Productive TVL on @katana - what does it mean?



If you've been following katana for a minute you've probably heard the words 'productive TVL' floating around - but does it actually mean?🤷‍♂️

Put simply, TVL = total value locked. It's measured in USD and it's the total amount in USD value of all assets on the chain.

TVL has been used as a metric to measure the success or health of a chain by bragging about the amount of $ sloshing around the chain - either in DeFi or just bridged over.
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There's 2 types of TVL:

> Chain TVL

The total value of all assets on the chain

> DeFi protocol TVL

The total value of all assets within DeFi protocols

In the eyes of katana, the only TVL that matters is 'productive TVL' i.e. TVL within DeFi protocols. If they want the flywheel to thrive, it needs productive assets, not idle assets.

How does katana achieve this? ⚔️

1) Through @Agglayer's vaultbridge - typical bridges leave assets on Ethereum doing nothing, vaultbridge puts them to work.

2) Boosted yields in DeFi - liquidity pools have boosted yields from various fee and yield generating mechanisms to encourage the use of core DeFi apps and assets.

3) Chain-owned liquidity - CoL is deployed to core DeFi apps on katana.

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That's impressive, anything else?

Yes, katana have created chain-aligned TVL (CAT) which means certain DeFi protocols are deemed chain-aligned and will gain additional benefits such as $KAT incentives.

Examples of these assets are:

> $AUSD by Agora
> uTokens from universal
> $LBTC & $BTCK from lombard
> weETH from etherfi
> vbTokens from agglayer’s vaultbridge.

The idea is katana can blend productive TVL with chain-aligned TVL to create deep liquidity and great yields across all of katana's core DeFi apps.

Katana's goal is to stop using antiquated TVL metrics because they don't paint the full picture of a chain's economic health.

Instead, katana want to create incentives for users (via chain alignment) to keep TVL productive - this leads to a more reliable understanding of what TVL is doing within a chain.

Less fluff and more real data ⚔️
IN-10.39%
DEFI-4.11%
NOT-3.89%
ETH-3.67%
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