A new project built on top of Bitcoin’s sidechain, RSK, is preparing to promote decentralized finance (DeFi) in the Bitcoin ecosystem.
Sovryn, a self-billed “decentralized Bitcoin trading and lending platform,” launched today with $ 2.1 million behind it.
Likewise, crypto venture capital firm Greenfield One led the funding round. Which also featured contributions from Collider Ventures and Monday Capital.
It is a 2-in-1 decentralized exchange and derivatives market. In essence, Sovryn will offer merchants loan and loan services in Bitcoin.
Cheaper and Secure Flash Loans with New Ethereum Implementation for DeFi
A new improvement proposal, recently merged into the Ethereum code, seeks to standardize the processes for flash loans.
Incorporation of these loans into decentralized finance protocols is expected to be simplified. Well, it would no longer be necessary to consider each implementation in particular.
The proposal, called EIP-3156, seeks to unify criteria and approaches. Basically, this implementation requires the loan recipient to execute the onFlashLoan function.
For this, you must have received tokens from the person making the call. So that the transaction is not reversed, the receiver must send the caller both the amount and the commission.
Additionally, the token contract must implement a FlashLoan function that executes the equivalent of an ERC20.transfer operation. The lender’s contract can execute a transfer of the tokens. Who owns or mints the tokens to be lent.
Yields on cryptocurrency loans are higher on CeFi than on other platforms
According to the results of a report by Kraken Intelligence, although each cryptocurrency lending platform establishes its own rules.
Interest rates tend to be significantly higher on loans from centralized finance (CeFi) compared to decentralized finance (DeFi).
The data was compiled in the report entitled “Crypto Yields-A Simple Breakdown” published on December 11 by Kraken. There, the exchange team evaluates the different products.
That generate returns and that are currently available in the cryptocurrency market. It focuses on loan platforms. Although it also mentions derivatives and staking.
“We look at how each one works, what benefits they offer, and the associated risks,” Kraken says on his blog. He adds that the goal is to help users decide which offers best suit their needs.
The publication highlights the fact that obtaining attractive returns has emerged as a new opportunity within the ecosystem.
However, he sees this as an opportunity that also carries risks. Even if the interest rates or the rewards in cryptocurrencies exceed most of the rates that can be earned with traditional financial products.