The Orby Network, a protocol on the Cronos blockchain, recently introduced a new feature that enables users to borrow its stablecoin, $USC, without incurring interest. This development allows for the use of $USC in various decentralized finance (DeFi) activities on the Cronos network without the need to pay high or fluctuating interest fees.
As an emerging platform on the Cronos blockchain, which is compatible with the Ethereum Virtual Machine (EVM), Orby Network offers its users the option to use certain assets as collateral to borrow $USC. The introduction of interest-free borrowing is aimed at increasing liquidity in the Cronos ecosystem and improving capital efficiency for Orby Network users.
$USC is an overcollateralized stablecoin that is pegged to the US dollar in a soft manner. It is intended to serve as a store of value, a medium of exchange, and a measure of value. By borrowing $USC, users can keep their cryptocurrency assets and benefit from any increase in value, while also using $USC for transactions within the ecosystem.
In contrast to many DeFi lending platforms, which typically apply an interest rate of 2% to 6% for borrowing stablecoins, Orby Network’s approach eliminates interest charges. This initiative, which is the first of its kind on the Cronos platform, is designed to encourage more active economic participation by enabling users to borrow $USC indefinitely without the concern of accumulating interest.
Charlotte Kapoor, Head of Innovation Programs at Cronos Labs commented: “Orby forms an integral part of the DeFi ecosystem that is taking shape on Cronos. The introduction of interest-free $USC borrowing on Orby will strengthen its status as a cornerstone of Cronos DeFi while unlocking new financial opportunities. We’re excited to support and nurture Orby with the tools required to build new innovative products for our users as part of our latest accelerator cohort.”
Orby Network’s implementation of interest-free borrowing allows users to deposit certain cryptocurrencies as collateral and borrow $USC in return. Participants can also contribute $USC to Orby’s Stability Pool and receive liquidator fees. The protocol includes a one-time borrowing fee, due when the borrowed $USC is repaid, avoiding the continuous interest payments common in other lending models. Borrowers are advised to manage their debt positions carefully to avoid liquidation.
Orby Network’s selection for the third cohort of the Cronos Accelerator Program, which is supported by a $100 million fund, indicates its potential impact on the Cronos ecosystem. This program provides early-stage crypto projects with mentorship and funding to promote innovation and growth within the Web3 space.
By offering a stablecoin lending protocol that allows for interest-free borrowing of $USC, Orby Network provides a tool for users to efficiently use their digital assets within the DeFi space on Cronos. This feature aims to facilitate wider participation in DeFi by removing the financial barriers associated with interest payments, demonstrating the potential for blockchain technology to offer innovative financial solutions.
Disclaimer: The subject matter and the content of this article are solely the views of the author. FinanceFeeds does not bear any legal responsibility for the content of this article and they do not reflect the viewpoint of FinanceFeeds or its editorial staff. The information does not constitute investment or financial advice or an offer to invest.
