The cryptoverse in 2021 was dominated by a few keywords: NFTs, GameFI, Metaverse. But there was one niche that jumped into the mainstream without much attention. Yes, I am talking about DeFi. I know a lot of you would say that DeFi was extremely hot topic throughout the year. As per defillama, the total value locked in these protocols jumped from $18B to $240B in the last year itself. Now tell me, was the noise up to this extent?
But then what powered this huge leap in the DeFi space? Well, it was significant improvements in the protocols that powered finance without any central authority snooping in. Today, I am going to talk about one such protocol called EasyFi. We’d also discuss some problems this protocol is trying to overcome in DeFi space. Hang in till the end, as I may have a little surprise for you if at all you decide to invest in this project.
What is EasyFi?
Simply put, easyfi is lending and borrowing protocol in DeFi space. We’ve come across multiple such protocols namely Aave, Compound etc. in this space. So what’s easyfi doing differently? Well, to begin with, it is chain agnostic and can run on BSC, Polygon and ETH. There goes my opportunity to crack gas jokes about ETH. Apart from that, there are some other features as well that we’d explore in the upcoming section.
If you have ventured into DeFi space, you might realize that this is a pretty big deal. For the uninitiated, let me take a shot.
You see, when you take loans from a bank, you mortgage something of equal or high value. This is a far lesser risky proposition because there’s an intermediary (bank) and you are KYCed to the core!
But in a DeFi landscape, there’s no KYC and intermediaries. So how do lending protocols work? Well, through something called overcollateralization. This means if you want to borrow $1000 from a protocol, you may need to deposit a token like ETH worth $1200. If price fluctuates and ETH falls below $1050 (a liquidation price set by protocol), your tokens are sold.
So far, that was the only way to lend money in a decentralized fashion.
EasyFi brings a new twist to this. They have something called trust score, which is maintained for each user. It analyzes borrowers’ activities on various lending platforms and determines the collateralization ratio required for each individual.
Building Creditworthiness Score:
Think of it as AI based lending that is taking conventional finance by a storm. Companies like Slice, Jupiter are already doing it for traditional finance. They check your past history, credit score and basis that offer you loans.
There was no CIBIL in a decentralized world, but with this protocol kicking in, we might have something like it soon!
This would incentivize the healthy borrowers by undercollateralized borrowing and meanwhile charge higher from the defaulters.
This is yet another great attempt to mimic the traditional finance. Easyfi tries to come up with products like microlending (small loans borrowed for a fixed time) so that it can create mass adoption in this space. That would help the traditional small businesses to look at decentralized alternatives while looking for some working capital.
Token and Use Cases:
The typical functions of Easyfi native token EZ are as follows:
- Protocol incentivization
- Network Conesus
- Dual Farming: This is yet again an interesting approach to yield farming. Usually when LP tokens are staked, the yield is in the form of the native token itself. But here you can chose amongst different DeFi tokens for your yield.
I told you we’ve got a surprise towards the end. So here goes:
WazirX is launching this token real soon and is organizing a giveaway worth $47,510 for it’s users.
- Tuesday, 4th January – Friday, 7th January – Signup on WazirX and receive free 0.5 EZ.
- Tuesday, 4th January – Trivia on WazirX Instagram page with prizes of $50. Play interesting trivia about EZ and win.
- Tuesday, 4th January – Wednesday, 5th January – Quiz on our Blog page with prizes of $500. Show off your EZ knowledge in a fun quiz session and win.
- Wednesday, 5th January – AMA with Shantanu Sharma, VP, Growth & Marketing. Learn everything about EZ and win total prizes of $300.
- Thursday, 6th January – YouTube Live with Ankitt Gaur, Founder & CEO, EasyFi Network.
- Monday, 10th January – Thursday, 13th January– 72-hour long Highest Trader Kaun Marathon with prizes of ₹27,82,375 ($35,000) worth EZ for top 350 traders.
- Friday, 14th January – EZ Trading Lucky Draw. Lucky traders will draw additional prizes from a $10,000 Prize Pool.
You can check out more details here.
Web3 is in it’s nascent stage right now. While there are some frugal use cases like Jpegs selling for million dollars, there are some protocols that are trying to make a difference. Easyfi seems to be one of them. But the quantum of impact it will create, only time will tell.
What do you think?
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Until next time..