Welcome to DeFi Decoded where we unravel the complex intricacies of the DeFi world! In this series, I will be taking you through decentralized finance protocols, making them accessible and understandable for everyone. Today, we will be shedding light on FortiFi, a cutting-edge vault platform that lets you earn more from your cryptocurrencies. Let's dive in further to see how FortiFi will be utilizing some unique strategies to help grow your assets and discover how it may be able to open some exciting opportunities in the realm of DeFi.
What is FortiFi?
FortiFi is designed as a high-tech secure vault for digital assets. Similar to how a bank vault holds your money, FortiFi Vaults holds your cryptocurrencies. Each of these vaults contains a different sub-strategy, which can be thought of as different investment strategies, like putting your money in different types of businesses. When you deposit your cryptocurrency into a Vault, it automatically gets divided and invested into these different strategies to earn you more cryptocurrency. The best part? All of this happens with just a single click.
FortiFi will be rolling out two different types of vaults: SAMS Vaults and MASS Vaults.
Single Asset Multi Strategy (SAMS) Vaults: This type of vault will be rolled out first. You deposit one type of cryptocurrency, and it gets turned into many different investments automatically. It's like trading one type of candy for a variety of candies in a single candy jar. The variety of candies represents the different protocols Fortifi will utilize to generate yield. The three initial SAMS Vaults will be centered around USDC, BTC.b, and sAVAX.
Ex: A user deposits $35 into the USDC SAMS Vault. The vault then automatically takes that $35 and allocates it to the predesigned strategies. You check back in a month and see that your total position is now worth $135! You decide to pull your funds from the protocol. Because you do not own any partnership NFTs, you pay a total performance fee of 8%, or 8$ of your total profits (total of $100), and pocket the remaining $92 profit along with your original investment/collateral of $35.
Multi Asset Single Strategy (MASS) Vaults: Imagine you have a single token that represents a mix of different cryptocurrencies, just like a basket of fruits. Each fruit (cryptocurrency/strategy/protocol) earns you money, and the MASS Vault automatically balances the fruits to ensure you earn the most money while managing the risk. Are apples performing well? Add more apples! Pears growing mold? Dump them to not let them affect the collective group!
Ex: A user deposits $35 into the USDC MASS vault. The vault then automatically takes that $35 and allocates it to the predesigned strategies. If one strategy or token begins to underperform, the vault then converts that allocation into a better performing asset to continually optimize your potential ROI and mitigate risk.
Note: FortiFi only takes a fee (Maximum 8%) when your Vault makes a profit and doesn't charge you for putting money in or taking money out of any of the Vaults. This fee can be lowered by participating in Fortifi’s executive partnerships programs.
FORT Token
The FORT Token will be the key that lets the community decide how the vaults work. Holders of FORT can vote on important decisions with the FortiFi Voting Gauge. Some example items that will be up for vote: which types of vaults are utilized, which types of cryptocurrencies, etc.
Staked Fort (sFORT) and Voting Fort (vFORT)
Staking FORT gets you two types of tokens. vFORT is a governance token used for voting on decisions, and sFORT is like a receipt that shows you staked FORT. It's also used to share the rewards that the platform makes.
Rewards and Incentives
Short Term: Users who are involved early (~first 3 months after launch) and support the platform might be rewarded with an airdrop. Each Vault will get 600 FORT tokens to give to the people who use it. A snapshot will be utilized to determine who will be eligible for the airdrop.
Long Term: As the protocol matures, FortiFi will have a more permanent way to give out rewards. People who own FORT tokens can cast votes to decide which specific Vaults get rewards. The more FORT tokens you have, the more your vote counts. The Vaults that get the most votes will get more FORT tokens as rewards. These rewards will happen every month, and it's all decided by the community.
Token Vesting
A vesting period is in place for the tokens that are distributed via the presale or held by the team. This just means there is a delay before they can be used. There are graphs that illustrate these vesting period in the official docs.
Conclusion
And there you have it, a more simplified insight into FortiFi! To truly get the full picture I encourage all to check out the official documentation that can be found via the Fortifi website. However, I hope that by reading this you are able to get a better understanding of some of the ideas FortiFi is bringing to life without the complex industry jargon. FortiFi's Vaults, staking mechanisms, rewards, and community-driven governance will soon be at your fingertips. Be sure to join their discord and pay attention to the official X account to stay in the loop and prepare for launch!
As the DeFi space continues to evolve, accessibility remains a critical factor. DeFi Decoded rises to the challenge by breaking down complex protocols and industry jargon, catering to both newcomers and experienced enthusiasts. Join us on this journey through DeFi Decoded as we unravel the intricacies of decentralized finance, one term, one token, and one protocol at a time.
This "DeFi Decoded" series is intended for educational purposes only. The content provided should not be considered as financial advice, and it does not constitute any form of investment recommendation. Cryptocurrency and DeFi investments carry inherent risks, and it's essential to conduct thorough research and consult with financial professionals before making any investment decisions. Always exercise caution and due diligence when engaging in financial activities within the decentralized finance space.
Thank you for reading!