Tenet Protocol Review: The Next Explosive Project In The LSDFi Trend

July 1, 2023 - Around 8 mins mins to read

Tenet Protocol is setting the stage for a disruptive ecosystem of products in the Liquidity Staking Derivatives (LSDfi) space. The company is leveraging its EVM-compatible layer 1 blockchain and harnessing the power of LSD housed in the Tenet validator network. Let’s find out in the article below in this Tenet Protocol Review.

What is Tenet Protocol?

Tenet Protocol Review: The Next Explosive Project In The LSDFi Trend

Tenet Protocol is an EVM-oriented development platform Blockchain that uses Diversified Proof Of Stake consensus mechanism, meaning that users can use assets issued from LSD platforms as LST to deploy a validator on Tenet Protocol.

The Tenet Protocol Review has taken an enormous step forward by acting as a liquidity black hole for LSD. By allowing LSD holders to delegate their LSD to Tenet validators, the protocol draws liquidity from all types of PoS blockchains, providing additional returns on profitable assets.

Staking Providers active on the Tenet network can issue a tLSD (Tenet Liquid Staking Derivative) representing LSDs staked to network validators. tLSDs combine two sources of yield and make them new collateral to be used in an expanding ecosystem of LSDfi-protocols.

Tenet Protocol review employs veTokenomics at the chain level to direct emissions from block rewards and other dAPP user incentives. Users locking the Tenet asset in this mechanism receive yield from protocols deployed across the ecosystem.

LSDC is the native stablecoin of the Tenet blockchain and is minted against overcollateralized positions of tLSDs. This represents a third yield opportunity for capital deployed to Tenet.

The difference between Tenet Protocol

Although born after many LSDfi projects, however, Tenet Protocol has the following differences:

Not only at Ethereum LSTs, but Tenet Protocol supports a basket of crypto assets such as ETH, ATOM, BNB, MATIC, ADA, and DOT.
The use of multiple tokens makes Tenet’s network decentralized and not controlled by VCs, Whales, etc., who own a single token.
As one of the rare LSDfis that go in the direction of Layer 1 development while the other protocols go in the direction of Collateralized Debt Position (CDP).

Tenet Protocol Review: Diversified Proof of Stake

Proof of Stake is now cemented as the preferred consensus model for new blockchain adopters. The reduced fees and increased scalability it enable powerful smart contract economies. As a bonus, its low carbon impact appeals to corporations and media, which boosts the odds of accelerated mainstream adoption. There needs to be more innovation in Proof of Stake models.

Tenet Protocol review introduces a novel Proof of Stake framework that retains all of its benefits while increasing security compared to legacy PoS models. This is the dawn of Diversified Proof of Stake (DiPoS).

Diversified Proof of Stake allows network consensus to be reached by validators that stake a basket of assets. This removes the risk of the network being owned by a large controller of a single asset. The probability of a network attack decreases exponentially with each new asset class needed to maintain network control.

The consensus can approve additional assets that can participate in network security, but the genesis stake in network security is allocated to ETH, ATOM, BNB, MATIC, ADA, and DOT. Naturally, TENET is a key part of the basket.

The most important achievement of this model is its ability to enhance network security by evaluating the shared market strength and difficulty of mass control of a robust basket of assets. Any network attacker would need a significant market share in all of these assets.

This allows TENET – from its initiation – to be the most secure blockchain network. It benefits from the combined security of a basket of assets, which, when put together, are more secure than any individual asset in the basket, including ETH.

Tenet Protocol Review: Products

Tenet Bridge – Powered by LayerZero

Currently, LSD is fragmented across different chains and between different wrappers. This results in a terrible user experience for those looking to move their LSD between chains to take advantage of new profit opportunities — such as the triple-tier returns available on Tenet.

Tenet’s bridge, developed in collaboration with LayerZero, solves this problem. Tenet’s bridging will allow the wrapping of LSDs from any chain into a single, unified OFT, which can then be seamlessly connected to any network that integrates LayerZero endpoints.

Tenet Bridge will be the first DeFi project we launch on Tenet and will open the door to connecting to Tenet and using other DAPPs built on top of the network.

Tenet Stablecoin Protocol – LSDC

LSDC stands for Liquid Staking Dollar Coin and is a soft-pegged dollar stablecoin that is over-collateralized by LSDs. LSDC is created by the Tenet Stablecoin Protocol, a non-custodial decentralized application running on the Tenet blockchain. The protocol allows users to create interest-free loans against yield-bearing collateral assets.

