Impermax Finance — a cross-chain decentralized lending protocol, where users can participate as lenders or borrowers in isolated lending pools.
About coin defi Impermax Finance
Each Impermax Finance credit pool is a pair of two DEX tokens. Lenders can supply tokens to any credit pool to receive passive income without time losses. Borrowers can contribute LP tokens to the credit pool in order to borrow tokens of the token pair.
With Impermax, farmers can start earning income from providing liquidity on the DEX with a single token deposit. Impermax removes the risk of non-permanent losses for these farmers (suppliers) by removing one of the biggest drawbacks of providing liquidity.
Other features of this DeFi:
| 1 | Instead of investing directly in DEX contracts, funds are made available to borrowers who use them to increase farm income through leverage. |
| 2 | These increased earnings are shared with the lender in the form of interest. |
| 3 | This is called indirect liquidity provision. The borrowers bear the entire risk of non-permanent losses on behalf of the Indirect liquidity providers. |
The ability to select higher and lower risk/reward positions for DEX farming creates many new earning opportunities that weren't there before. The ability to borrow LP tokens and use the funds for other investment transactions eliminates large opportunity costs for liquidity providers. Impermax users have already come up with many new strategies to maximize profits and minimize risk. As the DeFi industry grows, these strategic options will become more common and useful.
What is indirect liquidity provision?
Indirect Liquidity Providing supplies tokens for lending to farmers. Borrowers use the funds to earn higher returns on decentralized exchanges and share some of the rewards with indirect liquidity providers. All rewards are paid automatically. Smart contracts ensure that funds come back to creditors automatically. If a loan becomes too risky, the contracts automatically liquidate the borrower's position and transfer all funds back to the lender's account without loss to the lender.