Goldfinch

Today I‘d like to tell you about a new and strong project with the name Goldfinch Finance.

Goldfinch — this is a decentralized protocol that allows you to borrow money without collateral. Below are the principles of work of this project.

How does this project work?

Senior Pool provides Senior Tranche in the Borrower Pools.

Backers provide Junior Tranche in the Borrower Pools.

Borrowers take the funds in borrow that was provided by Senior Pool and Backers

The task of the Senior Pool is only to provide liquidity for the Senior Tranche. He is not involved in risk assessment. And the profitability here is significantly lower than in Backers, but the risk of the first loss is also significantly lower. All payments are made to the Senior Pool first.

The task of the Backers is to receive increased profitability for the invested funds. The risk of the first loss is much higher, therefore, the role of Backers is much more extensive:

Backers themselves look for good borrowers and weed out bad ones. To do this, they closely communicate with candidates, ask questions, study financial documents, etc. In addition, the Sponsor community must work together to develop high standards for borrower appraisal. For this, mutual help and discussion are welcome in the community. Sponsors also independently monitor the fulfillment of the borrower’s obligations.

Mechanism of work

Goldfinch Finance provides an opportunity for any person even without having very large funds be a Backer or a Borrower if you pass the audit of the Auditors. At the moment, the protocol has already been in operation since December 2020. Since the launch of the Goldfinch, it has grown 2.5 times and now serves tens of thousands of its end borrowers.

I hope I have written everything clear to you so that you are interested in this project.