TrueFi AMA Summary with Decentralized Club ✔️
Dear, Community,
Welcome to the recap of our AMA with TrueFi.
Our vibrant and enthusiastic community had a lot of questions to ask. To those who want to know quickly what TrueFi is about, we are sure this recap is gonna help you. So without further ado, continue reading 😉
✔️Introduction with TrueFi : 👉
| DK | 🌿 | Never PM/DM First 🐞 Decentralized Club:
First question of Introduction :
Q1. Can you provide a brief introduction to the core team behind TrueFi?
Rafael Cosman:
Yes of course
We’re not an anon team… I’m Rafael and I’m the CEO
I studied Computer Science at Stanford and then worked at Google before starting this company
We’ve got about 25 people on the team today, some very crypto native people but also lots of folks from compliance, legal, etc. everything you need to build a trustworthy & safe platform!
| DK | 🌿 | Never PM/DM First 🐞 Decentralized Club:
Wow 👍👍
Amazing😍
Next question :
Q2. What problem in Defi is TrueFi trying to tackle ?
Rafael Cosman:
Good Q
We are trying to bring uncollateralized lending to DeFi
Right now a huge amount of DeFi is built on over-collateralized lending
Which is good, but DeFi will always be limited if it stays there
You’ve probably heard of Compound, AAVE, and Maker, right?
Those DeFi platforms all do over-collateralized lending
E.g. you can put up $150 of ETH as collateral and borrow $100 of stablecoin
Or put up $150 of stablecoin and borrow $100 of ETH
That’s over-collateralized
But a lot of the lending world is about uncollateralized lending
People and businesses are willing to pay a much higher rate to get an uncollateralized loan
Because often times it’s difficult for them to put up that much collateral
So that’s where TrueFi comes in- it actually does uncollateralized loans
Borrowers are all big crypto funds right now, such as Alameda Research, Grapefruit, Invictus
People can put stablecoin in the lending pool, and then firms borrow it out without collateral and pay a very attractive rate
| DK | 🌿 | Never PM/DM First 🐞 Decentralized Club:
Very Impressive👍👍
Ok, move on to next question🙋
Q3. Can you talk a bit about your prospective customers and how they will gain from your products and services ?
Rafael Cosman:
Well we’re a lending platform, so there are two sides:
lenders and borrowers
Lenders can be anyone- they put stablecoin (and in the future other assets as well) into the lending pool
And they start earning a get APY immediately
Rafael Cosman:
Here are the platform APYs today just so you can see
Can always check them at https://app.truefi.io/dashboard
Lending pool, including the farmed TRU tokens, is offering 89% APY
— —
The other side is the borrower side
These are big firms like I mentioned, and they borrow millions of dollars from the lending pool in exchange for paying interest
They are often willing to pay more to use TrueFi than other platforms such as Compound etc. because they don’t have to put up collateral
But they of course have to be vetted to make sure they are credit-worthy
So every borrower posts information on the governance forum (history of their fund, what they are using the loans for, etc. etc)
And borrowers only get onto the platform if the TRU holder community votes to add them
—
Part of what’s excited about this is that the high ROIs offered by these kinds of funds are usually unavailable to smaller investors
E.g. Alameda research is so big they can’t take a $1000 check
But because of TrueFi, anyone can put any amount of stablecoin into the lending pool
And immeidately get access to the same high APYs that big whales are getting
| DK | 🌿 | Never PM/DM First 🐞 Decentralized Club:
Amazing 😎 It shows a lot of transparency
One more TrueFi team member joined now, Welcome @mikegas :) 🙏
Rafael Cosman:
Thank you!
Yes great to have you @mikegas
| DK | 🌿 | Never PM/DM First 🐞 Decentralized Club:
Next question :
Q4. Which is that milestone in TrueFi that you are most proud about of achieving?
Rafael Cosman:
Never getting hacked or having a loan default?
Kidding…
But it certainly is important to not get hacked and to make sure our users are safe!
Milestone we’re most proud of achieving- have 5 of the top crypto funds on the platform and they have done 20mm+ of loans already successfully repaid
You can see the full status of every loan here: https://app.truefi.io/loans
Everything is public on the blockchain of course!
Also have grown the lending pool to over $30mm, even though the platform is still pretty new!
Lots more coming up in the next few months though. We are just getting started here.
| DK | 🌿 | Never PM/DM First 🐞 Decentralized Club:
Thats a lot of work and by your words it is clear TrueFi is well on track to achieve its goals.
Rafael Cosman:
I think so
| DK | 🌿 | Never PM/DM First 🐞 Decentralized Club:
Last question of Introduction :
Q5. What is further planned for TrueFi in 2021 ?
Rafael Cosman:
Ah. A lot
Wow
One sec…
Let me share our roadmap with you
https://blog.trusttoken.com/the-truefi-protocol-roadmap-92f388ac6eb3
The goal of TrueFi is to become the most widely adopted and most trusted protocol for uncollateralized lending on blockchain. TrueFi’s first borrowers are crypto-native trading firms and will gradually become a diverse set of companies and individuals, letting TrueFi act as a more general financing tool.
