Silo, a non-custodial decentralized finance marketplace, has officially launched its V2 protocol on Sonic, a cutting-edge Layer 1 network.
This launch empowers users on Sonic to access innovative lending markets with risk mitigation measures in place. If one market encounters difficulties, it won’t adversely affect the others. After successfully completing multiple security audits, Silo V2 is now operational and has already garnered $400 million locked into the platform.
Silo V1 made significant waves in the DeFi ecosystem by facilitating loans amounting to hundreds of millions across over 50 markets, all without any significant setbacks or solvency crises.
The platform allows users to create lending markets for any ERC-20 token, offering customizable settings like loan-to-value ratios, liquidation thresholds, and interest rates. This flexibility empowers both lenders and borrowers, enabling them to tailor their strategies to specific assets and prevailing market conditions.
Empowering Users
A key enhancement in V2 is the elimination of permission requirements for market creation, making it accessible for everyone.
Silo has introduced innovative “hooks” that allow users to integrate new functionalities, such as linking different markets, allocating idle funds to other platforms for additional yield, or establishing fixed-term loans.
By adopting the ERC-4626 standard, Silo V2 enhances its interoperability with other DeFi applications, facilitating smoother fund transfers and interactions across platforms.
Enhanced Risk Management
Silo V2 introduces a dual-oracle system to refine loan-to-value and liquidation threshold calculations, leading to more accurate risk assessments and decreased likelihood of bad debt.
Additionally, market creators can now earn fees from interest and incentives through an ERC-721 token. This feature cultivates new revenue opportunities for market builders while stimulating a more diverse and competitive lending environment.
Future Developments
Following the Sonic launch, Silo plans to roll out V2 on Ethereum, Arbitrum, and Base, broadening its influence within the DeFi landscape. By combining flexibility, security, and scalability, Silo V2 is set to revolutionize decentralized lending, making it more accessible and user-friendly than ever before.
