How Merlin helps active DeFi investors: extended deep analytics options
Let us walk you through the main issues making the life of active DeFi investors harder and explain how Merlin can help here. Starting with the first issue — lack of accurate and deep level analytics.
Investing in DeFi protocols is often clunky and distributed. Having to keep track of your positions is tough. As the investor, not only you must know which protocols your assets are interacting with, but also their relative size and composition, profit/loss (both in nominal terms and in terms of yield) and general success or failure of each investment. VALK’s main goal is to make your DeFi game as smooth as possible, so you can focus on profits. We start with Merlin & portfolio management.
Issue: Lack of detailed portfolio analytics options on one dashboard
Of course there are wallet reporting tools such as Zapper and Debank out there, but active DeFi users require a higher degree of accuracy and more depth when it comes to analysis of their positions and investments. There is currently no way to get an aggregate and holistic summary of all positions, that accurately depicts how each is doing relative to initial entry. Put simply, you can see the current values, but not historical information that allows you to understand whether you are really making profit or loss.
Solutions from Merlin
Merlin provides all necessary information on one platform with a simple and accessible UI that allows accurate analysis and reporting, including:
- Overview of all recent and historical transactions
- Profitability of yield earned vs NAV
Merlin is able to track the date at which you deposited your tokens into staking, the price at that time, the yield earned during that period and the current price of the token. This way, Merlin calculates whether there has been a profit or loss related to that staking action.
- Aggregate transaction fees, aka gas fees
This is particularly important when gas fees are volatile, because we all know that it can be a big expense in your trading.
- Impermanent loss on liquidity pools such as Uniswap
Impermanent loss occurs when there is price volatility of one of the token pairs supplied in the liquidity pool, which leads to automatic rebalancing of the pair to ensure the 1:1 ratio remains intact. Impermanent loss occurs if the combined value of this pair within the liquidity pool is less than it would have been had the investor just held the two tokens. Merlin calculates impermanent loss, range and the ratio of the tokens within the liquidity pool to see if the investment has gained or lost money. Additionally, Merlin can allow the investor to claim any fees that they have earned from liquidity provision.
- Overview of assets held in your wallet and assets held inside the protocols such as Aave and Compound
Wallet trackers such as Etherscan can’t understand DeFi or interactions with smart contracts on a deep level. This means that DeFi transactions, yield generated and PNL are not properly tracked, while it is absolutely necessary to have a deep understanding of each DeFi smart contract.