Decentralized lending platform introduces ‘DeFi lease’ to improve risk management

Nolus Protocol introduces innovative decentralized finance features, including interest-free leverage and advanced risk management, setting new standards for the DeFi and reinsurance sectors.

The decentralized finance (DeFi) landscape introduces new ways for users to borrow, lend, and invest without relying on traditional intermediaries. With its transparency, accessibility, and innovative financial models, DeFi is becoming an attractive alternative for users seeking greater control over their assets through blockchain technology.

However, DeFi lending has its challenges , particularly for users leveraging their positions. Managing the risks associated with high leverage during market volatility remains a significant hurdle.

DeFi platforms often lack robust risk management systems, leading to full liquidations when market conditions shift rapidly, forcing borrowers to sell at a loss. Fluctuating interest rates and slippage during trades further complicate the borrowing process, making it harder for users to manage costs effectively.

Bridging DeFi to TradFi

Nolus Protocol is an advanced platform that bridges the gap between traditional finance (TradFi) and DeFi, offering innovative cryptocurrency borrowing and lending solutions. Central to Nolus is its “DeFi Lease” model, which enables users to gain asset exposure with minimal upfront capital.

Unlike traditional DeFi platforms, Nolus emphasizes user flexibility and security, offering up to 150% financing based on collateral . This model strengthens Nolus’s risk management system, significantly reducing margin call risks and optimizing investment returns.

Interest-free leverage incentive: Nolus is currently running a limited-time promotion offering interest-free leverage until Nov. 1, reducing the financial burden on borrowers. While this offer is temporary, it provides an added incentive for users to maximize their returns with zero interest costs.

Global liquidity pools: Nolus operates global liquidity pools similar to money markets, allowing borrowers to access funds for leveraged positions. By sourcing assets from liquidity providers, users can control more assets than their initial capital would typically allow, creating better investment opportunities.

Advanced risk management with partial liquidation: One of Nolus's standout features is its partial liquidation engine , which minimizes margin call risks. Instead of triggering full liquidation during volatile market conditions, Nolus performs partial liquidations to preserve a portion of the borrower’s assets. This reduces the risk of losing entire positions and protects liquidity providers from excessive losses.

Fixed interest rate structure: Nolus employs a fixed interest rate system directly linked to utilizing its liquidity pools. As utilization increases, the interest rate rises—but is capped at an optimal threshold to prevent excessive borrowing costs. This offers borrowers predictable and transparent costs, in contrast to the fluctuating rates on many other DeFi platforms.

Slippage and onchain liquidity: Nolus sources assets from decentralized exchanges, meaning borrowers must consider onchain liquidity and potential slippage. Higher liquidity reduces slippage, lowering total costs when executing trades or maintaining leveraged positions. This efficiency is key to the cost-effectiveness of the “DeFi Lease” model.

Maintaining a Competitive Edge

Nolus Protocol stands out in the DeFi landscape by offering a more secure and flexible financial model compared to traditional onchain leverage protocols. The combination of 150% financing, fixed interest rates, and advanced risk management makes Nolus a compelling choice for both borrowers and liquidity providers.