TM Rating: 78% I
February 2nd, 2022
Hundred Finance is a decentralized protocol that enables the lending and borrowing of cryptocurrencies. A multi-chain protocol, it integrates with Chainlink oracles to ensure market health and stability, while specializing in providing markets for long-tail assets. Since the explosion in popularity of
the decentralized ﬁnance ecosystem in 2020, borrowing and lending platforms have become core infrastructure within the cryptocurrency space. Not only do they provide users the ability to leverage their crypto assets, obtaining liquidity from their investment while simultaneously earning interest, they also underpin the workings of other protocols.
The movement of assets from the Ethereum mainnet to EVM-compatible blockchains and scaling solutions has done nothing to alter this. Platforms that grant the ability to borrow and lend are one of the key applications users look for in any emerging chain. Hundred Finance aims to play a central role in provisioning these services in the multi-chain environment that has ﬂourished since early 2021, delivering the freedom to earn yield and borrow assets to a growing number of users in a trustless, secure, and economically eﬃcient manner.
The goal of Hundred Finance is to expand to multiple chains in order to deliver its decentralized and economically eﬃcient ﬁnancial services as widely as possible. Currently, the platform is implemented on Ethereum, the Layer 2 scaling solution Arbitrum, Fantom, Harmony and Moonriver. While the platform maintains the same core functionality independent of the chain, assets, interest rates and other variables such as transaction costs often differ between them.
While Hundred Finance ﬁrst launched on Ethereum’s Kovan testnet in late-June of 2021, the project owes its origins to a previously established protocol. It is the successor to Percent Finance, a community owned fork of Compound Finance using Chainlink oracles. Percent Finance was launched in September 2020, as a 100% community distributed alternative to Compound Finance, but in November of the same year a protocol upgrade that included incorrect assumptions regarding interest rate models inadvertently locked several contracts permanently.
Hundred Finance has been designed to build on the strength of its predecessor’s community spirit, launching the protocol with a treasury that serves new users and old. But Hundred Finance didn’t settle for only a rebuild of Percent. Instead, the team has decided on adding any valuable new innovation the DeFi ecosystem allows. Following all the recent activity around ve (vote escrow) tokens popularized by the Curve wars, in December 2021, a vote escrow (veHND) governance token mechanism was implemented using contracts developed by Curve Finance.
This addition facilitated direct community involvement in the emission of HND through the use of stablecoin staking contracts that receive a quantity of HND every epoch based on the votes cast by veHND token holders. The distribution of HND is ongoing, as the broadening of veHND’s ownership and the platform’s usage is the principle means by which Hundred Finance will acquire decentralized, community governance and function as a trustless provider of borrowing and lending services.