B58 Finance

A mobile-based wallet with an integrated DeFi platform, aiming to increase Cardano adoption through the familiarity of the access point for the general public.

Currently in the developmental stage, B58 Finance wants to increase the adoption of Cardano by providing members of the general public with a familiar onboarding point which gives access to DeFi whilst simultaneously removing the complexities of the DeFi world. This will be done by presenting this world of DeFi to the users through the familiar interface of a wallet in a mobile app. That is Begin Wallet Viewed through a traditional financial lens this wallet and the company itself can be seen as an internet or mobile bank.

The many DeFi services that will eventually be provided through B58 Finance's link to the Begin Wallet are as follows:

Buying and selling of ADA in the users’ local currency
Connecting to dApps outside the platform
Social Lending (a micro lending platform akin to current cloud funding platforms, where the user pays back their backers but is not required to put down collateral)
Borrowing and lending (based on crypto pairs in liquidity pools, where a user puts in collateral to receive a loan in a cryptocurrency of their choosing)
ADA debit card (where users can have a separate account they can spend like they would a regular debit card)
Token swapping (based on the common DeFi automated market maker, AMM, protocol)

Other features discussed in B58 Finance's whitepaper include an integrated Proof-of-Transparency which uses transaction metadata to record the receivers information, which is connected to an off-chain database containing their KYC information. In this the sender can choose whether or not their information remains anonymous.

Industry

DeFi

Lending Protocol

Lending Protocols

Lending protocols in the DeFi world allow people to loan or lend money in a peer-to-peer manner, i.e. without the banking middleman. These loans are secured by the lender over-collateralizing the loan and the terms of the loan being managed in a smart contract. This gives the unbanked or those who have poor credit the ability to take loans, and it gives those with excess capital the opportunity to provide loans in a secure and trustless manner, and to earn income from them.

Over-collateralization means that the person receiving the loan locks up more than the value of the loan to secure it e.g. if they want to loan 100 they must lock up 150. How much they over-collateralize the loan by, and which tokens they use as collateral, depends on the platform. Some platforms only accept stablecoins, and other accept a variety of crypto assets. Typically, an individual uses one asset for collateral and takes a different asset as their loan.

An important factor in all loans is the interest rate and the length of the loan. These vary greatly by lending protocol, and loans can have fixed interest rates and periods, or infinite periods with interest rates that fluctuate throughout the loan period, fluctuating based upon the utilization rate of the pool of funds the loan was drawn from.

Importantly, the receiver of a loan is expected to maintain a certain ratio of collateral to loan, meaning that if the value of their collateral drops below that of their collateral to loan ratio, they need to add more collateral to keep the required balance. If they don’t keep up the collateral ratio they face liquidation and the loss of their collateral.

To "become the bank" those with idle tokens can deposit them into a lending protocol and earn from the interest derived from the loans their tokens are used to facilitate. Usually this deposit requires a lockup period of a certain length of time. Often, the longer the lockup period the higher the percentage return for the depositor.

DeFi

Here are all the Cardano DeFi projects complete with descriptions and tags. If you’re looking for a Cardano DeFi exchange, a lending protocol, a launchpad, a Cardano stablecoin, or platforms on which to tokenize real world assets then you’ve come to the right place. The Cardano DeFi ecosystem is maturing and, as it does, we will continue to list the new Cardano DeFi projects here. If you look at Cardano in 5 years this list will be substantially different, some projects will have left it, but many many more will have been added.

If you’re looking to simply swap Cardano native tokens then a Cardano DEX is your best choice. If you’re looking to utilize your crypto holdings for a loan then take a look at all the Cardano lending and borrowing platforms on offer and choose which one fits your needs. There is much more utility in the Cardano DeFi world and we invite you to explore it here!

Borrowing

Lending Protocols

AMM

AMM stands for Automated Market Maker. This is an algorithm, often supplemented by oracles, that facilitates the pricing and exchange of assets between users. Assets are exchanged at market value through liquidity pools. These pools are created by Liquidity providers, LPs, who deposit assets to the exchange in pairs. This “asset pair” then allows users to swap one asset for the other through the liquidity pool. Fees are paid to the LPs who provided the liquidity. The more liquidity a pair has the less “slippage” a user experiences, meaning the less likely the user is to experience a price change in their trade.

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