September 24, 2021

The Goldfinch Flight Academy.

Hello everyone, today I introduce you about a very interesting project @goldfinch_fi which I research and learn in the #FlightAcademy program for a week. Let's take a look about their idea, and their soluttion!

Goldfinch is a decentralized protocol that allows you to borrow cryptocurrency without providing cryptocurrency.

Goldfinch is a new approach in the field of crypto lending. The main mission of the Goldfinch team is to create a decentralized credit platform that expands access to financial services. It means that now not only large companies, but also individuals will be able to use a loan in cryptocurrency, as well as act as a lender, and receive passive income from their assets.
Let’s take a look at the protocol

It has four core participants: Borrowers, Backers, Liquidity Providers, and Auditors.

Borrowers are participants who are looking for financing, and they offer pools of borrowers for evaluation by investors. Borrower pools contain the conditions that the borrower is looking for, such as the interest rate and repayment schedule.

Investors-evaluate the pools of borrowers and decide whether to provide them with the capital of the first loss. After investors provide capital, borrowers can borrow and repay their loan through a pool of borrowers.

Liquidity providers-supply capital to the senior pool in order to receive passive income. The pool of senior participants uses a leverage model to automatically allocate capital to the pools of borrowers, depending on how many investors participate in them.

Auditors-vote for the approval of capital for Borrowers, which is necessary before they can borrow capital. Auditors are selected by the protocol (randomly), and they provide human-level verification to protect against fraud.

Today, being a bank is expensive, and this limits the range of available lenders. But there are thousands, if not millions, who could lend with the right system. Goldfinch is a platform that allows anyone to become a lender, not just banks.

Goldfinch is incredible project. I believe that it has an amazing cryptocurrency future.