DeFi.ch
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Explained
DeFi.ch's Decentralized Savings Platform is the solution to introduce decentralized financial services to a wider audience. Learn more about how it works and why it's different.

The challenge.

While searching for savings options that would return a fair interest rate for our cryptocurrencies, we realised that most services just generate lucrative rates for stablecoins. If you dig deeper into the topic, it is pretty obvious why stablecoins generate a high yield: demand for these coins is very high and people are willing to pay higher interest rates for their loans. It is in the nature of the P2P-lending business that borrowers prefer to get their loans in a stable currency so as not to run the risk of impermanent loss while the loan is active. So how might it be possible to get a high interest rate on crypto deposits which are not stablecoins?

The solution.

The solution to our puzzle was to be found where most decentralized finance start-ups won't ever investigate: the banking sector or so called ‘Old Finance’. As we in the banking industry all know, the floodgates of liquidity remain wide open. This paves the way for cheap money which is exactly what we need to solve our problem. Once the answer was clear, it still took a lot of work to find the perfect partner for our journey but now we are happy to say we found the perfect match.
One of the biggest advantages of the banking sector is that there is nearly unlimited liquidity and that there is no need for overcollateralization. While it is understandable that in the crypto space, there is no way around overcollateralization in some cases, it can be very helpful to not need to deposit two dollars if you want to borrow one. And for us that was exactly the case: by finding a way to get access to liquidity and not having to overcollateralize every dollar, we found the solution to our problem. Since banks are making their first small steps in the direction of being pro-crypto, we hope we can do our part in showing the old banking industry that crypto is something positive!
As far as we know, our partnership is the first of its kind and we are trying something new in a special way, but we believe that we should try to find a way to use synergies instead of fighting each other.