Access credit with multiple asset types to improve capital efficiency
What is ParaX?
ParaX is a decentralized lending protocol that allows users to borrow and lend against Non-Fungible and Fungible tokens alike. ParaX allows users to tap into otherwise-unused capital to fund further investments and earn yields on the same.
The ParaX team believes in a future where tokenized assets proliferate with different kinds of utility, applications, and especially the connection to real-world assets. The next 10-20 years will see substantial changes in how we account for and transact valuable assets. Ultimately ParaX will act as the permissionless and highly customizable infrastructure to solve many unmet needs in efficient uses of on-chain capital. We seek to bring web3 and Decentralized Finance to 1 billion people.
What Problems Does ParaX Solve?
Crypto users hold significant value in their Non-Fungible and Fungible Tokens, but in most cases these assets sit idle and remain capital-inefficient. NFT users in particular are forced to sell their valuable assets to gain the liquidity which then affords the ability to invest further into NFT's or elsewhere.
Existing lending solutions have limited support for different types of collateral and do not allow the users to customize their borrowing and lending according to their specific risk preferences. Worse yet, users have up until now been forced to manage borrow positions against specific NFT's instead of a broader collection of both Fungible and Non-Fungible Tokens.
ParaX is crypto's first cross-margin NFT Finance protocol as it allows users to borrow and lend against ERC-721 and ERC-20 tokens all from the same account with a single credit line. Holders of assets can tap into liquidity and/or earn yields against all of their assets from a simple to use but powerful protocol.
How do I use the ParaX Protocol?
Deposit your ERC-721 and ERC-20 assets on ParaX to use as collateral for borrowing and/or to earn yields.
Earn interest yield: ERC-20 tokens supplied earn a share of interest paid by borrowers of those assets.
Borrow from the lending pool: A user may borrow from a pool of ERC-20 tokens against ERC-721 Non-fungible tokens and/or ERC-20 tokens as collateral. Borrowers can hold their borrow positions so long as the value of collateral keeps their account in good health, and they may repay their loan over time.
You can see a full list of supported assets via our Asset Risk section.
Where can I use the ParaX Protocol?
ParaX is built and operates on the Ethereum blockchain and in the future will support EVM-compatible or equivalent blockchains in order to build capital efficiency across the crypto space. Our mission is to solve user problems and improve capital efficiency, and we aim to support cross-chain and multi-chain borrowing and lending.
Key Features of ParaX and Controlling Risk
NFT holders can maintain the utility and security of their assets when using the ParaX protocol. Specifically the protocol has and offers the following:
Stringent security policies: ParaX puts security at the forefront of everything we do, and we follow stringent internal security policies and reviews, engage and perform audits with top industry external auditors, implement timelocks on withdrawals and protocol changes, and offer bug bounties to protect user funds. See Protocol Security and External Auditsfor full details.
Insurance Reserve for the protocol: This is a pool that helps cover lenders in the event that the protocol suffers losses on liquidations or is compromised.
Tokenized NFT and escrow: NFTs supplied into escrow contracts that only allow for transfers in stipulated conditions. A user who supplies an NFT receives an nToken, a mirror of the NFT and its metadata, which restricts NFT redemption to the holder of that nToken. Users are further unable to transfer nTokens except in the case of loan repayment which helps secure users' NFTs.
Flash claim and airdrop coverage: Holders can claim any airdrops while their assets are supplied in the protocol through the flash claim feature.
View our Asset Risk section for a fuller accounting of risk controls across our collateralized borrow and lending protocol.