What is Radiant Capital?

Radiant Capital is a decentralized omnichain money market built on the LayerZero protocol. It enables users to lend and borrow assets across Arbitrum, Base, Ethereum, and BNB Chain, addressing liquidity fragmentation in decentralized finance.

The platform supports deposits of widely used assets like USDC, WBTC, and ETH, as well as newer liquid staking derivatives such as Kelp’s rsETH and Renzo’s ezETH. Users can use them to earn multiplier points through airdrop campaigns for EigenLayer and other partnered protocols.

Radiant had a strong start, particularly after the release of its V2 version, the RDNT token, the DAO and the RIZ Vaults, with users earning double-digit returns. Unfortunately, the protocol was hacked in late 2024, causing its total value locked to drop by 98%.

How Does Radiant Work?

Radiant unifies liquidity across multiple blockchains, enabling users to efficiently lend and borrow assets. The platform achieves this through a unique architecture powered by dynamic liquidity.

• Lending and Borrowing: Users deposit assets (stablecoins, ERC-20 tokens, etc.) to earn interest or borrow funds by providing collateral.
• Cross-Chain Borrowing: Utilizes LayerZero's Delta Algorithm, which ensures instant finality for cross-chain lending and borrowing by leveraging unified liquidity pools.
• Dynamic Liquidity Providers (dLP): Participants can lock RDNT tokens to become dLPs, earning platform fees, RDNT rewards, and governance voting rights.
• rTokens: Depositors receive interest-bearing rTokens (e.g., rUSDC, rETH) representing their collateral and earned interest, which can be redeemed at any time.
• Decentralized Governance: Radiant is governed by the Radiant DAO, allowing RDNT token holders to propose and vote on upgrades, emission schedules, and security measures.
• Yield Optimization: Both borrowers and lenders can earn RDNT rewards and multiplier points for ecosystem engagement, boosting their returns.

Radiant V2 Explained

Radiant V2 was launched on January 15, 2023, introducing a comprehensive overhaul to address inefficiencies in Radiant V1.

The upgrade transitioned the RDNT token from the ERC-20 standard to LayerZero’s Omnichain Fungible Token (OFT) format, enabling native cross-chain fee sharing and simplifying the expansion to more chains, starting with BNB.

V2 also revamped tokenomics utility by replacing single-sided RDNT staking with dynamic liquidity provision, tying emissions eligibility to meaningful liquidity contributions, and disincentivizing mercenary farming.

Other significant changes included restructured exit penalties, extended vesting periods, optimized fee splits, and the addition of 20+ new collateral types, reinforcing Radiant’s position as a leader in the trending at the time “real yield” narrative.

RDNT Tokenomics

RDNT is the utility token of Radiant Capital, with a total supply of 1,500,000,000 tokens. The primary purposes of RDNT include incentivizing liquidity provision, facilitating governance participation, and rewarding users within the Radiant ecosystem.

The token allocation and vesting schedule are structured as follows:

• Incentives for Suppliers and Borrowers: 47.1% of the total supply is designated for emissions to suppliers and borrowers, released over five years.
• Team Allocation: 13.3% is allocated to the team, with a release over five years and a three-month cliff; 10% of this allocation is locked at the protocol's genesis and unlocks after the three-month cliff.
• Radiant DAO Reserve: 30.9% is reserved for the Radiant DAO to support the protocol's long-term sustainability and governance initiatives.
• Core Contributors and Advisors: 4.7% is allocated to core contributors and advisors, released over one and a half years.
• Treasury and Liquidity Provision: 4% is reserved for the Treasury and liquidity provision, as ratified in the RFP-9 governance proposal.

Additionally, RDNT emissions from lending and borrowing undergo a 90-day vesting process. Users must actively initiate the vesting period in the "Manage Radiant" section and can claim their vested RDNT early, subject to a 25-90% exit penalty, depending on the remaining vesting time.

Radiant Innovation Zone (RIZ)

The Radiant Innovation Zone (RIZ) introduces isolated lending markets that allow users to borrow and lend within specific, independently managed pools.

Each market operates with distinct parameters, including collateral types and risk exposures, ensuring users can engage without affecting the broader liquidity pool. RIZ Markets use a shared vault system to centralize liquidity, optimize yield, and manage risk effectively.

New features like Oracle Routers and Bad Debt Managers improve market accuracy and safeguard against extreme events, ensuring stability across these specialized lending environments.

Radiant Capital Hack

In October 2024, Radiant Capital suffered a $53 million hack by North Korean UNC4736 hackers, making it the protocol’s second attack of the year. Affected users are urged to revoke wallet approvals using tools like Revoke.cash to mitigate further risks.

The attackers exploited Radiant's 3-of-11 multi-signature wallet system, using malware to manipulate Gnosis Safe, seizing the Pool Provider contract, deploying malicious versions on BNB Chain and Arbitrum, and finally draining the funds from the lending pools.

Earlier, in January 2024, Radiant Capital experienced a flash loan exploit that drained $4.5 million from the platform. This attack focused on a newly launched USDC market on Arbitrum, exploiting a vulnerability in the pool's rounding logic to manipulate fund withdrawals.

As a result, Radiant Capital's TVL peaked at nearly $400 million in early 2024 but dropped to $75 million after the January flash loan exploit. The October multi-signature hack then caused a collapse to less than $5 million, a 98% decline from its peak.

Founders

Radiant Capital was founded in 2022 by George Macallan, who has a background in other DeFi projects. However, publicly available information about him and his specific contributions to the industry remains limited.

The company secured $10 million in early-stage venture capital funding in July 2023, with Binance Labs among its investors.

Bottom Line

Radiant Capital was a fan-favorite among on-chain yield seekers, admired for its ambitious roadmap, including upcoming V3.0 and V4.0 upgrades.

While the devastating 2024 exploits dealt a severe blow to the team and its vision, the new year might mark a turning point and potentially a big comeback story.

With the community’s support, Radiant embraces this challenge as an opportunity to rebuild, innovate, and restore its position as a leader in decentralized finance.