Qoda x Arbitrum AMA Transcription

Audio recording is available on X:

Ana is a community manager at Arbitrum Foundation.

Dhruv is a founder and CEO at Qoda Finance.

Ana

Hello, GM, GM, and Happy Friday. I hope you’re having a fantastic day already, and I really hope you enjoy the weekend. Today, we have a new AMA with a new project that is building in the Arbitrum ecosystem and the Web3 ecosystem in general…

It’s time to get to know more about Qoda Finance. So we can start with some introductions. Hey, how are you, Dhruv?

Dhruv

Hey, great. My name is Dhruv Dang. I’m the founder and CEO of Qoda. Really excited to be chatting with you today. We’ve had a lot of interesting stuff happen on Arbitrum over the last few months, and we’re happy, we’re excited to share that with the community.

Ana

Oh, exciting. Thank you for joining us today. It’s a great day to be talking about Qoda. So, I would like to know what is Qoda Finance. Why are we here today?

Dhruv

Yeah, Qoda Finance is a decentralized lending and borrowing exchange. We are an orderbook-style exchange which hasn’t been done before on-chain and our loans are all fixed rates. So if you lend or borrow at a particular rate, it’s going to be the same rate until the loan matures.

Qoda has been out for a few months this year. We’ve launched on different networks. We’re a multichain protocol, fully EVM-compatible. Our latest deployment was Arbitrum, and our most active deployment is actually Arbitrum.

Ana

That’s cool to know. Well, it's very exciting to have you in the ecosystem. Ok, you explained what Qoda is, but what if there are new people here, new Arbinauts, who are listening for the first time about Qoda? Then, what’s the best way for them to get involved and get started with Qoda?

Dhruv

That’s a great question. The two big features that Qoda offers are lending and borrowing, so if you want to lend, it’s actually really easy. You can open up a DApp, go to qoda.fi, open up the Arbitrum deployment and pick a market that you want to lend your assets to. We currently have two markets on Arbitum: USDC loans, maturing in December, and Ethereum loans, maturing in December over time. As we see more liquidity, we’re planning to launch even more markets on Arbitrum, especially as new opportunities arise related to lending and borrowing.

So once you open a market, you can lend quite quickly. As a borrower, you first need to deposit collateral. Qoda has a unified collateral pool. That means you can deposit collateral in a bunch of different assets, from wrap-staked ETH to vanilla Ethereum and the ARB token as well. You can borrow against that collateral without having to liquidate those tokens. You can borrow in both the USDC and ETH markets against the same collateral pool.

The main thing is to keep an eye on your account health, so you have to make sure your account health is healthy, and that’s all described on the Qoda website and in our Docs. So I’ll let you have a look at that if you’re interested in borrowing. But the really exciting thing is that it’s a unified collateral pool, and every single loan that you take out, whether you’re lending or borrowing, has a fixed rate until maturity.

So the really big example of why this is important is what we’re seeing in markets right now. We’re seeing a nice rally and pump happen in crypto assets and the cost of borrowing that’s variable on lending and borrowing pool, pool-based protocols like Aave and Compound have seen the USDC cost of borrowing rocket in Qoda. If you’ve taken out a levied position by borrowing US dollar coin, your interest rate would have been fixed throughout all of this hysteria.

Ana

Fantastic. Thank you, Dhruv. That’s a very straightforward process; thank you for explaining each. Also, I would like to know more about the launch that you have on Arbitrum. This happened three months ago. You’ve already shared that Arbitrum was the most active chain for Qoda. So I would like to know more about it and more about your experience.

Dhruv

Yeah, I would love to share. We are so excited about the activity we’ve seen on our Arbitrum deployment. I actually have a really special announcement about it, which is that we, for the first time, have crossed $100,000 of loans traded! The vast majority of that is on our Arbitrum deployment. And the reason for it, I think, is we’re really lucky, we have a super passionate community, and there’s a super passionate bunch of others out there, and we’re seeing that sort of manifest itself in how Qoda is being used.

