Dolomite

Dolomite is a decentralized finance protocol that combines a lending/borrowing money market with decentralized exchange functionality. It supports over-collateralized loans, margin trading, spot trading and other on-chain financial instruments, and states that it is the only lending and borrowing platform able to support over 1,000 unique assets, with borrowing available against 100+ assets. Positions are held in isolated borrow positions so that changes in one position do not affect others, and the protocol supports subaccount transfers, flash loans (described in the documentation as free), and trading against internal or external liquidity.

The protocol's architecture is split into two layers: an immutable core layer, whose changes are limited to certain configuration parameters, and a mutable module layer that allows new features and integrations to be added without altering core behavior. A virtual liquidity system underpins what Dolomite calls capital efficiency — the reuse of the same liquidity to earn multiple sources of yield simultaneously, for example earning lending yield and swap fees at the same time. Isolation Mode and virtualized balances let users continue staking or claiming rewards on deposited assets (the documentation cites plvGLP, GLP, jUSDC, Camelot nitro pools, Atlas SI tokens and Lyra option vaults) while borrowing against them, including non-standard or non-tokenized positions.

User-facing features include Zap, which integrates DEX aggregators and protocol routing so users can swap, loop, hedge or repay inside a borrow position in a single transaction; Strategies, pre-built positions curated by Dolomite and ecosystem partners, filterable by APR, risk level and chain; and a token system consisting of DOLO, veDOLO and oDOLO used for community rewards, protocol-owned liquidity and governance. The documentation also covers E-Mode and segregated risk, a TypeScript client, a subgraph, USD1 Points and Community XP programs.