Introducing BuddyDAO, The First Guarantor-Based Defi Lending Protocol

We are excited to announce BuddyDAO, a decentralized, blockchain-based protocol that enables guarantor-based lending on Binance Smart Chain (BSC). BuddyDAO benefits everyone, including the unbanked with an opportunity to take an immediate loan from lenders all over the world. The platform leverages an off-chain personal relationship of borrowers with guarantors and allows them to get immediate loans.

And now let’s take a closer look at the challenges, opportunities, and pros of BuddyDAO.

The Challenges

These days, the reality is that getting a loan from a real bank to fuel your startup idea is pretty hard. There could be several reasons –

• Your startup idea doesn’t seem appealing to the bank.
• Or they require collateral to grant loans.

Many more such reasons could become hurdles in the process. And the idea of taking a loan for a startup is just an example to show how complex the process is.

As a solution, people switch to DeFi believing that DeFi can unlock new possibilities to take loans not just from the banks, but from any lender across the world. But again, DeFi loans have got issues too. Overcollateralization with crypto is the major one that prevents a vast number of borrowers from taking interest.

The Opportunity

At BuddyDAO, we believe, with DeFi in place, we have a massive opportunity to transform access to capital, but it’s only possible once we can make loans without collateral work. Removing the collateral requirement is the first crucial step that finally unlocks the possibilities of crypto lending to the majority of the world.

That’s how we can finally open crypto lending to most people in the world. And that’s what BuddyDAO is all about!

BuddyDAO — Unlocking the True Potential of DeFi Loans

As stated above, the perfect solution for over-collateralized loans is to offer uncollateralized loans which many platforms like Goldfinch, TrueFi, and Maple are already doing. With risks associated with uncollateralized loans, BuddyDAO works differently.

The platform is putting together the concept of TradFi and DeFi that supports relationship-based-underwriting in lending and borrowing money. Hence, BuddyDAO proposes a solution to have borrowers bring along a guarantor who knows the borrower and can assure the creditworthiness of him/her.

This solution allows us to welcome everyone to participate and get loans in just a few seconds. On the other hand, we can also analyze each borrower with on-chain data shared by the guarantors.

All this is done to realize the true potential of the cryptocurrency world as well as to make the lending process safer and easier.

How Does It Work?

Now let’s talk about how the whole loan process at BuddyDAO works.

But before, let’s talk about the types of users who can interact with the BuddyDAO Protocol.

• Borrowers
• Lenders and
• Guarantors.

Borrower - They can ask the guarantor to join BuddyDAO and apply for a line of credit in

stable coin.

Lender - They will deposit stable coins into the BuddyDAO protocol and get BNote

tokens in return. These tokens can be redeemed as stablecoin at loan maturity or

the lender can simply sell them in DEX to get stable coins back.

Guarantors - They will deposit crypto assets such as Bitcoin and get a credit line back. This credit line can be extended to the borrower to draw funds.

And now the process of how it’s done.

Lenders will add their crypto assets into a BuddyDAO lending pool that would be used to fund new loans. By doing this, lenders will earn BNote tokens in return.

Borrowers along with their Guarantors will be whitelisted through a rigorous onboarding process that involves a deep background check.

Borrowers, once approved (based on their Guarantors), submit a request for the loan at an interest rate and credit limit that is subject to further BuddyDAO community approval who signal their opinion on the loans.

The Borrower is implied to return the principal and interest on the loan on or before the term expires.

Final Words

The project is aimed at enabling loans for everyone by building a decentralized lending platform that empowers anyone in the world to be a lender, not just banks. So to speak and very soon is going to enter the market with a bang.

However, we can’t do it alone. We will require a strong global community to build this together. We want you to join us onboard. We’re especially looking for the ones who want to help fund and assess these early lending opportunities.

Before launch, BuddyDAO will be undergoing security audits to ensure all borrowers, guarantors, liquidity providers, and pool delegates can safely use the protocol. As the community continues to grow, we will continue publishing content on our blog, and staying active on Twitter, Telegram, and Discord.

To stay up to date on the latest news on BuddyDAO, follow us on social media –

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