Easyfi is a layer 2 lending protocol. Now lets revise the thumb rule of why Layer 2 solutions are built on Ethereum ?
1.) Devastatingly slow transaction speeds.
2.) Killing high Gas Fees.
Decentralized Finance is a growing Industry. This can be well proved with the fact that it took 146 days for the Total Value Locked (TVL) in the Defi industry to grow from $1 Billion to $2 Billion but after that it exponentially grew and it took only 58 days to $6 Billion from $2 Billion. The current TVL is whooping $250 Billion plus. Such exponential growth requires a highly scalable solution. The issues on the Ethereum blockchain were marring its growth. Ethereum 2.0 is obviously promising in the future but in the short term, there was no ready solution to this problem. As a result it was the need of the hour to create an alternative scaling solution.
Apart from speed and cost of transactions, its important for a Defi platform to be more user centric and provide convenience and better experience to the user. There are a hell lot of Defi protocols and financial protocols being introduced in the market. New users are looking for long term opportunities rather than small term incentives with better standards of security and principal protection. Hence to bring in these innovations and to accelerate the Defi industry, Easyfi was created.
What is Easyfi exactly ?
It is a universal layer 2 lending protocol for digital assets. An open financial system built on top of the polygon network. They have choosen Polygon because of its easy access to the Ethereum blockchain and also to harness the power of plasma technology on which polygon is built.
The first and foremost goal of Easyfi is to ensure fast and cheaper transactions to serve a large number of users. The next DNA component is to focus on credit aspects of the protocol so that it opens up various categories for the user to access credit easily and responsibly. The project also enables Defi based insurance modules to protect the capital investors from any NPAs (Non performing Assets) that might occur as the market progresses.
Key Functions of Easyfi
Easyfi is built to provide additional features which other financial industries lack. Some of the key functions that will help Easyfi standout are as follows-
1. Secured (Collateralised) Loans:
These are the basic loans which are provided by any lending project. Similarly even Easyfi will have Collateralised Loans as their main offering of their Interest Rate market protocol.
2. Under Collateralised Loans:
It will be one of the most important innovations and struggle of the lending industry to promote decentralised lending and in turn enable strong adoption. It is connected to an industry leading rating mechanism TrustScore built by Koinfox. It will enable users to access billions in capital which can be allocated efficiently.
In our surroundings we have seen so many people who are working just because they are loaded with daily time bound loans of small value. There are millions of people like this who are exploited by lenders with high interest rates. Micro Loans of Easyfi has been introduced to provide small loans to such borrowers to help fulfill their short term needs of medical emergency, small business or anything else.
4. Credit Delegation (CD):
One of the core products for higher trust based loans where the parties either know each other or accept the risk level based on TrustScore of the borrower. Delegation is for loans of a bigger ticket size, enabling finance for various needs of the entity through the protocol. Some examples where Credit Delegation comes into play is Short Term Loans for Working Capital Financing, Project Financing, etc.
5. Credit Default Swaps (CDS):
This is an important feature of Defi as it brings insurance and also enables lenders of certain ticket size to convert the loans into tradable instruments. They can then sell them to institutional customers who are willing to take the risk. Thus it provides credit insurance to various categories of loans on Easyfi. The CDS feature of the protocol will establish a money market for various passive income streams backed by these high guaranteed loans which can be moderated according to the risk appetite of the user.
It was founded in the year 2020 by two Indians-
- Ankitt Gaur, Co-Founder & CEO
He is a global consulting professional who has enabled enterprises across the globe to adopt and benefit from progressive technology. He is the first Indian based author on Blockchain Technology from non-techie perspective and also is associated with Institute of Chartered Accountants of India as a Blockchain guest faculty
- Anshul Dhir, Co-Founder
He is an entrepreneur and digital techie who has founded companies in completely different sectors which include cryptocurrency mining, real estate, finance, Internet media. All are still up and running. He is also a certified stock broker and consultant.
Easyfi Native token Easy is an ERC-20 token. Its Total Supply is limited at 10 million EZ and current supply is at around 2.5 million EZ. Almost 4 million EZ is reserved for community distribution and incentive programs. Its all time high $44.39 was reached on 6th April, 2021. Lets have a look at the uses of the EZ token-
- Governance: EZ token enables the users to play a part in the protocol’s decisions as it intends to become a DAO in the future and handover the control of the Governance decisions to the community.
- Protocol Incentivization: It helps the user earn rewards from time to time and also provides voting rights for the development of the protocol.
- Staking Rewards: It helps various projects to start their lending and borrowing feature on the Easyfi network and in turn enables them to stake EZ tokens to earn tokens of their respective project and also interact with other markets on the network.
- Cross Market Interaction: It is the first Defi protocol to start dual token farming and allows various projects to be launched on Easyfi and incentivise the users to interact with them.
- Cross Chain Settlement: The tokens are used for settling cross-chain transactions on various bridges created to interact and share the liquidity with various chains like Binance Smart Chain, Polkadot, etc.
The three key benefits of using Easyfi i.e it being layer 2 and providing fast and speedy transactions, frictionless on-boarding of new users with inbuilt gasless meta transactions along with it being a mutli-chain money market protocol being live on various networks like Polygon, BSC, Ethereum, etc makes it stand out from other available Defi Protocols in the market. The marquee feature i.e Dual farming is an added advantage.