Silo, the non-custodial decentralized finance (DeFi) lending marketplace, has unveiled its V2 protocol on Sonic (S), as reported to Finbold on Friday, March 14.
After a rigorous auditing process, the protocol has left the beta phase and is now expanding its isolated lending markets, with over $400 million already locked into Silo V2.
Looking ahead, Silo has announced future deployments on Arbitrum (ARB), Base (BASE), and other Ethereum (ETH) Virtual Machine (EVM) Layer-2 (L2) and EVM-compatible chains.
Silo V2 markets
Building upon the foundations laid down by Silo V1, which facilitated hundreds of millions in loans across more than 50 isolated pools on ETH and various L2s, Silo V2 introduces customizable twin-asset lending markets.
These markets allow deployers to optimize their solutions for a more diverse range of assets by tweaking parameters such as loan-to-value (LTV) ratios, liquidation thresholds, oracles, and interest rate models.
Other key features of Silo V2 are permissionless market deployment and optional hooks that enable inter-market connectivity, yield optimization through idle liquidity deployment on other decentralized apps (dApps), and the creation of fixed-term or permissioned regulated asset markets.
Silo V2 security
Third-party integration on Silo V2 is ensured by the protocol’s adherence to ERC-4626 standards.
A dual-oracle system further improves risk management by calculating LTV and liquidation thresholds to mitigate bad debt.
The protocol also offers modular liquidation and interest rate options to accommodate traditional, auction-based, and fixed-rate structures and assets ranging from stablecoins to real-world assets (RWAs).
Finally, deployer revenue, an optional fee on interest and incentives that accrues as an ERC-721 token, rewards market creators for the development of customized markets.
As such, Silo V2 helps deployers achieve their goals by ensuring that issues in one pool don’t affect the entire ecosystem, while Sonic’s emphasis on speed and developer-friendly tools serves to further enhance its use cases.
