Invest Spoke

Overview

Invest Spoke is the lender-facing capital entry point of the protocol. Investors supply assets such as ETH, BTC, and major stablecoins into the Invest Spoke, which then routes liquidity through the Hub so borrower-facing LP collateral spokes can extend credit against active liquidity positions.

This design separates capital supply from LP collateral management. Lenders can participate in the credit market without managing impermanent loss, liquidity ranges, or AMM-specific collateral operations, while Borrow Spokes remain responsible for underwriting LP risk at the market level.

Architectural role: the Invest Spoke makes the capital side of the system scalable, while Borrow Spokes keep LP-specific risk isolated.

Capital Entry Point

The Invest Spoke exists so lender deposits can power borrowing across multiple LP-collateral markets through one shared Hub layer instead of fragmenting liquidity by collateral type.

Early in the protocol lifecycle, Hub liquidity may also be supplemented by Aave v4 credit lines. Over time, Invest Spoke deposits are expected to become an increasingly important source of native lending capital.

Risk-Adjusted Yield

The risk-adjusted yield enhancement from LP token collateralization comes from the protocol's ability to price and manage liquidity provision as a productive economic activity rather than treating LP positions like static collateral. Unlike non-yielding assets, LP tokens can generate ongoing cash flows from trading activity, and those fees can partially offset the borrowing costs attached to leveraged LP exposure.

That matters to the capital side of the protocol because it changes how credit should be priced. Aave v4's risk premium mechanism gives the system a way to reflect this yield-generating characteristic in the terms extended to high-quality LP collateral, potentially supporting more favorable pricing than would be available for non-yielding assets with similar volatility.

Implication for lenders: when LP collateral is priced correctly, the Invest Spoke can route capital into a credit engine backed by productive collateral rather than passive balance-sheet assets.

Dynamic Risk Controls

The risk-adjusted framework also goes beyond static LTV settings. By monitoring pool composition, trading volume, price divergence between paired assets, and broader market conditions, the protocol can implement time-varying risk parameters that respond to the real behavior of LP collateral instead of assuming fixed risk at all times.

In practice, that means risk controls can tighten during periods of elevated volatility, liquidity stress, or widening divergence, then relax during more stable operating periods. This helps protect lender capital during stress scenarios while preserving more capital efficiency during normal market conditions.

By keeping lender capital in Invest Spoke while letting Borrow Spokes adjust to collateral-specific market conditions, Avana can scale capital formation without flattening LP markets into a one-size-fits-all risk model.