Most recently, a global revolution has entered the market, in the form of crypto loans. At the moment, this area is gaining huge momentum every day and is constantly developing in this regard. I want to tell you in detail how crypto loans occur, and the main theses about the project
GoldFinch can give crypto loans only with a collective assessment of the participants, and not that you have crypto assets.
The protocol involves 4 people: Borrowers, Sponsors, Liquidity, Providers, and auditors.
Borrowers are participants who are looking for financing, and they offer pools of borrowers for sponsors and evaluation. Borrower pools contain the conditions that the Borrower seeks, such as the interest rate and repayment schedule. Borrowers repay loans through a pool of borrowers.
Sponsors also provide their capital with a small percentage to borrowers, and before giving them a loan, they evaluate their pools in what size they are.
Liquidity providers provide capital to the Senior Pool to receive passive returns.
The senior pool uses a leverage model to automatically allocate capital to the Borrower. When the Senior Pool distributes capital, part of its interest is redistributed among the Sponsors. This increases the effective profitability of Sponsors, which encourages them both to provide capital with a higher risk of first loss and to do the work of evaluating Pools of borrowers.
Finally, the Auditors vote on the approval of Borrowers, which is necessary for them to be able to take out loans.
Auditors are randomly selected according to the protocol, and they provide human-level verification to protect against fraudulent actions.
The project also has its token, which is a FIDU token that is used for crypto loans, it works on the ERC-20 network. Also, at any time, liquidity providers can withdraw funds by exchanging their FIDUS for USDC at an exchange rate based on the net asset value.
The withdrawal fee is 0.5%
