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Two Unicorns United: Compound.finance and Uniswap.exchange
Elevator Pitch
The pooled funds on a UniSwap-like platform are both used for borrowing and lending a Compound-like platform, adding both supply and demand, where the borrowed and lent funds remain liquid within the Uniswap platform to add both upfront and ongoing funds to the arbitrager’s pool to then boost the fees from trades and returns to poolers on Uniswap.
Full Pitch
If you use the pooled funds on Uniswap to both lend and borrow on Compound, then you can have more initial funds for arbitragers to trade with on Uniswap while also drawing income from lending on Compound, which can be put into the system to allow both more money in the long run for arbitragers to trade with and for returns on the Uniswap platform.
In reality, this would be a third, unique platform with a single point of entry to put funds in and withdraw funds back out after returns are realized, with the background process explained in great detail. The goal is for the added liquidity to create more fees in additional trading than it costs to be borrowed, balanced in realtime vs the returns from lending the other half of those pooled funds. Practically, these are weighed against each other and loans are decollateralized or recollateralized according to current market conditions, keeping sure that the risk of liquidation doesn’t become a reality.
