Invalend
Capital efficiency, unlocked.
Created on 24th October 2025
•
Invalend
Capital efficiency, unlocked.
The problem Invalend solves
Leverage in Crypto: The Current Problem
Institutions, DAOs, and advanced DeFi users require capital-efficient leverage to optimize returns. Yet leverage in crypto today is still fundamentally broken:
- Borrowers must lock 100%+ collateral, wasting capital
- Custody risk: lenders hand over full control of funds
- Hidden execution risk: borrowers can take reckless positions
- Bad debt easily occurs in volatile markets
- LPs rarely understand how funds are actually used
- Compliance and auditability remain a challenge
In short:
Crypto leverage remains unsafe, opaque, and unsuitable for institutional adoption.
What Can People Use It For?
Borrowers (Traders, DAOs)
- Access up to 5x leverage with only 20% collateral
- Trade inside a controlled smart wallet that prevents abuse
- No negotiation or credit scoring needed
Liquidity Providers
- Earn passive yield by funding capital-efficient leverage
- Protected by restricted execution and automated risk controls
- Full visibility over borrower positions and health
Institutions
- On-chain, compliance-ready leverage infrastructure
- Real-time tracking of all fund flows and positions
- Modular risk framework aligned with institutional mandates
No more trusting users.
Trust the code, trust the collateral.
Challenges we ran into
1. Uniswap V4 Integration Complexity
Challenge: Integrating with Uniswap V4's new architecture while maintaining restricted execution
Solution: Built custom RestrictedWallet contract with V4-specific swap functions and whitelist enforcement
Learning: V4's modular design actually made restriction enforcement easier than expected
2. ERC-4626 Vault Implementation
Challenge: Implementing proper share-based accounting with yield accrual
Solution: Used OpenZeppelin's ERC-4626 standard with custom yield calculation logic
Learning: ERC-4626's composability made LP experience seamless
3. Frontend State Management
Challenge: Managing complex multi-step flows (approve → create loan → trade)
Solution: Built custom hooks with proper state management and error handling
Learning: React hooks pattern works well for DeFi UX complexity
4. Base Sepolia Testnet Limitations
Challenge: Limited liquidity and testing infrastructure on Base Sepolia
Solution: Deployed mock tokens and created comprehensive test scenarios
Learning: Testnet limitations actually helped focus on core functionality
Link to the GitHub Repo of your project
Live URL of your project
What is your product’s unique value proposition?
20/80 Prefunding Model
- Borrowers supply 20%, LPs finance 80%
- All capital flows are on-chain and custody-safe
- LPs never hand over control of their funds to the borrower
Restricted Execution = Zero Custody Risk
The borrower cannot:
- Withdraw LP funds
- Transfer assets externally
- Access unknown DEXs or risky assets
- Evade protocol controls
Every position is auditable in real time.
Automated Risk Protections for LPs
- Enforced stop-loss/liquidation rules
- Prioritized repayment for LPs
- Transparent risk-sharing framework
LPs get yield without reckless borrower behavior.
Built for Base’s Institutional Vision
- Designed to integrate with Coinbase ecosystem wallets and tools
- Matches Base’s focus on scalable, trust-minimized financial rails
- Accelerates institutional liquidity on-chain
Who is your target customer?
Primary Audience: Institutional & Advanced DeFi Participants
Invalend focuses on users who demand leverage with strict capital controls and auditability:
| Segment | Needs | Why Invalend Fits |
|---|---|---|
| Professional traders | Higher capital efficiency | 20% collateral access to 5x leverage |
| DAOs & Crypto funds | On-chain mandates and risk limits | Restricted execution + full transparency |
| Institutional LPs | Compliance-friendly yield | Controlled vaults + prioritized repayment |
| CeFi/TradFi onboarding | Trust-minimized infrastructure | Clear auditing and operational protections |
These users deeply care about safety, visibility, and capital efficiency — not purely high APY.
How We Validated the Audience
- Customer discovery with hedge fund operators highlighted leverage inefficiency as a major blocker
- Feedback from large LPs in structured DeFi products emphasized the need for automated protections
- Engagement with Base ecosystem builders revealed growing demand for institutional readiness
Behavioral Data Across DeFi
- Aave, Maker, and GMX users are migrating toward safer leveraged strategies
- Market shift toward real collateral and transparency over undercollateralized credit
Signals indicate:
Protected leverage and transparent liquidity flow are top institutional requirements for on-chain finance.
Who are your closest competitors and how are you different?
Competitive Landscape
The leverage and credit landscape is crowded, but no one protects LP capital by design.
| Competitor | What They Offer | Risk Gaps | Difference vs Invalend |
|---|---|---|---|
| Aave | Overcollateralized lending | 100% collateral burden, bad debt events | Invalend uses 80% LP capital with risk controls before loss |
| Maple Finance | Institutional credit pools | Off-chain underwriting, rehypothecation risk | Borrowers never custody LP funds; all activity enforced by smart wallet |
| Gearbox | Credit account leverage | Flexible but high execution risk | Restricted execution guarantees safe asset usage |
| GMX / Perp DEXs | Leverage trading venues | Impermanent loss and counterparty risk | Invalend is not a venue, but a controlled leverage infrastructure |
| Silo / Morpho | Isolated risk lending markets | Still overcollateralized | Invalend achieves higher leverage with less collateral |
The Core Moat
Invalend is the first leverage infrastructure where LP capital never leaves protocol control, and risk is restricted at the smart wallet level.
Our Defensibility Sits In:
- Custodyless leverage: borrower cannot withdraw or gamble funds
- Execution sandbox: only approved assets and venues
- Capital efficiency breakthrough: 20% collateral vs 100%+
- Auditability: matches traditional finance standards
This approach aligns perfectly with Base’s institutional liquidity strategy.
What is your distribution strategy and why?
Go-To-Market Strategy
Invalend will scale through the channels where institutional liquidity originates and where traders already operate.
Our plan focuses on partnership-first distribution, supported by embedded integrations and reputation-based community growth.
1) Institutional & DAO Partnerships
Channel: Direct outreach, co-designed vaults
Target: Funds, treasuries, lending desks
Why it works:
- These users deploy the largest capital and care the most about risk-controlled leverage
- Offering Vault-as-a-Service unlocks immediate institutional TVL
2) Base Ecosystem Integrations
Channel: Protocol partnerships (DEXs, perps, RWAs)
Why it works:
- We meet traders inside existing liquidity hubs
- Aligned with Base’s roadmap to become the home of institutional capital
3) Embedded Trader Distribution
Channel: Wallets, aggregators, social trading interfaces
Why it works:
- High-frequency traders prefer frictionless access to leverage
- Integrated directly into existing trading flows, no need for new platform onboarding
4) Proof-of-Safety Community Growth
Channel: Leaderboards, transparent performance data, KOL analysts
Why it works:
- Trust is earned through visible security guarantees and performance transparency
- Safety-first yield attracts both sophisticated LPs and smart retail
5) Compliance-Enabled CeFi Bridges
Channel: Coinbase Wallet, custody providers, compliance APIs
Why it works:
- Institutions require auditability and compliance alignment
- Enables smooth onboarding of regulated capital through trusted infrastructure
Why This Strategy Fits Our Audience
| Audience | What They Value | Strategy Fit |
|---|---|---|
| Institutional LPs | Capital protection, compliance | Direct partnerships + Base ecosystem integration |
| Professional traders | Easy leverage + execution control | Embedded integrations inside trading apps |
| Power users & whales | Transparency & reputation | Leaderboards + KOL-driven credibility |
We grow by proving safety and performance,
not by inflating yield.