The non-custodial DeFi lending marketplace, Silo, has launched its V2 protocol on Sonic. This implementation makes it possible for users of the high-performance L1 network to get access to risk-isolated markets. With the introduction of V2, Sonic will be able to access programmable lending markets for the very first time. This launch comes after comprehensive auditing.
Silo V2 has been enabled to exit beta and begin rolling out isolated lending markets across numerous chains, beginning with Sonic, as a result of the successful completion of multiple audits. More than $400 million has already been committed to Silo V2, which provides Sonic users with the opportunity to earn a dividend on their investments while insuring against risk. Mainnet, Arbitrum, Base, and a great number of additional EVM L2 and EVM-compatible chains are going to be included in the future expansion of the chain.
The success of Silo V1 is the foundation upon which Silo V2 is built. V1 has been responsible for facilitating loans totaling hundreds of millions of dollars across more than fifty isolated lending pools on Ethereum and several Layer 2s, all while maintaining an uninterrupted record of solvency. Deployers are given the ability to customize loan-to-value (LTV) ratios, liquidation thresholds, oracles, and interest rate models using the upgraded V2 protocol, which enables twin-asset lending markets that can be customized for any ERC-20 token.
Permissionless market deployment and optional “hooks” that enable additional functionality are two of the most important elements of Silo V2. These features allow for the interconnection of market clusters, the deployment of idle liquidity to other decentralized applications (dapps), and the creation of fixed-term and permissioned markets for regulated assets. Using the ERC-4626 standard guarantees that integrations with third parties will go off without a hitch.
Modular liquidation and interest rate choices with V2 provide flexibility for a wide range of assets, including stablecoins and real-world assets (RWAs). These options range from conventional to auction-based or fixed-rate, and they may be offered in a variety of configurations. Through the separation of LTV and liquidation threshold computations, a dual-oracle system adds another layer of protection against the danger of bad debt.
During the introduction of version 2, deployer revenue, an optional fee on interest, and incentives that accrue to market developers in the form of an ERC-721 token are also included. These features are intended to encourage the development of bespoke markets. The isolated nature of Silo V2 helps to reduce the systemic risks that are often associated with conventional pooled lending.
In order to provide lending options that are both safe and flexible, Silo V2 on Sonic was carefully developed. When it comes to addressing particular demands, such as improving yield or controlling risk, its programmable markets make it possible for deployers to do so while still retaining the isolation that safeguards consumers from more widespread system deficiencies.
Silo V2 is supported by Sonic’s high-speed infrastructure, which places an emphasis on scalability and developer tools. This enhances the ability of the lending platform to unlock new use cases for decentralized lending.
The Silo marketplace is a non-custodial decentralized finance platform that brings together lenders and borrowers in isolated lending pools. In terms of total value locked (TVL), Silo works across many chains with hundreds of millions of dollars. V2 introduces programmable lending markets, which expand flexibility and risk isolation for users of decentralized finance. This creates the opportunity for lenders to do more with their digital assets.
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