Hermes Defi: Decentralized Hybrid Yield Optimization Platform

What is Hermes Defi

Friends, imagine taking your money out of the bank—not to deposit it in another bank, but to put it into a special “digital farm” where your funds can “grow” on their own. This is what’s commonly referred to as “liquidity mining” or “yield optimization” in decentralized finance (DeFi). Hermes Defi (project abbreviation: IRIS) was originally a manager of such a “digital farm.” It is a decentralized hybrid yield optimization protocol—in simple terms, it helps users place digital assets (such as cryptocurrencies) in different places to earn higher returns. It initially operated on the Polygon and Harmony blockchain networks.

In this “digital farm,” you can deposit other cryptocurrencies or provide liquidity (that is, pair two different cryptocurrencies and deposit them into a liquidity pool). In return, you receive Hermes Defi’s governance token, IRIS. This IRIS token acts as both voting power and a reward voucher for the “farm.”

However, it’s important to note that the original Hermes Defi project published a “Post Mortem” in July 2022, stating that due to an attack on the Harmony blockchain and an unsuccessful project launch, this phase of Hermes Defi has ended.

Later, a project called “The Hermes Protocol” emerged, described as a more comprehensive DeFi application suite, with its core being a low-cost, high-efficiency decentralized exchange (DEX/AMM). This new “Hermes Protocol” is closely related to Maia DAO and operates on the Metis network. It is an AMM DEX forked from Solidly, aiming to enable cross-chain trading and unified liquidity. While the IRIS token is still mentioned as one of the ecosystem tokens in this new system, the main governance and utility token is HERMES (HRMS).

Project Vision and Value Proposition

The original Hermes Defi project adhered to the principles of “security, transparency, and speed,” hoping to introduce more people to DeFi, showcase the potential of digital assets, and promote DeFi education. It aimed to provide a platform for users to increase their wealth through liquidity aggregation services.

The “Hermes Protocol” (the version associated with Maia DAO) has a more ambitious vision: to offer an all-in-one platform for DeFi services and continuously create new products to address emerging challenges in the DeFi space. Its goal is to become a leader and key player in DeFi by integrating advanced features and elevating the blockchain trading experience to a new level. It seeks to enable users to trade and provide liquidity across chains as if on a single platform, through a unified liquidity market.

Technical Features

The original Hermes Defi, as a yield optimizer, was technically centered on the use of smart contracts. Smart contracts are like self-executing agreements on the blockchain that automatically execute when preset conditions are met, without third-party intervention. Hermes Defi used these smart contracts to manage user deposits, liquidity provision, and reward distribution.

The “Hermes Protocol” (DEX/AMM version) adopts more advanced technologies:

• Decentralized Exchange (DEX) and Automated Market Maker (AMM): This is a platform that allows users to trade cryptocurrencies directly on the blockchain, without traditional centralized exchanges. AMMs use mathematical formulas to automatically price assets and facilitate trades via liquidity pools.
• Solidly Fork and ve(3,3) Model: “The Hermes Protocol” is a fork of the Solidly protocol designed by renowned DeFi developer Andre Cronje. Solidly introduced the ve(3,3) model, a complex tokenomics design that incentivizes long-term holders and liquidity providers by locking tokens, granting them governance rights and higher rewards.
• Omnichain Functionality: Designed to enable seamless trading and liquidity management across multiple blockchain networks, allowing users to operate as if on a unified platform, reducing the complexity and risks of cross-chain bridges.

Tokenomics

The Hermes Defi project uses a multi-token system, mainly including IRIS, PLTS, and HERMES (HRMS).

IRIS Token

• Token Symbol: IRIS
• Use Case: IRIS is the governance and reward token of the original Hermes Defi project. Holding and staking IRIS grants voting rights and participation in project decisions.
• Issuing Chain: Initially launched on the Polygon network, later expanded to Harmony via Anyswap/Multichain for cross-chain compatibility.
• Total Supply and Issuance Mechanism: IRIS has a total supply of 1,000,000 tokens, all of which have been fully emitted—meaning no new IRIS tokens will be minted.

PLTS Token

• Token Symbol: PLTS (Plutus)
• Use Case: PLTS is an intermediate reward token on the Harmony network and the presale token for “The Hermes Protocol.” It aims to attract users through mining rewards and provide funding for protocol development.
• Features: PLTS has a deflationary mechanism: each transaction incurs a 3% tax, with 1% permanently burned and 2% entering a “bank” system to reward users who lock PLTS.
• Total Supply: PLTS has a maximum supply of 3,000,000 tokens.

HERMES (HRMS) Token

• Token Symbol: HERMES (HRMS)
• Use Case: HERMES is the main token of “The Hermes Protocol” (DEX/AMM version), used for staking, boosting yields, and governance voting. By locking HERMES, users gain voting rights and can earn up to 2.5x liquidity provider rewards.
• Distribution: HERMES token allocation includes 60% for mining rewards, with portions allocated to ecosystem funds, private sales, IRIS DAO, etc.

Team, Governance, and Funding

The original Hermes Defi project was founded by “valleyrider” and his brother in July 2021. The team grew to 16 members.

