Decentralized-finance platform Unbound Finance will launch its version 2 on the Arbitrum One mainnet on April 11, offering liquidity providers a chance to access higher returns by using their LP tokens as collateral for loans on Uniswap, developers told CoinDesk on Monday.
With Unbound, Uniswap V3 LPs can borrow Unbound’s stablecoin, UND, interest-free, secured against their concentrated liquidity positions. This feature allows users to continually earn rewards from Uniswap while being able to take out loans – which can be used for other DeFi applications.
Unbound version 2 has been running successfully on the Ethereum Goerli network test network since last October.
In addition to Uniswap V3 positions, Unbound is also expanding collateral support to LP tokens of relatively volatile asset pools, such as WETH-DAI. The version 2, however, will introduce price stability mechanisms that automatically liquidate or redeem loaned positions to ensure UND’s value remains stable and closely aligned with its intended $1 peg.
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