Is traditional bank and DeFi isolated from each other? No, Linen allows non-encrypted users to borrow on encrypted assets.

LoanScan, the team behind the cryptocurrency platform Bloqboard and cryptocurrency data provider, is launching a new app called Linen that attracts non-encrypted local users. Linen's goal is to reduce barriers to acquiring cryptographic assets by reducing the need for multiple dApps in the lending process.

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Vitaly Bahachuk launched Bloqboard on the Ethereum platform earlier. However, in general, people are not completely sure how to use their initial product launch, which has led his team to focus on a specific subset of the product, a bulletin board that gives users direct access to the Ethereum-based lending agreement. Services provided, such as MakerDAO and Compound. Now, Bahachuk and his team are using Linen to extend this subset, extract some of the more tricky parts of DeFi, and show customers a more user-friendly interface.

Linen will focus on functionality. This is a financial technology app that supports traditional banking apps such as direct deposits, savings, debit card functions and transfers, and obtains variable interest through a loan agreement based on Ethereum (such as Compound). At the time of this writing, it Provide USDC lenders with an annual interest rate of 5.68%. In this way, Linen claims to combine traditional financial and non-encrypted local users' DeFi capabilities for marketing to users who may use high-yield savings accounts in the traditional financial world.

“For our members, this experience is no different from transferring money from their US bank account to Wealthfront or Betterment,” Bahachuk told The Block.

In general, Bahachuk said that the services of the local community of crypto assets are very good. This is to introduce DeFi to a wider audience. However, this brings about a problem of balanced transparency and accessibility. In order to meet its spirit, Linen needs to help users understand what they are investing in, why its interest rates are higher than the traditional market, and what the risks are, all of which cannot scare them away. To achieve this, Bahachuk said transparency is first.

“We tell the user what actually happened,” he said. “So we actually disclosed that these are margin loans supported by cryptocurrency investments and there is no insurance. We are very transparent about this.”

According to Bahachuk, the way to make users feel comfortable is to actually use it. High-interest accounts are not suitable for large investments, and even impose limits on how much users can invest in order to minimize overall risk. In addition, their goals are those who have a certain understanding of the financial mechanism, those who understand margin loans or intraday transactions, and provide them with an opportunity to get involved in the world of cryptographic assets.

Balachuk believes that, in the final analysis, the key is to put the benefits of the traditional financial system and the so-called "parallel" DeFi system in the same pocket. The magnitude of the yields is not as important as they represent, but provides an opportunity for unrelated rates of return. In recent months, as the Federal Reserve Board (Fed) cut interest rates sharply, unrelated yields have become more attractive.

However, Linen is not for everyone. New Yorkers can't use the app because its transfer agent, Wyre, doesn't get a Bitlicense license, which is the gold standard for New York State transfer compliance. Linen is not welcome wherever Wyre is not welcome.

Linen also recently completed a round of financing, the amount of financing was not disclosed, and won the partner for the company's latest efforts. According to Linen, investors include Wyre, Coinbase, Polychain and Hashkey, a digital asset investment group. Bahachuk said Hashkey's investment is strategic.

Balachuk said: "We want to open our doors to Asia, and Hashkey is one of the major investors in the region."

At the time of launch, Linen will support USDC and plans to support Dai.

What is Bloqboard?

Bloqboard is a non-custodial digital asset lending platform that generates and settles settlements on the Ethereum blockchain. The Bloqboard platform is actually an interactive interface to the decentralized lending agreement, backed by Dharma and Compound, two well-known decentralized lending agreements.

Users can borrow and lend either point-to-point or in the liquidity pool. In point-to-point lending, the borrower can set the terms of the loan, which will be announced on the bulletin board, waiting for the lender to provide funds. In the case of borrowing in a liquidity pool, the borrower can directly obtain the money, the amount has no maturity date, and the interest rate is determined by the market. All types of loans require the debtor to collateral with another digital asset.

Bloqboard is not an exchange, so users do not need to store tokens. However, it should be pointed out that regardless of the loan, the borrower must provide the mortgage; in the liquidity pool loan, the borrower must first deposit the collateral into the compound smart contract before borrowing.