Glossary

  • AI Agent / Agentic AI: In the context of SurfLiquid, this refers to the autonomous software “agent” that uses artificial intelligence techniques to make decisions and execute DeFi strategies. It’s more than a simple script; it’s a smart entity that can learn from data, adapt to conditions, and act independently within the bounds you set.

  • DeFi (Decentralised Finance): An ecosystem of financial applications built on blockchain networks. These applications (like decentralised exchanges, lending platforms, liquidity pools) operate without centralised intermediaries – instead using smart contracts. SurfLiquid taps into these to earn yields.

  • Yield Farming: A strategy in DeFi where users provide liquidity or stake assets in return for rewards, often in the form of interest, fees, or governance tokens. It’s essentially putting your crypto to work to “farm” more crypto. SurfLiquid automates yield farming by moving your assets to the farms with the best returns.

  • Lending Protocol: A DeFi platform that allows users to lend and borrow assets (e.g., Aave, Compound). Lenders earn interest (yield) on deposited assets. SurfLiquid’s stablecoin strategy - Horizon, optimises across multiple lending protocols to get the highest interest rates.

  • Stablecoin: A cryptocurrency pegged to a stable asset (usually USD) – e.g., USDC, USDT, DAI. These are used in SurfLiquid for low-volatility yield strategies. Because their value remains stable, they’re ideal for lending without exposure to price swings.

  • LP (Liquidity Provider) & LP Tokens: When you provide liquidity to a DEX pool (e.g., contribute ETH and USDC to a pool), you get LP tokens representing your share of the pool. These tokens can often be staked to earn additional rewards (that’s yield farming). SurfLiquid’s farming strategy handles providing liquidity and staking LP tokens for you.

  • Impermanent Loss (IL): A temporary loss in value that liquidity providers might experience when token prices change relative to each other in a pool. It’s “impermanent” because if prices revert to the original ratio, the loss disappears; it becomes permanent if you withdraw at the divergent prices. SurfLiquid’s AI considers IL when choosing pools to avoid negating yield with heavy IL.

  • Smart Account / Smart Contract Wallet: A blockchain wallet deployed as a smart contract, not just a regular address. SurfLiquid uses user-specific smart accounts based on pre-audited, secure contract frameworks. These accounts include built-in rules and programmable logic, letting you automate, secure, and control DeFi operations, think of it as your programmable on-chain vault.

  • Multicall: A contract feature that lets multiple actions, like swaps, staking, or farming, happen in a single, atomic transaction. Multicall ensures efficiency and security: if any step fails, the whole transaction reverts, preventing partial execution and reducing risk.

  • Session Key: A temporary key or authorisation used by SurfLiquid’s agent to control your smart account for a session. It has limited permissions (can only do what the strategies allow, and only for a set time). Session keys let the agent act without you signing every on-chain action, but you can revoke them anytime.

  • APR (Annual Percentage Rate): The simple annual interest rate earned on an investment, not accounting for compounding. If a pool offers 10% APR, $100 would earn $10 in interest over a year (if the rate stayed constant). SurfLiquid often quotes APR for lending yields.

  • APY (Annual Percentage Yield): The annual rate of return including compounding. If yields are compounded (reinvested), the APY will be higher than APR. Many yield farms advertise APY since they auto-compound. SurfLiquid’s auto-compounding can turn an APR into a higher APY by reinvesting earnings throughout the year.

  • Rebalancing: Shifting assets from one investment to another to maintain or improve returns. In SurfLiquid, rebalancing refers to moving your funds from one protocol/pool to another to capture a higher yield. It’s like changing lanes to the faster-moving traffic on a highway.

  • Harvesting: Claiming yield rewards (like interest or farm tokens) from a protocol. Manual farmers have to harvest periodically; SurfLiquid automates this, so it harvests for you and reinvests those rewards (see auto-compounding).

  • TVL (Total Value Locked): The total amount of funds deposited in a protocol or strategy. It’s a measure of size. For example, SurfLiquid’s TVL would be the sum of all users’ funds it’s managing. In context, we also consider the TVL of target protocols as a measure of their usage/popularity.

  • Agent Token Flywheel: A concept where the platform’s token ($SURF) is integrated in a way that platform usage increases token value, and token usage benefits the platform, creating a self-reinforcing cycle. For SurfLiquid, this involves using fees to reward token holders and giving token holders perks, aligning ecosystem incentives (explained in the $SURF Token & Utility section above).

That concludes the SurfLiquid documentation. We hope this not only helps you use SurfLiquid effectively but also deepens your understanding of the DeFi and AI underpinnings that make it all possible. Now, strap in and let our AI agent surf the DeFi waves for you – happy yield hunting! 🏄‍♂️🚀

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