The most important news to surface on the crypto market this week is that Clearpool will now opt for a new network for its institutional lending platform. Clearpool, a decentralized capital market provider credit platform, will move on to a more robust Ethereum scaling tool polygon network. Let’s dive in to unearth more about Clearpool and learn in-depth about its lending platform. We will also see how this move will benefit the institution and the market in general.
What is Prime?
Prime is a new and exclusive credit lending platform of Clearpool. The Prime platform is set to start operating during the first quarter of the year, i.e, by the end of March 2023.
The platform is set to act as an institutional-grade capital marketplace. Clearpool Prime will enable the borrowing and lending of digital assets by institutions at a wholesale level.
Prime will offer a space where borrowers can create credit pools, and liquidity providers can invest in generating profit. It is expected to deliver easy and efficient liquidity and pricing to participants. The platform is also set to offer a secure and regulated environment for borrowers.
Is Opting for Polygon is Next Step for Clearpool’s Evolution?
Last year, Clearpool announced the launch of a permissionless liquidity pool. The launch was on Clearpool’s DeFi lending protocol. The launch was in partnership with Jane Street. Jane Street is a leading trading company and liquidity provider with offices across the globe in New York, London, Europe, and Hong Kong. Over the last few years, Jane Street has emerged as a well-known crypto and blockchain investment firm.
According to official data, the liquidity pool was funded initially with a whopping $25 million USDC. After its launch, the pool was expected to scale up 100% in value with up to $50 million of USDC. This, however, was subject to how the market would perform in the future.
Clearpool’s launch of the liquidity pool was marked as a highlight for decentralized finance (DeFi). This confirmed Clear pool’s front position in the flourishing space of DeFi.
After a good few months, Clearpool has now announced its Prime marketplace. Does it represent the next step for Clearpool’s evolution? Is it an attempt to further strengthen its position in the DeFi space?
These are a few questions we will try to uncover here.
Prime’s Lucrative Future
Since Clearpool’s launch of the first permissionless liquidity pool in partnership with Jane Street, there has been a clear growth in demand for decentralized financing with compliant access.
Prime comes in precisely to meet these institutional needs. Prime has been built and tested to help support the decentralized capital markets. Not only that, Clearpool’s Prime is also equipped to facilitate the growth of the capital markets.
The CEO and Co-founder of Clearpool stated in an email that they have been collaborating with Polygon since June of 2022. He also emphasized that they have a strong relationship and will continue to work together to deliver institutional DeFi products.
Jakob Kronbichler, Co-founder and COO of Clearpool, expect that they see an addition of a wide range of borrower profiles, which he stated to range from traditional trading firms to contemporary crypto players.
Clearpool’s Prime platform usefulness is not going to be limited to DeFi space. It is going to be lucrative for the Fintech industry as well, which provides lending solutions in the traditional finance market.
KYC and AML Complaint Access
According to the Protocol’s press release, it started the onboarding and whitelisting process for institutional borrowers and lenders. Clearpool is set to deliver KYC and AML-compliant access to the largest global network for wholesale borrowing and lending of digital assets with its new platform.
Thus, it was outlined that the borrowers and lenders intended to use this new platform must follow the KYC and AML checks to be fully eligible.
What is Polygon?
Polygon is a ‘two-layer’ scaling solution that runs alongside the famous Ethereum blockchain.
The Ethereum blockchain is used in a wide range, from NFT markets to gaming to DeFi systems. It is popular because of its compatibility with smart contracts and its potential to be used in an array of different applications.
However, the growing demand for Ethereum increases the addition of transactions to its blockchain. Which results in higher fees making some transactions economically unfeasible.
To solve this issue, Polygon comes into the picture. It uses the ethereal blockchain to offer cost-effective and efficient transactions. Thus, coming in as a solution to Ethereum’s high fee issue. Polygon acts as a speedy substitute and runs parallel to Ethereum’s blockchain
Polygon relies on its proof-of-stake blockchain for its transactions and on Ethereum’s network for safety and security. Two of Polygon’s most significant recent partnership has been with Instagram and Starbucks.
To use Polygon, you can transfer some of your cryptos from Ethereum to Polygon. After the transfer, you can interact with a plethora of popular crypto apps that were once usable only via the Ethereum blockchain.
Clearpool’s Move to Polygon: Why It Is Significant?
- Significant move: Clearpool’s competitor protocols, such as Maple and TrueFi, already mostly uses the Ethereum blockchain network. Thus, Clearpool’s move to build Prime on Polygon is deemed smart and significant, considering the demands and growth of the crypto space.
- Wider market reach: Clearpool’s integration with Polygon will help present Clearpool’s coming-of-age innovative products to a wider market.
- Rapid scale: This move will allow Clearpool to provide faster and low-cost options for its users in the DeFi space, which in turn will allow the protocol to grow at a rapid pace.
- Access to high-yield earning: Clearpool will move its liquidity pools and tokenized credit solution to the Polygon. This will give the lenders massive access to high-return lending options.
- Cost-effective: With the help of the Polygon network, Clearpool can now concentrate on low-cost and high-functioning transactions, which will make Clearpool a promising addition to the recent DeFi launches.
- KYC and AML compliant: Clearpool’s Prime will offer KYC and AML complaint access to the DeFi space.
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