Truefi is the first DeFi lending protocol that does not require collateral. It lets people get loans without giving anything as security. This boosts the capital efficiency of borrowers, resulting in increased demand.
TrueFi features its own native cryptocurrency, the TrueFi ($TRU) token, denoted by the ticker symbol TRU. TRU is designed to be used as a utility token, funding network transactions. TRU can also be staked for prizes and awards. The TrueUSD stablecoin is supported by the Truefi network as well.
TrueFi offers a variety of financial options, including financing gig workers and investing in emerging economies, among others. In this way, TrueFi makes it easy for DeFi to get loans and assets from the real world.
TrueFi was created by Rafael Cosman in November 2020 with the intention of developing an uncollateralized lending protocol, which was entirely absent from the DeFi space. He started the business and is now managing it as its CEO. He went to Stanford University and finished his degree in Computer Science.
In November 2020, TrueFi provided Alameda Research with its first unsecured loan of nearly $2 billion. Currently, the platform has disbursed over $40 million to lenders. Aside from that, Cosman co-founded and serves as CEO of Archblock, the most open and effective asset management platform in the world.
The TrueFi project was initiated with the intention of enhancing lending services in the DeFi sector. TrueFi borrowers can choose between secured and unsecured loans with competitive interest rates, and they can get their money right away. More than that, TrueFi manages the highest level of transparency by using the world's first DeFi credit score system to give people who contribute to the TrueFi lending pool a clear way to properly examine their risk. A number of the financial activities that it provides were previously available solely to wealthy persons through traditional funding, but these financial solutions are now accessible to users worldwide. TrueFi further improves capital efficiency, expands access to global liquidity, and protects lenders from default-related losses through multiple levels of risk mitigation.
Lenders: TrueFi provides an app that enables its lenders to examine pools and portfolios for which they qualify. The lenders then make decisions depending on their risk tolerance and desired rate of return. The choice of lender is made by portfolio managers, which is fine and allowed by TrueFi because not all portfolios are accessible to all lenders.
Borrowers: After a comprehensive analysis of both off-chain and on-chain data, the TrueFi credit committee determines whether a borrower is qualified to borrow on TrueFi. TRU holders then vote on whether to accept or reject a borrower's application. Loans are issued from any of the TrueFi DAO pools after a borrower's application has been approved successfully.
Portfolio Managers: Portfolio managers have constant access to global liquidity, resulting in cost reductions and transparency. Being a borrower and a portfolio manager in TrueFi are similar in that they both need permission. Before portfolio managers can be included in the TrueFi app, they must be accepted and evaluated.
TRU is the native token for the project. TRU can be used in the following ways:
Governance: TRU holders have a direct impact on the protocol's development via on-chain voting.
Staking Yield: TRU stakers get rewards in the form of tokens and a part of protocol earnings for protecting lenders against default.
Uncollateralized Lending: Borrowers can stake TRU in order to increase their borrowing limit or terms.
| DATE | NEWS/EVENTS | IMPACT |
| 15/03/2023 | CZ causes a decrease in the Value of TRU While releasing Zero-Fee BTC trade updates | -45% Decrease |
| 16/02/2023 | TrueFi's TRU Token skyrockets following Binance's TUSD mint rumors | +155% Increase |
| 08/04/2021 | TrueFi secures $12.5 million in funding from BlockTower Capital, A16z, and Alameda to scale the TrueFi uncollateralized lending protocol | +318% Increase |
Even though decentralized lending isn't new, TrueFi's collateral-free lending options set it apart from the competition. It also facilitates borrowing globally by providing affordable interest rates and rapid loan funding. TrueFi is a good DeFi project that you should look into if you want to earn a steady return as a lender or just need to borrow assets.
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