Fringe Lending (previously Primary Lending Platform) is a non-custodial, permissionless DeFi lending facility.
Within Fringe Lending:
- Liquidators liquidate borrower positions that are below the minimum collateralization level.
The two diagrams below illustrate the key functions, participants, and interactions in Fringe Lending:
Functioning of the Fringe Lending Facility
Users can interact with Fringe Lending in a number of ways, as diagrammed below:
Fringe Lending interactions.
Fringe’s Lending facility is comprised of the following key features:
- 2.Platform fees, a proportion of which are to be distributed as rewards to FRIN token stakers.
- 3.Primary Collateral Safes, into which borrowers deposit collateral, and which reflect their borrowing capacity.
Whitelisted LP tokens can be used as collateral when borrowing assets on Fringe’s Lending Platform. This offers Fringe users unprecedented flexibility and access to the untapped value of Liquidity Pool tokens.
Through overcollateralized loans, liquidity providers can unlock this value without closing their LP positions, giving them access to stablecoin capital to participate in other DeFi opportunities or increase their exposure to liquidity pool yields through leverage.
With this, Fringe Finance enables LP providers to further optimize their yield-earning positions.
Fringe’s v2 will implement this along with safety mechanisms that safeguard stability and platform solvency.
In the next pages of this section, we will explore in detail the user roles and mechanisms of Fringe Lending.