CreditShaft
We're digging deep into credit liquidity
Created on 4th June 2025
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CreditShaft
We're digging deep into credit liquidity
The problem CreditShaft solves
💳 CreditShaft - Safe DeFi Leverage Protocol
🎯 The Problem It Solves
💀 DeFi's Brutal Reality
- Instant Liquidations: One price spike = lose everything
- Over-collateralization: Lock up 150%+ assets for basic leverage
- No Safety Net: Complete loss with zero recourse
- High Barriers: Need significant crypto holdings to start
🚀 What People Can Use CreditShaft For
Turn your credit card into a DeFi safety net
✅ Safe Leverage Trading: Get 2x-5x crypto exposure without risking total loss
✅ Emergency Protection: Credit card backstop prevents liquidation wipeouts
✅ Capital Efficiency: Use less collateral, get more leverage
✅ Yield Generation: Earn sustainable returns as a liquidity provider
✅ Risk-Free Entry: Try DeFi leverage without fear of losing everything
How It Makes Trading Safer & Easier:
🛡️ Safety First: Credit card acts as emergency collateral - no more total liquidations
⚡ Instant Setup: Single transaction opens leveraged positions atomically
📱 Familiar UX: Use credit cards everyone already understands
🏦 Professional Tools: Chainlink automation monitors positions 24/7
💰 Earn While You Sleep: LP providers get fees + profit sharing
🔗 How Chainlink Powers Safety
🔧 Chainlink Functions - Payment Bridge
- Creates Stripe pre-authorizations (150% safety buffer)
- Charges expired timeouts after 7 days
- Releases holds when positions close safely
🤖 Chainlink Automation - 24/7 Guardian
- Monitors position health in real-time
- Triggers liquidations when LTV > 65%
- Handles expired pre-auth charging automatically
📊 Chainlink Price Feeds - Market Truth
- Real-time LINK/USD price data
- Accurate LTV calculations
- Risk assessment for all positions
💰 How LPs Earn
Dual Revenue Streams:
- Flash Loan Fees: 0.09% on every trade
- Profit Sharing: 20% of successful trading profits
Example: $1M monthly volume = $900 fees + $10k profit share = ~13% APY
⚡ User Flow
Traders: Deposit LINK → Add payment details → Get 2x-5x exposure → Close anytime safely
LPs: Deposit USDC → Earn fees + profit share → Withdraw with rewards
Credit card safety net means you never lose everything - the future of safe DeFi leverage.
Challenges I ran into
🛠️ Challenges I Ran Into
Building CreditShaft was basically a crash course in "everything that can go wrong, will go wrong." Here's what broke and how I fixed it.
🏦 Aave Integration Was a Nightmare
The Problem: Aave V3 docs made it look simple, but reality hit hard. aTokens, health factors, approval flows - felt like learning a new language while blindfolded.
The Real Problem: Tried cramming everything into one massive contract. Bad idea.
The Fix: Split into three clean contracts:
- CreditShaftCore: Handles flash loans and LP rewards
- CreditShaftLeverage: Main user interface, orchestrates everything
- AaveStrategy: Pure Aave vault, owns all the aTokens and debt
Now each contract does one job well. AaveStrategy isolates all the Aave weirdness, Leverage orchestrates the flow, and Core handles the money. Much cleaner!
⚡ Flash Loans: External vs Custom
The Problem: Started with Balancer flash loans. 0.3% fees, complex integration, zero control over execution.
The "Aha" Moment: Why pay someone else when I can build better?
The Solution: Built custom flash loans in CreditShaftCore. Now LPs earn 0.09% fees instead of paying Balancer, and I control the entire flow. Win-win!
🔐 Chainlink Secrets Were Impossible
The Problem: Spent literally hours getting "Error fetching secrets" when trying to call Stripe. Documentation was confusing about DON vs threshold encryption.
The Breakthrough: Finally figured out DON-hosted secrets need proper versioning. Upload secrets → get version number → reference in contract. Once it clicked, everything worked perfectly.
🚨 Aave Sepolia Was Completely Dead
The Plot Twist: Deployed everything to Sepolia... and USDC borrowing was disabled. Not just for me - for EVERYONE.
The Investigation: Turns out the entire protocol had zero USDC liquidity. No liquidity = no borrowing enabled.
The Creative Fix:
- Minted 1M USDC from Aave faucet
- Supplied it all to restore liquidity
- Searched event logs for existing borrow events
- Paid off random people's USDC debt to free up more liquidity
- Boom - USDC borrowing worked again!
Plot Twist: I accidentally fixed Aave Sepolia for everyone. Other devs could suddenly borrow USDC again! 😂
🎯 What I Learned
- Testnets break in weird ways - always have backup plans
- One job per contract - makes everything easier to debug
- Custom solutions beat external deps - better control, better economics
- Sometimes you gotta fix the infrastructure to build your vision
- Persistence > everything - every "impossible" problem has a hack
The craziest part? When the entire testnet is broken, don't give up - just fix it yourself! 🔧
Tracks Applied (2)
Onchain Finance
Avalanche Track
Avalanche
Technologies used
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