Welcome to this post, where we are going to see how Belt, one of the main platforms in the binance Smart chain, works.
Belt is a platform that has managed to capture a large amount of LTV or total value locked inside its platform, due to what it offers, which we will now see in detail.
With over $170 million on its platform, and currently on 3 different networks, BSC, HECO and Klaytn. Being one of the oldest platforms in the BSC that is still maintained with quite a lot of capital invested in it.
What is Belt
Belt.fi is an AMM stablecoin exchange protocol that incorporates multi-strategy performance optimization on Binance Smart Chain (BSC), HECO Chain, and Klaytn with low commissions/slippage that also provides aggregation through vault compounding, borrowing, and yield generation in order to achieve maximum performance.
Belt Finance’s stableswap AMM gives users a more efficient way to exchange different stablecoins by offering significantly less slippage than the usual exchange protocols. Belt Finance also focuses on giving users the best performance through a combination of trading fee rewards and a multi-strategy optimization vault system. By using multiple strategies simultaneously, Belt.fi minimizes dependence on any one protocol while generating users the best possible rates of return on DeFi. This also protects users from liquidity withdrawal problems.
Users are not required to actively move their assets between protocols to find the best performance, as Belt Finance vaults do it for them. This ensures the highest possible reliable performance by providing a wide variety of many parts of the DeFi ecosystem. As Belt Finance grows to include more strategies, assets and chains, it is expected to continue to grow.
More than that, the composition of Belt.fi’s vaults brings together convenience and en gas fees while also having essentially no impermanent losses. Thus being a way to optimize your returns with different tokens.
Belt, unlike optimizers, focuses on finding the best DEFI strategy within each network. While in an optimizer, you deposit and makes a particular strategy, Belt is changing and adapting to find the best strategy for example, BNB or stablecoins in the Binance Smart chain, taking into account the annual % and risk of each platform. Therefore, it is not so much a farm optimizer, but rather a platform that creates its own strategies looking for maximum performance.
The first thing we find is the dashboard, where we will find the main information of the protocol. Aspects such as your portfolio, or the different vaults and pools currently available. In addition to seeing the purchases made by the platform itself of your token.
To begin, the first thing we must do is to connect our wallet at the top right and select the BSC. Although the operation of the other networks is the same, we will focus on the Binance Smart Chain, since it is where we find more variety and it is the main network of the platform.
In pools we find the strategies that Belt has with its stablecoins. At the moment, we find the 3Tether, which consists of USDT from the BSC, HECO and Klaytn and you can get about 11% per year.
The 4 Belt, which is the best known, has the Belt version of the most popular stablecoins such as DAI, USDT, USDC and BUSD. With a yield of 5% per annum at the moment.
Finally, the last pool we find DAI, USDC, USDT and HUSD with its Belt version, which offers 13.87% at the moment.
In all these pools, you can deposit a single stablecoin, without having to deposit all 4. And it does not need to be the Belt version, you can deposit for example DAI without any problem. Simply indicate the amount you want to deposit, click on approve and confirm the transaction in your wallet to have your stablecoins in the pool you are interested in.
In vaults is where we find the most interesting part of Belt, and with a great variety of cryptocurrencies that we can deposit to get a good annual %. Among them, we have BTC, ETH, BNB, USDC, USDT, BUSD, HT, HUSD and many more.
Sometimes you will see more than one BTC or ETH vault, and this is because they are different strategies used to get the annual % it indicates. So I recommend you to take a good look at each strategy to see which one interests you the most.
In APR you can see the % that each vault generates, and if you click on it, you can find more information. The most relevant aspect here, is to see the strategy that is using that vault just below the deposit.
Each vault uses a different strategy, but usually Belt spreads that vault on different platforms, to reduce the risk in case something happens on a single platform. And although sometimes the annual % is not so high in others, it is a better strategy if you take into account the risk. Also, that in many occasions, the annual % is higher on one platform for a while, and then it is higher on another. This way, you can distribute your balance between the platforms that are currently offering the highest return on that token, for example with BTC.
In the case of the first vault, we see that it uses Alpaca finance with 58.45% of the total, Venus with 35.82% and Fortube with 1.88%. And each vault will have a different distribution and sometimes different platforms. What is important is to understand where the money is invested in each vault before depositing to know the risks and how it works.
Once you have seen the vault and you are interested, it is as easy as going to deposit, and first click on approve. Confirm in your wallet and now you can deposit the cryptocurrencies you want. Click on deposit and confirm in your wallet.
When you deposit, for example BNB, you will receive BeltBNB. That token, you can see next to deposit the graph, which represents its appreciation in value with respect to BNB in this case. It is similar to liquid staking, where instead of receiving rewards, you get a token that is worth more and more compared to the token you have deposited. So, when you go to exchange your BeltBNB for BNB, you’re going to get more BNB. And the same happens with BTC, where you will receive BeltBTC and so on with all the tokens with vault.
To withdraw it, you simply click on withdraw, indicate the amount and confirm the transaction in your wallet. Remember to have the Belt token, in this example, BeltBNB to be able to withdraw your BNB from that vault.
In staking you will be able to staking the native token of the platform, Belt to be able to participate in the governance. Belt is currently giving a 2.58% annual staking with its token.
Also, in staking there are LP Tokens with Belt, such as WBNB-BELT, which is staking 22.89% annually. Or WHT-HBELT with a 28.99% annual rate. You will have to create the LP tokens and stake them here in order to get that annual %.
Finally, we find the swap and bridge part. Being a platform with 3 networks, it allows you to interact with them very easily, since it has liquidity in each of them. In the swap, you can even exchange tokens from one network to another directly. A format very similar to what Thor’s network does.
The swap works like any swap you may have used as a panckeswap. Although the aspect that stands out is that the slippage between swaps is the smallest in stablecoins. This means that you do not lose when exchanging between stablecoins as it can happen when you do it in an exchange with low liquidity. This is very useful if you need to exchange stablecoins and you don’t want to lose a % of the total, as it usually happens. If you have experience exchanging stablecoins, you will have seen for yourself, that with large amounts, there is more and more difference when you want to exchange between two stablecoins.
Although I recommend you always check if there is much difference between using Belt or another DEX like pancakeswap, because depending on the liquidity maybe one can be better than the other.
I hope it has helped you to know how Belt, one of the main platforms in the Binance Smart Chain, works. Remember, if you don’t have an account with binance, you can create one just below.