In the Atom Economic Zone (AEZ), staking and security go hand in hand, but they come at a cost: capital is locked, and users can’t access the value of their assets without unstaking. That tradeoff limits the full potential of DeFi on the Hub.
Amulet Finance is tackling this challenge head-on with a bold new approach: self-repaying loans backed by future staking rewards. By rethinking how staked capital can be accessed and used, Amulet is opening the door to a more flexible, user-empowered financial system within the AEZ.
To help bring this to life, the Atom Accelerator DAO (AADAO) supported Amulet’s development as part of its mission to fund high-impact projects that expand the functionality and efficiency of the Hub.
About Amulet Finance
Amulet Finance built a non-custodial, decentralized lending protocol that allows users to take out self-repaying loans using staked assets. Instead of forcing users to unstake their ATOM or other AEZ tokens, Amulet lets them borrow against those assets and gradually repay the loan using the yield generated over time.
Powered by Neutron and leveraging Interchain Accounts, Amulet enables:
- Access to liquidity without unstaking
- Loans backed by future staking rewards or yield farming strategies
- Yield-enhancing DeFi strategies using ATOM-based derivatives and wrapped assets
With a dedicated grant from AADAO, Amulet had the funds needed in order to:
- Publish a three-part educational content series to explain how the protocol works
- Launch a lockdrop in partnership with Eclipse
- Address legal and compliance frameworks for a secure and sustainable rollout [see audit here]
Amulet’s model draws inspiration from Ethereum’s Alchemix, which reached nearly $900M in TVL, and reimagines it for Cosmos-native infrastructure, tailored to the unique structure of the AEZ.
Why This Matters for the Hub
Capital efficiency is the next major unlock for DeFi in the AEZ. As more users stake their ATOM to secure the Hub, Amulet offers a new path forward – one where staking doesn’t mean sacrificing flexibility.
This unlocks several key benefits for the Hub and its surrounding ecosystem:
- Increased liquidity and participation without undermining security
- Greater utility for staked assets, enabling users to contribute to network health while also engaging with DeFi
- Enhanced composability, as Amulet helps create a new class of staked-asset derivatives that can be integrated across AEZ protocols
By enabling users to do more with the assets they already hold, Amulet strengthens the AEZ’s position as a dynamic, user-first ecosystem. AADAO’s support ensures that this innovation can launch with clarity, momentum, and strategic alignment to the Hub’s long-term vision.
Follow Amulet’s journey as they onboard new partnerships, assets, and overall opportunities for users! Or read further into the success of their testnet and mainnet launch, as well as other accomplishments along the way.
About the Atom Accelerator DAO
Atom Accelerator DAO (AADAO) is a governance-mandated DAO of the Cosmos Hub. We have been formed and mandated to drive value for the Cosmos Hub and ATOM, supporting initiatives that either directly create economic impact or produce value that can drive its growth. From this, our current primary mandates are public grants and venture grants.
*Note: Starting January 1st 2025, AADAO has been sunset and is in maintenance mode, no longer accepting new grant applications.
