Angle is a scalable, efficient, over-collateralized and liquid decentralized stablecoin protocol. Get to know how it works under the hood!
Welcome to Angle Developers Guide ⚒️! The goal of this guide is to help developers understand how Angle protocol works under the hood and how to build on top of it.
In this documentation you'll find details about:
The different smart contracts at stake in the Angle Protocol
Tools you can use to easily build on Angle (SDK, API, ...)
If there are questions which are not well answered by this guide, if you see elements which are no longer up-to-date or if you need extra development support, please do not hesitate to join the #developers🛠 channel on our Angle community Discord server 🕹️.
Angle is the first over-collateralized, decentralized and capital-efficient stablecoin protocol. It offers full convertibility between stable assets and collateral at oracle value: you can swap 1 of collateral against 1 of stablecoin and conversely.
This makes the protocol both capital efficient and highly liquid.
Angle Protocol has started by launching agEUR, the first liquid Euro stablecoin in the market. The goal however is to create the non-USD money layer for DeFi and so new stablecoins pegged to other types of assets should be launched later in 2022.
🎨 Protocol Design
The protocol consists of several different modules with a minting right on the stablecoin contracts. While Angle was launched with a single minting module (the Core Module), a borrowing module allowing to borrow Angle stablecoins against deposited collateral will soon be released. The protocol is also engaged into Algorithmic Market Operations (AMOs) where agTokens are invested in protocols for Angle to get a yield on.
The Core module of the protocol involves 3 agents, very common in other DeFi protocols, which all bring something to Angle, while benefitting from the protocol:
Stable Seekers/Holders, or Users: they can swap collateral against stable assets, and conversely swap stable assets against a whitelisted collateral of their choice at oracle value, with no slippage and small transaction fees.
Hedging Agents (HAs): they can open on-chain leveraged positions on Angle. They need to bring accepted collateral to the protocol, and are able to take positions on perpetuals futures on the available collateral/stablecoins pairs. By doing so, they insure the protocol against the volatility of the collateral brought by stable seekers. This volatility is transferred to these traders, and the protocol is able to ensure users of the convertibility of the stablecoins they own even in case of collateral price drops.
Standard Liquidity Providers (SLP) : they lend collateral to the protocol in return of a share of minting and burning fees, and of the rewards earned from investing part of the protocol reserves into yield-earning strategies.
In short, Angle Core Module matches people who want stability (stable seekers) and people who want volatility (Hedging Agents). Yet, there isn't always a perfect match between supply and demand of volatility, meaning that the protocol's collateral may not be fully covered at all times by Hedging Agents. The additional collateral brought by Standard Liquidity Providers, serve as a buffer in this marketplace.
The Borrowing module of the protocol allows users to deposit collateral and borrow agTokens (debt) against this collateral. It is designed to enable getting leverage on almost any asset through an agToken loan, or to simply let people get access to stablecoins while keeping their exposure to a volatile asset or to a yield-bearing token.
Inspired from more traditional borrowing protocols (like Maker, Abracadabra, Liquity, Aave, Compound, ...), it comes with its set of new features and improvements which make it efficient. Among other things:
All operations are designed to be capital-efficient
Liquidations are thought to optimize the borrowing experience, meaning that liquidators only get the smallest discount possible on the collateral
Angle is not limited to these two modules. It is notably involved in algorithmic market operations where agTokens are invested directly by Angle in other protocols.
Angle also relies on a Governance module to manage the protocol.