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Whether you are new to DeFi or an experienced user, this guide will help you navigate the Divi DeFi platform and take full advantage of all it offers. Let's get started!
Before you get started, there are a few things you need to have in order before you can take advantage of the Divi DeFi platform. These have all been discussed in more detail in previous articles, which you can find on our blog, and we recommend you read all of the DeFi education series pieces before proceeding.
1. Visit the Divi Blockchain Bridge: https://changenow.io/currencies/divi-erc20/divi
(This link can also be found in the “Bridges” tab in the header of the Divi DeFi site)
2. Enter the amount of DIVI you wish to exchange for DIVI(ERC20) and click “Exchange.”
Swaps as the Bridge
3. Enter your MetaMask wallet address in the “Recipient Wallet” field and click “Next.” You can paste your address here or click the MetaMask fox icon to select a wallet directly from your Metamask browser extension. This is the wallet where your DIVI(ERC20) tokens will be sent after the swap takes place.
Recipient address
4. Follow the on-screen prompts to confirm the details of your swap.
5. Send your DIVI to the address provided and follow the progress bar until your DIVI(ERC20) tokens arrive in your wallet.
Critical details
1. Visit the Divi DeFi Website
2. Click the “Connect Wallet” button in the top right corner of your browser window.
Divi DeFi Homepage
3. Choose Metamask from the list.
Connecting your wallet
Note: If you do not have a MetaMask wallet and would prefer to create a new wallet using Magic Connect, you can select the “Email” option and follow the on-screen prompts. You can learn more about Magic here.
4. The Divi DeFi platform will display a “Waiting to connect” message.
Connecting
Simultaneously, you should see a new prompt from MetaMask. Select the wallet that holds your DIVI(ERC20) tokens from the list, and click “Next.”
*Note that you may also be prompted to sign into MetaMask if you are signed out.
Select NEXT
5. MetaMask now provides an overview of the permissions you are granting to the Divi DeFi platform. When you’re ready to proceed, click “Connect.”
Confirming connection
6. You’re now connected and ready to get started. You will now see your wallet address displayed in the top right corner of the browser window.
Connected!
Now that your wallet is connected to the platform, you can start interacting with smart contracts. One of the first things you should try on the Divi DeFi platform is a trade on our decentralized exchange.
For example, let's start with a trade between ETH and DIVI(ERC20).
*Reminder: you need to already have ETH in your wallet to make this trade.
1. From the header menu, click “Trade” and select “Swap” from the dropdown menu.
Swap/Liquidity
2. In the “Pay” section, select ETH from the assets dropdown menu and DIVI in the “Receive” section.
Select assets
3. Enter the amount of ETH you wish to trade in the “Pay” field. The amount of the other asset you will receive is automatically populated.
4. This screen now displays some vital information:
5. Once you’ve reviewed the information about your trade, click “Swap” if you’re ready to proceed with the trade.
SWAP
6. On the next screen, you’ll be asked to confirm this trade again. Click “Confirm Swap” to proceed.
Confirm Swap
7. After confirming, the Divi DeFi platform will display a “Waiting for confirmation” message.
Waiting for confirmation
Simultaneously, you should see a new pop-up prompt from MetaMask. To fully execute this trade, you’ll need to sign a transaction with your wallet to authorize the transfer of assets on the blockchain.
By signing, you agree to the terms and conditions set forth by the contract, such as the amount of assets you are trading and the price at which they will be traded. The signature of the contract also proves to the network that you own the assets you are trading and have permission to transfer them. This ensures the trade is valid and can be executed on the blockchain.
Confirm transaction
8. Review the information displayed and take special note of the “Estimated gas fee.” This price changes depending on the current use of the Ethereum network. When you’re ready to sign the transaction, click “Confirm.”
9. The Divi DeFi platform will now display a “Transaction Submitted” screen. The “Add Divi” button will assist you with adding the DIVI(ERC20) contract address to your MetaMask if you have not already done so.
Confirmation!
10. After confirmation on the Ethereum blockchain, your trade is executed, and the acquired tokens will appear in your wallet. You can also head to the Dashboard to see the history of your executed trades.
