Introducing Project 0: Product, Timeline, and Token

Project 0 is the first DeFi-native prime broker. Borrow against your entire portfolio, regardless of the venues you use.

Introducing Project 0

Today, we’re announcing that Project 0 will power the marginfi program, the marginfi dApp, and the MRGN validators. We’re going to be refining those products and integrating them into Project 0, a landmark new product for DeFi, now open to new deposits. Below, I'll detail what we've done at Project 0 to reshape MRGN and position P0 to fill a massive gap in defi, building upon some foundational pieces we've proven out.

In a different piece, I'll detail more in-depth the challenges we faced and the decisions we made in the face of those challenges. There was a lot of hard work and difficult decisions behind the scenes, and we're now in a position where I can provide more clarity on the obstacles we overcame.

For this article, we'll focus on how we came to build Project 0, and what it is.

The Opportunity

The marginfi protocol is one of the most battle-tested protocols in Solana DeFi. It's handled hundreds of millions of dollars in deposits, borrows, and withdrawals on single days. It's extremely lightweight, which has enabled 20+ teams to build on its program without running into constraints or limitations. marginfi’s risk systems have handled all significant market events on Solana over the last 2+ years with no insolvency. The marginfi protocol has been punched in the face repeatedly by crypto volatility since its inception and has handled every single event while protecting 100% of user deposits.

There's just a few problems.

First: undifferentiated, overcollateralized lending is one of the most competitive things you can do in DeFi. There's brilliant teams across every blockchain tackling this problem, and many have significant moats (eg: Aave).

Second: overcollateralized lending is not capital efficient. We've heard this a million times because it is resoundingly true. From your average user to your sophisticated trader, undercollateralized lending is a necessary staple of their lives (from mortgages to complex equity/commodities/crypto positions).

Third: the minute you have a need outside an overcollateralized crypto borrow-lend, you need to move your capital to another venue. In DeFi, as with traditional finance, there are always multifaceted needs. I don't know a single defi user that just uses one defi protocol. they use multiple, because they have multiple, often complex, use cases.

Fourth: a borrow-lend doesn't inherently optimize for anything Solana is good at. Someone with an isolated $100M, prolonged borrow need doesn't care if that borrow comes on Solana or Ethereum. In fact, they probably prefer Ethereum because Ethereum often has more liquidity and more “lindyness”.

These are a few obvious but glossed-over problems that make current lending protocols unoptimized. Project 0 was built with these in mind. More on the new protocol's capabilities later, we need to hit more of the story behind Project 0 first.

We've Assembled a Team

I’m going to pause for a moment on our team. Putting together world class talent in crypto isn't easy, and worse -- it's wasted if you don't deploy that talent at the right problems. In a competitive arena like finance, if you don't play to your strengths, you will lose.

We've built our team around a few core competencies.

First is risk. Over the last year, we've built granular pipelines around internal (on protocol) and external (across markets) data. This will enable us to act real time and build a highly competitive, sophisticated risk engine for Project 0. Our stretch goal this year is to have a functioning dynamic risk system (instead of the static risk systems you see today across DeFi) being piloted on the back of these new pipelines.

Second, we've surrounded ourselves with execution expertise to innovate on our liquidation systems, at scale. Solvency for a permissionless protocol enabling credit is a function of liquidator capacity. That means our ability to liquidate tightly and at scale, expanding our external market coverage and capabilities, makes our product as a whole more competitive and safe. There's a few major unlocks we're releasing on the liquidator front this year, starting with a new liquidations system end-to-end on Project 0. I have a lot more thoughts here, but perhaps I'll write more on this in a later article.

Third, we've put together a world class application team. I'm of the opinion that if you want a successful open source program on Solana to succeed -- success meaning you have unincentivized, independent third parties integrating the program and using its resources, you need to bootstrap that program with a dominating application (or two!). We have an application team that is finally unblocked by the strides we've made on our backend systems, which is moving at a blistering velocity as they tackle a slate of exciting new products at Project 0.

Fourth, we've added to our program team. We're doing things that have never been done on the program side at Project 0, and this cutting edge work takes extremely talented people. Our program team is composed of deep rooted Solana contributors that have been instrumental to core Solana defi evolution. We have even more firsts for DeFi coming on the program side with Project 0 later this year.

With this team we’ve assembled, we've also spent a considerable amount of time on our token, our company structure, and our revenue. We've structurally aligned all three. These are things that take time and multi-party coordination, aren't easy, and are existential to the future of Project 0. I'll write more on this later, but it's important to highlight in the context of the things we've overcome over the last year

Looking Forward

Now the fun thing. The secret. What is Project 0?

