Mainframe's system design makes the protocol impervious to liquidation failures and creates more significant incentives to stimulate the flow of funds and achieve greater capital efficiency.
FREMONT, CA: Mainframe, a San Francisco, CA-based blockchain company operating a decentralized communication platform, acquired Sablier, a protocol for real-time finance on the Ethereumblockchain. It also announced its relaunch as Mainframe Lending Protocol and plans to use Sablier's money streaming technology into a fixed-rate lending protocol and create tokenized debt markets to further the evolution of decentralized finance (DeFi). Paul Razvan Berg, the founder of Sablier, will join Mainframe as the head of development.
"Mainframe has a collaborative vision that joins the best aspects of several DeFi technologies," said Berg. "I'm excited to join the Mainframe team, add Sablier resources to the project and build those lending and borrowing instruments that are in high demand."
Mainframe proposes a novel zero-coupon bond system that quickly allows borrowers to offload debt for increased purchase power. Borrowers deposit collateral and mint tokens, representing a debt obligation. Lenders purchase the tokenized debt obligation, typically at a discount, and redeem them for face value at maturity. Individuals can also interact with the protocol as Guarantors, allowing them to pool assets to protect the system from becoming under collateralized. Guarantors earn income from fees and purchase collateral at a discount when borrowers fail to satisfy the collateral requirement.
"Think of debt markets like the lifeblood of an economy; you want to keep that blood pumping and flowing," said Doug Leonard, CEO of Mainframe. "Debt obligations create temporary clots and overcollateralization restricts efficient monetary flow. Mainframe allows lenders and borrowers to shift capital out of stagnant wallets and increases circulation. Ultimately, this leads to a healthier DeFi space."