Base is for everyone, and with Alvara, creating asset baskets is for everyone. But Base’s marketing slogan isn’t the only reason why we decided that our next multi-chain expansion should be the Base L2.
Built and deeply integrated with the Coinbase ecosystem, Base has quickly established itself as one of the highest-activity L2s. Being part of the biggest CEX in the United States gave them a significant advantage over others: built-in distribution.
The Base app brought non-custodial onchain trading straight into people’s feeds, and their relentless focus on supporting builders resulted in nearly 4 billion in TVL locked.
One glance at the most popular apps on Base suggests that users rely on it heavily for DeFi activities such as lending and borrowing. All top three dApps by TVL are in that realm: Morpho, Aave, and Steakhouse Financial.
The first two are typical DeFi lending protocols that enable those with stablecoin holdings to lend them to willing borrowers at a decent rate, which in turn facilitates traders taking out stablecoin loans for leverage trading backed by crypto collateral. The third is a so-called risk curator, a platform that offers users different curated vaults to invest in.
This might sound similar to what we’re doing at Alvara, but with one big distinction: the current risk curators are focused on actively managing a select handful of vaults for users to purchase access to.
Meanwhile, at Alvara, anyone can create their own collection of assets (BSKTs) to bet on what they think will make it big. Once created, others can easily purchase a share in that BSKT.
The differences aren’t limited to the mechanics of who gets to create an offering; it goes beyond that.
Vaults vs ERC-7621
By now, DeFi has recognized investors’ desire to easily diversify their holdings and gain exposure to financial products beyond a single asset. Catering to this have been projects that specialize in developing smart contracts that could execute a specific strategy to maximize yield (or other preferred outcome).
In this context, the smart contract is better known as a vault. It accepts deposits, issues LP tokens, and acts as a programmable fund wrapper deploying capital into lending, LPing, RWAs, and more. Since the addition of risk curators, external third parties have the ability to deploy vaults and manage them according to their preference.
It’s an amazing innovation, yet it does not cater to the market for discretionary fund management, a big segment of traditional finance in which professional fund managers actively manage clients’ funds tailored to financial goals, risk tolerance, and investment horizon. However, recently it’s also been shown to come with some downsides.
With the implementation of a custom Ethereum standard, ERC-7621, we’re offering an alternative to vaults and bringing discretionary fund management onchain.
We’ve not just copied what was there, by putting it all out in the open. Managing funds via Alvara is more transparent, open, and decentralized than traditional fund management could ever be.
Plus, it’s open to anyone and therefore infinitely customizable to individual preferences. Not everyone might want to be their own fund manager, but many who are currently unable to access fund management can easily invest in other smart people’s knowledge this way.
BSKTs on Base and Beyond
Did we mention that each BSKT’s performance record is completely open? Lowering barriers and providing investors with the details required for an informed decision.
That’s another thing that we’re aligned on with Base. Making it easier for anyone to get into crypto by meeting them where they are. With its low fees, fast speed, and large network, Base is a perfect venue for democratizing asset management.
Ready to create your first BSKT on Base? Go here to get started.
