The blockchain is going to land. There are two areas that are currently the fastest. One is the game and the other is finance. The blockchain finance is also a completely different species from traditional financial or internet finance.
Based on the interest in blockchain landing, Blue Fox notes have been very interested in finance in the blockchain field. I have also seen many blockchain financial projects such as Saltlending, ETHlend, Jibrel, DCC, Ripo, Nexo, etc. ETHlend has lent more than 15,000 ETH in the last few months; Saltlending has a valuation of more than $200 million. Ranked among the top 30 in the blockchain digital asset rankings. These all show the potential of blockchain financial services projects.
Logically, based on blockchain technology, financial services data can be transparent and open, and peer-to-peer services can be operated on a smart contract. Both traditional financial and Internet finance have the potential to reduce the impact.
However, to truly land, it is still inseparable from the risk control system, especially credit loans, and good risk control is still the core competitiveness. After all, financial consideration is not only the income of assets, but also the security of assets.
Needless to say, there will be more and more blockchain financial projects, just as Internet finance once appeared. Recently, Blue Fox notes focus on LendChain's blockchain financial project, its model and the foundation it relies on, giving it a unique advantage.
LendChain 's new finance
The concept of new finance was preceded by the Internet compared to traditional finance. With the birth of blockchain technology, the blockchain-based finance has improved the level of development. The opportunities contained here will continue to be explored along with the blockchain project. A new innovation model has emerged, releasing new power.
LendChain's goal is to become a decentralized digital asset financial services platform.Since the outbreak of the digital asset market in 2017, the entire market assets have climbed from less than 200 billion US dollars to the end of the year to 600 billion US dollars. Although the market is now entering a bear market, the overall market size is still more than 250 billion US dollars, and more importantly, At present, the number of currency-holding users has been greatly improved. The number of global ETH-holding users has reached more than 37 million, and the scale of more than 70,000 new addresses per day has been increasing. According to this speed, the number of currency-holding addresses will exceed 50 million at the end of the year, even considering A person has multiple addresses and goes to a larger part. The overall user size is also very impressive. Moreover, a large number of Bitcoin users are not counted here.
More important blockchain projects are more and more, although it is currently a bear market, but it has not affected more people to participate. Almost every day, more than 10 projects are financing, and the blockchain market is slowing, but never Did not stop.
With the birth of more and more landing projects, the demand for financial services on digital assets will increase as the management of digital assets. Although we see today that trading on the exchange is the main user scenario for the current digital asset market. However, as the market matures, there is an increasing demand for financial services such as digital currency investment, lending, insurance, and futures.
For example, a user holding a digital asset token will urgently need a cash flow when he is in a bear market, but he is not willing to buy a token. At this time, the demand for borrowing appears. For example, users who make digital currency investments do not have ETH in their hands, but recently ETH prices fluctuate greatly. The investor can borrow ETH through USDT collateral, then sell ETH at the appropriate price, buy again when ETH price falls, and then repay Give investors, and thus gain.
For those who are good at investing, more tokens can be used to increase the value of assets through borrowing. On the other hand, many digital asset holders who are committed to long-term investment can obtain stable income through lending by their own BTC or ETH.
Through these financial products, some digital asset holders can get more benefits in volatile financial markets. In the real world scene, it has also been verified. On March 27, 2018, Block City app launched a wealth management service for the creation of the residents: the remaining money treasure, only a 15 seconds 30,000GXS quota was robbed. This fully shows that for users with digital token assets, there is a strong financial need, especially in the bear market, through the digital token wealth management services, you can get more tokens, which is the way to achieve asset appreciation.
LendChain looks at its business plans, including digital token collaterals, credit lending, wealth management products, private equity funds, bonds and other financial products services.
In the long run, LendChain will expand the field beyond the digital token. With the offline assetization, such as real estate, auto, equity, stocks, bonds, funds, futures, etc., LendChain's distributed financial products service will put the tentacles Expand into more areas, and as the model matures, it can be extended across the globe to the world.
From this perspective, LendChain is not only a lending service for digital tokens, but also a distributed digital asset financial service platform, which is based on the world. In essence, it is to connect the holders of digital assets and the demanders of digital assets directly point to point through the blockchain, so that both asset holders and demanders can meet their respective needs at a lower cost. Some people find suitable borrowers to realize the value-added income of assets; borrowers borrow more digital assets to achieve more liquidity and obtain higher asset returns.
LendChain lets the business grow naturally
The LendChain business has grown with the development of digital asset business. First of all, the founder of the team, Ayi, once served as a CMO in GXChain. From the business of GXChain, he also saw the demand for digital asset management and financing. These already strong demand have given the business a natural foundation.
