Swap aggregator support for the Algofi Lending Pools and router

Algofi’s lending pools are fantastic. The recent proposal that was enacted to reduce the STBL2 lending pool costs and the enabling of the Algofi router allow great opportunities for better trades. However, aggregator applications are not taking advantage of these to their full extent.

Deflex (used by Alammex and soon DEFLY) has recently added lending pool support in their swap plans, but does not use the Algofi router.

Vestige (used both by their website and integrated into Pera) does not use Algofi lending pools at all. The Vestige devs in their discord have mentioned numerous times about not having examples of how to do this, and feel like they don’t get responses for questions asked to the Algofi devs.

Not being included in Vestige and Deflex swap plans lead to sub-optimal traffic for Algofi LP providers and a sub-optimal user experience for the users of the aggregator apps as they may not be getting the best price possible.

This proposal is not for any change to the Algofi code base, but for the Algofi team to reach out to the Deflex and Vestige teams to pitch to them to add support for Algofi Lending pools and router in their swap plans AND to provide those teams with any examples or support requested (within reason) to make that happen. The ideal end deliverable would be for all Algofi Lending Pools and the Algofi router to be usable in Deflex and Vestige swap plans.

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totally agree! we need those lending pools integrated in aggregators, which should bump up the volume by a lot due to the fee change and the overall liquidity we have here

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As far as I’m concerned, the Defly team is working on this (integrating Algofi pools to their aggregator). Vestige team has indicated that this is not their priority (not sure if they changes their mind on this matter or not).

On a side note: I think the purpose of an Algofi governance proposal is to directly change/update the platform codebase. So this is not really an appropriate proposal in that sense.
Thanks.

Appreciate the feedback nlh. A few follow up thoughts.

I feel like the purpose of Algofi governance is to improve the overall usefulness and adoption of the protocol. I do agree though this proposal is a bit different than past ones and welcome others opinions about if this type of proposal is appropriate or not.

The DEFLY team is indeed integrating Deflex into their swaps. Deflex uses the Lending Pools as you mentioned but does not utilize the Algofi router as part of that. You can see this visually if you try a swap on Alammex. Swapping Algo → STBL2 will route through that lending pool with a 0.125% fee tier. But doing a Algo → goBTC swap does not go through the lending pools. It uses the much smaller Algo → goBTC LP pool instead of routing Algo → STBL2 → goBTC. While one could argue this could just be part of deflex’s swap plan, Algofi already is that router built for them to get a quote from. So there is still work for the deflex team to get this fully optimal (hopefully DEFLY will get this for free then after deflex integration is complete).

The Vestige team doesn’t have any lending pool integration, so they are actually the biggest opportunity to increase traffic. They have indeed said it wasn’t a priority, but also indicated that was because they felt like the time investment it would take them to figure out how to use the lending pools wasn’t worth the value add for them. If the Algofi team can reduce the time investment though, that could change the priority and value for them (lower cost to implement and staying competitive with Deflex).

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to add to this: maybe its time to think about using the treasury to accelerate the integration (if the algofi devs dont make that router easy to integrate). and this would definitely need a temp check, so its probably good to start a discussion on if we agree that the integration would be really valuable for the protocol

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If I remember correctly, the Algofi team plan to open-source their code base this year so that integration and composability between other protocols and Algofi (hence among major Algorand defi protocols overall) can be significantly improved. A bit unsure if it is still in their plan or will be delayed further.

I like the idea of using the treasury for this a lot. Asking another team to integrate your tech when they have other priorities would surely go better if you were offering to pay them as part of the process. How would we go about determining what a reasonable rate would be? Seems like it could vary considerably depending on a lot of factors.

After thinking about how to do this for a while, I realized the best way to start trying to figure this out was to just ask the Vestige team. Turns out they had already seen this post and had discussed it a bit. You can see my response to their discord discussion here.

They seem open to the idea, but said it would take them off of current projects for approximately 1 month. They gave a price they would be happy with at $10k, though acknowledged were up for discussing it. As a Software Engineer myself, this does not seem unreasonable for a month’s compensation on a contract job.

I don’t know how much is in the Algofi treasury though and want to know a bit more about the rate of funds flowing in if anyone knows. And of course, if others think that price would be appropriate for the value of having Algofi lending pools and router added into Vestige.

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I think Swag has said it’s in the roadmap but they are working on limit orders now

It technically is, but to quote swagg in that discord post:

They gon have to put up some $$ to make us do it, if we’re being realistic. We’re working on a lot of things right now, and we will be working on a lot of things for the considerable future. Doing free work that gives us very little benefit is going to stay at the bottom of our todo-list always, and we’re busy people so that might be indefinite

So the question for this group is would that amount of treasury funds be worth bumping this work to the top of their queue, vs it likely never being prioritized?

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I do have a very different view on this matter @odnarb.
If I build an aggregator, it is certainly my job to make sure that I can integrate all possible pools to my dapps so that it can find the best possible route for any swap, especially when it is related highly popular tokens such as BANK or STBL2.
I’m quite surprised that the Vestige team think that Algofi should pay them to do their job. In fact, if I am the Defly team, I’ll put this integration at my highest priority. There’s just a lot of Algofi users and BANKs holders to take on-board out there.

@nlh this change will fire up the pools on algofi. Why wouldnt we pay them to do it considering how much more difficult the algofi devs made it for them. This is a win/win that will pay for itself and then some in the future. I think its time to push this forward.

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the problems are that (1) algofi apparently didnt make it easy to build on top of those lending pools (at least thats what it sounds like) and (2) vestige has other stuff to do than working on their aggregator. but we are unfortunately dependent on such an integration to get more volume… so what are our options if not paying for it?

Just a quick follow-up.
I checked and the latest version of Defly already integrated deflex in its integrator. Hence all of the Algofi’s lending pools are now supported by Defly.
I tested with some typical swaps such as BANK->ALGO and BANK->STBL2. Worked like a charm.
Since deflex also support multi-hop, you can also swap something like Defly<–>BANK. Worked well.

the problem is they dont support hopping from one lending pool to another. so they wont go like ALGO-STBL2-goBTC only using lending pools… only the first swap can be a lending pool swap

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Sounds to me like there is enough interest in using the treasury to put this into proposal staging and get the ball rolling to put it to a vote. I think 10k sounds like a very reasonable price to get this integrated.

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