StableCredit is a new lending protocol from the creators of yearn.finance

It seems the founder of Yearn.finance just decided to issue a new lending protocol called StableCredit. Here is information released from the creators of the popular Yearn.finance financial platform, Andre Cronje. It looks like they’re trying to get away from the governance token craze that’s currently driving digital asset lending protocols.

The arrival of StableCredit was an event that broke the current DeFi scene

StableCredit seems to take many of the best decentralized-finance buzzwords, put them in a blender, and pour them into a protocol.

The blog post stated:

“StableCredit is a protocol that has tokenized debt stable coins, lending, automated market makers, and single-sided AMM exposure to create a completely decentralized lending protocol.”

This project works as follows. First, users put in some USDC, each unit of which should equal roughly $ 1.00, since it’s a dollar-pegged stablecoin. (Though USDC is a stablecoin pegged to the dollar, that doesn’t mean it always equals $ 1.00. In the last year, it spent nearly a month at $ 1.01 or higher and dropped below $ 0.97 twice.) An oracle delivers the exact price of a dollar to a USDC stablecoin and mints StableCredit USD at that rate.

A mixture of equal parts USDC and StableCredit USD goes into an automated market maker, which tries to keep the total value of those assets equal. What the end-user gets is a specified amount of StableCredit USD, a tokenized version of the US dollar, which they can use as collateral to borrow other assets within the AMM.

Cryptocurrency researcher Hasu noted:

“The innovation is a lending protocol without governance. Therefore, there’s no need for token voters or to extract rent from users.”

Governance tokens are all the rage right now. First lending platform Compound, then exchange Synthetix, then lending protocol Aave, then, well, everybody started using governance tokens as a way to redistribute control of the platforms and protocols to those who use them. Governance tokens, though meant to serve a utility by giving a user voting or governance rights in exchange for providing liquidity, have become hot properties in their own right as users look to leverage them for interest.

Cronje’s YFI, the governance token for yearn.finance, is trading for over $ 33,000, though Cronje himself said it was designed to have “0 financial value.”


Source: CoinMarketCap

It’s too early to know what financial value StableCredit will bring. According to Cronje, the user interface will be ready later this month.

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