1/10
Understanding the "ZERO Stability Pool".
#ZERO is the new product released by @SovrynBTC using @RSKsmart
A #DEFI platform using #SmartContracts on #Bitcoin to allow users to borrow against their assets with NO interest
2/10
A key element to understand, and what makes this #DEFI protocol different from centralized lending platforms like #Celsius is the Stability pool.
In short it is set up to punish risk takers and preserve the funds prudent actors
3/10
This is how it works:
We lock our #Bitcoin in the #SmartContract, we get a #ZUSD #Stablecoin loan.
We can then add the coins to the stability pool.
5/10
This uses people's self interest in favor of the longevity of the protocol, makes sure that no line of credit can endanger the entire ecosystem for the safer players
And rewards those who provide the funds for it to work!
6/10
Because we are talking of #DEFI, all the information is on chain, another big step forward from #CEFI.
So we can see how many lines of credits are close to the danger zone in real time
7/10
This acts as further incentives for people to add funds to the stability pool, which makes the system more resilient.
It acts as a signal to self profit seeking individuals to where their funds provide more value.
As free Markets are supposed to do
8/10
Having all the information available and auditable at all times, I know for a fact where my #Bitcoins are. This make #ZERO and #DEFI incredibly powerful.
It uses #BTC only as collateral and runs on @RSKsmart to me, makes it one of the best things out there for Bitcoiners
9/10
@RSKsmart is merged mined by #Bitcoin miners and all fees get paid to the #BTC miners. So #ZERO helps the main chain be more profitable to mine, this helps in making it more secure!
10/10
As someone who earns fully in #Bitcoin, being able to borrow against my assets to afford daily costs while keeping access to the future valuation of them is very useful.
It is still a new protocol so be sure to understand it and test it before jumping in
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