Fi allows users to leverage their positions using the multiply feature as well as seek yield opportunities via Summer.Fi earn. 

The DeFi-savvy friend can take advantage of the yield opportunities on Summer.Fi through the process of leveraging a staking yield considering that the asset owned is stETH, and the base yield is higher than the borrowing cost. This can be done by collateralizing the stETH and borrowing the base token, which in this case is ETH, and then converting the ETH into more stETH, rinse, and repeat. 

Should the DeFi-savvy user decide to execute this strategy in a manual way, it’ll be an extremely tedious process. However, by using Summer.Fi Earn loop strategies are executed in a single transaction. 

Multiply Users

We’ve seen two fictional users of Summer.Fi and what the protocol offers to both of them. But there’s more. Summer.Fi allows users to multiply their exposure to an asset, opening the room to many scenarios and opportunities. 

One of those opportunities is that the multiply feature can be used for long-term DCA transactions wherein a user wants exposure to a token but only takes advantage of price dips. 

For example, say such a user holds stETH but wants to accumulate more. The user can proceed to watch the market for dips, probably set an alert on CoinGecko or any other platform, or just manually check. When the price dips by a percentage that appeals to the user, such a user can take advantage of the dip by using the multiply feature for their stETH. They can simply select any stETH vault across the integrated protocol after considering the metrics associated with the vault, such as the loan-to-value ratio, borrowing rate, or the maximum amount they can multiply their exposure by, after which they can open a multiply position. 

In a situation where the price dips even more, such a user can take advantage of the stop-loss mechanism to mitigate serious losses should the market move in the opposite direction. 

Likewise, there are a bunch of other ways you can use Summer.Fi to your advantage, such as buying key levels of an asset through a multiply transaction (accumulation) leveraging the auto-sell and take profit automation mechanisms that Summer.Fi provides to increase your exposure to an asset or hedge an asset by opening a short multiply position. 

For a more vivid understanding of how multiply positions work on Summer.Fi, check out this transaction on Spark protocol using Summer.Fi. 

The bottom line is that Summer.Fi is the best place to deploy your capital in DeFi for the options, automation mechanisms, and risk management strategies made available to each user, helping them become smarter with how they deploy and manage their assets. 

Thoughts

Using Summer.Fi is like playing the game in easy mode. The protocol provides you with an incredible user experience that matches CEX-like efficiency with high-standard tooling. 

It’s hard not seeing that Summer.Fi will eventually become the default app to deploy capital as it caters to any form of DeFi user, from holder to active yield seeker to those seeking to borrow assets, especially with multi-chain integrations and expansion to accommodate more vaults.

If you are going to use Summer.fi then consider using our referral link which will entitle you to earn 5% off the fees generated.

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