Capital is the power of the world, funding infrastructure, providing lubrication for the wheels of business, and enabling liquidity to flow smoothly through the crisscrossing network financial track。Timely injections of capital can save struggling businesses and give start-ups an incentive to enter the big leagues。From driving innovation to curbing inflation, capital is what makes it all possible。

However, the deployment of capital is not motivated by altruism, and its owners, whether banks, large corporations or billionaires, expect more returns from their investments。This is how the financial world works: rich people lend and earn income in return for the risks they take by entrusting some of their net worth to others.。As the saying goes, money begets money, however, despite this ability, a large part of the world's wealth is still idle and unused。

This dormant capital has the potential to generate income that benefits both the owner and the recipient, but it needs to be activated and provided in a suitable way, otherwise the capital is like a coin locked in a bank vault and left to accumulate dust。In a digital age where value can be transferred instantly and seamlessly, this is undoubtedly a waste of resources。

Sleeping dormant capital

Dormant capital is money or assets that are not actively used to generate returns, which can happen for a variety of reasons。For example, in traditional finance, the description applies to long-term unspent funds in a bank account。

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Technically, any funds that have been idle for more than a year are considered dormant, although in some jurisdictions the determination period is three years.。This is a well-known problem with anonymous Bitcoin wallets, but it's becoming more common as cryptocurrencies expand into other areas such as DeFi。

In reality, capital cannot always be actively managed, so there will inevitably be periods of idleness。It is also common for funds earmarked for investment to be idle, including stocks, bonds and other securities。This can happen if investors are not actively managing their portfolios or holding cash while waiting for new investment opportunities。

As for dormant commercial capital, some companies have large cash assets on hand that may be earmarked for future expansion or acquisitions.。However, given that such projects can drag on for years, it is not uncommon for this cash to remain idle for long periods, during which it can be used to generate substantial returns。

This is just a part of all the dormant capital in the world: real estate, unclaimed assets (such as insurance policies or inheritances), etc.。In fact, much of the money tied up in this category is more difficult to exploit, for example, converting real estate into active capital usually requires obtaining a loan secured by real estate.。

Deploy active capital on the chain

For on-chain assets, the opportunities to generate income are multifaceted, which is at the heart of the programmable money market that makes up decentralized finance。DeFi has grown by leaps and bounds with the emergence of the first revenue circle to offer "token 2 for coin 1."。Today, it supports a wide range of on-chain and off-chain assets that can be used in clever ways to generate sustainable returns.。

Projects such as EigenLayer are at the forefront of this trend, providing a way for idle pledged assets (such as stETH) to be used elsewhere to protect other chains and used for lending。As part of the LSDfi space, EigenLayer has significantly increased the available liquidity on the PoS chain, meeting the need to play a more active role in DeFi and receive rewards。

Crypto-decentralized finance

Dolomite is a money market protocol designed to provide greater capital efficiency through a virtual liquidity system.。Dolomite supports advanced financial instruments such as excess mortgages and the aggregation of returns on "niche" assets。It is possible to extract as much as possible from the available rate of return while protecting capital, and Dolomite does this by integrating with existing DeFi protocols。

Now you can mortgage, limited partnership, pledge and borrow assets with just a few clicks, making it easier for dormant capital to work。