{"id":"hydration","title":"Hydration","content":"**Hydration** is a [decentralized finance](https://iq.wiki/wiki/defi) (DeFi) protocol built on the [Polkadot](https://iq.wiki/wiki/polkadot) network to facilitate seamless and efficient liquidity provisioning. Established in 2020, Hydration aims to unify various financial services, including trading, lending, and over-collateralized stablecoins, under its scalable and multifunctional DeFi platform. Originally known as HydraDX, Hydration implements innovative strategies like the Omnipool AMM ([Automated Market Maker](https://iq.wiki/wiki/automated-market-maker)) to centralize liquidity, thereby optimizing trading and reducing friction across its ecosystem. [\\[1\\]](#cite-id-piuygYZZY6XxGUBR) [\\[2\\]](#cite-id-TgqPemGMyK0Z3j8G) [\\[3\\]](#cite-id-KEtJEHhDBqj8JuAy)​\n\n## Overview\n\nHydration is a [decentralized finance](https://iq.wiki/wiki/defi) (DeFi) protocol developed within the [Polkadot](https://iq.wiki/wiki/polkadot) ecosystem. The protocol provides infrastructure for decentralized financial activities, including token swaps, [liquidity pools](https://iq.wiki/wiki/liquidity-pool), lending, borrowing, and the issuance of an over-collateralized [stablecoin](https://iq.wiki/wiki/stablecoin). It was introduced as HydraDX in 2020 and adopted the name Hydration in 2024 following the expansion of its protocol architecture.\n\nThe protocol is built around the Omnipool, an [automated market maker](https://iq.wiki/wiki/automated-market-maker) (AMM) model that allows multiple [digital assets](https://iq.wiki/wiki/digital-assets) to share a common [liquidity pool](https://iq.wiki/wiki/liquidity-pool) instead of relying on separate liquidity pairs. Hydration also includes the HOLLAR over-collateralized [stablecoin](https://iq.wiki/wiki/stablecoin), the HDX governance token, and a set of protocol components designed to support [decentralized financial](https://iq.wiki/wiki/defi) services on the Polkadot network. [\\[1\\]](#cite-id-piuygYZZY6XxGUBR)  [\\[3\\]](#cite-id-KEtJEHhDBqj8JuAy)  [\\[5\\]](#cite-id-zD6UGDdeGGbp8xQq)  [\\[7\\]](#cite-id-BcFJWsUAxLxqg7Ij)  [\\[8\\]](#cite-id-XR2NeHAiMPc4gl3q)  [\\[9\\]](#cite-id-aV0uAdrFPUpvgPFS) \n\n## History\n\nHydration was initially launched as HydraDX in 2020, created with the intention of enhancing [DeFi](https://iq.wiki/wiki/defi) infrastructure within the [Polkadot](https://iq.wiki/wiki/polkadot) ecosystem. Founders Jakub Panik, Jakub Gregus, and Mattia Gagliardi led the project with a vision to solve liquidity inefficiencies, leveraging Polkadot’s capabilities for security and scalability. [\\[4\\]](#cite-id-qdvvbhMQNAqpsasA) The project transitioned to Hydration in mid-2024, marking its evolution with the advent of the Omnipool, which aggregates liquidity across various assets using a hub-and-spoke model to eliminate fragmented liquidity. [\\[5\\]](#cite-id-zD6UGDdeGGbp8xQq)​\n\n## Technology and Architecture\n\nHydration's technical architecture is centered on the Omnipool, a universal [liquidity pool](https://iq.wiki/wiki/liquidity-pool) designed to support the trading of multiple assets within a single framework. Utilizing Polkadot's Substrate framework, the Omnipool allows different liquidity pools to operate as one, minimizing slippage and requiring only one token to participate. [\\[6\\]](#cite-id-WnfCP3nmwOBIxhVs) Complementing this is the HOLLAR [stablecoin](https://iq.wiki/wiki/stablecoin), which is over-collateralized and integrated within the protocol’s lending and borrowing services. HOLLAR provides stability in volatile markets, backed by assets like [DOT](https://iq.wiki/wiki/polkadot-dot), [ETH](https://iq.wiki/wiki/ether-eth), and [BTC](https://iq.wiki/wiki/bitcoin-btc). [\\[2\\]](#cite-id-TgqPemGMyK0Z3j8G)​\n\n## Products and Services\n\nHydration offers a broad spectrum of products designed to optimize [DeFi](https://iq.wiki/wiki/defi) interactions. These include:\n\n* **Swaps and Trading**: Facilitated through the Hydration app’s user-centric design, which includes omnipools and stablepools for a variety of trading scenarios, making it easier to execute trades with minimal slippage. The platform supports over-the-counter (OTC) trades, allowing for large transactions without affecting the market price. [\\[5\\]](#cite-id-zD6UGDdeGGbp8xQq)\n* **Lending and Borrowing**: Users can lend and borrow [digital assets](https://iq.wiki/wiki/digital-assets) with support for multi-collateral loans within the platform. This functionality is improved by interest-earning opportunities and a modified version of [AAVE](https://iq.wiki/wiki/aave) v3 security protocols. [\\[7\\]](#cite-id-BcFJWsUAxLxqg7Ij)\n* **HOLLAR Stablecoin**: Functions as a decentralized [stablecoin](https://iq.wiki/wiki/stablecoin) that maintains its value via a basket of [cryptocurrencies](https://iq.wiki/wiki/cryptocurrency) and the stability module which mitigates liquidity risks. [\\[2\\]](#cite-id-TgqPemGMyK0Z3j8G)\n* **Governance**: The HDX token, integral for governance, allows holders to influence protocol developments, thereby ensuring a community-driven approach. Governance mechanisms empower stakeholders to propose and vote on changes, reinforcing the decentralized ethos of the platform. [\\[1\\]](#cite-id-piuygYZZY6XxGUBR)\n\n## Team and Governance\n\nThe governance of Hydration revolves around its native HDX token, driving decision-making processes aligned with community input and proposals. Participation is incentivized through [staking](https://iq.wiki/wiki/staking) rewards, encouraging active involvement from token holders. [\\[1\\]](#cite-id-piuygYZZY6XxGUBR) Led by a team of experienced developers and [blockchain](https://iq.wiki/wiki/blockchain) enthusiasts, the project continuously evolves with a focus on maintaining security, user engagement, and expanding liquidity options. Collaborations with various partners within the [Polkadot](https://iq.wiki/wiki/polkadot) ecosystem further bolster its operational capabilities and strategic growth. [\\[8\\]](#cite-id-XR2NeHAiMPc4gl3q)​\n\n## Partnerships and Ecosystem\n\nHydration operates within an extensive network facilitated by its integration on [Polkadot](https://iq.wiki/wiki/polkadot). The protocol collaborates with diverse partners such as Banxa to extend its on-ramp services for [cryptocurrencies](https://iq.wiki/wiki/cryptocurrency), enhancing accessibility and liquidity across numerous markets. [\\[8\\]](#cite-id-XR2NeHAiMPc4gl3q) This strategic positioning opens opportunities for liquidity provision, staking solutions, and cross-chain integrations, reinforcing its mission to streamline and democratize [DeFi](https://iq.wiki/wiki/defi) applications. Hydration's continuous enhancement of features like cross-chain communication and asset management further establishes it as a pivotal player in the landscape of [decentralized exchanges](https://iq.wiki/wiki/decentralized-exchange). [\\[9\\]](#cite-id-aV0uAdrFPUpvgPFS)​\n\n## Funding and Expansion\n\nFunded by top-tier investors including KR1, CMS Holdings, Hypersphere Ventures, and [Tenzor](https://iq.wiki/wiki/tenzor) Capital, Hydration boasts robust financial backing facilitating its development and operational scalability. [\\[3\\]](#cite-id-KEtJEHhDBqj8JuAy) This investment pool helps sustain the protocol's technological advancements and market penetration strategies, ensuring sustainable growth and user adoption