Angular Finance serves as a cross-chain money market for decentralized finance (DeFi) users to create permissionless isolated pools for lending and borrowing across any asset connected to the Composable Finance ecosystem. This includes assets from DotSama, EVM, and IBC chains. Angular also offers leverage-as-a-service to enable DeFi users to take advantage of margin trading (short and long) opportunities. Being built as a secondary pallet on Picasso, Angular taps into the functions of other primaries like Cubic and Apollo, Mosaic and Centauri.
Substrate developers can use Angular as a base layer for development to compose unique modular pallets
As a pallet, Angular is composed of modularly executable functions; hence, the constituents that comprise Angular can function individually and as part of the whole. These constituents include Picasso’s primary pallets and modularly executable functions such as Angular’s cross-chain money market and leverage-as-a-service functions. As illustrated in the above image, Substrate developers can compose these modular functions to create unique modular pallets.
How lending and borrowing work
As depicted in the above image, both lenders and borrowers can deposit compatible assets into Cubic vaults which are essentially isolated lending/borrowing pools. Angular’s user interface (UI) makes depositing these assets into isolated pools seamless. Composable’s bridging infrastructure, Mosaic and Centauri, in turn, enable seamless asset transfers from EVM and IBC-enabled (Inter-Blockchain Communication Protocol) chains, respectively. DotSama’s cross-consensus messaging format protocol (XCMP) enables seamless asset transfers from DotSama chains. The asset transferral process from compatible chains occurs at the click of a button from Angular’s UI. The integration of Apollo aids in the aggregation of asset prices to reflect the market-wide trading activity. The Apollo oracle also helps mitigate price oracle attack vectors and authenticate transactions. Here is how lending and borrowing work:
Lenders can simply select the isolated lending pool they would like to deposit to, depending on their appetite for risk-reward, directly from Angular’s UI. For example, a lender depositing KSM may opt to lend to a KSM-USDC lending pool if they prefer a lower level of risk. If a lender is more risk-tolerant and is seeking a higher potential annual percentage yield (APY) as a reward for lending KSM, they may opt to lend to a lending pool comprising KSM and a more volatile asset, such as ETH.
Borrowers can select the isolated borrowing pool they would like to participate in, based on their collateral asset type and the asset they wish to borrow, via the Angular UI. The term of loans on Angular will be continuous. Interest will compound continuously and the interest rate will vary depending on the utilization ratio. This essentially means users that borrow with a higher loan-to-value (LTV) will have to pay lower interest. Repayment of the loan and interest must occur in the same asset borrowed. If the borrower abides by the loan terms, their collateral will be returned to them upon the repayment of the loan.
Angular is quickly emerging as one of Picasso’s most important primitives owing to the functionalities that Angular provides to DeFi users and the endless array of modular pallets that can be composed by Substrate developers utilizing Angular as a base layer for development. Angular makes the process of taking out a simple or leveraged loan seamless, as it occurs right from Angular’s UI at the click of a button.
We will dive into Angular’s leverage-as-a-service functionality in the near term, so follow our social channels for the latest information!