Project 0 is the first generalized, on-chain, permissionless, multi-venue, unified margin protocol. In short, it's a defi-native, trustless prime broker. So why is this important?

I've talked about the problems with isolated, overcollateralized lending above. It's highly competitive, it's capital inefficient, and it doesn't optimize for what Solana is good at (or the activity we see on Solana). Apart from that, for me personally, it's uninspiring. It's "Aave on Solana", depending on your architectural decisions. It's a fork.

Crypto has a hyper fixation on reinventing existing, working crypto applications over and over and over again, partly as a result of this industry's perceived limited market and use cases. I refuse to be part of that.

Project 0 solves the capital inefficiency woes that plague defi. It also answers the single reason someone would want to build defi products: composability.

Unlocks

Project 0 allows you to use Kamino, Drift, Jupiter, and other DeFi venues as a single portfolio with unified credit. This is not a dashboard, this is not a lending aggregator. This is a true, un-opinionated DeFi prime. If you have $100 on Drift, $200 on Kamino, and $300 on Jupiter, you can borrow against your entire $600 portfolio in one click on Project 0.

Your P0 portfolio gives you superpowers across the activity you’re already doing, on the venues you’re already using. You can finally set up a delta neutral position between Drift and Jupiter without getting liquidated if markets move one way. You can finally hedge holdings on Drift and Kamino without having to manage two borrows from two different venues with two different rules. You can run cash and carry trades, perp funding rate arb, or set up yielding, hedged positions across multiple venues with unified margin. Or, you can just hunt for yield across venues and be able to borrow against your entire portfolio whenever you need it.

By managing your DeFi portfolio through Project 0, you get better risk, better rates, better capital efficiency, and better UX. You don't need to stop using the venues you love. In fact, you don't need to change a thing.

You don't add additional smart contract risk by using Project 0. Project 0 just inserts a self custodial account in between you and the underlying venue you're using to enable deleveraging, protecting solvency. If you use more than one DeFi venue, which is 99% of DeFi users, you have worse capital efficiency by not using Project 0.

Project 0 serves the crypto user that uses more than one defi venue -- which is 99% of DeFi users.

Diving Deeper

To reiterate: through Project 0, defi users can finally, for the first time, borrow against their entire portfolio. This will start inclusive of their assets on Kamino, Drift, and Save, and will soon be more -- like their perp position on Hyperliquid, their JLP position on Jupiter, their lent assets on Loopscale, their yield token on Exponent, and their assets on Project 0's market -- all in one click, with unified, global margin.

Passive users in search of yield now have the ability to loop Kamino USDC with... P0 USDC. We're launching powerful automations that will enable multi-venue yield strategies with an accurate understanding of portfolio-wide delta across all the independent venues you're using.

For more sophisticated traders: remember, Drift doesn't know if you have a position open on Jupiter with offsetting delta. So if the market moves against you on Drift, you're liquidated. On Project 0, your exposure on Drift and Jupiter is part of your comprehensive, singular portfolio risk -- so if you're delta-neutral between both and the market moves, you won't get liquidated. This is a simple example of what's now possible with multi-venue unified margin and risk management.

The second order effects of this product will be powerful. Project 0 should bring greater efficiency to each new venue it integrates -- meaning rates should compress to their appropriate, risk-adjusted rate, per venue. Liquidity flows from Project 0 should help stabilize irrational, single-venue rate or price dislocations. In short, venues integrated with Project 0 should become more efficient, which is pretty profound.

DeFi is growing up.

One of the biggest unlocks, however, is that delta-aware portfolios across multiple venues will unlock real undercollateralized borrowing. You'll be able to use the venues you love without tradeoffs, with a portfolio that maximizes what Solana is uniquely good at: speed and trading.

Points Clarity

Project 0 is going to be driving development of marginfi starting today, and the marginfi lending venue and dApp will now be powered by Project 0. So, here's how we're rewarding MRGN Points holders at P0:

First, we will be assigning a points multiplier to users who have used marginfi from June 2024 to August 3rd, 2025. We are going to assign this multiplier right before TGE to ensure these users are adequately protected. These are users that actively used the marginfi program when there were no expectations, purely for the core functionality it provides. These are users we want to prioritize growth with at Project 0.

For users of LST, second, Project 0 will be providing a significant amount of points to minters and holders of this product. As many people know, MRGN runs some of the most performant validators on Solana. Project 0 will now be managing and growing that validator set. Users who stake Project 0 validators and mint $LST improve performance on Project 0 for everyone, while also earning the highest possible amount of Solana yield (inflation and MEV). Driving stake to our validators will remain a priority at Project 0.