When we first deployed on Arbitrum, we were ramping up slowly, but the vast majority of volume has happened in our December markets. Because everything is on the blockchain and transparent, you can actually see this activity pick up in October in our USDC and Ethereum markets. One thing that I personally felt once we launched on Arbitrum is how Qoda needs to run because it’s a complicated protocol. We originated the smart contracts ourselves, and we went through the audit process with Halborn ourselves. And it’s really tough to find the right network for an orderbook-based decentralized exchange. And when as soon as we launched on Arbitrum, I knew that we had found the right network for us. It’s been a really great experience.

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Ana

Fantastic. It’s great to hear that CODA is growing at the same time for sure boosting the Arbitrum Ecosystem. Congratulations on that, Dhruv. I would like to know more about the innovations that Qoda is bringing to the ecosystem and to the community. What makes Qoda unique?

Dhruv

We sort of touched on this idea of an orderbook lending and borrowing exchange and a fixed rate style. One thing that we’ve actually been building out in our team is this idea of undercollateralized borrowing. And this has been really difficult to achieve in crypto because it’s anonymous. So, the things we love about blockchain are the things that make undercollateralized borrowing difficult. So, we built the infrastructure inside Qoda to support borrowers who don’t actually have enough collateral to post their loans. And that’s the true value of credit.

The true value of taking out a loan is the ability to access capital when you don’t have it yourself and overcollateralized borrowing while it is amazing to be able to do that on-chain and lever up your portfolio, it doesn’t unlock the true potential. The one thing we’ve done in our team that’s pretty special is that we’ve built on top of this orderbook and fixed rate protocol to support undercollateralized borrowers. And we’re excited. We can’t make any big announcements about that right now, but we’re pretty excited to make some announcements about that in the near future.

Ana

Nice. So, to track your progress, we need maybe activate notifications from you and Qoda on X, to be the early people who know more about it. Ok, I would like to know also more about what your team at Qoda is working on now, and maybe you can share some details about your roadmap or what’s coming next for Qoda.

Dhruv

Yeah, I would love to share. So, just some context about our team. I think the protocol that we’re building is really special, but I’d love to share some info about our team. We’re only seven people, we’re really small compared to a lot of the other protocols out there. And we’re all really passionate about what crypto stands for, which is decentralizing like markets and finance. We believe that there’s a lot that happens in traditional finance today that just isn’t accessible to everyone, and one of our core values is to make finance and financial markets accessible to everyone, so we build products on the blockchain that enable that.

And we see that in our markets people have already traded on Arbitrum loans as small as $1 all the way up to $20,000–30,000 at a time. And this is happening in the same marketplace. So it’s a level playing field. What we are working on now is to grow the scope of the Qoda beyond just the infrastructure of lending and borrowing markets.

We believe there’s a whole area of finance that just hasn’t been addressed in crypto. And one example of that is asset management. It’s one of the largest industries in the world. It has a huge addressable market. We estimate it to be over $280 billion a year. We want to start building portfolio management tools to enable people of all sorts to be able to manage their own portfolios on-chain. We’re excited to announce that we’re working on a new product called Threebalance that allows people to rebalance their crypto portfolios in three steps. It’s that easy, and it will be coming to Arbitrum first.

Ana

Wow, this AMA is full of alphas, to be honest. Nice. In the beginning, you mentioned that you are very aligned with the values that the ecosystem is bringing, like turning it more decentralized and fighting against censorship. So, bringing a more and more inclusive ecosystem because there are, in the end, a lot of people that don’t have access to a bank account for example. But with Web3, you only need the Internet. That’s something super cool, and I would like to know more about this plan of Qoda Finance.

Dhruv

I’d love to share. The whole other part of Qoda is how we actually enable our community and Arbinauts to participate in what we’re doing. And that’s through the QODA DAO. This is our third and probably most exciting announcement today, which is that we are going to be launching the QODA token on Arbitrum as a native asset in the coming months!

We are aiming to launch the token really soon. The QODA token and the Qoda DAO will participate in both of the projects I’ve described today. So, the fixed-rate lending and borrowing markets as well as Threebalance and any future projects we build, will be inside the DAO. One thing that we have learned about running Qoda up through a bear market, other than having thick skin, is to survive. We want our products to be a going concern. We really believe in what we’re doing. We believe that our ethos matters, and the QODA token is gonna help us get there.