Phase 2 — By Feb 19th 2021
Milestones:
Add Liquid Exit
Improve staking model
Launch fully on-chain governance
⬆️ this is shipping very soon. Code is getting audit right now.
Phase 3 — By May 20, 2021
Milestones:
Add additional USD-backed stablecoins, specifically USDC, to the first TFI-LP pool
Add Lines-of-Credit
Implement a more robust credit model for onboarding borrowers
Allow Loan Tokens and Line-of-Credit Tokens to be tradable
Phase 4 — By August 18, 2021
Milestones:
Add support for arbitrary ERC20 tokens (e.g. WBTC pool, WETH pool, etc.)
Allow lending pools to provide liquidity on all Loan Tokens and line of credit tokens
Allow other protocols to participate in Loan Token and Line-of-Credit primary fundraising
That’s what we have planned!
Happy to answer any questions about this and why we’re excited about it!
| DK | 🌿 | Never PM/DM First 🐞 Decentralized Club:
Thank you @rafaelcosman, super insightful and very easy to understand.
🐧Community ask Questions by Twitter ✔️
| DK | 🌿 | Never PM/DM First 🐞 Decentralized Club:
Twitter question no 1.
Username : @socsonz1
Defi and Nfts are two hot trends, so what do you think about these two trends and in the future, whether TrustToken will become a part of Defi or Nfts?
Rafael Cosman:
Those are definitely hot trends- TrueFi is already a part of DeFi and is listed on DeFi pulse as a major DeFi platform by TVL! Lots of room to grow though of course.
In terms of NFTs, we don’t support them yet, but if there would be a market for uncollateralized lending & borrowring of NFTs, we certainly could support them in the future
We’ll have to see how the NFT market develops!
I haven’t been able to keep up with it because I’ve been focusing on DeFi so much
| DK | 🌿 | Never PM/DM First 🐞 Decentralized Club:
Twitter question no 2.
Username : @abangpiscok1
Can you tell us the motivation and benefits for investors to hold $TRU long term? What plans do you have to help drive demand and scarcity for the token?
Rafael Cosman:
TRU token is the governance token of the platform- benefits for holding it are as follows:
1. TRU can be staked on the platform to earn a strong APY. Once staking V2 launches (in the next 8 days!!) you TRU stakers will receive BOTH bonus TRU for staking and also stablecoins from the loan origination fees
Every time a borrower takes out a loan, they pay an origination fee, and staking V2 actually allows TRU holders to directly claim these fees
If they stake their TRU on the protocol
On loans that are millions or even tens of millions, these fees can be quite large!
So you are directly earning both stablecoin and TRU by staking your TRU
Can be very attractive
2. TRU has governance power over the protocol
Right now we do governance through snapshot similar to many other protocols
But we are about to ship (planned to ship in 8 days) full on-chain governance
Similar to Compound
This takes the decentralization of the protocol to a whole other level
Where our company will no longer have any special powers or keys to control the protocols
Truly in the hands of TRU holders, and via the farms we’re putting TRU in the hands of all users
Very exciting step for us!
===
And this is just what we’re about to ship, if you take a look at the roadmap you can see lots more there to add even more utility for TRU holders
| DK | 🌿 | Never PM/DM First 🐞 Decentralized Club:
Twitter question no 3.
Username : @HendriA11938225
Traget TrueFi is a higher risk and higher yield market segment, what steps will the TruFi team take to achieve that?
Rafael Cosman:
Yes- I believe we are achieving this right now
Look, so the situation is this. If you don’t take collateral you certainly can have more risk
We mitigate that by reviewing borrowers carefully and TRU holders have to vote to approve every borrower and even every loan that they take out
Whereas a platform like Compound or AAVE has collateral, but they will loan to anyone
So there are tradeoffs
But because we’re uncollateralized, borrowers are willing to pay more to borrow
Many borrowers won’t even use Compound because they have to put up so much collateral
Not worth it to them
This means that our lenders are earning a higher APY than they would earn on most other platforms
You can see the APYs here: https://app.truefi.io/dashboard
Currently 92% APY actually. 🔥🔥🔥
This is including farmed TRU
Thus while uncollateralized lending certainly has risks, we think that most traders, investors, and funds, will in the future want to allocate some of their portfolio to this segment
Even if it’s just a piece of their portfolio, we believe uncollateralized lending will be a huge market- likely as big or bigger than the current over-collateralized market
Which is in the billions or maybe low tens-of-billions now
So we think there is HUGE room for growth in this segment
| DK | 🌿 | Never PM/DM First 🐞 Decentralized Club:
Thanks for the quick and prompt answers!
Rafael Cosman:
Great questions from Twitter, thank you everyone!
🌍 Community ask question by Website 👨💻
| DK | 🌿 | Never PM/DM First 🐞 Decentralized Club:
Website question no 1.
From : Ola
How can the community contribute to the progress of truefi? Do you have a Governance model? Is there and ambassadors or bug bounty or contest we can assist in so as to enable further adoption?