Although LendChain aims to become a financial platform for digital assets, from the beginning, not all financial business has been done, but the trend has come to the ground, so that business naturally occurs. At present, the most natural business in digital currency financial services is collateral lending.
All financial products and services, whether traditional finance, internet finance or blockchain finance, have one thing in common from the perspective of model sustainability, namely risk control. Collateral loans based on digital currencies are relatively safe in terms of risk control. It is far easier to deliver than property collaterals such as real estate and automobiles, and has a lower risk than credit loans. It is a relatively perfect business model, which is also a unique financial model belonging to blockchain digital assets.
LendChain starts with the most stable financial products with the lowest risk. Specifically, LendChain's digital asset lending service refers to financing with digital asset tokens as collateral.
LendChain's entire lending process is executed through smart contracts, all of which are on-line, including the release of financing requirements, collateral asset lock-ups, borrowing targets, investment operations, repayments due, overdue delivery, etc. The process is transparent, open, and free of human operation, which can maximize the interests of investors and avoid the risk of the traditional centralized P2P Internet financial platform running. Moreover, the entire process does not need to upload various credit information as traditional Internet finance. After the upload, the platform has to carry out credit rating evaluation, determine the quota, and even have to conduct manual review.
The lending process of the LendChain platform is simple. From the point of view of the borrower, it can be done with a simple operation. The first step is to verify identity and security. The second step is to create a collateral: the borrower recharges a certain amount of digital tokens as collateral. Currently supports BTC, ETH, GXS, etc. The third step is to issue the loan target: enter the loan digital token (BTC, ETH, USDT, bitCNY, GXS, etc.), custom interest (the official will recommend a reasonable range), the term, etc. After the release, the collateral token is automatically locked.
If the loan target is 100% raised within 24 hours, the loan will take effect. If the price is not 100%, or the price of the collateral token falls by more than 20% within 24 hours, the target will automatically expire. After the loan is successful, it will be returned after the expiration.
From the perspective of investors, the investment process is also very simple. Investors also need only three steps, the first step is to log in to the LendChain platform; the second step is to choose the investment target: choose their own investment target according to different interest rates, deadlines, and token types. The third step is to recharge and apply: recharge the required digital tokens for the selected target, and finally submit the application.
If the investment target is fully funded within 24 hours, the investment will take effect and the investor will receive the principal and interest after the expiration. When the borrower expires, the digital token and interest of the loan will be automatically returned. If the overdue period occurs, the investor will receive the overdue fee in addition to the original interest income after the borrower finally repays the loan.
In this lending model of digital assets, the key to risk control is collateral, but the digital tokens as collateral have price fluctuations themselves. How to design collateral rates? If the collateral assets plunged, how can we guarantee the interests of investors?
In order to control the risk, LendChain sets a new user's collateral rate of 50%, that is, if you are a new user, you have a BTC worth 10,000 USD, then you can only borrow USDT, bitCNY, ETH, etc. worth 5,000 USD. At present, on the ETHlend, the loan token cannot exceed 65% of the value of the collateral token, which is relatively loose on the risk control.
Of course, LendChain will float on the collateral rate based on the user's credit history. The credit history mainly comes from the user's previous loan records, as well as credit data based on public credit, etc., depending on the credit rating, there will be different collaterals. rate.
Due to the huge volatility of digital tokens, once the plunge, the collateral rate is not enough to protect the interests of investors, this involves the closing mechanism of collateral assets. LendChain evaluates the collateral assets of each loan and sets up a warning line (70%) and a level (50%). Once the collateral token reaches the warning line, the system will prompt the lender to increase the collateral and meet the collateral rate requirements to avoid being closed. If the collateral token assets reach the liquidation line, the platform will deliver the collateral assets, and the locked collateral currency will be transferred to the investor's account. Of course, due to market fluctuations, the collateral of the lender is delivered and the credit taint will not be generated.
In order to make the collateral lending process simple, LendChain manages collateral assets through smart contracts, docks with mainstream exchanges, and obtains collateral digital asset prices in real time to control risk. Once the liquidation line is reached, the smart contract will automatically deliver the digital assets of the collateral.
In addition to the liquidation caused by the collapse, there is also a situation in which the collateral assets are delivered, that is, when the user reaches the limit after the deadline, the current set period is one week. Remind the loan several times during the week and still not return the loan on time. The LendChain platform first deducts the overdue fee and then delivers the collateral, and the overdue record will be chained, which will affect the user's credit rating.
