Silo Protocol: Addressing Crypto Lending’s Long Standing Problems 

The DeFi sector, which is crypto lending, has been the most disruptive part of the blockchain industry.

Loans have historically been tightly controlled and centralized, with banks often imposing strict conditions. This is all changed by crypto lending in DeFi. People can now access loans with a combination smart contracts and cryptocurrency, while still keeping their privacy.

This system is not perfect. Malicious parties have attempted to exploit smart contracts and attack liquidity pools even of the largest DeFi platforms. To minimize potential damage from such attacks, some lending protocols have decided to separate cryptocurrency pools. These efforts have not yet solved the problem.

They either separate cryptocurrency into trading pairs-based pools or create smaller pools with different cryptocurrencies. Silo Protocol, however, has created a protocol that reduces the risk of an attack on barest mining.

How the Silo Protocol Works

Silo is a protocol for non-custodial lending that allows isolated money markets to be created from two assets. The token and ETH are the assets. They act as a bridge token between different money markets. Users can use Silo to create a money market for any asset.

Each asset has its own money market, so the risks associated with any asset are contained within a single market. Industry has seen the potential of Silo Protocol as it was awarded the ETHGlobal 2021 hackathon.

The management of Silo Protocol now has plans to expand its operations, primarily through a token sale.

Gnosis Sale

Silo Protocol hosted its Gnosis Auction, where interested parties could purchase 10% of Silo’s token supply.

The sale was done to raise liquidity for Silo’s Decentralized Autonomous Organization, and the funds will be used for two purposes. The DAO’s Treasury will receive 85% and the community will vote on its future use. The remainder will be used to develop the fund.

Gnosis’ pricing mechanism was the reason Gnosis was chosen as the preferred platform for sale. Gnosis is a platform that prohibits bots from purchasing tokens. All tokens can be sold using a clearing price mechanism.

The Silo team also reiterated their commitment to ensuring that the ecosystem is as community-focused and inclusive as possible, even during fundraising.

“Unlike ICOs in 2017, where funds were given to the company that developed the protocol, the Protocol Owned Liquidity (or Silo) raised by Silo is under the control of the community. Therefore, the community can direct it in order to ensure sustainable growth of protocol.

Strong DAOs foster a culture that is fair, transparent, and togetherness. We believe auctioning tokens on Gnosis Auction, where everyone establishes a fair price for the project, is the first step in building such a culture. For Silo DAO,” stated Aiham Jaabari who was a founding contributor.

Read More

2021's Most Anticipated Growth & Wealth-Building Opportunity


Marla Brooks


2021's Most Anticipated Growth & Wealth-Building Opportunity


Close Bitnami banner