Rafael Cosman:
Lots of ways to contribute
Would love to have all of you involved
Ways to contribute:
1. Use the protocol, earn APY and farm TRU
2. Participate in governance!
Our community uses snapshot right now but is about to move to full on-chain governance in the next week or two.
3. Engage on our forum and discord
TrueFi Discord: https://discord.com/invite/Yx7J4jZ
Looking forward to having you join us!
| DK | 🌿 | Never PM/DM First 🐞 Decentralized Club:
Website question no 2.
From : Arisabela
It says in your medium article that TrueFi is actively following the path of progressive decentralization putting control in the hands of the community. Can you tell us how does you governance system work? Who is able to participate and make decisions?
Rafael Cosman:
Yes- so full on-chain governance is about to launch
Similar governance model as Compound
Our governance code is actually based on theirs
Any TRU holders with a certain minimum amount of TRU can make a proposal. This is then voted on by all TRU holders
Needs to get >50% YES votes to pass. And also needs to have a certain level of participation (quorum) to pass.
So if there is not enough support from the TRU community it won’t go through
All governance parameters such as this are actually subject to change via governance as well!
So the protocol is meant to be quite flexible
| DK | 🌿 | Never PM/DM First 🐞 Decentralized Club:
Website question no 3.
From : CLOVER
TrueFi is a DeFi protocol for unsecured lending. Many of these platforms only focus on the lenders and leave out the borrowers. What are the advantages that borrowers will have? Will they also be able to get an APY or benefits when borrowing?
Question Tags: @CLOVER_JR
Rafael Cosman:
Our platform does focus on uncollateralized lending, and this is why borrowers love it
It’s possibly the only DeFi platform that can give them a loan right now without taking collateral
Which is a big deal for them
And they’re willing to pay a higher APY because of it
Our problem is actually finding more lenders
Because the borrowers want to borrow all the capital we have in the protocol
Right now TRU holders are actually having to turn down their loan applications because we don’t have enough stablecoin in the protocol to fulfill all of it
Apparently our 92% APY isn’t quite enough to attract more capital… 😛
But we’ll get there. One of the things that will help is adding support for more stablecoins such as USDC
DAI, USDT, etc.
As well as other assets such as wETH, wBTC
Any of these assest could be lent out on the protocol
Could grow TVL by a TON
Thank you for all the excellent questions!
✍️ Telegram live Questions answered by TrueFi ✔
Mafiya:
What is your top 3 things for priorities in 2021? Could you share some plans for the upcoming year?
Rafael Cosman:
Yes!
Our roadmap for 2021: https://blog.trusttoken.com/the-truefi-protocol-roadmap-92f388ac6eb3
Our main goal is to increase utility for TRU and expand the size of the protocol
We would like to be doing 100mm+ or 1b+ in loans, hopefully we can get there in 2021!
Jumur Qwn:
what companies are you partnered with or seeking to partner with in future ?
Rafael Cosman:
Good q
One of the best things about the TrueFi platform is that it lends itself very well to partnerships
We already are partnering with some of the top funds in crypto: Alameda Research, Invictus, Grapefruit, Wintermute, Nibbio, etc.
These are folks that do huge volumes of trading
And some of them manage >$1B in assets 👀
Very good firms to be partnering with
Michael G:
Also about to on board an exchange you may all know as a borrower: Poloniex!
Rafael Cosman:
And they also help to promote and grow the platform, because they benefit when the platform grows (more loans for them!)
Exactly- exchanges are probably the next big segment for us
Partnering with them as borrowers can lead to lots of other opportunities for TRU
Chanakaya:
Does the price of the token matter to you from an operational perspective, if the token price is $1 or $100?
Rafael Cosman:
It does matter to the protocol because staked TRU is used to provide an extra layer of assurance for lenders
TRU stakers basically stand to lose some of their TRU if a loan defaults
And this helps lenders to be secure- it covers some of their risk, similar to having collateral
The higher TRU price, the more coverage there is there
So the safer lenders can feel putting in large amounts of stablecoin
Hence there is the potential for a positive feedback loop there!
And farm APYs also rise when TRU price goes up
Another potential good feedback loop for the protocol
Lots to learn and improve here of course
Sak Noel:
Are you a global project or local project? Can anybody anywhere use Your project without any restrictions?
Rafael Cosman:
Yes this is one of the great things about DeFi- because it’s a smart contract anyone can interact with it
OK, @UniqueBoyDK I believe that was 4 good questions!
Thank you all very much for the engagement today
Great to be here and please join our project if you are interested
| DK | 🌿 | Never PM/DM First 🐞 Decentralized Club:
Unbelievable:) a special thanks for the lots of time Rafael 🙏
Rafael Cosman:
Thank you too
Lots of exciting stuff happening in crypto and DeFi today, exciting that we all get to be a part of it
| DK | 🌿 | Never PM/DM First 🐞 Decentralized Club:
It was a great moment
Rafael Cosman:
Let’s build some cool stuff for our community and for the whole world
| DK | 🌿 | Never PM/DM First 🐞 Decentralized Club:
Thanks again all of our community members with TrueFi team🙏
Ama end