across the global [DeFi](https://iq.wiki/wiki/defi) environment. [\\[4\\]](#cite-id-qdvvbhMQNAqpsasA)​","summary":"Hydration is a pioneering DeFi protocol built on Polkadot, known for introducing the innovative Omnipool system to unify decentralized liquidity provisions.","images":[{"id":"QmX8dudaCnJj9Y9QhTULdJYNoExrRtbzEU3qrur77MRwXp","type":"image/jpeg, image/png"}],"categories":[{"id":"projects-and-protocols","title":"Projects & Protocols"}],"tags":[{"id":"Polkadot"},{"id":"DeFi"},{"id":"Layer1"}],"media":[{"id":"QmXk8Ni99k4VV9ixf5xVwzbhxfC39FmZ5h662y9YsfBRCT","size":null,"name":"66d28647bbcfd6d72e61c0f5_Hydration.png","type":null,"source":"IPFS_IMG"},{"id":"QmWChKarewdA6kC7XxMuKYgnLU1TyDHhRXZm1x2pGZP1DR","size":null,"name":"Cópia de Design sem nome (9).png","type":null,"source":"IPFS_IMG"},{"id":"QmXFzLqqLpKcCs3N3gmSMkw8GtxrNeS6Gx7WfNEzFbWp8r","size":null,"name":"Hydration-Polkadot.jpg","type":null,"source":"IPFS_IMG"}],"metadata":[{"id":"references","value":"[\n  {\n    \"id\": \"piuygYZZY6XxGUBR\",\n    \"url\": \"https://hydration.net\",\n    \"description\": \"Hydration official site\",\n    \"timestamp\": 1785902010491\n  },\n  {\n    \"id\": \"TgqPemGMyK0Z3j8G\",\n    \"url\": \"https://thedefiant.io/news/defi/polkadot-defi-protocol-hydration-launches-decentralized-stablecoin\",\n    \"description\": \"Defiant news article\",\n    \"timestamp\": 1785902010491\n  },\n  {\n    \"id\": \"KEtJEHhDBqj8JuAy\",\n    \"url\": \"https://www.rootdata.com/projects/detail/Hydration?k=MTQwMw%3D%3D\",\n    \"description\": \"RootData profile\",\n    \"timestamp\": 1785902010491\n  },\n  {\n    \"id\": \"qdvvbhMQNAqpsasA\",\n    \"url\": \"https://parachains.info/details/hydration\",\n    \"description\": \"Parachains info\",\n    \"timestamp\": 1785902010491\n  },\n  {\n    \"id\": \"zD6UGDdeGGbp8xQq\",\n    \"url\": \"https://coinmarketcap.com/currencies/hydration/\",\n    \"description\": \"CoinMarketCap listing\",\n    \"timestamp\": 1785902010491\n  },\n  {\n    \"id\": \"WnfCP3nmwOBIxhVs\",\n    \"url\": \"https://docs.hydration.net\",\n    \"description\": \"Hydration documentation\",\n    \"timestamp\": 1785902010491\n  },\n  {\n    \"id\": \"BcFJWsUAxLxqg7Ij\",\n    \"url\": \"https://support.polkadot.network/support/solutions/articles/65000190279-hydration-defi-hub-on-polkadot\",\n    \"description\": \"Polkadot support article\",\n    \"timestamp\": 1785902010491\n  },\n  {\n    \"id\": \"XR2NeHAiMPc4gl3q\",\n    \"url\": \"https://banxa.com/press/banxa-deepens-polkadot-ecosystem-support-adding-hydration-to-its-global-on-ramp-network/\",\n    \"description\": \"Banxa press release\",\n    \"timestamp\": 1785902010491\n  },\n  {\n    \"id\": \"aV0uAdrFPUpvgPFS\",\n    \"url\": \"https://documentation.hydration.net\",\n    \"description\": \"Hydration documentation\",\n    \"timestamp\": 1785902010491\n  }\n]"},{"id":"website","value":"https://hydration.net/"},{"id":"twitter_profile","value":"https://x.com/hydration_net"},{"id":"coinmarketcap_url","value":"https://coinmarketcap.com/currencies/hydration/"},{"id":"coingecko_profile","value":"https://www.coingecko.com/en/coins/hydradx"},{"id":"github_profile","value":"https://github.com/galacticcouncil?tab=repositories"},{"id":"discord_profile","value":"https://discord.com/invite/kkmY35UxAG"},{"id":"telegram_profile","value":"https://t.me/hydration_net"},{"id":"rootdata_profile","value":"https://www.rootdata.com/Projects/detail/Hydration?k=MTQwMw=="},{"id":"previous_cid","value":"\"https://ipfs.everipedia.org/ipfs/Qmerfmggx8k1K2KnjENXC4JwxwPrdVNaqpNi9Z3RgcMNYS\""},{"id":"commit-message","value":"\"Updated tags order to Polkadot, DeFi, Layer1; 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