For users of past beta products like The Arena, we will also be providing a significant amount of points. All points assignments will receive the same boost if positions were active between June 2024 and August 3, 2025... so when and how you used these products does matter.

Finally, we have some more surprises for users who have been through it all with the marginfi venue. If you've been liquidated on marginfi, if you've traded through the marginfi dApp, if you've tried special features like mrgn loop... we have points reserved for you.

Project 0 is matching MRGN points 1:1. The multipliers described above will be visible only on the Project 0 dapp. Yes, you read that right. Points are now discontinued on the marginfi dApp. Importantly, you need a live deposit on the Project 0 dapp to activate your points. Project 0 will be running a final general points multiplier for everyone starting now, up until our second venue – Kamino – goes live. We expect Kamino to go live October 8, so you have about 3 weeks to use Project 0 in order to capture this final multiplier. You will see your adjusted Project 0 points, inclusive of your past MRGN points and the adjustments I described above, on the day we go public with our second venue, Kamino. You will not see the impact of the two boosts (June 2024 – August 3, 2025 and Now – Kamino going live) until right before TGE. Again, this will be done retroactively to ensure those users are adequately protected as new users join Project 0 and earn additional points.

If you don’t want our final general points multiplier now, the unlock with Project 0 is that after Kamino goes live, and then shortly after Drift and Save, if you’re already using those venues, you can continue to use them through Project 0 and still earn Project 0 rewards.

In order to give users the time to see this update, get familiar with Project 0, and for the P0 team to achieve Stage 1 of feature development, live in production, users will be able to accumulate new Project 0 points before the Project 0 token. This way, marginfi users get to benefit from new cutting edge functionality while keeping their accumulated points, and new users get to enter the Project 0 ecosystem and try something net-new to DeFi. This also gives us time to make necessary adjustments to P0 points to reward power users. If you are worried about Project 0 running a long points season, let me resolve that worry right now. I’ll lay out details and timeline in the next section.

Points Recap

We’ve architected P0 points so that 0 users get left behind with the points they've earned, and users who stuck with products we built the longest get rewarded the most. Power users, whether you're big or small, get rewarded extra. Everyone wins. We're architecting the Project 0 token to be maximally aligned with power users, while achieving distribution over the hundreds of thousands of real users that have used P0 products.

Again, you need a live deposit in the Project 0 dApp to activate your past and future points. Project 0 points will update, inclusive of MRGN points and the points adjustments I’ve detailed above, when our second venue: Kamino goes live on October 8. The Project 0 points guidance (which will exclude a few surprises I've hinted previously across my articles) will be published as well on October 8. Importantly, I will not make every detail explicit, because it puts small users at a disadvantage over well capitalized ones. If you're a small user, this is for your benefit.

Now: timeline on P0 points, and what you can expect from Project 0 token.

Project 0 Token

Given the length of the past MRGN points we’re rewarding, and to achieve a healthy initial float and market structure, the Project 0 team has reserved >50% of the token supply for users, with large initial and follow up distributions.

We will be kicking off governance conversations around the Project 0 token on October 15. I'm proud to announce this will include 20+ teams that are already built on Project 0, from Day 1. This will also include hundreds of thousands of users that have already used Project 0 products, also from Day 1. This will impact >$100M on Project 0, from Day 1. Finally, this will also include stakeholders across multiple development teams that have driven Project 0 development forward.

Project 0 governance in many ways is already the dream of what you want from an open source protocol. Many unincentivized teams built on it, many developers contributing to it, many stakeholders passionate about it, and many users actively using it. Better yet, there's so much more users, value, and growth in front of it.

This will not be a low float/high FDV token. This will not be an insider-only token. This will not be a token launched at the peak of development, with very little growth in front of it. We're going to be doing a lot of things differently with the Project 0 token. On October 15, we'll kick off discussions.

When TGE? We intend to go live with Project 0 token this year, 2025. Our sights are set on announcing the first distribution at Solana Breakpoint.

So what is Stage 1 of development? How do we intend to reach Stage 1 by Breakpoint? Here are the details:

Stage 1 will have the following features live in production, for anyone to use:

• Kamino Markets (this is audited, complete, and being actively tested).
• Drift Lending Markets (this has been internally reviewed and is in audit).
• Save Main Lending market (this has been internally reviewed and is in audit).
• Pay (infrastructure is done, no audit is required, the frontend is being built)
• Strategies (the infrastructure is done, no audit is required, the frontend is being built).

