Borrowing fiat for crypto collateral will be a major added utility for Aada. It also allows users to get double yield by earning staking rewards on Ada collateral on indigo while at the same time earning loan interest on iUSD on Aada. Currently liquidity of iUSD is not huge yet but having it on Aada will also incentivise more people to mint iUSD for double yield.
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Hello. Could you add more detailed information, so users don’t have to spend time digging for info elsewhere? You can edit your post by following the template here. Otherwise, we won’t consider the proposal legit.
Ok, will do tomorrow or latest on weekend! Thanks.
For some reason I can comment on this now but I still cant edit the post and I also cannot create a new one… When I try copying the updated proposal text into this editor it also gives me error 403…
Hi, you can now edit your post safely. If you’re having trouble doing it, I can help.
Just approved it!
Thanks
Now I am getting error 503… Here is my text: Intro:
I’m proposing to add Indigo’s iUSD as a borrowable asset on Aada.
Description:
Indigo just launched the first (relevant) stable coin of Cardano: iUSD.
That opens up a huge new use case for lending protocols like Aada, namely borrowing fiat (iUSD) for crypto collateral. Someone may use their crypto holdings to get a loan in USD and use it in real life and pay it back later, e.g. when they get their salary. This is especially beneficial because they can borrow in a currency that also their income is denomonated in (USD). In addition they can get cash for their crypto without selling the crypto and this creating a taxable event.
Current supply of iUSD is not huge (1.8m at time of writing as per defi llama iUSD: Circulating and stats - DefiLlama) but Aada could even incentivise more people to mint iUSD. This is because when people deposit Ada in Indigo, they still earn staking rewards on their Ada. They can at the sime time use the minted iUSD to lend on Aada and thus get double yield (and rather low risk double yield).
Remark: Using Aada to borrow/lend iAssets using Ada as collateral only partially makes sense, because on Indigo one can deposit Ada to mint iAssets for free (with no interest to be paid).
Summary:
Adding iUSD as borrowable asset on Aada brings a multitude of new advantage and features to Aada and the Cardano ecosystem.
You should check out the following proposal, I think it fulfils your purpose: Proposal: Add $iUSD as a borrowable asset to Aada V1
Please close this proposal as it already exist and voted on