At gem diggers our aim is to share knowledge and information about the best blockchain projects. So you can imagine our delight when Simone Rigolon accepted our invitation to an AMA about his ground-breaking project Impermax Finance, and to put the icing on the cake we managed to get in before other big players like DuckDAO!!!

Simone is the founder and core developer of Impermax Finance and joined our AMA to talk to us more about how for the first time providing the ability to use LP tokens as a means of collateral to borrow crypto assets provides investors with added value in a previously untapped resource. For borrowers Impermax is an instrument to adjust the impermanent loss risk, for lenders the platform guarantees a returned interest without any exposure to impermanent loss risk.

Impermax mainnet launch on Uniswap successfully took place on 1st March 2021, supporting every trading pair on Uniswap and unlocking over £3 billion of LP token value, this is ahead of the IMX token launch, keep an eye for more news on this release…


The rest of this article shares with you the questions we posed to Simone Rigolon and his answers to our audience, unfiltered, read on to see what Simone had to say…

Ozzy: Tell us a bit about yourself, how did you get into this space?

Simone: My name is Simone Rigolon, I am 22 years old and I am a blockchain enthusiast since the beginning of 2017. I’ve always been a tech enthusiast: I started studying computer science more than 10 years ago. When I found out about Bitcoin and the blockchain technology I’ve immediately realized the potential and I’ve worked in the space since then.

Ozzy: Can you tell us more about the team at Impermax, who’s doing what and how experienced are they?

Simone: I am the founder and core developer of Impermax. Other than me, the other core team member is Brian Tinsman. He currently is head of marketing and operations. He has a lot of experience in the crypto space. He’s been working for some major projects like NEM and Radix since 2016 and before that he had a 15+ years successful career as a game designer.

Ozzy: What is the aim of Impermax? Are there any similar projects out there? How are you different?

Simone: Impermax wants to create a lending marketplace based on the use of LP tokens as collateral in order to allow users to earn leveraged yield from AMMs platforms like Uniswap or Sushiswap. Not many projects are moving in this direction, the only major competitor is Alpha Homora. We differ from them in the architecture and in the way we allow users to enter leveraged positions. These differences allow Impermax’s users to achieve much higher leverages for a lower risk.

Ozzy: Why is the use of LP tokens for collateral a big deal?

Simone: Because there are currently around $10B locked in LP tokens not being able to be used as collateral. All LP token holders are users already familiar with DeFi and a large percentage of these users would want to use their LP tokens as collateral in order to increase their capital efficiency. Basically, this means that the demand to collateralize LP tokens is already a few billions USD and increasing each month

Ozzy: Why are isolated liquidity pools such an important feature of the Impermax protocol?

Simone: For 2 main reasons:

  • An architecture based on isolated lending pools is safer and allows for the permission-less creation of new lending pools without exposing to any risk the existing pools.
  • It allows us to use a brand-new collateralization model that is not based on how much value is being borrowed, but on which assets are being borrowed and in which proportion. This leads to optimal efficiency when leveraging LP tokens and allows users to achieve very high leverages on Impermax.

Ozzy: How much interest can I earn lending tokens on your protocol? What are the factors that dictate the interest rate I receive?

Simone: Lending interest rates in these initial months will be very high when compared with the rest of the market, especially once our liquidity mining program will go live. The factor that dictate the interest rate is the utilization rate (the percentage of the supplied amount borrowed by the borrowers). Impermax uses a dynamic interest rate model which targets a certain utilization rate. The interest rate keeps increasing whenever the utilization rate is above the target, and it keeps decreasing whenever it is below the target. And in which proportion. This leads to optimal efficiency when leveraging LP tokens and allows users to achieve very high leverages on Impermax.

Ozzy: What are your future product plans for Impermax; what’s next on the roadmap?

Simone: In Q2 2021 we will release our token, the liquidity mining program and many new exciting features for our application. The long-term plan is to keep Impermax expanding and to support others AMM platforms inside and outside the Ethereum ecosystem. And in which proportion. This leads to optimal efficiency when leveraging LP tokens and allows users to achieve very high leverages on Impermax.

Ozzy: Your product is live, why bother with the IMX token, what will that bring to the table?

Simone: Decentralization. IMX will be a governance token through which we will gradually give the Impermax applications and their profits back to their users.

Ozzy: How does the protocol make money, and what happens to all of those fees generated?

Simone: A percentage (defined by the reserve factor) of all the interests accrued will go in the reserves which will be governed by the IMX token holders. The purpose of the reserves is to be used:

  • for emergencies
  • to fund development grants
  • to share profits to the IMX token holders

Ozzy: Attracting borrowers and lenders to your platform will be critical to your success. What sort of marketing tactics and strategies will you deploy to attract that liquidity?

Simone: The main strategy to attract liquidity will be the liquidity mining program. Impermax will implement possibly the most exciting liquidity mining program ever: leveraged yield farming. We will reward users that enter on high leverage positions by borrowing high amount of tokens. This will cause large demand for borrowing in our platform and will make the lending interest rates surge, rewarding also the lenders.

Ozzy: Many successful DeFi projects like Impermax have seen numerous liquidity attacks. How are you ensuring the security of all funds and users on the platform?

Simone: As stated above, the architecture plays a big role in Impermax security. Isolated lending pools and the core-periphery architecture have allowed us to simplify the core components of Impermax as much as possible in order to reduce the likelihood of them containing any bugs. Other than that we’ve already done 3 security audits and we’re considering the possibility of doing more.

Ozzy: You recently had your contracts audited. Can you talk about the firm you selected to perform the audit (Cyber Unit), and what the key findings were?

Simone: Our experience with them is positive. They have large experience in the auditing sector and have audited also other DeFi protocols like Mirror Protocol. They are not one of the most famous auditing firms, but this has played as an advantage to us. We found out that most of the well-known firms had queues long months and starting the audit in December we wouldn’t have been able to meet the target of launching in March with any of them.

We hope you are excited as we are for the upcoming IMX token launch. Impermax have wasted no time in releasing pair after pair for LP token leveraging since mainnet launch. They are truly bringing next generation DeFI opportunities, it feels a little odd to say that given the relative age of DeFi but this space is developing at exponential pace. Impermax at right at the forefront of that development.

Find out more about this project using the resources below and be sure to join our AMA Telegram group for more upcoming AMAs with top class projects…

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