Interest Protocol Strategically Partners With Chainlink Labs
Interest Protocol is a highly capital-efficient borrow/lend protocol launched in June 2022, with Chainlink as its primary oracle. Interest Protocol has previously integrated Chainlink Price Feeds to mark-to-market users’ collateral assets with high-quality, tamper-proof price data — more details of that integration can be found here.
Now, Interest Protocol (IP) is announcing a strategic collaboration with Chainlink Labs, which includes strategic go-to-market advice and the integration of Chainlink Keepers and Chainlink Proof of Reserve (PoR).
IP is integrating Chainlink Keepers to help automate smart contract functions in a decentralized, cost-conscious manner. Chainlink PoR will provide robust oracles for off-chain asset attestations. By utilizing PoR, IP will be amongst the first protocols to use features that will bring the next wave of assets to DeFi and improve the security of existing popular assets. This collaboration between IP and Chainlink Labs allows IP to leverage Chainlink’s experience and strength in data collection and security, which will let IP focus on its mission to bring more capital efficiency to the DeFi ecosystem. Together, IP and Chainlink Labs can do their part to keep the DeFi promise of a more inclusive global economic system.
Chainlink Keepers is a decentralized transaction automation service operated by the same pool of time-tested, provably reliable node operators that currently helps to secure tens of billions of dollars in DeFi, even during record levels of network congestion. Chainlink Keepers will be used to monitor Interest Protocol loans for insolvency. If a loan is found to not be sufficiently collateralized, the Keepers network will automatically trigger a liquidation.
Chainlink Proof of Reserve enables the autonomous verification of off-chain collateral in real-time, ensuring users are protected from substandard reserve practices, fraudulent activity from off-chain custodians, and belated disclosures. Rather than forcing users to trust paper guarantees made by custodians, Chainlink PoR can be deployed for automated on-chain verification that gives users a superior guarantee of an asset’s underlying collateralization. Furthermore, Chainlink PoR is also increasingly being used to help secure the minting, redeeming, and burning of wrapped assets.
IP is an overcollateralized, fractional reserve lending protocol on Ethereum that pays interest to all users that hold its native stable asset. Interest Protocol issues a stablecoin — USDi — that is both overcollateralized and highly scalable. USDi holders automatically earn yield without having to stake. IP is highly capital efficient compared to lending protocols without fractional reserves, as it can conservatively and prudently generate more loans from a given amount of capital while incurring less liquidity risk.
GFX Labs — the company building IP — recently initiated the sale of Interest Protocol Tokens (IPT). IP has a unique sale mechanism that slowly sells a small portion of the IPT supply daily, which incentivizes a decentralized ownership structure of the protocol over time. The mechanism balances the need to decentralize with the high-growth trajectory of a new protocol.
“We’re excited to be working with Chainlink to build a more transparent and capital-efficient DeFi ecosystem,” stated Getty Hill, Founder of GFX Labs. “Whether it’s high-quality market data, secure smart contract automation, or real-time verification of reserves, oracles are essential to financial tools.”
“We’re excited to support Interest Protocol in building a novel lending and borrowing protocol,” stated Johann Eid, VP of go-to-market at Chainlink Labs. “By integrating multiple Chainlink trust-minimized services, Interest Protocol can scale its platform faster, save precious engineering resources, and get closer to its goal of bringing more capital efficiency to DeFi.”
About Chainlink
Chainlink is the industry standard for building, accessing, and selling oracle services needed to power hybrid smart contracts on any blockchain. Chainlink oracle networks provide smart contracts with a way to reliably connect to any external API and leverage secure off-chain computations for enabling feature-rich applications. Chainlink currently secures tens of billions of dollars across DeFi, insurance, gaming, and other major industries, and offers global enterprises and leading data providers a universal gateway to all blockchains.
Learn more about Chainlink by visiting chain.link or reading the developer documentation at docs.chain.link. To discuss an integration, reach out to an expert.
About Interest Protocol
Interest Protocol is a borrow/lend protocol that brings to DeFi a fractional reserve system popularized by banks. Instead of posting houses as collateral and borrowing dollars, Interest Protocol users post wETH, wBTC, and UNI as collateral and borrow a stablecoin called USDi. Instead of depositing dollars into a bank and earning next to nothing in interest, IP users deposit USDC into the protocol and receive the lion’s share of the fees paid by borrowers. While IP has improved upon all of the core pieces of a borrow/lend protocol, such as the liquidation mechanism and the collateral system, Interest Protocol’s main innovation is the capital efficiency that comes from allowing users to borrow its own stablecoin. Interest Protocol combines the capital efficiency of the fractional reserve system with the safety of overcollateralized loans.
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