Bonded Finance & Union Partner
Bringing Lending Protocol Protection & Collateral Optimization to DeFi
Bonded Finance is pleased to announce our partnership with UNION, a platform that offers bundled protection and a single-source risk management solution that lowers the barriers to entry for retail and institutional investors alike. In an effort to help bridge the gap between TradFi and DeFi, the partnership will initially encompass UNION smart contract protection for user deposits on Bonded Finance’s lending platform — accompanied by the direct integration of Union’s C-OP into the lending platform in order to increase capital efficiency.
In keeping with Bonded Finance’s goal to offer underserved altcoins pedigreed financial products and to enable these assets to offer low-risk yield for LPs and dynamic LTVs paired with increased liquidity for borrowers, the initial collaboration between UNION and Bonded Finance will focus on two aspects:
- UNION smart contract protection for Bonded Finance depositors.
- The integration of C-OP with Bonded Finance’s lending protocol.
The lending protocol protection is straightforward, and involves UNION’s protection pools for pricing risk and protecting user assets in the Bonded lending market. On the integration of C-OP, things get more interesting. Bonded Finance will be one of the first lending platforms to utilize C-OP and with it, Bonded Finance users can significantly reduce their over-collateralization (OC) ratio for deposits, vastly improving capital efficiency while increasing collateral. This collaboration enhances user experiences across the board. Our integration of C-OP represents the invocation of some forward-thinking products that offer utility in the near-term while providing an element of “future-proofing.” With modular type flexibility, it will also allow for the creation of additional complementary products and services.
John Liu, CPO of UNION states, “While DeFi is clearly the future of technical efficiency for traditional financial markets, it is still nascent in its journey of efficiently and safely leveraging its financial assets,” adding that, “Bonded Finance’s goal to unlock dormant capital through their Bonded Accelerated loans paired with UNION’s goal to optimize capital utilization in lending platforms with the use of derivatives is a perfect combination to accelerate DeFi’s maturation.”
For example, consider the implications of boosting the capital productivity of altcoins using synthetic versions of lower-risk baskets for exposure. With the incorporation of C-OP, the Bonded Finance instrument can scale more effectively. This fusion delivers a net positive for DeFi and highlights how mutual collaboration can help churn out products to keep pace with a hyper-competitive market moving at warp speed. Rather than explicitly focusing on building out individual ecosystems, Bonded and Union believe in a cooperative universe best ensures the future of both the universe of DeFi as well as the individual project.
Paul Mak, CEO of Bonded Finance, states, “Risk management in crypto has become a hackneyed theme; stated often and rarely used. As early adopters, the space is loaded with individuals who prescribe to a motto akin to “ready, fire, aim.” This cowboy mentality spurs innovation but is fraught with peril. To provide a measure of protection for our collective future, we will embed UNION’s collateral protection directly with our protocols and smart instruments to offer some needed stability for the risk-taker as well as to help welcome the risk-averse.”
We look forward to continued engagement with Union on the further development of innovative products with the common goal of determining how we can best work together to boost capital productivity across an array of DeFi assets.
About UNION
UNION is a technology platform that combines bundled protection and a liquid secondary market with a multi-token model. DeFi participants manage their multi-layer risks across smart contracts and protocols in one scalable system. UNION decreases the barriers to entry for retail users and lays the foundation for institutional investors. UNION’s full-stack DeFi protection is inclusive, composable, and brings battle-tested capital and pricing models from TradFi to the DeFi ecosystem.
About Bonded Finance
The Bonded platform was created to incubate and deploy experimental, high-yield, smart-contract driven, financial instruments that push the bounds of open finance. Bonding is an algorithmic model that aims to unlock, aggregate, and de-risk ~50 billion in dormant value distributed amongst untapped digital assets by allowing supporters of qualifying altcoin projects the opportunity to borrow against these assets or pool them and start earning.
