Have you noticed the absurd paradox that exists in the DeFi world?

If you stake your ETH for yield farming, you have to give up liquidity to earn yields; if you use your assets as collateral for borrowing, any appreciation in the asset's value no longer benefits you. It's like being forced to choose between "eating" and "breathing"—both are essential for survival, so why do you have to pick just one?

Even more ironically, the real world has already solved this problem. One property can be used for living, renting, mortgaging, and even listed on Airbnb for extra income—all at the same time. But on the blockchain, assets suddenly become "handicapped," only able to serve one function at a time.

# It's Not the Assets That Are Dumb, It's the Protocols

Early DeFi protocols were designed in a rather crude way: cramming all assets into standardized templates.

It's like a restaurant that only cooks noodles—no matter if you bring Wagyu beef or abalone, everything gets chopped up and thrown into the pot as noodles. ETH goes in and becomes "Asset A," stablecoins become "Asset B," and tokenized treasury bonds become "Asset C." The unique characteristics of each asset? All wiped out.

The root of the problem is that these protocols simply can't read "risk dialects." They can't tell the difference between a 6-month US Treasury and a 3-year corporate bond, can't see the validator concentration risk behind liquid staking tokens, and can't understand the different maturity structures of various assets. So they use the most primitive method—"disabling" the asset to mitigate risk.

# Falcon's New Approach: Building Asset Profiles

What Falcon is doing is simple: instead of labeling assets, it creates a complete "digital identity" for each one.

When you deposit a liquid staking ETH, the system doesn't just record "this is ETH"—it also tracks details like its staking duration, validator distribution, unlock period, historical volatility, and more...