/biz/ - Business & Finance

Give energy to LINK by posting old memes, old FUD, oldfag memories, old pasta, etc

>>21559852
Teller lets its users connect their credit scores with its protocol. A high credit score means that a customer would be able to take out a DeFi loan, from a lending protocol like Aave, Compound or Maker, with less collateral (less money up front) or with a lower interest rate. “It actually goes all the way down to zero collateral, which is really exciting because it's fully unsecured,” Ryan Berkun, Teller’s founder and CEO, told Decrypt.

And these DeFi loans also feed back into the credit score: default on a loan, and Teller will send the debt collectors after you and your credit score will lower—meaning it’ll be harder to get a loan at a regular, traditional bank. Berkun said that Teller’s partner, an undisclosed credit ratings agency, works with around 150 banks worldwide. Berkun didn’t provide details.

Michael Anderson, co-founder of Framework, told Decrypt that he saw in Teller an “opportunity for people who want undercollateralized [DeFi loans].” While some people appreciate the anonymity of DeFi loans—they offer the opportunity to bank entirely off-the-grid—anonymity comes at a price.

“People who are willing to tie their identities to things means that they will potentially have a lower [Annual Percentage Rate] in terms of what they're going to pay,” said Anderson. “There's a reason why a credit score exists.”

Stani Kulechov, founder and CEO of Aave, thinks Teller and Aave could work in tandem. “I could imagine that Tellor could source their liquidity from Aave via credit delegation and use their credit scoring for underwriting loans to reduce credit risk,” he said.

“Both Aave’s credit delegation and Teller are fascinating tools for expanding DeFi into undercollateralized lending,” he said.

Defi and CeFi are back together again—a marriage perhaps encouraged by Framework, which has invested in them both. “We will most likely work together quite soon,” said Kulechov.