PARIBUS: A CROSS-CHAIN PROTOCOL BUILT FOR DEFI

Blaise Hilary
4 min readJan 19, 2023

Decentralized finance (DeFi) works similarly to traditional finance in that it offers services like borrowing and lending, in a decentralized manner thereby doing away with the drawbacks of centralized systems while providing higher interest rates.

Decentralized finance tools have produced immersive economies that are rapidly being improved as the user base keeps expanding at a breakneck pace. Nevertheless, several limitations such as insufficient liquidity, excessive transaction costs, and sluggish transactions have impeded mass adoption.

Regardless, cross-chain DeFi technology is now prepared to deal with these issues and offer a comprehensive blockchain-powered ecosystem as numerous interoperability components are facilitated by cross-chain technology which allows users to interact with various ecosystems from a single hub and at a low cost.

With the growing acceptance of cross-chain technologies in DeFi, several new DeFi platforms are emerging. However, the Paribus protocol stands out as it is a platform that enables DeFi investors to expand the reach of their digital assets to amass amazing yields. By tokenizing off-chain physical assets, users of the Paribus protocol can use them as DeFi tools and assets across the DeFi industry on various applications.

WHAT IS PARIBUS?

Built on the Cardano blockchain, Paribus is a chain-independent protocol that hosts a vast array of cross-chain interoperable decentralized finance instruments, providing holders of non-fungible tokens (NFT) with new utility and revenue sources.

Paribus enables users to tokenize any verifiable off-chain asset by combining a cutting-edge approach to non-fungible tokens (NFTs) with decentralized finance (DeFi). The Paribus’s borrowing and lending protocols may be used by users to harness these NFTs, giving previously underutilized assets a new purpose.

According to Paribus, a commodity has market worth and may be sold if its existence can be established. The investing industry has been transformed by decentralized financial applications, however alternative assets like NFTs have not been fully utilized by current DeFi protocols. By delivering tiered leverage across protocols and boosting the earning potential of DeFi investors on any chain, Paribus seeks to change this and redefine the value of these hitherto difficult assets within its cross-chain protocol.

The Paribus platform has primarily two sorts of users, namely:

The Lenders:

Paribus gives investors who don’t want to sell their virtual assets permanently the chance to generate passive income from them rather than letting them sit idle.

In the Paribus ecosystem, lenders serve as the liquidity providers and are compensated with interest for doing so. Lenders can use the Deposit APR for any given asset to predict their earnings since Paribus will offer Deposit APR depending on variables like utilization rate.

The Borrowers:

Since Paribus serves as a platform for collateralized loans, each borrower must deposit an asset of their own to use as collateral.

Therefore, borrowers on Paribus are also indirect liquidity suppliers, contributing to the sustainability and self-sufficiency of the platform.

ABOUT PARIBUS PRODUCTS

Due to the nature of Cardano and its capacity to integrate with current blockchains, Paribus makes use of and expands this capacity to free up liquidity across chains for a variety of assets such as NFTs, virtual lands, synthetics, as well as several other conventional cryptocurrencies. To put this into perspective:

NFTs

Paribus aims to enhance the economic worth of NFTs by improving liquidity and providing options for utilizing their economic capacity without having to sell them. Additionally, owners of NFTs are able to access liquidity by taking out collateralized loans against their NFT assets to fund other business endeavors like trading and investment.

Virtual Lands

Paribus also proposes a collection of smart contracts that enable for collateralization using Virtual Lands in order to specifically solve this. Due to the immaturity of the Cardano ecosystem and the absence of established norms for this asset class, Paribus will contribute and provide ideas that will work toward releasing liquidity through these assets in the form of borrowing and lending. We will seek to innovate and incorporate metadata into NFT standards as one area.

Synthetics

Paribus provides a product line for borrowing and lending to increase the underlying assets’ leverage in order to fulfill more complex use cases using Synthetics and LP tokens.

The PBX native token is tightly integrated with these products as reduced fees are offered to users via PBX, profit sharing for liquidity providers and stakeholders, and, of course, the ability to exercise governance through its proposed DAO structure.

THE PBX TOKEN

All PBX holders may take part in platform governance thanks to the PBX token, which was developed to support decentralization on Paribus. PBX gives holders the ability to draft and vote on governance proposals, The fee-sharing feature of the PBX token is one of its additional benefits; holders can get a portion of the platform’s fees based on the amount of tokens they own. According to the team, Those who have more tokens will receive a larger share of this. Stakeholders gain by obtaining value in exchange for continuing to retain, which promotes continued holding.

Find out more about Paribus and keep you with all their recent news and developments via the following links:

Website: https://paribus.io/

Twitter: https://twitter.com/paribus_io

Telegram: https://t.me/paribus_io

Medium: https://medium.com/@paribus_io

Discord: https://discord.io/paribus

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