Many people are moving to decentralized finance (DeFi) as it offers a superior user experience compared to traditional financial services. Decentralized lending and borrowing protocols enable lenders to easily earn interest on their assets, while borrowers can seamlessly access loans with variable or fixed terms. While decentralized lending and borrowing protocols are seeing increased traction, they still face a number of challenges as the blockchain ecosystem continues to mature.
First and foremost, DeFi loans are typically overcollateralized, meaning users have to deposit a significant amount of excess collateral to help ensure that the loan will be paid back. Unfortunately, excess collateral may be unattainable for the majority of users,
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