In the end, due to the existence of collateral assets, the collateral rate is 50%, and if the user does not return the loan after the deadline, the investor will not face the risk of capital.
LendChain also gives users more choices in terms of the currency and interest rate of the loan. The interest rate is set by the borrower, but the platform itself will set the interest rate range to ensure the interests of investors. In the early period,
LendChain opened the products with daily interest, and the borrowed and returned coins must be the same token.
If an overdue period occurs, it involves overdue fees, and it also involves credit stains, which will be on the chain. The overdue fee is currently the daily principal* interest rate*2.If you repay in advance, you will need to pay the loan principal, interest, and default handling fee (50% of the total interest on the remaining days).
In addition to collateral lending, LendChain will gradually step into the credit loan of digital assets as the user's loan record increases and through the help of the public credit credit record.
In the traditional Internet financial credit loan, the risk control process is complicated. From the user experience, especially the experience of borrowing users is not very good. Not only is the process complex, but privacy is not protected.
LendChain's entry into the credit lending field also naturally grows with the development of the business. First, it has generated the user's credit history with its collateral lending. Second, it has a partner's public letter, and LendChain plans to connect with the GXChain public chain. The real name data of the public letter treasure is opened.
Based on this data, the LendChain team can build a wind-based model based on big data, which can realize the credit evaluation of users and provide small-value digital token credit loans with different credits and deadlines for users with different credit ratings.
Although credit loans are more risky, they can also bring more business volume. The bad debt rate is also inevitable. However, as long as the risk ratio is controlled, the entire business model has the opportunity to develop. More importantly, the scale of credit lending will be relatively large. The core competitiveness here is risk management.
In addition to the lending business, LendChain also has wealth management products for currency users. For many money-holding users, especially for those who have a strong demand for stable income, instead of putting the token in the wallet, it is better to obtain higher income through financial management.
In addition to the above mentioned financial indicators for providing collateral lending and credit lending to investors, LendChain also offers diversified wealth management products to investors who meet different income and risk preferences.
These wealth management products include quantitative funds, private equity funds, mine projects, large customer collateral market-making projects, and bonds. For example, private equity funds, LendChain cooperates with high-quality private equity funds. By dividing the share into multiple shares, ordinary investors can participate in the investment of high-quality private equity funds to obtain higher returns from early investment. At the same time, in order to meet the liquidity, the income right of wealth management products can be transferred.
Another example is the financial management of bonds, which also has the opportunity to become a way to follow-up financing of blockchain projects. Bonds in the financial market far exceed the securities market. If, in the future, a mainstream blockchain project, for business development, it needs to raise 100,000ETH to expand its business. Then, it can initiate bond financing on LendChain, and the project can be guaranteed with certain tokens and other collateral, which has increased investor confidence. Investors can also transfer bonds to obtain the liquidity of assets.
LendChain lets distributed platforms expand its imagination
One of the most important reasons why LendChain is new finance is that it is based on a distributed financial services platform. First, it has changed the drawbacks of traditional financial platforms, including the centralization of Internet financial platforms. The second is that it works with other platforms to make distributed financial products services ubiquitous.
Let's first look at the distributed features that bring it to life.
LendChain can solve many of the shortcomings of the centralization of traditional financial and Internet financial platforms by decentralizing distributed financial service platforms.
In terms of loans, loans were mainly collateral loans before the 18th century. Today, credit loans have become very popular. For example, through FICO's risk assessment, Internet finance has made full use of big data and artificial intelligence technology to develop a new credit decision-making system. It has been making progress and indeed promotes the popularization of credit lending. Financial significance, but the centralization operation is still problematic.
For example, the authenticity of data is difficult to distinguish. The data of third-party organizations is not completely credible; the data has islands, different user data is in different systems, the cost of information verification is high, the borrower borrows on different credit platforms, the data between the platforms is not shared, and it is impossible to grasp whether the user is There are long-term loans; in terms of privacy, there is no guarantee. In order to obtain loans, users are authorized to use the Internet lending platform to crawl their own mailboxes with credit card consumption records, climb payment purchase records, Taobao shopping records, and climb call records. These data include individuals. Name, phone number, address, consumption record, call history, and even which restaurant to go to eat at any day, in which hotel to spend, spend a lot of money, are clear.
These privacy-related data, although desensitized, may be compromised due to the centralization of the server, and there may be internal employees stealing user data. In this case, user privacy is almost impossible to obtain any guarantee.
In an era of increasing emphasis on privacy and security, in the long run, this Internet financial credit model is not sustainable. In addition, centralized credit has a deep contradiction that cannot be solved by itself. This contradiction is that its cost, efficiency, and distribution of benefits are unreasonable.
