Ever since I got into crypto, I always wished there was a way to essentially never leave the crypto ecosystem. All of my assets from a physical one like a house to digital assets and stocks, I always dreamed of a way to just use them as collateral in a blockchain and get rewarded. Why get a HELOC with a traditional bank if I could collateralize the house on a crypto platform instead?
If I want to collateralize current stock assets, I can take loans against it. For example, M1 Finance will let me borrow 35% LTV on my stock portfolio and as low as a 2% interest rate with a $125 monthly fee. So, for a $100,000 loan in M1 Finance, that would be equivalent to a 3.5% interest rate. Which is pretty satisfying on assets I really don’t ever want to sell.
Maybe those conversations are on hold for years down the road here at Balanced. However, as someone that loves the idea of never selling my assets and just using them as collateral, this is the future I saw in Balanced with my crypto holdings.
Lastly, I have all of my ETH and MATIC in Celsius Network. While I don’t have a loans with them, I am earning interest on them.
I’d assume the people that are using Balanced are similar to me. Sure, there are the short term speculators that are only looking for short term loans, but my understanding is that OMM is for shorter term loans and Balanced is for longer term.
So, my hope is that the vision of Balanced is to incentivize long term holders, borrowers, collateral, synthetic assets, LP’s, etc with the underlying goal that the BALN token price appreciation is the ultimate goal.
I feel we need to either carve a specific niche of the market or we need to be the first to the market if we are going to work towards the price appreciation of the BALN token.
While we are the first Defi project on ICX, I think we need to do more to attract other users.