Atlendis, a capital-efficient DeFi lending protocol that enables crypto loans without collateral, is partnering with X-Margin, the credit oracle risk engine for trading firms and institutions, to enable capital-efficient crypto borrowing and lending. The partnership will accelerate the adoption of uncollateralized loans on the blockchain, by using proven methodologies to reduce the inherent risk of DeFi lending.
In overcollateralized lending a borrower can only access an amount of secured credit provided they front at least the same amount in collateral, limiting borrowers in their borrowing capacity and lenders in their potential return. Returns in uncollateralized lending can be significantly higher, correlating to the risks incurred by liquidity providers who have no visibility on borrowers’ credit. However, lack of transparency on a borrower’s profile and creditworthiness may create a barrier for lenders to make an informed decision about which borrowers to lend to. Potential credit risks can discourage lenders from depositing into liquidity pools, reducing a borrower’s borrowing capacity.
The Atlendis protocol will address these issues by creating a more capital-efficient environment. X-Margin’s privacy preserving technology will be integrated with the Atlendis protocol. X-Margin will enable the measurement of institutional borrower creditworthiness by computing a credit risk evaluation without revealing the sensitive underlying data.
X-Margin straddles CeFi as well as DeFi applications with a credit oracle for counterparty credit evaluation, encompassing real-time risk monitoring across borrower portfolios, KYC and financial statement analysis. Lenders gain transparency of risk through X-Margin’s privacy-preserving credit oracle, alongside additional security, with optional programmatic control of funds.
One of the steps in the Atlendis whitelisting process will be for borrowers to obtain a credit evaluation from X-Margin, which will be displayed on the Atlendis protocol. Once borrowers are whitelisted, they will get access to borrower-specific liquidity pools providing a revolving line of credit at a borrowing rate established via market rate discovery.
Lenders on the Atlendis protocol will have the ability to choose the borrowers they trust to lend to as well as their preferred lending rate. Through the partnership with X-Margin, lenders will have access to more data on borrowers to make informed lending decisions and to exercise more granular control over their portfolios.
Alexis Masseron, Co-Founder and CEO of Atlendis Labs, stated, “While the Atlendis protocol focuses on the financial aspect of the platform to make it fair and fully functional, it cannot vouch for the reputation of the borrowers involved. We are excited to partner with X-Margin, as onboarding X-Margin’s credit evaluation will provide more information on borrowers without revealing sensitive data, and thus attract lenders with verification that loans will be more secure.”
Darshan Vaidya, CEO of X-Margin, added, “On-chain credit markets will be one of the fastest-growing sectors of DeFi, and the backbone of this will depend on an oracle-driven approach that can capture the off-chain and on-chain activity of a borrower in a privacy-preserving way. We are delighted to be working with the Atlendis Labs team to help build a more efficient credit marketplace for the crypto ecosystem.”
Atlendis is participating at ETH Dubai event from March 29th to 31st 2022.