Users start by connecting their wallet to the Alchemis platform. Once connected, they select their risk tolerance and the desired duration for which they want to earn yield.
- The Alchemis AI analyzes yield-earning and lending protocols on Solana and Solana-compatible blockchains. It evaluates the performance of various coins over the past 1, 3, 6, and 12 months by looking at factors like volatility and price changes. This helps the AI assess the risk associated with each coin it may swap into to generate yield.
- In addition, the AI examines the Total Value Locked (TVL) in each protocol. A higher TVL is generally considered an indicator of the protocol’s trustworthiness.
- Based on the user’s risk tolerance and desired earning period, the AI provides the user with:
- An estimated yield (the potential returns).
- A list of tokens the protocol will swap to for yield generation.
- Probabilities of unrealized loss (temporary decline in the value of assets) and liquidation risks.
- The minimum deposit period, as some protocols have a required staking duration.
- The higher the user’s risk tolerance, the more likely the AI will allocate funds to lower market-cap coins on protocols with lower TVL.
- Users can adjust the amount they wish to invest in each token or protocol, depending on their preferences. Once satisfied with their choices, they can click “Start Earning.”
- The protocol initiates a request to the user's portfolio to interact with Alchemis' smart contract and deposit their ALS tokens.
- The system then sends a series of requests to various smart contracts across the blockchain. These interactions can be tracked in real-time via our user interface.
- ALS tokens are automatically swapped into other cryptocurrencies, such as SOL, and deposited into yield-generating protocols on Solana and other compatible blockchains.
- When the user wishes to withdraw their funds, they simply click "Withdraw Funds." Our smart contract retrieves the assets from all the protocols, swaps them back into ALS tokens, and returns them to the user.
- If the AI invested in lower market-cap coins that lost value, the user may receive fewer ALS tokens than initially deposited, even if the yield was high. Conversely, if these coins increased in value, the user could gain more ALS tokens than expected.
- To minimize risk, the AI spreads investments across multiple protocols. This diversification helps protect users in case a particular token or protocol underperforms or fails.
- Alchemis also offers a liquidity pool where users can deposit SOL, ALS, and other tokens to facilitate swaps at any time. This pool is particularly appealing to users who are bullish on ALS and believe its price will outperform SOL and other tokens.
- A 0.1% burn fee is applied to every deposit, ensuring a deflationary supply of ALS over time.
