Teller Finance, a blockchain project for decentralized lending, today announced its upcoming integration with Chainlink, the market-leading oracle provider, ahead of their public alpha launch. Chainlink will initially provide Teller with three cryptocurrency price feeds via its Price Reference Data oracle networks, these feeds will include DAI/ETH, USDC/ETH, and LINK/USD.
Teller uses an open-source protocol that interacts with consumer data to calculate default risk and offer unsecured crypto asset loans. Users can supply liquidity to the protocol’s lending pools and earn interest from repaid loans. Teller leverages borrowers’ credit history to calculate an annual interest rate (APR) that is based on market conditions vs. consumer credit risk, reducing or eliminating the need for collateral.
“Teller calculates consumer credit risk as a measure of personal financial data, e.g. debt to income ratio. The latter translates into an APR that is not only based on money market interest rate, but also takes into account consumer credit risk. Variable loan APRs in turn result in variable APY for liquidity providers,” explained Ivan Perez, Founder & COO at Teller Finance. “For the consumer, this means an affordable user experience that leverages positive credit history to lower DeFi’s exorbitant collateral ratios.”
Integration of Chainlink’s Price Reference Data feeds will allow Teller to capture real-time price information on the protocol’s assets under management, ensuring that all APR calculations for unsecured loans reflect real market conditions.
Chainlink’s oracles capture this information off-chain from numerous high-quality data aggregators and make it available on-chain for any smart-contract-enabled blockchain. This allows Teller to leverage a decentralized network of independent, Sybil-resistant oracles to obtain volume-adjusted market data that is accurate, highly available, and resistant to various data manipulation attacks.
According to DeFi Pulse, there is now more than $6 billion worth of crypto locked in existing DeFi environments, up 500% since June. However, that is still only a fraction of the $215 trillion debt market Teller Finance aims to disrupt.
“We’re excited to empower Teller Finance with secure and reliable oracles so they can expand the already booming DeFi ecosystem through the introduction of undercollateralized loans,” said Daniel Kochis, Head of Chainlink Business Development. “Lending accounts for more than 60% of DeFi’s TLV, and that’s just from overcollateralized lending options. Unsecured lending via consumer credit risk is the next major milestone towards truly capturing new users, and we’re excited to provide key oracle functionality to make that a reality.”
Incubated by A16Z’s crypto startup, Teller recently announced their secured $1 million seed round led by venture capital firm Frameworks Ventures.
Following the successful integration of Chainlink, Teller will operate as a DeFi adoption bridge, enabling the acquisition of new users by lowering the industry’s barrier to entry and maximizing consumer capital efficiency.
About Teller Finance:
Teller Finance uses an algorithmic credit risk protocol, which enables the creation of decentralized lending markets that can offer unsecured loans. The protocol’s unique cloud-based infrastructure can connect to and privately compute credit and banking data to generate individual loan terms based on a users’ creditworthiness. Teller Protocol was designed to develop decentralized loan products, without collateralized debt, reducing consumer risk and costs. Teller can interoperate with centralized finance data, offering everyone the freedom to develop a new wealth of trustless financial instruments.
For more information, please visit: https://teller.finance/
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Chainlink is a decentralized oracle network that helps resolve connectivity issues with smart contracts, enabling users to build blockchain-based smart contracts that securely access off-chain data feeds, web APIs, and traditional bank payments. By doing so, Chainlink transforms the role that smart contracts can play in a vast number of sectors, including financial services, insurance, and supply chain. Chainlink provides highly secure and reliable oracles to large enterprises (Google, Oracle, and SWIFT) and leading smart contract development teams such as Polkadot/Substrate, Synthetix, Loopring, Aave, OpenLaw, Conflux, and many others. Learn more by visiting the Chainlink website, following us on Twitter or Reddit, or joining our Discord.
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