The Silo Finance protocol has announced the launch of its updated V2 version, which includes a number of enhancements aimed at improving safety and usability in lending and borrowing.
Managing Risk: Isolated Pools and New Mechanisms
In the new V2 version, Silo Finance has introduced isolated pools, which help prevent a domino effect when issues arise in one of the markets. A dual-oracle system has also been integrated, separating loan-to-value calculations from liquidation triggers, which minimizes the risks of bad debts. This allows market creators more flexibility in setting loan terms for any ERC-20 tokens.
Silo Vaults Launch: Liquidity Optimization
One of the key innovations is the Silo Vaults, described as a 'liquidity-optimizing layer' built on ERC-4626 markets. With managed vaults, liquidity can be shuffled between isolated markets to maximize yields for lenders and convenience for borrowers. Currently, four vault managers have been announced on the platform: Re7 Labs, Apostro, Varlamore Capital, and Shorewoods.
The Future of Silo Finance: Feature Expansion
Silo Finance plans to expand V2 further on Ethereum, Arbitrum, Base, and other EVM-compatible networks. With such enhancements, users will have access to new features that significantly enhance the experience of working with the protocol.
The launch of V2 promises significant improvements for Silo Finance users in terms of risk management and liquidity, making lending and borrowing safer and more efficient.
