Following this idea of extreme innovation MELD will be offering a self-repaying loan. The customer collateralizes their cryptocurrency and takes out a loan with a slightly higher interest rate. The customer is only required to service the interest on the loan, they can but do not have to pay on the principle. In the MELD Genius loan part of the yield generated by the collateral is then used to pay down the principal on the loan. Based on our models it will take between 3 and 6 years to repay a $100,000 loan depending on the market conditions.
This product is able to offer users self-repaying loans by capturing some of the trading fees (APY), generated by DEX aggregators utilizing our liquidity pools for swaps. These fees are used to repay the loan over time. This type of structure is unique to the financial industry and is only able to be brought about by the decentralized nature of DeFi.