What is Silo Finance? Silo Finance is a Lending Protocol platform that uses Isolated Pool to provide a secure and efficient lending marketplace. Let’s find out what is special about this project with Weakhand in this article.
What is Silo Finance?
Overview of Silo Finance
Currently, leading lending platforms such as Aave or Compound all use the Shared Pool model. This means that all user deposits are put into a single Pool by the project, which helps borrowers only need to deposit collateral to be able to borrow any asset in the Pool.
However, with this Shared Pool model, there are also some risks such as: Hackers attack the Pool, all assets are in danger,…
Silo Finance applies the Isolated Pool model meaning the platform splits into isolated Pools where every asset has its own lending market and is paired with ETH and Stablecoin XAI (Stablecoin developed by Silo Finance). The Isolated Pool model partly overcomes the risk of being attacked. When one Pool is attacked (for example, Ape Pool), the other Pools are still safe.
However, the Isolated Pool model also has some problems such as: Users who want to use tokenA as collateral to borrow tokenB must go through ETH or XAI as an intermediary asset. This makes the process more complicated for users and costs more Gas fees.
Silo Finance’s operating mechanism
The model on the Silo Finance platform takes place according to the following steps:
- Step 1: Lenders deposit assets into the platform, Silo Finance mints an amount sToken represents a deposit. For example: Users send Link and receive sLink, sLink will gradually increase over time and can switch back to Link at any time.
- Step 2: Borrowers deposit collateral into the platform to borrow a corresponding amount of ETH or XAI. Silo Finance mint produces 1 amount dToken Representing the borrower’s debt, dToken also increases over time like sToken. If you want to borrow tokenB other than ETH or XAI, users need to bridge through ETH or XAI as an intermediary asset to borrow tokenB. Silo Finance also mints 1 amount dBridge-ABC represents debt.
- Step 3: When wanting to get the collateral back, the borrower needs to send back the loan amount + interest, Silo Finance then also burns dToken to clear the debt.
Sale: When the loan amount exceeds 90% of the collateral value, the borrower’s assets will be liquidated. The liquidator will sell the collateral for ETH and receive a reward of 9.89% of the collateral value.
What is the Difference of Silo Finance?
Silo Finance wants to create an open market where anyone can create a Pool on the platform.
Silo Finance uses a dynamic interest rate model depending on supply and demand in the market. As demand for borrowing an asset increases, borrowers may also have to pay higher interest rates.
Core Team
Yoshua Urioste Schwartz : Business Development Lead
- Yoshua Urioste graduated with a degree in economics from Santa Monica College.
- He briefly worked at the companies Local Motion Hawaii, Inc and SYNERGY since October 2017.
- In November 2019, he decided to venture into the crypto market and worked at Paxful and ATLAS Digital Research.
- After that, he decided to quit his job and join Silo Finance as Business Development Manager from September 2022.
Aiham Jaabari : Growth Lead
- Aiham Jaabari graduated with a bachelor’s degree in business administration from Tishreen University in 2004.
- After that, he graduated with a master’s degree in Strategic Marketing from the University of Wollongong in 2007.
- He had a short time working at many companies such as: BPA Worldwide, Dubizzle.com, Namshi.com,… since April 2009.
- In January 2015, he joined Aiham.io company as a Product Growth Consultant.
- In September 2021, he decided to quit his job and join Silo Finance as Founding Contributor.
Investor
Update…
Tokenomics
Basic information about tokens
- Token Name: Silo Finance
- Ticker: SILO
- Blockchain: Ethereum
- Contract: 0x6f80310CA7F2C654691D1383149Fa1A57d8AB1f8
- Token Type: Governance
- Total Supply: 1,000,000,000 SILO.
Token Allocation
Token Release
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Founding Contributors & Future Contributors – Advisors: Lock the first 6 months and distribute linearly within 3 years.
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Community Treasury: Linear distribution over 3 years.
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Early Contributors & Investors: Lock the first 6 months and distribute linearly for 4 years.
Token Use Case
SILO tokens are used for:
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Vote on activities on the platform.
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Incentive for users to provide liquidity on Curve Finance.
Exchanges
SILO tokens are traded on Dex exchanges such as: Curve Finance, Balancer, Uniswap.
Information Channel of Silo Finance Project
- Website: https://www.silo.finance/
- Twitter: https://twitter.com/SiloFinance
- Medium:
summary
Silo Finance is a Lending platform that uses a new design model but still maintains capital efficiency. Hopefully through this article, everyone has interesting perspectives on Silo Finance.