Silo Unveils Version 2 On Sonic Network, Granting Users Access To Risk-Reduced Markets

Decentralized finance (DeFi) marketplace for non-custodial lending, Silo announced its V2 protocol launch on Sonic , which allows users on the high-efficiency Layer 1 network to engage with markets that are effectively isolated from financial risks. This new version follows extensive audits and marks the first introduction of programmable lending markets on Sonic.

Having successfully completed multiple audits, Silo V2 has officially moved beyond its beta phase and is now rolling out isolated lending markets across a range of blockchain networks, starting with Sonic . Currently, over $400 million is staked in Silo V2, providing Sonic users an opportunity to earn returns on their capital while minimizing their risk exposure.

Looking ahead, Silo has plans to broaden its reach to additional blockchains, including Mainnet, Arbitrum, Base, and various Ethereum virtual machine (EVM) oriented Layer 2 and compatible networks. 

Silo V2: Launching Customizable Dual-Asset Lending Platforms For ERC-20 Tokens, Market Deployment Without Permissions, And Revenue For Deployers

Building on the strength of V1, which facilitated loans amounting to hundreds of millions across more than 50 distinct lending pools on Ethereum and various Layer 2 frameworks while reliably maintaining solvency, the upgraded V2 protocol now introduces customizable dual-asset lending markets for ERC-20 tokens. This enhancement provides deployers with the flexibility to modify loan-to-value (LTV) ratios, liquidation thresholds, oracles, and interest rate structures.

Key features of Silo V2 encompass permissionless market deployment alongside optional \"hooks\" that allow for innovative features. These include linking market clusters, redirecting idle liquidity to other decentralized applications (dApps) for earning yields, or establishing fixed-term and controlled markets for regulated assets. The integration of the ERC-4626 standard guarantees seamless collaboration with third-party systems.

V2 introduces a variety of liquidation and interest rate alternatives – ranging from traditional approaches to auction-based or fixed-rate methods – allowing for greater adaptability across a spectrum of assets such as stablecoins and real-world assets (RWAs). The dual-oracle mechanism further reduces the risk of bad debt by distinctly calculating LTV and liquidation thresholds. 

The launch of V2 also brings in deployer revenue, an optional fee based on interest and incentives that accrues for market creators as an ERC-721 token. This feature incentivizes the establishment of bespoke markets. The isolated architecture of Silo V2 plays a crucial role in mitigating systemic risks commonly found in traditional pooled lending environments.

Silo V2 on Sonic is designed to offer secure and adaptable lending solutions. With its programmable markets, deployers can fine-tune the platform to meet specific objectives, whether that’s maximizing yield or managing risk, all while sustaining the isolation that safeguards users from larger systemic failures.

Sonic’s infrastructure bolsters Silo V2 with a strong focus on scalability and developer resources, further enhancing the platform’s capacity to foster new use cases for decentralized lending.