By achieving Stage 1 before TGE, we establish a landmark new product for DeFi, opening up entirely new use cases for traders with capital efficiency and risk needs, before tokenizing. Most importantly, this positions Project 0 to go after its biggest growth opportunity AFTER tokenizing, which is adding perpetual markets to your P0 portfolio.

We are actively architecting the integrations for perps on Hyperliquid, Jupiter, and Drift to be added to your unified portfolio, with unified margin on Project 0. We’d also love to work with other perps teams (as well as other lending, swaps, etc teams), prior to these new integrations.

The second trading markets go live, Project 0's functionality radically levels up. Strategies like multi-venue cash and carry trades across spot and derivative products, or delta-neutral perp portfolios across e.g. Drift and Jupiter – protecting your account from liquidation if the market moves either way – and so, so much more is unlocked. Remember – all this happens under a single portfolio, meaning you have unified leverage, unified risk, and holistic systems giving you better capital efficiency, risk, rates, and UX.

Better yet, token holders will get to look forward to this, not back at it. Perp integrations come after the token, not before. Timing is important and we owe it to our users to do everything we can to grow with them, not adjacent to them.

Now, this isn't the best place to give all the remaining details on the token. That will come closer to token launch, but in the interest of transparency, I'll give the starting variables I intend to propose to community discussions on October 15:

• 20% Community (Initial)
  • 15% to users, no vesting.
  • 4% to power users, inclusive of partners, subject to vesting.
  • 1% to a single user, chosen at random from a pool of power users, before TGE. P0 and MRGN points will be considered together, as well as non-points related actions. Subject to vesting
• 20% User Incentives
  • Helping our new product grow post initial distribution
• 20% Team
  • The people who put in the work to get this product to market
  • All team allocation is subject to vesting
• 20% Investors
  • The people who believed in us, even when others didn't.
  • All investor allocation is subject to vesting.
• 20% Foundation
  • Ensuring the Project 0 ecosystem thrives for years to come.
  • Managed by token holders.

Again, no low float / high FDV. No insider heavy allocation. This will be a token architected to benefit from the growth of DeFi, starting on Solana with our Solana integrations, and expanding to wherever our unified margin integrations go (Ethereum, Hyperliquid, and more).

There's a ton of exciting mechanics we'll be proposing to the token's functionality. We'll detail that more when we open governance discussions on October 15.

Finally, over the last year the MRGN team has been operationally blocked from launching a token on many fronts. These hurdles are important to talk about, and now that we're through them at P0, I plan to address them. This will come in a separate article.

Next Steps

The Project 0 market is now live and open for early deposits and borrows. Our second venue, including Kamino Main and Isolated Markets, is audited (multiple times), live in testing, and will be live on the Project 0 application October 8. Our third and fourth venues, Drift Main and Isolated Lending Markets and Save Main Market, have completed development, completed review, and are in audit now. These two venues will go live early November. Once Jupiter Lend is open-source, we will also add this integration. We also want to work together with partners like Loopscale, Exponent, and Asgard on integrations! Finally, we have our sights set on integrating Aave and Hyperliquid. Hyperliquid? Yes – the biggest area of product growth after integrating lending markets and their dominating liquidity is perps!

This is not just a prime broker for lending markets. This is a prime broker that unifies lending market liquidity so traders can trade the products they love while using their collateral across all the defi programs they use. We're building a world class trading application over perps markets like Drift, Jupiter, Hyperliquid, as well as spot markets, derivative markets, and more. To go one step further – we have no plans to ever spin up our own trading market. Seriously. Ever. There will be no native Project 0 perps, no native Project 0 spot, no options, no nothing. All the products you trade through Project 0 will exist natively across stress-tested, robust trading protocols.

The only thing native to Project 0 is our custom risk and credit engine, which has been audited countless times, has gone through extreme stress-tests in production with billions of dollars of scale, and is built off the marginfi program which has protected 100% of user solvency since its inception.

We also have a Pay and Strategies product that will go live starting at the end of October. Turn on notifications to be the first to learn more.

Stakeholders

Thank you to those who have been extremely supportive during the last year, especially to those who know the depths of what I went through. We faced an extreme and unique set of circumstances when rebuilding MRGN, and I'm thankful to those who trusted me to come out the other side. This was heads down, tireless work, with much to fix before we could take meaningful steps forward. There were limitations on the comms we could do while we took these steps, and at many times it certainly felt like my back was against the wall. We've finally turned the corner and have an incredible fourth quarter in front of us. I'm incredibly excited for what's next.

To learn more about Project 0, join our Telegram community channel and follow us on X.