THE PARIBUS PROTOCOL: WHY USE IT?
A cross-chain borrowing and lending protocol for NFTs, liquidity positions, and synthetic assets, building for the Cardano blockchain. In the expanding synthetic cryptocurrency assets movement within the decentralized finance (DeFi) industry, the Paribus protocol seeks to innovate. In other words, holders of synthetic assets can experience price exposure to an underlying asset even though they don’t actually own or manage it. As the business expands at an unprecedented rate through 2021, the Paribus network wants to give users access to their synthetic assets. With their synthetic assets and non-fungible tokens, users can earn passive income through the Paribus decentralized lending marketplace in addition to offering a solution for unused assets that fuel the DeFi application (NFTs).
Six key components are now present on the platform website for developing and utilizing non-fungible tokens (NFTs) and synthetic assets. Paribus predicts that NFT markets will eventually mirror the openness and liquidity of the traditional bitcoin asset market. With the help of the following features, the platform hopes to drive this innovation and development:
Synthesizing Non-Fungible Tokens
Non-fungible token (NFT) collateral-based loans are made possible by the Paribus protocol. The Paribus borrowing protocol allows users to stake any NFT asset by presenting it. As the value of the underlying NFT increases, customers may then borrow money against it.
For owners of non-fungible tokens, receiving incentives for staking is an additional use case (NFT).
Users may stake their NFTs in related NFT pools using Paribus (e.g., music NFT pools, domain name pools, etc.). Users consequently start to see a return on their investments, generating a passive income stream.
The project gives users a selection of staking pool choices for different liquidity provider (LP) tokens from different blockchains. The chain-agnostic protocol offers many cross-chain assets competitive staking options.
Users of the Paribus network can borrow money against their investment in liquidity provider (LP) tokens to leverage their holdings as LPs. Users of Paribus can obtain a loan with complete collateralization against the liquidity positions of various well-known automated market makers. The project is one of the first live Cardano blockchain applications that supports staking for digital assets. The software also permits borrowing and lending using virtual assets. Paribus offers total "investment flexibility" compatible with any blockchain.
With Paribus, all $PBX token owners can get passive income by staking their tokens in a tiered system. In exchange for their holdings of $PBX tokens, platform fees are split among $PBX token holders.
USAGE CASES FOR PARIBUS
By identifying a number of lucrative prospects, the Paribus protocol aims to revolutionize the traditional investment industry. Even though it’s still in development, the ability to synthetically tokenize off-chain assets on the blockchain promises a new paradigm for investing. Yet, the Paribus protocol is currently being used with a significant amount of digital, synthetic, and non-fungible assets.
The platform offers holders of commonly traded non-fungible tokens (NFTs) the opportunity to generate passive returns on their investment in addition to any growth in natural assets. For NFT owners of assets that don’t have a lot of active utility, like digital artwork or cryptocurrency collectibles, Paribus presents a lucrative choice. Furthermore, insurance contracts connected via Ethereum Name Service (ENS) domain names and smart contracts are NFTs that may only sometimes communicate while being retained. The platform thus offers the owners of these assets the chance to generate returns while they are sleeping. This also applies to virtual landowners and music NFTs, even though they might also provide extra unique revenue streams.
The Paribus platform allows automated market makers (AMMs) and liquidity providers (LPs) of other decentralized exchanges (DEXs) to earn from their liquidity positions in addition to the non-fungible token (NFT) utility. The Paribus protocol allows LPs to stake their LP tokens in the relevant LP staking pool. Additionally, holders can fortify their position by taking out a fully-collateralized loan against the stake they have in the LP token. In addition, the Paribus network's permissionless, borderless protocol enables anybody to mint synthetic assets with visible collateral on-chain.
In conclusion, another problem Paribus is trying to solve is the under-utilization of otherwise idle non-fungible token (NFT) assets. Thanks to Paribus, the liquid NFT market will be entirely adaptable, free-flowing, and interoperable.
