Hifi Finance (formerly Mainframe) has announced the launch of its fixed-rate cryptocurrency lending protocol, which enables anyone to create fungible debt obligations on the ethereum blockchain.
Fixed-rate lending options allow investors to map out finances and trading strategies better. The HiFi protocol lowers collateral requirements for cryptocurrency lending and lifts the barriers preventing highly volatile assets as potential collateral pairs for crypto lending and borrowing applications.
Initially, HiFi will offer USDC stablecoin borrowing with WBTC (wrapped Bitcoin) collateral, and the team plans to rapidly add products and services to expand lending markets and collateral pairs.
“Fixed-rate lending is an important milestone for DeFi. Investors and traders need less-volatile options so that they can plan finances, have predictability in expenses and hedge investments with certainty. With the surge in DeFi lending activity, protocols like Aave have attempted to offer stable rate lending. However, market volatility has diminished the value of these “stable” rates as borrowers incur fees to maintain a semi-fixed position,” said Doug Leonard, CEO of HiFi.
The cryptocurrency market is witnessing dramatic volatility, and developers struggle to balance between collateral demands and incentives for borrowers and lenders. Still, the decentralized finance (DeFi) markets have ballooned to a more than $40 bn evaluation. HiFi’s protocol automates incentives in a perpetual balancing act that optimizes