This means that users of Tenet can bridge over their liquid staking derivatives from other networks, such as ETH, BNB, SOL or Matic, stake them to a Tenet validator to receive additional yield and then borrow against those yield bearing Tenet LSDs using the Tenet Stablecoin Protocols.

The Tenet Stablecoin Protocol creates a more capital efficient and user-friendly way to borrow stablecoins against a decentralised collateral base but goes even further in decentralizing the governance (and therefore security) of the protocol.

Accepting only profitable capital allows its capitalization rate to remain low, resulting in better capital efficiency than other stablecoin protocols that do not accept profitable collateral;
Managed by holders of all accepted forms of collateral (using our unique consensus layer) and thus avoiding centralization of governance in a single token; And
Can be scaled to adopt any new LSD through our governance system (with Tenet having brought LSD into LSD-free networks to date).

Admin class veTenet

Tenet is the first blockchain to implement a voting escrow system at the chain level, where users can lock Tenet tokens to receive veTenet, have the power to direct the distribution of the original reward pool, and receive protocol revenue.

Keeping veTenet in your wallet will also allow increased returns on all your actions on the Tenet ecosystem — from staking on validators to providing liquidity on the DEX.

veTenet is an integrated and fundamental approach to operating and linking incentives.

Meta LSD

We have seen an explosion in LSD innovation and experimentation with different types of token dynamics. This presents new challenges for LSDfi pioneers like Tenet. In addition to tLSDs, we will introduce LSD metas that combine different non-replaceable representations of LSD content in a single, composable basket.

The resulting token acts as a synthetic token representing a diverse portfolio of tLSDs. This consolidates liquidity into a single token, which can then be effectively used as DeFi collateral for stablecoin mining and other DeFi operations.

Meta LSD enables the efficient use of cross-chain tLSD to be the ultimate, profit-generating user asset used across the DeFi space — not just on the Tenet network. Aggregation of LSDs also encourages decentralization of validators on the network, benefiting users and protocols on Tenet.

Tenet Protocol Review: Tokenomics

Tenet Protocol token information
Token Name: Tenet Protocol
Code: TENET
Blockchain: Tenet Protocol
Token classification: TE 20
Contract: 0x9663677b81c2d427e81c01ef7315ea96546f5bb1
Total supply: 1,200,000,000 VND

When you lock TENET to be a validator on the Tenet Protocol network, you will receive tTENET then you hold the key tTENET for a minimum of 1 week and up to 4 years to receive veTENET.

When owning veTENET, users will have a number of benefits as follows:

Network administrator rights.
Revenue sharing from protocols across the ecosystem.

Tenet Protocol Review: Pros and cons

Pros

Supports multiple native tokens from other blockchains.
Staking and receiving tLSDToken tokens as collateral allows Mint Stablecoin LSDC to participate in DeFi market and earn higher profits.
Offers interest-free LSDC loans based on Mint fees from 0.5% to 5% on network activity.
When conversion activity is high, fees are high and vice versa. This mechanism helps maintain the LSDC price.
The veToken model using the TENET governance token is awesome. As veTENET holders can participate in the index and share benefits, dumping of TENET Tokens can be prevented.

Cons

When borrowing LSDC Stablecoin, there will be smart contract risk and initial asset liquidation risk.
Each new block generated will reward TENET Tokens, leading to inflation.

Conclusion

Tenet Protocol review is creating an ecosystem of products designed for the LSDfi space built on top of its EVM-compatible Layer 1 blockchain and benefits from the governance power of LSDs housed in the presenter network. Tenet authentication.

Tenet and other blockchain platforms adopt the PoS consensus mechanism and integrate the Project Governance Stake Token into the verifier to ensure the security of the network. Compared to networks like Ethereum, BNB Chain, Cosmos, Cardano, Polygon, Avalanche and Polkadot that accept LSD Token assets, Tenet is more advanced.

Investors participating in pledging assets will be accepted and issued tLSDToken tokens. This asset can be used as collateral for the Mint Stablecoin LSDC to further profit from the DeFi market.

It can be said that Tenet Protocol review is one of the rare projects in the LSDfi industry that chooses a direction full of risks and challenges, but full of development opportunities.

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DISCLAIMER: The information on this website is provided as general market commentary and does not constitute investment advice. We encourage you to do your own research before investing.

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