Contrary to what most people would think, decentralized finance isn’t a single product neither is it particularly a silver bullet — a fix-it-all to longstanding issues plaguing the traditional finance industry. Rather, DeFi represents a collective movement of various products leveraging two key technologies: blockchain technology and smart contracts.

The end goal of decentralized finance (aka open finance, fittingly) is to “open up” the current closed financial system. This would ultimately make financial services accessible to anyone, anywhere in the world at almost no cost.

Decentralized finance takes traditional financial services like lending, borrowing, trading and asset management up a notch. The fast-growing DeFi industry now fosters a booming ecosystem of DEXes, lending and borrowing protocols, derivatives trading platforms, staking dApps, prediction markets, investments, and oracles among others.

Perhaps unsurprisingly, the demand for decentralized financial products has skyrocketed since DeFi became popular in 2018. According to DeFi Pulse data, the DeFi space is now valued at more than $11 billion, with over a hundred protocols launched already — all in three years! Fyeth is one of the lending and borrowing protocols aiming to provide hassle-free crypto loans to users.

What Is Fyeth Finance?

Fyeth is a non-custodial asset management platform with a truly decentralized lending, borrowing and saving protocol built on the Ethereum blokchain. By depositing your cryptocurrencies on Fyeth, you can earn interest on your deposits and open collateralized debt positions (CDPs), using your crypto assets as collateral.

Fyeth Finance originally started out as a decentralized platform offering non-custodial asset management services to its users. Through the crypto asset custody, users are able to maintain perpetual control of their funds, as all user crypto holdings are stored offline in cold, multi-signature wallets.

However, after recognizing the poor experience associated with obtaining loans in a traditional financial setup, the platform has evolved into a DeFi protocol, offering peer-to-peer crypto-backed loans to customers.

How Fyeth Crypto Lending and Borrowing Works

Fyeth Finance has recently created a new service on their platform that will allow users to borrow money via the blockchain network. This newly launched service was announced in November 2020, and it is sure to become one of the best lending solutions ever.

Since Fyeth Finance is a decentralized platform, this service will be available to users anytime, anywhere in the world. The protocol supports borrowing with ETH, BTC and yETH (the native token of the Fyeth blockchain) as collateral.

Regardless of the amount of money you might need, it will be made available as soon as you’ve deposited your crypto assets as collateral. And even better, each loan transaction and repayment is settled on-chain. This will help to guarantee fairness and transparency when obtaining and repaying collateralized loans.

For instance, once a borrower opens a CDP, their crypto collateral is held in a smart contract to prevent them from defaulting on loan commitments. Also on the lender’s part, they can’t modify the loan terms since the details of the loan transaction is made available as a transparent, tamper-proof record on the Fyeth blockchain.

On Fyeth Finance, you can define your loan terms and obtain a loan-to-value ratio ranging from 30% up to a maximum LTV of 90%. To receive personalized offers from lenders, you have to register on Fyeth Finance.

Fyeth Finance adopts a customer-first philosophy in its business process, offering users the best custodial, trading and lending services compared to other platforms. The lending mechanism employs bank-grade security and one-of-a-kind flexibility, allowing users to obtain loans in different fiat currencies.

Why You Should Choose Fyeth Finance

Fyeth Finance was created to help investors (particularly borrowers and lenders) maximize profits through decentralized lending and borrowing and margin trading services with low risk and near-zero transaction fees.

On the borrowers’ part, users can unlock the value of their crypto assets. Instead of selling those assets and losing on unfavourable rates and taxation, yETH allows borrowers to access loans easily by holding their assets as collateral. Besides, they can use their crypto-backed loans as leverage for various trading strategies.

For lenders, yETH is a perfect opportunity to invest in fiat or crypto with minimal risk since all loans are overcollateralized by crypto. Choose your desired interest rate and earn returns without worrying about the borrower’s solvency.

The foremost priority of Fyeth Finance is to offer premium crypto-based financial services to everyday users, thereby solving key issues with traditional financial platforms. Here are some other reasons why you should choose Fyeth Finance.

P2P Crypto Collateralized Loans Made Easy

Besides competitive interest rates on deposits, Fyeth also generates better returns through compound interest, allowing you to grow your crypto holdings faster over time. Fyeth charges zero fees for lenders and borrowers; just a 5% withdrawal fee. Also, several payment methods are supported for deposits and withdrawals. You can choose from Visa/MasterCard, SEPA, SWIFT and several other payment methods.

On yETH, the interest rates are determined by a variable interest model which is a function of the current demand and supply (i.e., borrowers and lenders, respectively) on the platform. As such, there are no fixed interest rates and historically, there have been loans borrowed under 5% only and some loans lent under 22%.

The liquidation algorithm allows us to provide one of the highest LTV ratios in the DeFi lending market — 70%. The loan limit will rise to an 80% collateral factor once the platform gains huge traction. The liquidation point comes only when the LTV ratio is higher than 90%.

You’re free to repay your loan at any time without attracting any penalty. You can choose from two repayment options for your loan: pay the interest only, or repay the full principal and interest.

First-movers in Crypto-backed Lending

Fyeth Finance can easily be considered as the first platform to pioneer and successfully implement P2P crypto-backed lending. The project started as far back as 2018; at the time, almost no one understood the concept of crypto-backed lending.

However, the co-founders of the platform recognized the possibilities crypto collateralized loans offer and began their research on the concept.

