Sommelier operates as a non-custodial, cross-chain system designed to run intelligent DeFi vaults known as Cellars. Members of the community can establish these Cellars, which utilize smart contracts to manage sophisticated DeFi positions. Strategy Providers (SPs) drive these Cellars by creating trading strategies and submitting recommended actions to Sommelier Validators, who execute them with the goal of generating yield.

Examples of potential Cellar strategies include:

• A BTC and ETH portfolio that rebalances according to price trends detected by machine learning algorithms
• An NFT trading approach that utilizes Twitter sentiment regarding specific collections
• A method for hedging liquidity provision on decentralized exchanges

The platform relies on a distinct architecture featuring the Sommelier Cosmos SDK blockchain, an off-chain execution environment that maintains strategy privacy while enabling diverse off-chain data modeling, and a high-performance ETH bridge. This bridge transmits strategy instructions to adjust assets within Cellars. The team is also expanding this bridge to support other networks, such as Polygon and Avalanche, ensuring strategies are not limited to Ethereum’s high-gas markets.

By aggregating and batching transactions, Sommelier lowers gas fees, offering a cost-effective alternative to standard Ethereum transaction costs. Security is maintained through a decentralized governance model managed by validators, which aims to provide advanced protection for user funds. While validators transmit strategy instructions across the bridge, user assets remain deployed directly in Cellars and are never moved across the bridge. Additionally, because Cellars are non-custodial, users retain the ability to withdraw their assets at any time, and Strategy Providers never hold ownership of these funds.

The native utility token, SOMM, serves several functions:

• Securing the proof of stake blockchain
• Paying fees for transaction processing
• Operating validator nodes on the network by staking SOMM tokens
• Casting governance votes to decide which Cellars are admitted for deployment and how network resources are distributed
• Distributing a share of the real yield generated by Cellars to stakers

Currently, the circulating supply stands at 500 million SOMM tokens. When Sommelier launched its mainnet in September 2021, it created 500 million SOMM tokens at genesis. The distribution of this supply is as follows: 30% resides in the on-chain treasury (the community pool), 20% is held by the Sommelier foundation, 30% is allocated to investors, and 20% is held by the team building Sommelier. Since launch, Sommelier has maintained zero inflation. This approach relies on SOMM stakers earning real yield from the performance of Cellars on the platform, which the team intends as a more sustainable incentive mechanism than inflationary staking rewards. These platform fees are designed to grow linearly with the amount of liquidity in Cellars.

Sommelier was established by early Cosmos core contributors Zaki Manian, Kristi Põlsdam, Jack Zampolin, and Kevin Kennis. Zaki Manian acts as CEO and has been a prominent blockchain developer since 2014, when he self-taught cryptography and started contributing to initiatives such as Bitcoin, Ethereum, Zcash, and Tendermint. He played a key role in constructing the Cosmos ecosystem, which included launching the first public Cosmos testnet and serving as director of Tendermint.

You can trade SOMM on Osmosis. Strategy tokens linked to Cellars will also be listed on Osmosis, along with decentralized exchanges such as Uniswap.