Lending continues to be the breakout Open Finance application, with Ethereum-based protocols seeing over $387 million in loan originations year to date. Existing lending platforms have mostly opted for ...
Lending continues to be the breakout Open Finance application, with Ethereum-based protocols seeing over $387 million in loan originations year to date. Existing lending platforms have mostly opted for a variable interest and variable term design. In MakerDAO’s case, this variable rate model is a function of stakeholder’s desires to adjust rates for monetary policy purposes, while in Compound and dYdX, this variable model is necessary to operate a “peer-to-contract” architecture, in which borrowers interact with one continuously fluctuating consolidated pool of liquidity.
Fixed-rate loans offer participants guarantees over the structures of their engagements over a set period of time, affording better financial planning.
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source https://www.tokentalk.co/The Block/ethberlin-interest-rate-hackathon-projects-5d6c66c1b98396a4770c96f9
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