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The Arrival of Staking & Re-staking Era

Real World Asset Backed Yield...Rare Zem, Anzen

If any of the following applies to you, you'll find today's reading useful:
Lost a significant amount of money on Terra.
Never received an Airdrop and find it difficult to follow.
The majority of your assets are in crypto.

I'll briefly explain the features of the Azen protocol for each topic.

Tl;dr Anzen currently offers an APY of about 67.7%, with interest automatically rebalancing every 7 days to enjoy compounding, and Unstaking is flexible.

1. Lost a Significant Amount of Money on Terra.

Many DeFi products, including Anchor Protocol, operate solely within the crypto realm. Therefore, in times of market instability, they are vulnerable to cascading declines due to their external dependencies. Azen is a project that institutionalizes private credit on-chain, allowing investment in real estate accessible only to institutions to earn interest. Receiving strategic investment from Circle to stake USDC and pay interest in USDC as well, is what I believe makes Anzen a sharp proposition in the unstable crypto market. Anzen's structure can be easily understood by thinking of the US mortgage market, where banks lend money to people based on:

  1. The general upward trend of the real estate market.

  2. Trust that the borrower will repay the money.

  3. Confidence that they can manage if foreclosure is necessary.

Like banks indirectly investing in the real estate market through borrowers, Anzen lends money to institutions investing in real estate to earn corresponding interest. Because it generates interest using real assets as collateral, it can offer significantly higher interest rates than other stablecoin-based lending protocols

A vulnerability of existing RWA DeFi is that the real estate market, already flush with cash flow, has little need for crypto assets, raising the likelihood of using unhealthy listings as collateral. Anzen, developed by a team with over ten years of institutional investment experience in real estate, ensures the soundness of the listings themselves.

Canto is also interested in RWA onboarding, having partnered with Anzen Legal Entity to provide real estate listings and enable Canto to create its RWA DeFi. Anzen is currently over-collateralized, not matching 1 RWA per pool but rather compounding multiple RWAs to enhance stability.

While offering high interest rates based on real assets is advantageous, the challenge, of course, lies with the oracle issue. Participating in the Chainlink BUILD program and closely collaborating to maintain blockchain transparency raises expectations. According to this announcement, instead of using Chainlink's infrastructure, 5% of Anzen tokens will be provided to the Chainlink community.
*Tokens?!?!? More on this below.

2. Never Received an Airdrop and find it difficult to follow.

Airdrops, including point farming, can be a hassle for those casually enjoying crypto, especially when unclear criteria, like with the recent StarkNet, result in hard work without any reward. The recent Ethena also leaves users to choose between earning points or a high APY, creating a structure that can generate a 27.5% interest rate. It's annoying, complicated, and gas fees are high, with nothing certain. If all this bothers you and you have some disposable assets, converting a portion to USDC to easily deposit and enjoy a 67% APY (for now) with automatic rebalancing for compound interest while aiming for Anzen governance token airdrop could be a not-so-bad choice.

The Majority of Your Assets Are in Crypto.

The second advantage and the most important value I see in Anzen is that it allows Permissionless Users access to profitable, stable assets. Although the market is active, making this need much lower than a few months ago, having this option for degens to diversify their portfolio without traditional finance and with almost no downside volatility is remarkable. Unlike traditional finance, where intermediaries take high fees, Anzen uses smart contracts for efficient/automated financial products, making it an effective service for conservative Web2 individuals' DeFi onboarding.

The Potential of Anzen

At Anzen, you stake USDC and mint $PCT (Private Credit Token), which can be wrapped into $wPCT for Permissionless use. With investment firms like Frax involved, if DeFi protocols start using $wPCT as collateral, users will be able to engage in various interest farming activities (who knows how it'll turn out!).

Anzen's backers

I first met Ben, the founder of Anzen protocol, last year at a conference in Kyoto. Beyond being just a crypto enthusiast, he's a genuine entrepreneur who truly enjoys the process of building. He often mentioned how shocked he was to see so many people get rug pulled and found it utterly insane. Ben is not only a builder but also an early startup investor, with Galxe being among his notable investments. I was extremely pleased when he finally released his new protocol, which he also finds useful for himself and his backers. As someone working in this industry, I've been in need of and waiting for a stable staking environment where I feel safe. I'm very happy about the Anzen launch and hope my article will be useful to others who share my needs.

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