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DeFi Lender Aave Issued First …

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DeFi Lender Aave Issued First ...

DeFi Lender Aave Issues First Loan to Decentralized Exchange
CONTENT

  • DeFi project opens first line of credit for DEX

  • Users can earn on a percentage of the provided crypto assets

  • DeFi Market Rises To Record Highs

International consortium of news organizations developing transparency standards.

DiversiFi Decentralized Exchange Received Credit Line Back Through Third Party Collateral Using Aave’s New Credit Delegation Scheme.

DeFi Lender Aave Issued First ...

DeFi project opens a line of credit for DEX

DeFi Lending ProtocolDecentralized finance (DeFi) is a blockchain-based financial service that offers users access to an open, efficient and … More Aave has announced the first loan for the DerversiFi decentralized exchange. The line of credit uses funds provided by other Aave users who wish to generate additional income from loan origination. The agreement was facilitated by the decentralized contract service OpenLaw, which draws up credit conditions and monitors compliance with agreements between participants.

The deal represents the first step towards providing DeFi loans to millions of users without collateral with the potential for multiple market expansion..

Credit Delegation allows users to deposit collateralized crypto assets into Aave, and then allow users who are trusted by the depositor to borrow against that collateral. Both parties sign an agreement provided by OpenLaw to confirm the details of the loan, such as credit limits, use of funds, and repayment terms. 

In exchange for allowing borrowers to use their collateral, liquidity providers generate interest on loans taken out against their assets using credit delegation.

“Delegating credit will unlock liquidity under the Aave protocol through DeFi without the need for collateral. Likewise, lending could be a way to bring DeFi liquidity to traditional finance, ”said Aave founder and CEO Stani Kulechev in an interview with Decrypt.

The agreement signed today gives DiversiFi access to 20 wBTC worth over $ 236,000. In June, DiversiFi released an update to its decentralized lending platform targeting professional traders with self-trading capability, hardware wallet support and enhanced privacy protections.

The DeFi industry is constantly growing

DeFi Lender Aave Issued First ...

The crisis year 2020 was a real breakthrough for the decentralized financial market. In July of this year, the capitalization of DeFi increased to $ 4 billion, while the figure continues to grow exponentially. So, on July 3, DeFi had only 2 billion dollars, two weeks later the amount reached 3 billion. And then in less than a week it reached 4 billion. This dynamics reflects the rapid acceleration and makes experts suspect the formation of a dangerous speculative bubble in the market, akin to an ICO bubble.

Already at the beginning of August this year, the capitalization of the DeFi market was $ 8 billion. This information was presented to users by the CoinGecko resource. Note that this figure is not the ultimate truth. For example, the similar figure presented on the DeFi Market Cap website was $ 7.1 billion yesterday. However, its statistics – unlike CoinGecko – do not include the Chainlink coin. Meanwhile, LINK recently entered the top ten cryptocurrencies in terms of market capitalization, and also became the leader in the DeFi asset market according to CoinMarketCap..

BeInCrypto previously reported that Aave and Synthetix have taken a new step towards decentralizing their protocols.

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