The DeFi lending project Teller Finance will integrate Chainlink data feeds and will start offering under collateralized crypto loans as we are reading more in our Chain link news.
The Defi lending project Teller will integrate Chainlink and will allow borrowers to leverage credit ratings in order to reduce their collateral needs. Lending pool liquidity providers can also earn interest on the loans. Teller finance announced the integration with Chainlink and the oracle provider will provide Teller with three crypto price feeds thanks to its Price Reference Data oracle network.
Teller is an open-source protocol that interacts with consumer data in order to calculate default risk and to offer unsecured crypto-asset loans. The users can supply the liquidity to the protocol’s pools and earn interest from repaid loans. Teller leverage borrowers’ real-world credit history can be calculated with an annual interest rate that is based on the market conditions vs the consumer credit risk thus reducing the need for collateral.
Teller will also leverage the data from Chainlink’s DAI/ETH, LINK/USD and USDC/ETH feeds among others. The market-leading oracle provider will help Teller to capture real-time price information on the assets under management ensuring that all APR calculations for the unsecured loans will reflect the real market conditions. Chainlink’s oracles services can capture this information off-chain from the high-quality data aggregators and make it available on-chain for the smart contract enabled blockchain. Teller Finance was designed to develop decentralized loan products without having to go in the collateralized debt, thus reducing consumer risk and costs. Teller can interoperate with traditional finance data and can also offer the users tools to develop a new suite of trustless financial instruments. The co-founder of Teller, Ivan Perez said:
“Teller calculates consumer credit risk as a measure of personal financial data, e.g. debt to income ratio. The latter translates into an APR that is not only based on money market interest rate, but also takes into account consumer credit risk. Variable loan APRs in turn result in variable APY for liquidity providers. For the consumer, this means an affordable user experience that leverages positive credit history to lower DeFi’s exorbitant collateral ratios.”
Integrating Chainlink’s price reference data will allow the protocol to provide accuracy of the pricing data and the under collateralized lending will mark a positive step for DeFi according to the Chainlink head of business development Daniel Kochis:
“Unsecured lending via consumer credit risk is the next major milestone towards truly capturing new users, and were excited to provide key oracle functionality to make that a reality.”
Chainlink provides highly secure and reliable oracles for larger enterprises and leading smart contract development teams such as Loopring, Aave, OpenLaw, Conflux, and Polkadot.
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