What is TrueFi (TRU)?
TrueFi is an innovative Decentralised Finance (DeFi) protocol focused on providing users with the opportunity to earn competitive yields on stablecoin loans, in addition to allowing borrowers to access capital without the need for collateral. This unique framework creates a direct connection between lenders and borrowers, presenting an attractive alternative to traditional finance.
How TrueFi Works
Lenders can contribute TrueUSD (TUSD) into a TrueFi pool dedicated to lending activities. By doing so, they earn interest and can also participate in farming TrueFi’s native token, TRU. If capital in the pool remains unborrowed, it is allocated to the Curve protocol, which aims to optimise returns for lenders.
Borrowing Process
Entities such as over-the-counter (OTC) desks, exchanges, and various protocols can submit borrowing proposals to the TrueFi pool. These proposals include details regarding the amount of capital they wish to borrow, the proposed percentage annual percentage yield (APY), the duration of the loan, and their Ethereum address. This process fosters transparency and allows for informed decision-making on the part of lenders.
Voting Mechanism
TRU stakers play a crucial role in the governance of TrueFi by voting on borrowing proposals. Each vote exposes participating TRU holders to potential gains or losses based on the probability of loan repayment. This mechanism incentivises stakers to carefully consider each proposal, thus adding an element of risk management to the lending process.
TrueFi’s Vision
The TrueFi team envisions a future where the most compelling products in the cryptocurrency space act as bridges between traditional finance and decentralised systems. By transitioning the uncollateralised lending market onto the blockchain, TrueFi aims to democratise access to financial services, allowing lenders of varying sizes and backgrounds the opportunity to participate in the marketplace.
Key Features of TrueFi
- High Yields: Earn competitive interest rates on stablecoin loans.
- No Collateral Required: Borrowers can access capital without needing to provide collateral.
- Community Governance: TRU holders can influence lending decisions through voting.
- Optimised Returns: Unborrowed capital is used in Curve protocol to maximise yields.
Associated Resources
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