Flare with Ola Finance is bringing customized lending networks on Songbird - Flare’s canary network. DeFi projects building on Songbird and Flare can deploy a lending network through Ola’s protocol. The lending networks will include all F-Asset tokens like XRP, DOGE, ALGO & LTC, adding non-turing tokens to the DeFi ecosystem.
Flare is a network that combines Turing incomplete blockchains with the Ethereum Virtual Machine (EVM), allowing an asset to be included in a smart contract-enabled ecosystem. Flare is the first Layer-1 blockchain to offer trustless and safe inter-ecosystem interoperability with any other blockchain without needing the integrated chain to be modified. Flare can interface with as many blockchains as possible because of the combination of next-generation consensus, the State Connector, and the Flare Time Series Oracle, resulting in a robust cross-chain protocol that is genuinely decentralized, safe, and scalable. Flare is a united, decentralized future that is fast, low-cost, and low-carbon.
Hugo Philion, Co-Founder & CEO of Flare, said:
With TVL on Songbird reaching $120m in January, we are delighted that Ola’s lending-as-as-service solution is primed to attract even more liquidity into the Flare ecosystem. Their differentiator within DeFi lending which enables anyone to create their own branded lending network on Songbird & Flare should prove to be very powerful.
Ola Finance is a technology platform that provides its partners with lending-as-a-service. While the protocol is used to establish the loan network, its partners become the owners of the network once it is implemented. Ola has created loan networks for partners like SpiritSwap on Fantom, ApeSwap on Binance Smart Chain, and Fuse Network, with $48 million in value locked. It provides these communities with borrowing/lending services and all of the advantages of having their own Lending Network without having to devote resources to building one.
The virtual currency industry has grown to be worth $3 trillion. There have been significant breakthroughs in the bitcoin field during the last decade. The decentralized finance (DeFi) area is one of the most recent inventions.
Within the cryptocurrency realm, DeFi is one of the fastest-growing areas. It provides a wide range of services to bitcoin investors and other market participants. Lending platforms or protocols enable DeFi lending to take place. These services provide trustless cryptocurrency loans by allowing the holders to invest their coins in DeFi lending platforms for lending purposes.
A borrower may take out a loan via the DeFi platform, allowing the lender to collect interest after repaid. The loan procedure is completed without the use of intermediaries from beginning to end.
A coin holder uses a smart contract to transfer the tokens they want to lend into a pool. When coins are submitted to a smart contract, they become accessible for borrowing by other users. After that, the smart contract generates tokens (typically the platform’s native token), which are sent to the lender automatically. In addition to the underlying assets that were given to the smart contract, the tokens may be redeemed later.
Almost all loans made using native tokens are backed by collateral. Users who want to borrow money will be required to offer a guarantee. Unlike the traditional banking system, the guarantee in the DeFi space is in the form of cryptocurrencies that are worth more than the loan itself.
This approach may seem nonsensical on paper since the borrower may earn the funds by selling their assets in the first instance. DeFi borrowing, on the other hand, makes sense for a variety of reasons.
For instance, users may want cash to cover unanticipated bills, but they do not plan to sell their holdings since they think the assets will appreciate in value in the future. Furthermore, users may dodge or postpone paying capital gains taxes on their cryptocurrencies by borrowing money using DeFi protocols. Individuals may also boost their leverage on specific trading positions by borrowing cash from the DeFi protocols.
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