Gelato: an Ethereum bot for DeFi
Gelato: an Ethereum bot for DeFi
Defi

Gelato: an Ethereum bot for DeFi

By Gianni Morselli - 8 Feb 2020

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Gelato is a Berlin-based startup supported by Gnosis and Metacartel, who created the homonymous protocol to automate the operations of any Ethereum smart contract with a bot.

The decentralized finance of Ethereum allows users to obtain loans by collateralizing their crypto, earn much better interest than those offered by traditional banks, buy and sell cryptocurrencies and use advanced financial instruments while maintaining full control of their funds.

The assets are in fact managed by smart contracts that perform certain functions when predefined conditions occur, and the users simply sign transactions with their private keys.

And in case you don’t know it, it’s not only “human” users who use smart contracts: there are also the so-called “bots” who execute code. These bots, managed by financially incentivized individuals and organizations, execute operations by exploiting the potential of Ethereum’s smart contracts.

Bots and DeFi

Based on this protocol, the team created a dApp called Gelato Finance, which provides users with a series of bots that allow them to perform operations automatically on certain DeFi protocols. From the post on Medium:

“Gelato’s mission is to help you automate your Ethereum tasks around the clock. In short, using gelato gives you access to your own personal Ethereum bot that will execute transactions on your behalf, in principle enabling you to automate your interactions with every decentralized app“.

While Gelato Finance is managed by the team and focuses only on DeFi, the protocol can still be used to automate the transactions of any smart contract: betting, DAO and gaming, thus adding a LEGO to the Ethereum ecosystem and allowing developers to automate transactions for their dApp users.

How does Gelato Finance work on Ethereum

The most interesting part is that there is no need to know any programming language and no need to write any lines of code. Practically all users who have a MetaMask account (here the complete guide) can access the functions of Gelato Finance by going to the relevant page.

https://play.gelato.finance/

(WARNING: Gelato is in alpha version and the code has not yet been verified, “play” only with small amounts). 

For now, Gelato contains only some functions linked to Kyber Network and Fulcrum, but in the future developers will add other DeFi protocols to it. For example, it is now possible to close a leveraged position on Fulcrum before it is liquidated (see the tutorial on YouTube), buy on Kyber Network at predetermined intervals to avoid price slippage, transfer tokens at a predetermined time interval or accumulate tokens gradually.

Obviously, it is possible to take advantage of the two smart contracts of Fulcrum and Kyber Network: if, for example, you think that Ethereum will retrace on an important support in the short term (for example $170) and then bounce back and appreciate again, you can set your bot to automatically open a leverage position on Fulcrum as soon as the price of Ethereum will reach $170 on Kyber Network.

The interface is very simple and intuitive, we did some tests and setting up your personal bot takes a couple of minutes.

gelato screenshot

After connecting MetaMask, it is necessary to set the conditions by filling the necessary fields, determine the action you want the bot to perform and finalize it by signing a transaction with MetaMask.

In the future, the team will add new features and subject the code to a security audit, so as to finish version 2.0 of the Gelato Finance protocol.

 

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