What is Radiant Capital?
Radiant Capital is a DeFi lending platform built on the Arbitrum ecosystem and serves as the first cross-chain money market using LayerZero's omnichain technology. Users can deposit assets on any chain and borrow other assets supported on various blockchain network seamlessly.
Simply put, when a user wants to deposit $USDC on the Arbitrum network and borrow $ETH on another network. Instead of having to do a bunch of cumbersome operations with lots of gas costing transactions. Radiant Capital can help optimize user experience with just one click quickly and conveniently.
Products and features
Borrow & Lend and Stake
- Borrow: Users can borrow from the platform with their own collateral for liquidity without selling their assets and closing their positions, also without being taxed (Currently Radiant Capital supports lending $ETH, $wBTC, and stablecoins like $USDC, $USDT, $DAI).
- Lend: Users provide liquidity to borrowers on the platform by depositing crypto assets (Currently Radiant Capital supports $ETH, $wBTC, and stablecoins like $USDC, $USDT, $DAI) in order to earn interest from the borrowers.
- Stake: Users provide liquidity by pairing $RDNT/$WETH on SushiSwap then staking in Pool2 of the platform to earn interest in $RDNT.
Locking and Vesting
- $RDNT Lockers: Those who lock up $RDNT will enjoy 50% of the platform fee. Also, when locking $RDNT, those who lock $RDNT commit to a 28-day lock and cannot unstake until the 28-day lock is complete. This 28-day lockout commitment entitles those locked in $RDNT to enjoy additional penalty fees from those who vested $RDNT for less than 28 days.
- $RDNT Vesters: Users who receive $RDNT rewards from DeFi activities on the platform will have to participate in vesting 28 days. The reward process is analyzed in detail below.
How Radiant Capital works
Mechanism
Lenders provide crypto assets that are tokens/coins supported by Radiant Capital such as $USDT, $USDC, $DAI, $wBTC, $ETH by depositing in the 'Deposit' section. Borrowers who need to borrow will borrow from the fund that Lenders have previously deposited, Borrowers will have to pay interest -> platform fees (rTokens). This platform fees will be divided into 50% for Lender, this 50% becomes APY when depositing assets displayed in 'Deposit' section. The remaining 50% will be allocated to Vesting & the locked $RDNT rewards.
Rewards
Users can lend, borrow, or provide liquidity with the $RDNT/$WETH pair in Pool2, for a 28-day vested $RDNT bonus. Users have two ways to receive the $RDNT bonus:
- Receive reward before 28 days: Users will immediately receive 50% of the unlocked $RDNT reward, the remaining 50% will become a penalty fee when not reaching the 28-day vesting period, this penalty fee will be divided among those who lock $RDNT (lockers).
- Receive reward when vesting full 28 days: Users will receive 100% of the reward $RDNT unlocked when vesting full 28 days.
In addition, users can lock the unlocked reward $RDNT to be able to benefit from platform fees and penalty fees from $RDNT recipients who have not vested for 28 days.
Roadmap
Currently, Radiant Capital does not have an official roadmap for the project. However, according to the information received, the project is preparing to switch to the V2 version of the platform, specifically:
- Radiant Capital V2 will feature many design upgrades on the platform to serve $RDNT holders and lockers including LP locking, mercenary farming mitigation, bridgeable $RDNT, and updates related to locking, vesting and early exit mechanism.
- Discussion with partners and advisors to ensure the launch on BNB Chain.
- Implement multi-chain build to EVM chains that LayerZero supports through voting on the DAO.
Tokenomics
Key metrics
- Name: Radiant Capital token
- Ticker: $RDNT
- Type: Native ultility token
- Standard: ERC-20
- Chain: Arbitrum
- Contract: 0x0C4681e6C0235179ec3D4F4fc4DF3d14FDD96017
- Total supply: 1,000,000,000 $RDNT
- Total circulating supply: 240,886,237 $RDNT
Distribution and vesting schedule
Radiant Capital's $RDNT token allocation portfolio is specifically allocated as follows:
- With 50% of the total supply allocated for the purpose of incentivizing suppliers aka lenders and borrowers. This allocation will be open for a 2-year period.
- 20% of the total supply is allocated as an incentive for liquidity providers in Pool2. This allocation will also be open for a 2-year period.
- 20% of the total supply is allocated to the development team. This allocation is vested linearly over 1 year, with a 3-month cliff (10% of this allocation by the team will be locked at the early stage of platform launch and will be unlocked after 3 months).
- 7% of the total supply is allocated to mentors and individuals who have made a core contribution to the project. This allocation is vesting linearly over 1 year.
- 3% of the total supply is stored in the Treasury.
As can be seen from the above allocation portfolio, Radiant Capital owns the user-driven tokenomics design of the platform when providing 70% of the total supply of the portfolio used in paying rewards to users (liquidity providers, lenders, borrowers).
On the other hand, the project alone holds 27% of the total supply including 20% for the team and 7% for the advisors and core contributors, with a 1-year linear vesting time and 3-month cliff. The vesting time is quite short along with the fact that the project holds a quarter of the total supply also shows a certain level of risk.
Usecase
$RDNT is used as a utility token of the Radiant Capital platform, specifically with the following utilities:
- Governance: $RDNT holders will have the right to vote in the Radiant Capital DAO.
- Used to participate in DeFi activities on the platform such as stake, vest, lock.
- Rewards: $RDNT is used to reward liquidity providers in Pool2 and the lenders, borrowers, and lockers of $RDNT.
Conclusion
Through the analysis, it can be seen that the Radiant Capital product is well built and has a connection between features. From a subjective perspective, $RDNT can grow in the short term thanks to Radiant Capital launching the V2 version of the platform as well as the TVL of the Arbitrum ecosystem, which has grown significantly recently. As a project with a top TVL on Arbitrum, it is not difficult for Radiant Capital to enjoy a short-term surge.
However, in the long run, $RDNT is not a token that can be held for the long term through the following two interconnected issues. The first is that the design of tokenomics is not really good because the project alone holds a quarter of the total supply with a fairly short vesting time (now unlocked 10% of the total supply for the project team after 3 months of launching the platform) and also this is an anonymous team which can be a definite risk. Next is 70% of total supply for the rewards which would make $RDNT relatively high inflation, why rate it relatively high. In Radiant Capital's reward mechanism section, the fact that users can receive 50% of the $RDNT reward even if they do not vest for 28 days is a possible reason for this token inflation. The 28-day vesting period is also too short to unlock 100%.
70% of total supply for rewards plus ongoing payouts is responsible for inflation in the long run. The reward vesting period should last several months, specifically 3-6 months, which is a more reasonable number if the project wants to prevent inflation.
Disclaimer:
The information, statements and conjecture contained in this article, including opinions expressed, are based on information sources that Holdstation believes those are reliable. The opinions expressed in this article are personal opinions expressed after careful consideration and based on the best information we have at the writing's time. This article is not and should not be explained as an offer or solicitation to buy/sell any tokens/NFTs.
Holdstation is not responsible for any direct or indirect losses arising from the use of this article content.
