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Q101.Solend is the leading lending protocol on Solana. What are the demographics of the Solend userbase?
Introduction
Solend, an algorithmic and decentralized lending and borrowing protocol, is working on an exciting new product that has the potential to change the lending ecosystem on Solana (SOL/USD). It is a product of isolated pools that write everything on their blog.
These are independent lending markets that back a pool of assets, which you can use as collateral for a loan against each other, as opposed to a cross-collateral pool, where you can pledge any asset against Borrow any other assets.
It is important to list new assets carefully in a protocol with a cross-collateral repository because it makes the protocol vulnerable to a new attack vector. The entire TVL lending protocol is at risk. Cream Finance was hacked twice for listing assets with non-standard implementations, losing $19 million the first time and $130 million the second time.
ERC20 is a broad standard that many tokens do not conform to. In contrast, SPL tokens in Solana must conform to the SPL standard. Custom behavior is not possible. If assets listed on Solend are minable, they must have adequate liquidity and access controls.
While separate pools are by no means a panacea, the value of the assets at risk is limited to the assets in the respective pool. The entire TVL protocol is not at risk. Separate pools enable Solend to list many new assets that do not meet the cross-collateral pool requirements. They also enable better parameters. The loan-to-value (LTV) ratio of SOL and USDC in the cross-collateral portfolio is currently 75%. In other words, you can borrow $100 for every $75 you deposit. This avoids major losses for all lenders in the pool. This ratio can be increased up to 95% in a separate pool, bringing greater capital efficiency.
