what's Supernova?

Supernova is a DeFi protocol designed to enable efficient trading of interest rates within decentralized finance ecosystems. It addresses key inefficiencies in current markets by allowing users to hedge against fluctuations in borrow rates and lock in favorable lending rates over fixed periods, such as three months. This is particularly valuable for advanced strategies like looping principal tokens (PTs) on lending platforms such as Aave, where users can mitigate risks from rate volatility without disrupting their positions. By facilitating a robust rates market, Supernova acts as a critical tool for completing DeFi markets and preventing cascading deleveraging events. It supports mechanisms like ParRate for pricing fixed-rate borrows and lends, enabling market participants to trade rates in a capital-efficient manner. This unlocks new opportunities for farmers and liquidity providers to manage predictability in the cost of capital amid uncertainty driven by large-scale withdrawals or market frothiness.

Supernova launched on Ethereum testnet.