Wing Finance & O3 Labs AMA
Quick overview
We recently joined O3 Labs for a chat about our new bridging and liquidity mining partnership. Check out a quick overview of some of the questions.
O3: Can you tell me a little bit about the under-collateralized loans?
Wing: Yeah. The general idea is that if you have a decentralized identity, so you own your own identity, you have all that locked up on-chain, which is going to be more and more required for Web3, right? We’re going to be able to identify ourselves more readily as we move forward. So the idea behind that is not only can you have a decentralized identity, but the things you do in real life and onchain around DAOs or around other DeFi projects, you can build a reputation.
There’s something called an Oscore on the Ontology system, so you can build this credit history that is yours. It’s not owned by some credit company, not owned by some agency. It’s actually decentralized, self-sovereign, and you can start building that credit score yourself, so the general idea behind that is the better your credit score, the less collateralization you would need.
I think reputation is important. If this year’s taught us anything, it’s that reputation in Web3, in crypto, is very important and we should be looking for people with good reputations.
O3: So similarly to Wing we got started in a non-Ethereum community in Neo back in 2017, and so we were one of, we still are, the top wallet within the Neo community.
The DeFi summer was taking place and protocols were going crazy and by the end of the spring of 2021 he got a team together and built O3 Swap. That’s sort of when I joined, when we had the coin launch, and we had a big successful coin launch. The main goal was decentralized cross chain protocol, and we were crossing chains.
We just launched on Avalanche last week. We’re already supporting 9 chains. We’re gonna launch on another this week. We want to bridge any token across any EVM compatible network. That’s really the goal that we’re striving for. So unlike some other protocols, not only can we bridge the same token across chains, for instance USDC on Ethereum to USDC on BNB, we can actually swap across chains so we could do USDC for O3 on different chains. That’s really our main use case now, and we’re staking a bunch of different coins in the pools to support our bridging, and the swap is based on the aggregator.
Wing: I think that’s excellent and I’m just a huge believer in removing barriers to DeFi, barriers to crypto, and removing how many steps people need to take to achieve something. I think it’s absolutely essential for people taking off on this. You know if people are going to get involved, we have to make it as easy as possible. Something like that just removes those barriers for everyday users. So that’s a really nice feature.
O3: Can you tell the users a little bit about how users can use those Flash Pools most effectively?
Wing: Yeah absolutely, and I’m a huge flash pool fan and I can give you lots of examples. One of my favourite maneuvers is using Bitcoin and Ethereum as collateral, borrowing ONT token. Putting the ONT token into a node and earning ONG tokens. Because it’s similar to NEO, it’s a dual token system, you know. So it’s a dual token system so you earn ONG when you stake ONT. But the nice thing about that is while I’m all holding my BTC and ETH, I earn roughly 35% APR on that whilst also having the advantage of holding Bitcoin and Ethereum, and also being able to run my own node.
There’s a lot of arbitrage opportunity. Riskier, if you’ve got a slightly higher appetite for risk. One of the popular things to do in the bear market, so one of the things I also do is I will put some stablecoin, USDC, USDT, whichever one in the flash pool. Supply it and use it as collateral. So I’m earning 5 to 10% on that. But what that allows you to do then is to borrow BTC or ETH, or you know whatever it is you want and then you can essentially short it.
Then just wait until the price drops, buy back. You make some money while still keeping your collateral in place in the pool earning rewards at the same time, and so there’s a lot of different options on those flash pools. You know of course some of the things you can do with good bridging options is just do the arbitrage between the pools. Can you borrow Bitcoin at a cheaper rate on one chain and supply it at a slightly more expensive rate on the other chain? So there are lots of different opportunities to play with the arbitrage across chains as well. Again, depending on your appetite for risk, depending how involved you want to be, there are a lot of opportunities.
People I know even supply collateral in terms of BTC, in terms of ETH, in terms of NEO or you know anything else on there, and then actually take the money out, cash it out into their bank and use it for real life purchases and then pay it back at a later date. You know the interest rates can be pretty good.
Community member @POLYGON BABY: Do you have any requirements that users must fulfill before borrowing? Do I need to complete KYC before I can go and also I would like to know what are the measures in case users borrow some NFT’s and don’t return them on time, how does the platform tend to deal with this?
Wing: OK, great questions. I mean on the first one, what’s really nice is nope, you don’t need to do KYC because it’s collateralized lending. So your collateral is in there. So there are no KYC requirements. There’s nothing you need to do. On the NFT pool, just to be clear, you don’t borrow the NFT, you lock up the NFT. So you would lock up your NFT. Nobody takes it anywhere, it’s just locked in a smart contract so it’s still yours. It’s just on a smart contract. Lock up and you would borrow against the value. Nobody is taking it anywhere, so it can’t disappear. It literally can’t go anywhere. It’s just a smart contract. Once you pay that loan, your NFT unlocks and it’s back into your wallet. It never goes anywhere.
Community member @POLYGON BABY: What kind of wallet does your website support?
Which wallet you can use depends entirely on which chain you’re working on. So if you’re on the Ethereum chain we support MetaMask, ONTO Wallet, etc, so quite a few on there. On the Ontology chain, it’s ONTO Web wallet and ONTO mobile and something called Cyano wallet as well. We support a variety of wallets on the different chains.
In terms of security, the platform is fully audited. We know that the contracts are fine when it comes to web wallets. Do you know part of the problem is, and and this sounds a bit like a cop out, but it’s not because it’s outside everybody’s control. People just need to make sure that they download the official wallet, especially if they’re using a web wallet. As long as you double check you’re on the right website, that you are on wing.finance, then that security has been audited. I think the bigger risk for users comes when they are directed to incorrect websites or fake wallet connect sites, where people try to get your details. That’s not something you’ll come across on the website, but you know in telegram groups, things like that. Always be wary of people giving you links to go to the wrong site. Never follow somebody else’s link. Always go to the official site and follow links from there and that way you know that you’re on the right platform.
