Anthony Lynch

Apr 23, 2021

6 min read

Faster than Light: Equalizer Represents the New Generation of Flash Loans

Image from Twitter

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As DeFi continuously seen as a catalyst for progress in the blockchain community, many projects have been presented with new taste and twists. One of the many choices in the menu is the Flash Lending.

What is Flash Lending?

Flash Lending is considered as the first uncollateralized loan option in Decentralized Finance. It is a revolutionary financial product that has no corresponding centralized finance product or service. Basically, it enables the users to borrow instantly and easily with no collateral needed provided or an agreement between the borrower and lender.

Despite the absence of a collateral, it guarantees the safety of the funds in the reserve pool. Use-cases include arbitrage, collateral swapping, self-liquidation, and many more.

It gives a new flavour in the lending system of blockchain. Flash lending adds more depth to the concept of democratized finance by allowing everybody to act as a significant player in the field for any given instance. However, it is worth noting that the borrower should return the loan together with interest within the same blockchain transaction.

With that being said, let’s take a look with one of the leading platforms that offer Flash Lending and claims to be the face of the next generation marketplace for flash loans.

What is Equalizer?

Equalizer believes that every individual together with their businesses should have access to financial services without the need for an intermediary. There should be no collateral between the borrower and the lender, but a guarantee must be treated.

They act as a vital cog in the greater interconnected ecosystem of DeFi that reshapes the financial industry by specializing in the distribution of a critical service that enables a multitude of innovative business models which is known as flash lending. With so much confidence, they claim to represent as the first dedicated platform for flash lending with a. single core service model — a type of model that provides a secured and reliable platform for flash loans.

The main purpose of the network is to bring the liquidity providers closer to borrowers. They incentivize liquidity providers by offering them passive income for the same token they have provided as liquidity and giving them Equalizer governance tokens proportional to their funds and the lending duration.

But, how does it work?

When the liquidity providers (LPs) stake their funds in a secured vault, the network will incentivize them by giving more tokens coming from the fees of the flash loans provided.Not only that, the LPs will also automatically have a reserved part in the network’s yield farming program which is designed to stimulate long-term liquidity providers.

While borrowers are provided with a plethora of liquid pools (vaults) that bring more advantages than any other competitor in the market. The benefits include lower fees, a wider range of tokens, a minimum level of available liquidity, reliability in all market conditions and availability on multiple chains.

What makes it unique?

The network has a wider perspective on flash loans. It is not just a useful tool for a user who’s in-need, but also holds a vital role in the growth and stability of the DeFi ecosystem, directly linked with the DEX volumes and overall liquidity in the broader ecosystem. Equalizer mentioned that their main goal is to bring inexpensive and reliable flash lending services to the DeFi space. Instead of diverse initiatives isolated from each other. The network indeed could be a dedicated player for flash loans.

They took a shot in making a difference from the existing platforms in the market who have a few important limitations as they are not designed as Flash Loans Solution. The usual platform has high fees, limited pools of tokens, limited available liquidity in each token pool, limited integration features and limited documentation. While the Equalizer offers low lending fees with dynamic fees, unique incentive scheme for liquidity providers and unlimited ERC20 token range.

It is also an edge to have a fast and scalable infrastructure, integration-friendly philosophy, unique governance model and most importantly, a wider multi-chain and cross-chain capabilities.

What are the risks?

Worry no more because Flash lending is risk-free for liquidity vaults and strengthens the concept of democratized finance as it allows the borrowers to use the entire available capital of the vaults. The operations that are limited only to a small group of entities with many funds become available to everyone.

Where is EQZ available?

Equalizer has its own native token called EQZ. Token holders are empowered and able to participate in the decision-making processes, thereby fueling the network’s governance and having a real effect on the DeFi industry. It also serves as the Governance token The Governance token which is used to fine-tune the parameters of the Equalizer platform and to adapt to the evolution of the DeFi market. Remember that each token represents one option to vote, however, voting is optional.

Image from KuCoin

There are many exchanges that claim the title of “best” exchange. While this may all seem simple enough, however, in choosing the best crypto exchange to invest in, a customer has to pay attention to a myriad of considerations like fees, reputation, security, verification processes, and geographical restrictions an exchange platform has to offer.

To better understand most of the exchanges, as well as some of them that are working actively towards this goal, first, we need to understand some several factors that these crypto exchanges are currently working on:

Security: Safety should always come first. A good exchange will place great emphasis on the security of their users’ accounts, personal information, and the system in general. The majority of the assets should be stored offline in a cold storage system. Also be on the lookout for additional security features such as Two-factor authentication, withdrawal confirmations, etc.

Reputation: A well established, long-standing exchange is a much safer option.

24/7 Support: The support should be responsive, friendly, professional, and ideally reachable through several different channels. A call center is a big plus as it’s comforting to know you have the option to speak to someone in person.

Payment methods: Take into consideration which payment methods are available — do they support credit card purchases, p2p fiat trades, and other methods of payment.

Fees: Fees can vary substantially between different exchanges. The fee schedule has to be provided on the site.

Interface: The site should be easy to navigate, even for crypto beginners.

Geographical restrictions: Some exchanges are locally restricted and their service might not be available in your area.

Uptime: Avoid exchanges with lots of downtimes.

Verification: Even though some users find verification and KYC procedures a hassle, you should look at it from another perspective. They are done with the best intention to protect the exchange from money laundering and all sorts of scams.

Taking everything into consideration, KuCoin is one of the many cryptocurrency exchanges who explored the concept of what the future of cryptocurrency trading looks like. It is also a reputable exchange that adds high-quality projects.

EQZ is available here.

KuCoin has a highly trained research department that looks for top-quality projects throughout the crypto industry. The exchange has over 6 million registered users across 207 countries and regions around the world with 450+ trading pairs to date. KuCoin provides a highly secure and easy-to-use platform for users to engage in cryptocurrency trades and transactions efficiently and safely.

KuCoin also launched a series of other products in the past year designed to further help out crypto users, including futures markets, public chain, one-stop exchange solution, creating a platform for how your crypto can yield interest, as well as some upgrades to the main exchange to uphold its principle of security and transparency. KuCoin since its inception has insisted on taking the tech as its backbone to build a better trader relationship while constantly pushing for the sustainable development of the digital currency trading ecosystem as the ultimate goal.