Band and Constant ditch gatekeepers to create fairer financial systems
In media, people use the term “gatekeeper” for entities that control access to information.
On the one hand, gatekeepers can be a great source of data, but on the other, if people only use one or two, what’s stopping them from giving false information for their personal gain? How would we ever know?
Band Protocol was created to solve the gatekeeper problem that persists in current oracle solutions and centralized oracles that provide pricing data to smart contracts.
In the BAND system, BAND token holders can stake their tokens using a delegated-proof-of-stake-style (dPoS) consensus to vote for who provides data. Band token stakers are then rewarded with a percentage of query fees and dataset token appreciation — the current staking reward is 30%.
By tying the value of its tokens directly to the quality of data on their system, Band is rewriting the rulebook for smart contract oracles. With a decentralized, blockchain-agnostic data source, Band hopes to expand use case and security for DeFi apps.
But it’s not all about blockchains.
The finance industry has long had its gatekeepers, those forbidding bank managers, risk advisors, and credit assessment agencies who control access to loans and other credit products.
Well, this week, BAND holders can also use their tokens to obtain competitive loans, regardless of credit history, with P2P lending platform, Constant.
“At Constant, we believe traditional lending institutions have been leveraging their trusted status to line their own pockets instead of benefiting their customers,” said Duy Huynh, Constant’s founder, “At these institutions, investors and borrowers are tied down by fees and red tape. We want to offer something more direct, something peer-to-peer, without all of the hidden costs.”
In the Constant system, investors and borrowers choose their desired interest rates and the platform matches them together. To receive a loan, borrowers must escrow 150% of the loan in digital assets (like BND) as collateral. Upon repayment of the loan, the deposit is either transferred back to the borrower or sold off in the case of default.
“Just like Band’s protocol looks to decentralize oracles on the blockchain, Constant is working to decentralize lending,” said Huynh. “We are very excited to work with Band as they share many of our goals and are working to help upgrade the use case for apps like ours.”
Constant has matched over US$3,000,000 in loans since its launch in May 2019. It attributes much of its success to its responsive customer service and expanding range of features. It is also looking into implementing BAND technology into their systems in the near future.
By borrowing through the Constant platform, Band holders can unlock the value of their assets while working towards decentralizing the lending industry.
About Band Protocol
Band Protocol is a data oracle platform building the data layer of the Web 3.0. It provides an accurate information feed from community-curated data providers that allows blockchains to access trusted data from outside of the network. This solution is particularly important for the execution of smart contracts, that are triggered by off-chain occurrences. Band Protocol makes dApp (decentralised applications) development simple and allows developers to tap into trusted data sources by integrating basic lines of code.
Headquartered in California, Constant is an alternative financial services platform designed to strip out the inefficiencies of the traditional banking industry and help people get more out of their money. Constant was founded by a team of scientists, economists, engineers, and designers, fully devoted to the mission of building simple, elegant financial tools for an increasingly interconnected world.
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