Since its inception, the decentralized finance sector has served two key purposes: banking the unbanked and eliminating friction-intensive, bureaucratic processes. Anyone holding crypto can seamlessly use it to access additional revenue streams, adding to the core yields obtained through value growth.
The DeFi lending market is at an all-time high, with enthusiasts worldwide accessing crypto-collateralized loans in hopes of banking on the hottest opportunities. Users can normally obtain a crypto or fiat-based loan by collateralizing supported cryptocurrencies. However, if those coins are already earning yields in a liquidity pool, lending becomes impractical, as it entails giving up on existing revenue streams.
Here’s where Freeliquid comes into play.
Freeliquid is a DeFi lending platform focused on collateralized liquidity pool tokens. Users worldwide are eligible to obtain funding of up to 90% of their liquidity pool share, with no interest rates or credit checks. Loans are given in USDFL, Freeliquid’s native stablecoin soft pegged to the United States dollar.
Freeliquid is now enhancing its value proposition by integrating Curve Finance liquidity pools and expanding to the Binance Smart Chain.
Freeliquid stablecoin lending now supports Curve liquidity pool collateral
So far, Freeliquid was exclusive to liquidity providers on Uniswap, yet the DeFi platform has expanded far beyond this automated market maker. After a successful community vote, effective immediately, Freeliquid has integrated Curve’s liquidity pools.
Following this development, Freeliquid now supports Curve’s 3pool (3CRV) LP tokens as collateral, allowing users to borrow up to 90% in USDFL. This translates to support for roughly $800 million in additional liquidity for Dai, Tether (USDT) and USD Coin (USDC), according to Curve’s pool statistics, thus opening the gates for Curve LPs to further boost their yields. Curve has the market’s largest stablecoin liquidity, while also accepting different iterations of Bitcoin (BTC) and Ether (ETH), such as RenBTC (renBTC) and shorted Ether (sETH). When accounting for CRV farming rewards, Curve’s 3pool LPs obtain yields varying from 16% to 40% APY.
The 3CRV tokens are now supported as collateral on Freeliquid, allowing users to maintain their farming rewards while tapping into additional revenue opportunities via the USDFL stablecoin.
Freeliquid announces awaited expansion to Binance Smart Chain
While Ethereum is undoubtedly the DeFi market leader, scalability challenges have led to rising transaction fees that make the protocol impractical for large-scale usage. The Ethereum team is actively developing Ethereum’s future iteration based on proof-of-stake, but DeFi requires scalable and cheaper solutions today.
The last couple of months have brought along a colossal influx of capital into protocols based on the Binance Smart Chain. AMMs like PancakeSwap report TVLs as high as $4 billion, showcasing considerable demand for scalable and cost-effective blockchain networks. With fees as low as 10% of what Ethereum charges, BSC is here to stay over the long term.
Succeeding yet another community vote, Freeliquid is now expanding to BSC. The two chains will work independently, and the BSC integrations will not affect Freeliquid’s current users. Moreover, the team is developing an ETH-BSC bridge, allowing the simple transfer of USDFL and Freeliquid (FL) tokens between the ERC-20 and BEP-20 token standards.
At this time, the smart contracts are being readjusted, with the expansion scheduled for Q2 2021. The supported BSC liquidity pairs will be announced soon.
Recapping Freeliquid’s value proposition
While banks provide impractical interest rates of roughly 0% on customer deposits, DeFi ups the game through double-digit APYs. Freeliquid further boosts potential yields through collateralized LP loans, a secure stablecoin, community governance, audited contracts, flexible loan terms and saving incentives. As such, Freeliquid’s ascension as the market’s top lending platform for collateralized LPs is well-deserved.