Wing Finance: A DeFi Innovation in Ontology
A credit-based platform aims to integrate the concept of credit elements into a decentralized finance ecosystem. These products and features will evaluate the credit score of a user and thereby increase the potential and scope of decentralized financial services.
Wing Finance is a credit-based platform that allows various decentralized finance (DeFi) cross-chain products to work together. The platform is built on the Ontology blockchain.
It aims to introduce a credit evaluation component into the DeFi system which will expand the boundary of the current DeFi landscape by accommodating more advanced financial applications.
To achieve this, Wing Finance has introduced OScore, a feature supported by the Ontology blockchain that will transform the way digital lending, borrowing, and insuring will be conducted.
What Is OScore?
Build on Ontology, OScore is the first credit score for decentralized finance. It is an on-chain reputational system with verifiable credentials on the Ontology blockchain, and it supports cross-chain interaction.
Currently, The OScore’s primary credit evaluation mechanism calculates the user’s balance and historical holding records of digital assets. It supports blockchain platforms based on BTC, ETH, and ONT and automatically generates a quantifiable credit score. While doing all this verification, the application takes utmost care about the user’s privacy.
Thus, using this method, Ontology is planning to provide a solution to integrate users’ digital assets to their identity, which is missing from the current decentralized finance ecosystem. It will not only increase the trust and the security among the involved parties but will also take the DeFi system to another level.
According to Li Jun, founder of Ontology, “Ontology is providing a solution that connects users’ assets to their identity, providing increased security and trust to all parties, connecting the missing pieces of decentralized finance’s ecosystem.”
By using @OntologyNetwork‘s #OScore, risk experienced by lenders utilizing @Wing_Finance‘s #technology will be vastly reduced as #transparency and trust are greatly increased, and correct due diligence can take place. $ONT $ONG #DeID https://t.co/nPPqHaGFdU
— Li Jun (@LiJun_Ontology) November 13, 2020
The OScore system is planning to incorporate more on-chain data and evaluation mechanisms in the near future. Also, Ontology has plans to integrate OScore into the ONTO wallet.
Benefit of Credit-Based DeFi (OScore)
Credit-based DeFi refers to the collection of DeFi products that help in determining the credit factor and integrate it into decentralized financial services. Users will receive the following benefits for maintaining a good credit score (OScore).
- Users will receive WING tokens as rewards for returning the borrowed assets on time and maintaining positive behavior.
- Help in reducing collateral requirements, which in turn results in more transactions and higher asset liquidity.
- Users can withdraw any asset which is connected with their wallet directly from the dashboard.
- Users may be rewarded with lower interest rates and more generous financing options for good repayment practices.
- The Ontology’s Decentralized Identity solution protects both the user’s identity as well as their data.
Now let see the different products offered by the Wing Finance platform.
Flash Pool
Flash Pool was launched in early September. It allows the users to lend, borrow, and earn interest from asset lending. Flash pools also provide insurance facilities to minimize the risk of asset loss.
Lending
Users can supply assets to the Flash Pool and earn interest as well as WING incentives from it. Users earn interest in the specific form of the supplied asset and receive incentives in WING tokens at the respective APY and WING APY.
Borrow
Users can borrow assets from the Flash Pool if they have supplied collateral. The interest is charged in the same type of asset that the user has borrowed.
They can also earn WING incentives through borrowing in the Flash Pool, but for that, users need to mandatorily tick the check box to lock a 3% equivalent amount of WING tokens.
If you have locked a 3% equivalent token, then the number of WING tokens locked will automatically get displayed. Otherwise, it will be blank.
Insurance
You can also earn WING tokens by putting your asset in the Insurance Pool. But you can only insure WING in the Flash Pool if your address isn’t supplying or borrowing WING in the Flash Pool, i.e., the same address cannot be used in supply/borrow and insure WING in the Flash Pool.
Once you have joined the Insurance Pool, you can liquidate the collateral of a breached user at a preferential price along with an 8% liquidation bonus.
Withdrawing WING Incentives
Users can earn WING incentives by supplying, borrowing, or insuring WING in the Flash Pool. Though it is not required to withdraw the incentives explicitly as it automatically gets withdrawn if the user has selected the max button while withdrawing the asset.
Wing DAO
Wing Finance strives to have a strong governance model and is planning to build fully a Decentralized Autonomous Organization (DAO) with time. The DAO community discusses, proposes, evaluates, and ultimately votes on policy, features, and more for the Wing platform.
Users can submit a proposal to carry out the following activities:
- Adding new assets to the platform
- Changing collateral requirements
- Adjusting an interest rate
- Implementing buybacks
Proposal Prerequisites
- To participate in the governance system, a user must have a WING token.
- To submit a proposal, the user must have at least 1,000 WING tokens.
- Once the user submits the proposal, his WING tokens will be locked until the proposal is approved.
- Once the proposal is submitted, it will be reviewed by the Wing team within 72 hours before launching the voting process. The proposal is also required to be viewed 100 times and must engage at least 10 users.
- The Wing team reserves the right to reject and/or edit the proposal.
Types of Proposals
Based on the complexity of implementation, proposals are divided into three levels. These levels are defined and set by the Wing team.
Level 1
Should be implemented in three working days after the vote is passed. The Level 1 proposals mainly include adjusting certain project parameters.
Level 2
Should be implemented within one month after the vote is passed. It includes proposals regarding:
- Adding a borrowing or lending pool
- Deleting a borrowing or lending pool
- Adding or deleting a specific type of asset
- Adding a certain parameter
Level 3
It includes proposals that require more than one month to be implemented, such as:
- Adjusting certain mechanisms
- Adding new features
- Initiative with a long-term operation, such as buybacks
WING Token
The WING token is the governance token of Wing DAO.
WING Token Distribution
A total supply of 10,000,000 WING tokens will be minted and distributed according to the following distribution model. The total release will be completed in ten years.
- 8,000,000 (80%): Liquidity and margin incentives
- 2,000,000 (20%): Wing DAO community fund
Users can trade the WING coin on Hotbit or the Binance exchange.
Token Statistics
Token stats of WING as of Nov 29, 2020 at 2 pm IST.
Conclusion
A credit-based decentralized finance scoring system is an innovative approach to integrating many advanced solutions to the mainstream financial sector. With this approach, Wing Finance aims to strengthen the trust and security among the users involved. This concept not only helps users in particular but it has the power to revolutionize the entire DeFi system. Build on Ontology, the platform charges a very low transaction fee, which is another advantage. It will attract more users once the platform starts supporting more tokens.
Resources: Wing Finance Whitepaper, OScore: Everything You Need to Know, Lower Your Collateral Requirements & Loan Interests with OScore
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