Teller recently announced a partnership with DECO and Chainlink to develop a PoC (Proof of Concept). The PoC will be used for releasing undercollateralized cryptocurrency loans.
The collaboration seems remarkably promising, given the stature of DECO and Chainlink. The PoC with Chainlink will be a future-ready merge of DeFi and traditional finance. It will unlock new ways of digital assets lending via undercollateralized loans.
This will be an unprecedented achievement as the industry has not witnessed undercollateralized loans that do not compromise user security. With the help of Chainlink, Teller will enable a secure, private, and easy way of getting loans.
Ryan Berkun, Teller’s Chief Operating Officer, talked about the recent announcement. According to Berkun, the PoC between Chainlink Labs and Teller showcases the capability of DECO. It is also a testament to how privacy-centric oracle technology can facilitate trillions of dollars via undercollateralized lending.
Berkun stated that the Teller team is delighted to work with Chainlink Labs to develop and refine its PoC via DECO protocol.
The official post by Teller informed users about the announcement and undercollateralized loans. Undercollateralized loans do not need an equal amount of collateral and principal. It allows users to get loans with low deposits, a practice popular in the standard finance domain.
DeFi loans are collateralized for two primary reasons – volatility and trust. Given the market history of cryptocurrencies, the reasons are completely reasonable. However, the concept of equal collateralization can breach the primary feature of DeFi – trustlessness.
That is why Teller is building a privacy-securing network where borrowers can submit their private information. This data determines the user’s creditworthiness, establishing trust between the platform and the borrower.
Since the process is highly complex and risky, Teller needed the assistance of an oracle network, like Chainlink. Chainlink Labs have established an unwavering trust in its services, making it the ideal partner for Teller.
The community welcomed the announcement warmly, increasing its success chances significantly.