Governance Mechanism: The IRIS token serves as the governance token, allowing holders to gain voting rights through staking and participate in project decisions. In “The Hermes Protocol,” HERMES token holders gain voting rights by locking tokens and can vote on liquidity pool reward allocations, among other things.

Funding: Hermes Defi received a $305,000 investment from Harmony to fund the launch of “The Hermes Protocol.”

Roadmap

Due to the iterative nature of the Hermes Defi project, its roadmap is divided into different phases. The following mainly references “The Hermes Protocol” roadmap:

Historical Milestones:

• July 2021: Hermes Defi project launched.
• August 2021: Hermes Defi’s smart contracts audited by Paladin Blockchain Security, with issues resolved.
• November 2021: IRIS token achieves cross-chain compatibility, transferable between Polygon and Harmony networks.
• March 2022: “The Hermes Protocol” launches on Metis network as an AMM DEX.
• Q2 2022: “The Hermes Protocol” plans to launch DEX/AMM, bonds, auto-compounding vaults, lending systems, etc.
• July 2022: The original Hermes Defi project publishes a “Post Mortem,” noting operational challenges on the Harmony network.

Future Plans (for “The Hermes Protocol”):

“The Hermes Protocol” future plans include ongoing optimization of its omnichain DEX and liquidity market, such as:

• Limit Orders: Allowing users to set specific prices for trades.
• Leveraged Trading/Farming: Offering more advanced trading strategies.
• NFT Staking: Exploring the integration of non-fungible tokens (NFTs) into DeFi yield opportunities.
• Dashboard and Personal Portfolio: Improving the user interface with more comprehensive data analytics and management tools.

Common Risk Reminders

Investing in any cryptocurrency project carries risks, and Hermes Defi is no exception. Here are some common risk reminders:

• Technical and Security Risks:
  • Smart Contract Vulnerabilities: Although the project has been audited, smart contracts may still have undiscovered vulnerabilities that could lead to loss of funds.
  • Hacking Attacks: DeFi projects are frequent targets for hackers; for example, the Harmony blockchain suffered an attack that affected Hermes Defi’s operations on that network.
• Economic Risks:
  • Token Price Volatility: Like all cryptocurrencies, IRIS, PLTS, and HERMES tokens can experience dramatic price swings, especially in yield farming projects where native token prices may drop sharply after launch.
  • Impermanent Loss: For liquidity providers, changes in asset prices within liquidity pools can result in impermanent loss.
  • Project Sustainability: Historical “Post Mortem” reports show that even audited projects may face sustainability challenges and fail to deliver ongoing profits to investors.
• Compliance and Operational Risks:
  • Regulatory Uncertainty: Global regulation of cryptocurrencies and DeFi is still evolving, and future policy changes may impact the project.
  • Frontend Errors and System Failures: Websites or protocols may experience technical failures, affecting user experience or fund security.

Please remember, the above information is not investment advice. Cryptocurrency investments are extremely risky; be sure to conduct thorough personal research and risk assessment.

Verification Checklist

• Block Explorer Contract Addresses:
  • IRIS (Polygon):
    0xdaB35042e63E93Cc8556c9bAE482E5415B5Ac4B1
  • IRIS (Harmony):
    0x85FD5f8dBD0c9Ef1806E6c7d4B787d438621C1dC
  • PLTS:
    0xd32858211FCEFd0bE0dD3FD6D069c3E821e0AEf3
• GitHub Activity: The Hermes-Defi GitHub repository includes multiple projects such as frontend, block scanner, bonds, timelock, etc., showing development activity.
• Audit Reports: Hermes Defi’s contracts were audited by Paladin Blockchain Security in August 2021, with issues resolved. For “The Hermes Protocol,” Certik audit was ongoing in Q2 2022.

Project Summary

The Hermes Defi (IRIS) project has a complex and evolving history. It was initially launched as a decentralized yield optimizer on the Polygon and Harmony networks, aiming to provide yield opportunities for users through its governance token IRIS. However, due to changing market conditions and the Harmony network attack, the original Hermes Defi project published a “Post Mortem” in July 2022, indicating major operational challenges and marking the end of that phase.

Subsequently, a project called “The Hermes Protocol” emerged, closely collaborating with Maia DAO and evolving into an AMM DEX forked from Solidly, mainly operating on the Metis network and introducing a new native token, HERMES (HRMS). This new protocol is dedicated to building an omnichain decentralized trading and liquidity market, aiming to provide a more efficient, low-cost trading experience. While the IRIS token is still mentioned as an ecosystem token, HERMES (HRMS) has become the new core governance and utility token.

Overall, the journey of Hermes Defi reflects the rapid development and constant change in the DeFi space. From a yield optimizer to an omnichain DEX, the project team has continually tried to adapt to market demands and technological advancements. However, its history also serves as a reminder that DeFi projects face inherent technical, economic, and operational risks, including smart contract vulnerabilities, token price volatility, and sustainability challenges.

For anyone interested in Hermes Defi or “The Hermes Protocol,” it is strongly recommended to conduct thorough independent research to understand its current status, team, technical details, and potential risks. Cryptocurrency investment is highly risky; please exercise caution and make decisions based on your own circumstances. The above content does not constitute any investment advice.