Cost includes bad debt cost and operating cost, specifically, the cost of not paying back, risk assessment cost, customer cost, and collection cost. These traffic costs, risk control costs and bad debt costs are ultimately collected by the borrower. The cost will work. This means that there are really more costs for the creditors.
In terms of efficiency, in order to verify user identity, credit history, loan records, etc., it is necessary to borrow a large number of loan intermediaries and other services, which is inefficient and costly.
Finally, the issue of interest distribution, with the Internet lending platform and other intermediaries grasping more and more user data and loan records, has more information monopoly ability, resulting in some institutional violence, and even annualized interest rates of more than 100%, more The annualized interest rate of micro-finance has exceeded 300%, which is very unreasonable.
The best way to solve the problem of traditional financial intermediaries or Internet lending platforms is the decentralization model of the blockchain. Blockchain can solve the problem of data monopoly, allowing data ownership and control to return to users. Allowing the intermediary platform to achieve premium profits through monopoly data. The middle part is removed through the blockchain area, and the price is more reasonable according to the market price through the smart contract, which is more reasonable for the lender and the borrower.
The problem of personal privacy data leakage and being bought and sold by the platform can also be solved through the decentralized storage system of the blockchain. In general, through the decentralized model, many drawbacks of traditional financial institutions and Internet credit lending platforms can be reshaped, and the new financial model of blockchain can be promoted.
LendChain can build a financial service platform that meets the needs of different users through blockchain technology.
Second, LendChain will leverage the power of other platforms to grow its business together.
LendChain's own platform provides multi-terminal services, including PC, H5, WeChat, IOS and Android phones.
LendChain will make full use of the advantages of the public letter platform, and its blockchain is based on the GXChain public chain development to achieve data access. All loans will be chained, allowing users to increase their credit data.
In order to bring financial products and services to the forefront as soon as possible, LendChain will also develop Dapp based on the GXChain public chain, such as real-name authentication system, user credit rating system, distributed P2P lending platform, collateral digital asset management system, Token contract and so on. These applications have accumulated a lot of valuable data for the follow-up business.
LendChain's token is LVCOIN and is also based on GXChain. LVCOIN tokens are mainly used for handling fees, VIP membership fees, voting coins, and financing collaterals.
The handling fee means that the user needs to support a certain percentage of the service fee when using the LendChain platform business, and the discount is obtained when using the LVCOIN payment. For example, if a user uses a 10BTC loan 5BTC, the user needs to deduct a 0.05BTC fee. If paying with LVCOIN, he only needs to pay an equivalent fee of 0.025BTC.
The user purchases a VIP member by paying a certain amount of LVCOIN. The VIP member is mainly a user who invests in a large amount of assets. For example, the asset to be invested can be locked, and the interest rate and amount can be set. If the system meets the requirements, the priority will be given. VIP members grab the bid.
Voting on the currency means that the user decides to add the token with the LVCOIN token, and the new token can be used for lending, wealth management and other services.Finally, in cooperation with investment institutions such as investment institutions, market makers, project parties, and exchanges, they also need to collateral mainstream tokens and LVCOIN for margin.
In addition, LendChain also has a repurchase LVCOIN mechanism, which will use 20% of the income in the quarter for repurchase and destruction, which can be queried through the blockchain browser.
Finally, in order to allow more platforms to take advantage of LendChain's services, all platforms can access LendChain through the API to obtain a variety of financial products and services to achieve a win-win situation.
A few days ago, Blue Fox notes that LendChain landed on the Bitpie Wallet App, which means that Bitpie users can also enjoy LendChain's collateral products, money management and other financial products and services.
In the end, LendChain will open source, turning LendChain into a decentralized platform, enabling all assets to be implemented through smart contracts, enabling a fully self-running financial services platform.
Conclusion
The combination of finance and blockchain brings us more possibilities. Through decentralization, we can be more transparent and open through the way credit is recorded in the chain. At the same time, the financial system of digital assets itself will generate new models, such as the collateral lending of digital assets themselves, which are different from traditional financial models.
As the new financial exploration of the blockchain deepens, more models will be invented.
LendChain has its own unique foundations and advantages in many new blockchain financial projects. It starts with digital asset collateral lending, allowing the business to naturally occur and grow, and the landing steps are clear. It cooperates deeply with GXChain. Based on the development of public trust chain, it can make full use of the data on the public trust chain, so that the subsequent credit lending and other businesses can develop rapidly.
The team has many years of experience in the financial lending field, which makes it more grounded. Look forward to LendChain exploring more innovative models in the blockchain new finance.
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