Folks Finance is a lending protocol on Algorand, which is a high speed pure-proof of stake blockchain. It is one of the biggest DeFi dApps on its blockchain and is also amongst Tinyman, Algofi and a part of the Aeneas Liquidity Program of the Algorand Foundation that is distributing ALGO to users of supported DeFi applications.
Folks is a relatively simple lending protocol and works like Aave and Compound. People can provide supported cryptocurrencies to earn a yield from borrowers or they can supply tokens to use them as collateral to take a loan themself. Such a loan can be used for leverage trading, to short an asset or to get liquidity without selling your tokens. The APY for lending and borrowing is set automatically based on how much of the provided funds are being borrowed.
Borrowers can pay their loan back whenever they want without any fixed time limit or the like and there is no need for KYC or any form of credit because every loan is over collateralized and should the value of the collateral fall to a certain point it would be automatically sold to pay back the loan.
Like I said before, Folks Finance is part of the Aeneas Liquidity Program that is distributing ALGO coins to its users. 2 million ALGOs were allocated to Folks Finance and these funds are going to both borrowers and lenders. Borrowing any asset is rewarded with ALGO and lending the USDT and USDC stabelcoins is also rewarded with a high APY if you stake the f-tokens that you get for lending. The dApp is also partnered with , which is distributing its goMINT token to borrowers of goBTC and goETH.
Folks Finance also has a feature that lets you participate in the Algorand Governance while keeping your committed ALGO much more liquid. Normally when you commit ALGO to governance you will need to keep the committed amount of ALGOs in your wallet until the governance period of 3 months is over or else you will not get any rewards. Folks lets you deposit ALGO to mint tokenized staked ALGO called gALGO that you can burn to get the underlying ALGO after the governance period is over. The great thing here is that everyone that minted gALGO gets governance rewards after the period is over even if they sell their gALGO at any time. However, people that mint gALGO are passing their voting rights over to the developers of Folks Finance, who are voting the same way the Algorand Foundation does, so it’s bad for decentralization.
The protocol currently doesn't have its own governance token, but it will eventually add the FOLKS token which will be distributed to users of the application, although the exact tokenomics are still unknown. Folks is also competing with Algofi, which is also a lending protocol that also has its own decentralized exchange and stablecoin. Folks might evolve a lot more in the future but even now it could be a great tool for Algorand users to earn more crypto.
MEXC, 10% discount on fees
FaucetCrypto, Earn small amounts of Cryptocurrencies for free
Learn more about the LEDGER hardware wallet
Presearch, 25 PRE start bonus, earn cryptocurrency for searching the web
You can also tip me crypto directly if you want to!ALGO: 2LPXBHC5WIAOYESBJ4JTRYEQC6PUO4HZLZBY42V4XANUKGYZT6SWRMLDH4
NANO: nano_31nwmmab1pykptytqn9tzj684f3hhhwpawxaneefwqhxtw363ytwuo6uuuhs
BANANO: ban_31nwmmab1pykptytqn9tzj684f3hhhwpawxaneefwqhxtw363ytwuo6uuuhs
XLM: GCQ6ACH3WBHI5JBYHPEZUEETLM4SAMINNCBBQVHIH2F3A7SVALXX773P
