Concept

Learn about our innovative concepts.

Background

Pennysia began at the Sonic S-Tier Hackathon in August 2025, where we first introduced the groundbreaking concept of the Liquidity Prediction Market — a fusion of AMM mechanics and prediction-based yield enhancement.

The project went on to win 1st place, officially recognized and published on October 2, 2025.

The version you are reading now represents the refined evolution beyond our initial MVP, integrating multiple new innovations while staying true to our core mission: to build a low-risk, high-reward DeFi protocol.

Vision

In traditional finance, only large institutions could act as market makers. In DeFi, while AMMs opened access to everyone, most users still face high volatility, limited yield, and complex risks. We ask ourselves, "it would be nice if there is an automated protocol aiming to optimize for yields while maintaining the lowest possible risk on the principal, so we can play it in long term."

Pennysia is a project that empowers anyone to become a high-efficiency market maker and earn optimal yields safely, while giving new Web3 projects a reliable liquidity foundation to scale.

Problems We Tackle

We addresses challenges faced by two key user groups:

General DeFi Users (B2C)

Most users seek consistent returns, but current DeFi yield opportunities are either volatile, short-lived, or depend on unsustainable incentives.

We've compiled evidence showing that the majority of concentrated liquidity positions on volatile assets fail to generate profit due to excessive impermanent loss and unsustainable yield mechanisms.

Since most tokens exhibit high volatility, there is a clear need for a reliable, perpetual source of passive income that compounds automatically without exposing users to excessive market risk.

Web3 Projects and Protocols (B2B)

New projects often struggle with illiquidity and price discovery. Launching tokens requires continuous liquidity and integration support, which are costly and complex to maintain.

Projects need plug-and-play liquidity markets that are robust, flexible, and compatible with existing industry standards, and come with shared revenue incentives.

Solution For Users

Enhancing yield while keeping risk constant:

AMM + Prediction Market Fusion

By integrating prediction-market mechanics into the Uniswap V2 AMM model, users can express directional market views to boost yield. Even if their prediction is incorrect, their principal liquidity remains intact — no liquidation, no loss of ownership. We called this feature ‘LPM’.

Integrated Passive Yield through Aave

Liquidity within the AMM is automatically delegated to Aave(if supported), allowing users to earn dual yields — one from trading fees and another from lending interest — without any active management or additional risk.

Solution For Projects

Empowering builders with sustainable liquidity tools:

Battle-Tested AMM Foundation

Built on the Uniswap V2 model, Pennysia ensures infinite price range coverage and predictable behavior, eliminating liquidity depletion risks for new or volatile tokens.

Revenue Sharing Program

Projects receive up to 50% of protocol-generated revenue from their deployed markets — distributed automatically and permissionlessly to encourage ecosystem growth.

Fungible LP Tokens for Composability

All LP positions are represented by fungible tokens, enabling seamless integration into DeFi ecosystems such as staking, liquidity mining, lending, or bonding platforms.