Swap record
When you add liquidity to a trading pair, you will receive liquidity pool (LP) tokens representing your position in that liquidity pool. These tokens automatically earn fees in proportion to your share of the pool and can be redeemed at any time.
For this example, we’ll add liquidity to the ETH/DIVI(ERC20) liquidity pool.
*Note that you need both ETH and DIVI(ERC20) in your wallet to provide liquidity to this pool.
1. Select “Liquidity” from the Trade menu dropdown in the header of the Divi DeFi website.
Liquidity
2. Click “+ Add Liquidity”
Toggle to liquidity
3. In the top and bottom “Input” fields, select “ETH” and “DIVI” from the respective asset dropdown menus.
Liquidity scale
4. Enter the amount of ETH you want to contribute to the liquidity pool or use the slider to select a certain percentage of the ETH in your wallet. An equal USD value of the other asset, DIVI(ERC20), will automatically populate in the second “Input” field. Take note of the initial “Pool Share” you will have by providing this liquidity.
Providing liquidity
5. When you are ready to continue, click “Supply.”
Supplying liquidity
6. On the next screen, you’ll be asked to confirm your action. Review the details and click “Confirm Supply” if you are ready to proceed.
Confirming Supply
7. After confirming, the Divi DeFi platform will display a “Waiting for confirmation” message.
Liquidity provision confirmation
Similar to the MetaMask pop-up prompt you see when making a trade on the DEX, you should now see a new pop-up prompt from MetaMask. You’ll need to sign another transaction with your wallet to execute this action fully.
Confirming your liquidity provision
8. Review the information displayed and take special note of the “Estimated gas fee.” This price changes depending on the current use of the Ethereum network. When you’re ready to sign the transaction, click “Confirm.”
9. After confirming, the Divi DeFi platform will display a “Transaction Submitted” screen.
Liquidity transaction is confirmed
10. After confirmation on the Ethereum blockchain, your contribution to the liquidity pool has been made and is now displayed in the Dashboard in the “Swap & Liquidity” section.
Liquidity position summary
DeFi markets are highly volatile, and the value of your assets can fluctuate rapidly. Managing your liquidity positions in DeFi is important for maximizing returns and minimizing risk. By managing your liquidity position, you can reduce your exposure to price volatility, ensure you are getting the best possible returns on your investment, and identify when the value of your assets in the pool is increasing or decreasing.
Managing Liquidity positions
One of the easiest ways to keep track of your position is to use the “liquidity ratio.” The liquidity ratio is a metric used to compare the value of your assets locked in a trading pool to the value of your initial contribution. It is calculated by dividing the total value of your assets currently locked in the pool by the total value of the assets you initially contributed.
Here's an example of calculating the liquidity ratio:
1. Determine the value of your initial contribution: Let's say you initially contributed 1 ETH and 100 Divi tokens. You can always see your initial contribution by clicking the “Liquidity” toggle in the “Swap & Liquidity” section of the Divi DeFi Dashboard.
2. Determine the current value of your assets in the pool: Let's say the current value of those assets is 1.5 ETH and 150 Divi tokens. You can see the current value of your assets in the pool in the “LPs” section of the Divi DeFi Dashboard.
3. Calculate the liquidity ratio: To calculate the liquidity ratio, divide the current value of your assets in the pool (1.5 ETH + 150 Divi tokens) by the value of your initial contribution (1 ETH + 100 Divi tokens).
In this example, the liquidity ratio is 1.5, meaning that the value of your assets in the pool has increased by 50% compared to your initial contribution. If the ratio is greater than 1, the value of your assets in the pool has increased, and you have made a profit. If the ratio is less than 1, your assets' value has decreased, and you have incurred an impermanent loss.
It's important to note that the liquidity ratio does not take into account any fees or slippage that may have occurred during the trading process. Also, the liquidity ratio is a relative measure and should be used with other metrics to make more informed decisions about managing your liquidity position.
After providing liquidity to the ETH/DIVI(ERC20) pool, users can take an additional step and stake their LP tokens at the Divi DeFi Farm, enabling access to the cross-chain stakes from the vaulted DIVI at the bridge. Cross-chain staking can be found on the “Farms” tab.
This feature is coming soon. Stay tuned for this feature’s launch date and an updated walkthrough!
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