Overall mechanics

Like any lending and borrowing platform, you need lenders and borrowers.

Unique Features of SparkFi

1) nICP as collateral, borrow in ICP

This is to prevent price liquidation risk from change in the US$ price and hence empower borrowers to borrow a higher amount of ICP on their nICP holding with no regards to the US$ price of ICP.

2) Fixed borrowing period, auto repayment at the end of loan

This is to ensure a predictable and liquid supply of ICP for lenders to withdraw their ICP. The maximum loan period will be shorter than 6 months which is unwinding period for nICP.

3) Liquid proof of deposit for lenders; d.ICP

Similar to AAVE, assets deposited into the lending pool are transferrable and can be used across the ecosystem. In addition, we also offer an option to lock up the ICP for a longer period to earn higher multiple of interest.