Chainscore — a credit risk scoring protocol for DeFi that allows you to evaluate financial risk, using credit data from multiple chains. DeFi applications can use the chain to verify users' eligibility, based on a number of factors such as their past financial transactions, credit usage, payouts and credit age.
How does ChainScore work?
The ChainScore protocol allows you to access DeFi credit scores for accounts by tracking their financial transactions and assets across multiple chains. Financial transactions include lending, borrowing, debt repayment, vault/pooling, and more.
In addition to users, credit risk scores can also help to value derivatives, hedging, debt, AMM pools, and more. This will help to increase the trust and reputation of DeFi in financial transactions. They can also use credit scores to determine which users can bring in the most revenue.
Other features:
| 1. | DeFi protocols and dApps on the supported chain can request credit data from the ChainScore network, which is incentivized by the $SCORE token. |
| 2. | The architecture of ChainScore consists of data providers (blockchain indexers, APIs), a network of counters and a blockchain network. |
| 3. | The Scorer node listens for data requests from the blockchain, requests data from data providers and returns data back. |
The ChainScore network encourages $SCORE tokens. To request data from the chainscore network, contracts will have to pay a request fee in $SCORE tokens. The fees will also help to pay for oracle nodes and data providers on and off the network. Network nodes must stake $SCORE tokens in order to participate in the network. This makes the node an important part of the network security infrastructure and is compensated accordingly. $SCORE tokens can help to participate in the management of Chain Score.
Staking
Staking income is offered as interest, paid to the holder, and rates vary from one network to another, depending on several factors, including supply and demand dynamics.
Staking allows the protocol to be more reliable as it requires node validators for a certain number of $SCORE tokens and participation in the network. Providing inaccurate data can negatively affect their bid and bring potential penalties.
Users can stake $SCORE tokens with ChainScore node operators to earn fee rewards, based on requests and uptime. Also, users can stake their SCORE-LP tokens to receive rewards in SCORE tokens.