Introduction

Shift is a DeFi application designed to enable users to earn yield on their crypto by allocation funds in cross chain DeFi protocols while incorporating advanced risk mitigation solutions.

The platform generates returns through liquidity provision to DeFi protocols operating across various EVM chains. One of shift's notable features is the creation of the Vault, an ecosystem of smart contracts that strategically allocates funds to diverse yield farming strategies on behalf of users. Shift's on-chain infrastructure is transparent, eliminating the presence of "black boxes" and addressing concerns related to centralization. This ensures that users maintain complete control over their cryptocurrency holdings at all times.

Recognizing the inherent risks within the emergent DeFi market, shift introduces a real-time risk mitigation solution. In the event of an emergency situation involving any DeFi protocol where liquidity is provided, shift has the capability to automatically withdraw users' funds to their wallets. This proactive approach aims to enhance user security and protect assets in an ever-changing DeFi landscape characterized by potential risks.

In Details:

• Ease of allocating capital within the DeFi ecosystem. Allocation of the funds is done by depositing funds to the Vault. Vault - is an ecosystem of smart contracts which automatically forwards clients funds to the portfolio of cross chain DeFi protocols (such as Compound, Convex, Velodrome, Sonne Finance, etc) and auto compound accumulated yield.

• No centralization issue. Only the user has access to the assets. Ecosystem of smart contracts doesn't have any roles which can grant access to the user's assets to anybody except the user. Users could withdraw liquidity allocated in the DeFi protocols at any moment. Therefore the Vault does not have any centralization issue. In simple words, the main purpose of the Vault is to mint underlying lp tokens on behalf of the user and socialize tx costs while auto compounding.

• Diversifying funds allocation to optimize the risk-return ratio. Vault is a portfolio significantly diversified among various DeFi protocols and assets, in which the user takes exposure, aiming to offer the user an optimal risk-return level. The user can choose in which Vault to place their funds depending on their risk appetite. Each Vault has a different set of DeFi protocols and assets with established placement limits, to which clients' funds will be directed, shaping its risk profile. Before making a decision, the user can familiarize themselves with the list of DeFi protocols and assets, as well as the placement limits, to which exposure will be taken.

• Thorough analysis of each DeFi protocol before inclusion in the portfolio. Each DeFi protocol, asset, and blockchain undergoes a Risk Assessment and Management Policy (RAMP) before being included in the portfolio of any Vault. Within RAMP, Shift conducts research on protocols, assets, or blockchains (risk building blocks) from both economic and technical perspectives. As part of the research, for example (but not limited to), the composition of collateral for a stablecoin or lending protocol is identified, along with potential risks associated with it for the asset or protocol's solvency. Additionally, code audits of contracts are conducted to identify centralization issues, lack of protection against typical hacking patterns, and other vulnerabilities. Research determines the risk rating of each protocol, asset, or blockchain. Subsequently, depending on the risk rating, each risk building block is included or not in a particular Vault, shaping its risk level. The approach to researching risk building blocks is formulated and continuously updated based on post-mortem analysis of most exploit cases (both technical and economic) in the DeFi ecosystem.

• Continuous monitoring of the DeFi market to propose optimal yield farming strategies. Shift continuously monitors the DeFi market to identify new protocols or assets for inclusion in the research pipeline, which may be incorporated into various Vaults. It also monitors the risk-return level for current portfolios. As a result, Vaults' portfolios are periodically reshuffled to maintain an optimal risk-return level. In this scenario, Shift deploys smart contracts for a new Vault with a new portfolio, and users independently transfer their assets to the new Vault since they alone have access to their liquidity.

• Real-time identification of risky events in DeFi to minimize potential losses from exploits and negative market events. Shift has proprietary developed risk mitigation solutions that gather on-chain and off-chain data in real-time regarding DeFi protocols and assets, analyzing them to detect risk events. Upon identification, the risk mitigation solution withdraws funds from the protocol and/or converts them into a stablecoin, such as USDC if necessary. Risks and methods for their identification and mitigation are determined during the research phase of each DeFi protocol or asset. Additionally, the risk mitigation solution includes an AI module that analyzes on-chain data and attempts to identify malicious transactions related to protocols or assets, initiating the withdrawal of user liquidity and converting it into stablecoin if needed.