Better Returns on Your Investment

With Fyeth finance (yETH), users will actively earn compound interest and create passive income on their account balances. Compounding generates a better return on your deposit, allowing you to increase your holdings over time.

Fyeth Finance offers higher-than-market interest rates compared to the majority of crypto lending platforms. Typically, you’ll earn between 12%-18% returns on your investment.

Full Regulatory Compliance

Fyeth Finance is a subsidiary of the global fintech group Investment Evolution, and the company is incorporated in Tallinn, Estonia. Similar to Switzerland, the north-European country is one of the world’s most crypto-friendly environments. yETH’s operations are totally within a legal framework, with two European financial licenses to boot: FVR001444 and FRK001329.

Client-oriented, yETH offers a lending mechanism with bank-grade security and one-of-a-kind flexibility. The expansion services target crypto holders in more than 200 jurisdictions who can borrow in several fiat currencies.

Military-grade Security

A very important factor with decentralized Finance platforms is that it has top-notch security. Similar to other DeFi platforms, FYETH is built on the Ethereum blockchain, which happens to be the most secure crypto network. Plus, with less third-party restrictions, there is no room for infiltrations.

All in all, FYyeth Finance provides a valuable point of contact for borrowers who want to leverage their crypto assets for financial commitments without selling them off and lenders who want to gain high yield interest with minimal risks. With this platform, you can earn interest on your deposits and borrow money on a secure and decentralized environment easily.

The goal of Fyeth Finance is to put you back in control of your crypto assets and unlock their full value to bring you closer to financial freedom.

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This alone is an impressive feat; after all, no one — at least not a lot of people — believed that blockchain had the potential to revamp technology (and the world at large). Although blockchain technology (alongside Bitcoin) was created in 2009, it only became front and center of the tech debate in the last couple of years.

Blockchain technology has since gone on to achieve more impressive feats, impacting industries like healthcare, supply chain management, fintech, gaming, content creation, social media, digital rights management among others.

The development of Bitcoin has changed how transactions are conducted around the world. It eliminated the need for a central authority (i.e. banks, credit agencies and payment processors), enabling blockchains to evolve rapidly and achieve increased security, speed and efficiency.

To start with, let’s take a brief look at what the term ‘decentralized’ means in the context of blockchains.

What Is a Decentralized Blockchain?

Decentralization itself is defined as the delegation of the decision-making processes of an organization from a central point to various entities.

When the word “blockchain” comes up in conversation, most people would think of Bitcoin, Ethereum and other decentralized (public) blockchains which grant access to just about anyone willing to participate.

However, centralized blockchains also exist, and they are usually developed by large corporations who want to fully utilize the potential of blockchain technology.

Decentralized blockchains are known as public blockchains, and the centralized ones as private blockchains.

The core difference between decentralized and centralized blockchains lies in what you’re allowed to do. Decentralized blockchains are unable to place restrictions on or elevate the privileges of a particular node(s), excluding malicious or faulty ones. This implies that all nodes on the blockchain network have (no need for) equal permissions and privileges.

On the other hand, centralized blockchain networks are able to select a group of participating nodes on the network who are exclusively authorized to validate blocks of transactions.

Features of Decentralized Blockchains

From a technological point of view, both decentralized and centralized chains share the same core features. The makeup of a decentralized blockchain is not in any way different from a centralized blockchain.

Decentralized blockchains possess some features which give them an advantage over centralized blockchains. Here are a few:

Faster transactions — One of the most amazing things about a decentralized blockchain network is that transactions are conducted much faster. Since the need for a third-party to handle transaction verification is eliminated (due to its decentralized nature), it allows all the nodes present on the network to contribute to the computational power required to process and verify transactions.

The conventional payment methods are rather slow and they usually incur considerable transaction charges. However, a payments system sat atop a decentralized blockchain enables seamless transfer of funds with lesser verification windows. This saves cost and increases the speed at which transactions are processed.

Secure Network —  It’s almost impossible to take over a decentralized blockchain network, as long as the diversity (by which I mean the number of unique nodes present on the network) is maintained. On most decentralized blockchains, several thousands of nodes participate in consensus to verify transactions. There’s no central node neither are there nodes with elevated permissions to verify transactions.

To successfully hack into a blockchain network, an attacker must seize control of the greater majority (more than 51 percent) of nodes on the network, at the same time!

A decentralized blockchain is much more difficult because of the sheer number of nodes present on the blockchain. Nowadays, decentralized blockchains are designed to ignore malicious (or faulty) nodes, so they are not allowed to participate in consensus.

This is in fact how the concept of immutability in blockchains work. It is impossible to alter the records in transaction blocks on a decentralized blockchain network after a consensus has been reached (i.e. the block has been verified). This is a major advantage of decentralized blockchains over centralized ones, since there’s node equality.

An understanding of blockchain technology at its very core is a great step to identifying the higher level differences in centralized and decentralized blockchains. Of course, it still remains a question of design and target audience.

A blockchain solution developed for enterprise applications would often be centralized. In contrast, a blockchain network targeting public users should ideally be decentralized. The aim should be to put the user back in the driving seat when it comes to sensitive information (for instance, medical records, personally-identifiable information).

All in all, the average person prefers the concept of decentralization in blockchain because it offers unlimited freedom, as it’s not controlled by a select few.

To them, it is the ‘true’ blockchain.

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