Hashstack Finance has debuted its Open protocol, the first ever DeFi lending protocol to offer non-custodial, secure under-collateralized loans, Invezz learned from a press release.
This is an important milestone in Hashstack’s roadmap as they get ready to launch the Open protocol mainnent in the coming weeks.
Only independent lending solution in DeFi
Open protocol is the only independent lending solution in DeFi which makes it possible to provide under-collateralized loans with a collateral-to-loan ratio of up to 1:3. It means you can provide just $100 as collateral and borrow up to $300.
Of this, $230 is used as in-platform trading capital. The borrower can withdraw $70 (i.e. up to 70% collateral).
Hashstack Finance founder Vinay commented:
Today, if you want to borrow $100 on Compound, or Aave, or even MakerDAO, you are required to provide a collateral of at least $142. This breaks the primary intent behind loan procurement, and has restrictive use-cases for the borrower. In comparison, through Hashstack’s Open protocol you would be able to borrow the same $100 with collateral as little as $33.33. This 4.25x value-add against every established market player today is a remarkable milestone for the defi ecosystem in general, and will drive further adoption.
Hashstack’s Open protocol eliminates inefficiencies from the DeFi ecosystem through a three-tier approach:
- Effective asset utilization through diversification of available assets via lending and providing trading capital
- Clear compartmentalization of APY and APR of deposits/loans with that of their minimum commitment period (MCP)
- Under-collateralized loans
Hashstack integrates with PancakeSwap and other DeFi solutions to improve loan utility and facilitate in-app market swaps. It means borrowers don’t have to switch the dApp to swap the borrowed tokens into other primary or secondary coins.
At the beginning, the Open protocol will support only major stablecoins and liquid coins such as BTC, USDT, USDC, BNB, and Hashstack’s native governance token HASH. Open protocol will also bridge assets from Avalanche, Ethereum, and other chains as an expansion of the primary markets.