The DeFi ecosystem has been booming in the past year. From cross-chain technology to financial derivatives to various crypto investment tools and DeFi products, the decentralized business models and solutions have been thriving unprecedentedly. Among the many DeFi products, collateral loan is undoubtedly the crowd’s favourite development.
Based on the openness, security and high transparency at the core of the blockchain technology, the service of collateral loan can reach more potential user groups than ever before. The interoperability of blockchain is able to provide better support the development of a series of new lending products and service models. With its advanced strategy and continuous improvement in the field of crypto mining, the decentralized mining power financial service platform DMEX (dmex.im) has pioneered an independent and innovative development path in the field of collateral loan — — FIL mining power NFT collateral loan.
As is well-known in the crypto industry, FIL is the only token that rewards miners on the incentive layer of the decentralized distributed storage network IPFS. FIL’s application prospects and value have earned wide recognition in the industry since its mainnet came online. Nevertheless, FIL mining is a tedious process and a long-term commitment. The DMEX platform fully takes into account the huge potential of FIL mining power for users within the mining period. On the DMEX platform, through FIL mining power NFT collateral loan, users only need to pledge their FIL mining power NFT to easily secure a loan. The pledged FIL mining power NFT can generate mining revenue for the users, this design greatly improved the liquidity of FIL mining power assets.
The asset pool model benefits both the lenders and the borrowers
Whether you intend to lend or borrow, your first consideration before participating in pledged lending is probably the fund safety and the rate of return. Therefore, DMEX adopts a highly secure asset pool model in which the platform specifically creates an NFT collateral loan asset pool and redirects a certain percentage of the daily mining output of the platform token DMC in the pool. In other words, the DMEX platform NFT collateral loan pool will contain three digital assets: FIL mining power NFT, platform token DMC and FIL. The lender and the borrower will complete the entire business process of collateral loan within this common pool.
If you are the lender, you only need to deposit FIL into the pool. Then you can just sit back and wait for the FIL interest and DMC earning from the loan. You can withdraw your principal anytime you want. This process is very, similar to the demand deposit in a centralized bank.
If you are a borrower, you need to pledge two digital assets, the DMEX platform token DMC and FIL mining power NFT. The NFT collateral loan asset pool will dynamically adjust the DMC pledge ratio to manage the user’s borrowing limit, so as to maintain the lending/borrowing balance of the pool. After the pledge process is completed, users can borrow FIL assets as they wish. Users will be free to dispose of their borrowed FIL assets. For example, they could sell the FILs in advance for risk hedging, or they could reinvest the FIL back into purchasing FIL mining power NFT in the DMEX mining power marketplace so as to earn compounded mining incomes. With this product design, users can maximize the earning potential of their FIL mining power NFT assets.
Flexible repayment, unleashing the maximum potential of mining power
Similar to the financial model of centralized banks, the DMEX platform FIL mining power NFT collateral loan also incurs an interest. The NFT collateral loan asset pool will unlock the pledged FIL mining power NFT and DMC proportionate to the borrower’s principal repayments.
Of course, the borrowers have the option to pay back their FIL mining power NFT loan in advance to promptly unlock all their pledged collateral. It is also worth noting that when the total repayment due amount is equal to or greater than the current valuation of the pledged FIL mining power NFT collateral, the smart contract will automatically execute the mandatory liquidation process. The system will auction off the FIL mining power NFT collateral pledged by the borrower on the DMEX mining power marketplace/ Any remainder of the sale proceeds will be returned to the borrower after the due repayment is deduced. Therefore, borrowers must be mindful of the due repayment amount and deadline to avoid losing their collateral.
Compared to traditional digital asset loan services with complicated procedures, the DMEX platform has simple procedures and a straightforward interface with its collateral loan product, with which users can quickly choose to lend or borrower FIL assets with ease. This greatly reduced the confusion. Moreover, the DMEX FIL mining power collateral loan does not have a fixed repayment term, so as long as users have enough collateral to hedge against their borrowed funds, they can enjoy an absolutely flexible repayment schedule for unlimited times. This is one of the first of such products in both the traditional financial industry and in the DeFi industry.
The DMEX FIL mining power collateral loan was designed to dynamically adjust borrowing limits and enforce the pledged asset liquidation process through smart contracts. These important features undoubtedly bring greater accountability and transparency to the transaction process, resulting in a healthier financial system. Overall, the DMEX platform FIL mining power NFT collateral loan has excellent mechanisms in deposit, withdrawal, lending, repayment, borrowing limit control, and liquidation. These six key features will protect users’ income and achieve the optimal allocation of mining power NFT assets so as to release the maximum potential of mining power.
Official website: https://dmex.finance