Ana

Well, this is another huge alpha that we got here. And at the end of this, it is getting really decentralized. This is a great way for the community to get involved and actively involved in the decisions about Qoda Finance. That’s very cool to see, and congratulations on this. I’m looking forward to seeing more of what’s coming. And maybe we are going to have a new AMA soon for this launch.

I know that Qoda has submitted its grant proposal. Can you tell us more about it? What are you looking to achieve with this grant?

Dhruv

Yes, we have submitted a grant proposal. So, the proposal is specifically about Threebalance. Everything that we build in our team is brand-new tech. We don’t fork anything. There are no protocols that have already been done elsewhere. They’re all brand new. We funded the majority of the development expenses ourselves.

We’ve put in a small grant proposal to help us get over that finish line and finish implementing Threebalance to be able to deploy it on Arbitrum first and then allocate around half of those grant funds to actually market it and make it available. So, people are aware of Arbitrum and what Threebalance is doing in Arbitrum.

Ana

Fantastic. It’s cool to hear, and I would like to know how we can follow that progress. How can we stay updated? I know for sure, following the X account of Qoda. But what else is the best way to do it?

Dhruv

The X account is really important because that’s where we publish all our announcements. Discord is a great place to take part in the community. So it’s really where all of the dialogue happens bidirectionally where people can reach out to us and ask us questions or suggest features. We have a ticket system if you ever have any issues with what we’re building or need some help.

We’re always running promotions and programs to help get people involved as we ramp up to launch our token. We are currently running something called the Qode Grand Prix. It’s actually an Arbitrum Odyssey side quest. And every single loan that you trade on Qoda will earn you points towards the Grand Prix. Every month, the top 25 users earn a prize in USDC.

So following us on X and being part of Discord is a really great way to see how the Grand Prix works and take part and track your progress. You don’t have to do anything to register for the Grand Prix. You just need to trade.

The other way to keep in touch with us if you want to learn more about Qoda a little more deeply is to follow our blog on Medium. So, the link is blog.qoda.fi, if you follow us on Twitter, you’ll find all the links to these things.

We’re always open to meeting new teams and new partners as well. So, if you’re interested in working with us, this is the best way to reach out.

Ana

So, Qoda Finance is part of Arbitrum Odyssey. This is a seven-week incursion where you are able to learn by doing and getting to know some of the projects that are building in the ecosystem and ge NFTs while doing these missions. So, Qoda is part of it. I would like to know more about it. What can you tell us more about this and hope people can participate?

Dhruv

Yeah, the Grand Prix is an awesome competition. So the way it works is that when you lend or borrow, whether you go into the Qoda DApp and just lend or borrow directly, or you publish a quote into the orderbook that gets traded, you earn 100 points in the Grand Prix for every dollar equivalent of loans that you trade.

Over time, these points will accumulate, and the top 25 Grand Prix competitors will earn QODA tokens after the TGE. Every month, the top 25 traders of that month, lenders and borrowers, will take part in the $500 prize pool that we have each month. The cut of Grand Prix right now is just for fixed-rate loan markets, but it will also be available for Threebalance. So, there are a few ways to earn points over the next few months. It’s something we’re planning to run for quite a while. So take part and start racking up those points.

Ana

Looking forward to that. Well, Dhruv, we are about to finish our AMA, but wondering if you would like to share something else with the community or something that we haven’t touched yet. Let me see if there are questions from the community. Well, yeah, there is a question about when the DAO is coming out?

Dhruv

Yeah, that’s a great question. We are working hard to bring it as quickly as possible. We are a fully transparent team, and we are legally incorporated. So it’s important that we follow all the rules and regulations of the jurisdiction in which we’re incorporated. So we’re just making sure we do things correctly and ethically before we actually make an announcement. But the hope is it should be by the end of Q1 2024.

And I want to just add some things we just want to say from our team. We are a small team, but we are so grateful to you, Ana, for hosting this. We’re glad we could share that with the community. Super grateful to Arbinauts and the Qoda community. You guys make it, make what we do really special every day. We are so excited to build and ship new things, and it’s because of our community. So I really, really appreciate it.

Ana

Yeah, for sure. That’s very impressive what you are building. Congratulations to you, too. And thank you. Thank you for building Arbitrum together and the Web3 ecosystem together.

Dhruv

Awesome. Thank you so much.