Hello everyone. Today I want to touch on the topic of finance and talk about one wonderful GoldFinch project.
What is GoldFinch?
The project is a credit DeFi protocol in which users can borrow in stablecoins or even fiat, and in which investors from all over the world who want to make money on it provide collateral for loans. However, the key difference between Goldfinch is the lack of collateral. That is, this project is located at the junction of the traditional lending system and the decentralized one.
The principle of operation.
It works as follows. The Goldfinch ecosystem has a system of their liquidity providers and verifiers. The scheme of work of liquidity providers, which in Goldfinch are called by the term Senior, is similar to the standard scheme of work of DeFi protocols. Liquidity providers provide their coins and tokens to a special Senior pool, from which funds are then lent by the borrower. And after they return the loans with interest, the funds are returned back to the Senior Pool, from where the liquidity providers can receive their reward in the form of interest.
At the same time, the borrower must undergo a standard procedure for assessing solvency in order to obtain a loan. This is done by third-party companies or even individuals who can join the Goldfinch project. Thus, it turns out that instead of large and cumbersome banking systems, Goldfinch uses a distributed network of small auditors and credit organizations that can issue loans to people from all over the world, using capital provided by investors from all over the world.
The GoldFinch Ecosystem
This approach of Goldfinch solves many problems. After all, at the moment, banking services are not available to many people from all over the world. Residents of rural areas and third world countries cannot afford to open a bank account, because it is too expensive and difficult. And with the help of Goldfinch, even in a remote African village, some enterprising resident can open a credit organization, and using funds from the Senior Goldfinch pool, issue loans to his fellow villagers.
Goldfinch is already launched at the moment and you can act as both a lender and a borrower, either by borrowing funds or taking them into loans. Judging by the statistics in the Goldfinch application, the earnings here can be quite decent, about 10–15% per annum, depending on the specific pool of borrowers to whom you will provide liquidity. You can find out more about the project at the links below.
Discord username: Bagheera#0864