Silo, a non-custodial decentralized finance marketplace, announced Friday morning the launch of its V2 protocol on Sonic, a high-performance Layer 1 network.
This means users on Sonic can now tap into lending markets where risks are kept separate. This means if one market hits trouble, it won’t drag down the others. After passing several security audits, Silo V2 is now live and already attracted $400 million locked into the platform.
Silo V1 made a big splash in the DeFi world, facilitating loans worth hundreds of millions of dollars across more than 50 markets—without any blow-ups or solvency issues.
Anyone can create a lending market for any ERC-20 token and customize settings like loan-to-value ratios, liquidation thresholds, and interest rates. This means more flexibility for lenders and borrowers and permits users to fine-tune strategies to fit specific assets and market conditions.
Users are in control
One of the biggest upgrades with V2 is that users no longer need permission to create a market, it is open to anyone.
Silo has also introduced what is called “hooks,” which let users add new features like connecting different markets, redirecting idle funds to other platforms for extra yield, or setting up fixed-term loans.
The use of the ERC-4626 standard also means Silo V2 will be able to communite with other DeFi apps, making it easier to move funds and interact with different platforms.
Smarter risk management
To keep things secure, Silo V2 now uses a dual-oracle system to separate LTV and liquidation threshold calculations—basically making risk assessment more accurate and reducing the chances of bad debt.
Another unique feature is that market creators can earn fees on interest and incentives through an ERC-721 token. This creates a new revenue stream for market builders while encouraging the creation of more diverse and competitive lending options.
Looking ahead
After Sonic, Silo plans to roll out V2 on Ethereum, Arbitrum, and Base, expanding its reach and cementing its place in the DeFi space. With its combination of flexibility, security, and scalability, Silo V2 is poised to make decentralized lending more accessible and user-friendly than ever.
Read the full article here