The Ethereum-based aave decentralized Finance project (DeFi) has launched a new service that allows users to take out loans without the need for collateral.
According to the founder and CEO of Aave, Stani Kulechov, users who have made a Deposit on the aave Protocol can now “delegate” a credit line to another person. Thus, the second user will be able to withdraw ETH from the aave Protocol without collateral.
In this case, users sign a legal agreement that defines the terms of the loan, such as repayment terms and interest rates. The smart contract system developed by OpenLaw is used for this purpose.
According to OpenLaw co-founder Aaron Wright, the contract is generated automatically and gives more weight to the agreement. If the terms are not met, one user can sue the other if they are located in the same jurisdiction.
Wright noted that this approach makes the DeFi industry more attractive to traditional players who are used to dealing with large amounts and conducting proceedings in court.
Recall that in March of this year, the aave project announced support for the usdt stablecoin. At the same time, the offer immediately became the most popular on the lending platform.