🪙Echelon Market: From a single protocol to a lending layer for the Move ecosystem @EchelonMarket is a decentralized, non-custodial lending protocol built on the Move programming language, which is intended to become a universal money market that connects the liquidity of the entire Move ecosystem and improves asset utilization and returns. It currently supports more than 15 assets, with total deposits of $298 million and borrowings of more than $84 million. The protocol is powered by oracles provided by @PythNetwork and @switchboardxyz, and cross-chain bridging and collateral opening through @LayerZero_Core and @wormhole. Its core function is over-collateralized lending: users can lend assets to earn passive income, and can also borrow assets to obtain leverage or meet other funding needs.

💰Funding The project previously secured $3.5 million in funding in 2024, led by @ambergroup_io, with participation from @LaserDigital_, @SaisonCapital, @SeliniCapital, @280Capital, @Web3Port_Labs, @serafund, @Re7Capital, and many angel investors.

📠 Introduction to the Mechanism @EchelonMarket has customized its design based on the experience of mature DeFi protocols, combined with the characteristics of the Move ecosystem: 1⃣ Isolated Lending Markets: Each pair of assets operates in an independent market, where users can borrow one target asset by depositing a type of collateral asset. This mechanism effectively isolates risks, preventing the collapse of highly volatile collateral from affecting the entire system, thereby enhancing the overall repayment capability and stability of the protocol. 2⃣ Over-Collateralization and LTV: All loans must be over-collateralized. The protocol sets a maximum loan-to-value ratio for each market, and borrowers must maintain their LTV below the threshold, or they face liquidation risks. 3⃣ Deposits and Earning Returns: Lenders deposit assets into liquidity pools to provide funding support for borrowers, thereby earning automatic compound Supply APR. Returns are composed of borrowing interest, with interest rates dynamically fluctuating based on asset utilization. 4⃣ Treasury Account System: The protocol employs a centralized treasury accounting system to track all deposits, interest, and changes in claims. As interest grows, the total value of the treasury increases, and the shares held by lenders rise simultaneously, significantly simplifying the processes of profit distribution and accounting management.

📈Risk Control Framework @EchelonMarket has built a multi-layered risk management mechanism: 1⃣Interest Rate Model: Each asset market is equipped with an independent interest rate calculation contract, using a time-weighted variable interest rate model. The interest rate is dynamically adjusted based on supply and demand: when the utilization rate is high, the interest rate rises to attract more deposits and suppress borrowing; when the utilization rate is low, the interest rate falls to encourage borrowing. 2⃣Liquidation Mechanism: When a user's health factor falls below 1, their position will be triggered for liquidation. Liquidators can repay part or all of their debt to obtain their collateral, thereby controlling bad debt risk. 3⃣Key Risk Parameters: The protocol sets detailed risk parameters for each asset, including supply/borrowing limits, maximum LTV, liquidation thresholds, and reserve factors (a portion of interest goes to the protocol treasury). These parameters can be flexibly adjusted through governance. 4⃣Efficiency Mode: This mode is specifically designed for highly correlated assets such as stablecoins and LSTs, allowing users to achieve higher LTV under eMode, borrowing more assets with less collateral, making it an important tool for leverage strategies. 5⃣Protocol Fees: The protocol charges a one-time initiation fee for each loan, with rates ranging from 0.10% to 0.25%. This fee is included in the user's debt and provides the main source of income for the protocol, supporting security audits, ecosystem development, and liquidity incentives.

🪂 Points Program The first season of the points program ended on March 9, with a total of 60 billion points distributed and over 60,000 wallets created. The second season of the points program is currently underway, increasing the yield of points from earning 1 point for every $1 borrowed and 3 points for every $1 lent to earning 2 points for every $1 borrowed and 4 points for every $1 lent. Additionally, there is a referral program: referred users can receive a 5% bonus on all points, while the referrer can earn 10% of the referred user's points. 📈 Data Analysis According to Defillama data, the current protocol TVL is approximately $152 million, with the @Aptos chain contributing about $126 million. Meanwhile, its multi-chain expansion strategy has begun to show results, with $23.48 million in TVL on the Movement chain and $2.84 million in TVL on its Echelon Chain. Cumulative fee revenue is approximately $3.12 million, with an annualized fee revenue expected to be $4.15 million. The total number of users has grown from 140,000 at the beginning of the year to 270,000, with a total borrowing amount reaching $119.47 million. The ratio of total borrowing amount to TVL (i.e., capital utilization rate) is approximately 78.3%. High utilization rates are very beneficial for the protocol's fees but also impose higher requirements for risk management, necessitating that there is always sufficient liquidity to meet users' withdrawal demands.

Summary @EchelonMarket, co-incubated by @Aptos and @ThalaLabs, has built a composable lending market based on a vault accounting system. From its initial single lending protocol, Echelon is gradually evolving into a multi-chain interoperable and composable DeFi financial ecosystem. Its development path is clearly visible: from a single lending product to a multi-chain financial ecosystem. The strategic evolution can be divided into three phases: the first phase is to build a robust lending product on the Aptos chain. The second phase is horizontal expansion to other Move ecosystem chains like Movement. The third phase is vertical integration, launching its own dedicated application chain. Through an integrated layout of "on-chain infrastructure + application protocols," Echelon is moving towards becoming the DeFi hub, serving as a key liquidity engine and lending entry point in the Move ecosystem.

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