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Problem/Hypothesis

  1. 1.
    Pool-to-pool (Aave, Rari Fuse) are unable to provide optimised loan terms (high LTV, wide range of collateral assets, low interest rates, predictable interest rates) due to:
    1. 1.
      systemic risk of adding new assets as collateral.
    2. 2.
      large thresholds for safety for LTV, health factor, and liquidation penalties, liquidation game theory, and liquidator risk premiums especially during times of market volatility.
    3. 3.
      lenders prefer to have their loaned assets back, instead of claiming collateral.
  2. 2.
    Pool-to-pool has systemic risks brought on by adding new collateral assets.
  3. 3.
    Lending platforms are not generating enough fees for the platform owners.
  4. 4.
    Bluechip DeFi yields are currently low. New DeFi or bridge protocols have been exploited. Whale and institutional lenders are looking for low risk, moderate yield opportunities.
  5. 5.
    NFT P2P loan products are niche and limited addressable market due to asset base (bluechip NFTs, versus all ERC20s).