Clearpool scales unsecured credit marketplace to Polygon

• Institutional borrowers would rather pay higher interest rates for unsecured loans than keep their collateral under wraps
• The launch on Polygon will “allow Clearpool to scale through capacity improvements, transaction speeds and lower gas fees,” according to Clearpool’s CEO

Access to unsecured liquidity across the Polygon ecosystem will become easier for cryptocurrency whales.

Clearpool, a decentralized marketplace for digital asset liquidity, launches on Polygon. The DeFi protocol gives institutional borrowers access to unsecured liquidity through a network of lenders.

Unlike DeFi (decentralized finance) lending protocols like Compound and Aave — where borrowing liquidity requires you to prove you have twice the amount of assets — an unsecured loan does not require collateral.

Instead, lenders approve unsecured loans based on a borrower’s creditworthiness. Examples of unsecured loans in traditional finance include personal loans, student loans, and credit cards.

“Unsecured lending is commonplace in traditional finance, and now Clearpool is bringing it to decentralized finance,” Clearpool CEO Robert Alcorn told Blockworks.

Institutional borrowers often prefer unsecured loans, Alcorn said. “Companies would rather pay a higher interest rate to borrow liquidity and rely on their credit profile rather than posting collateral that can be used elsewhere.”

As a decentralized marketplace, Clearpool enables institutional borrowers to create liquidity pools for individual borrowers and compete for unsecured liquidity provided by a network of decentralized lenders once borrowers pass a whitelisting process governed by the Clearpool community.

Liquidity Providers (LPs) generate returns on pooled interest rates and receive additional rewards paid in Clearpool’s utility and governance token CPOOL.

A protocol like Clearpool can be particularly attractive to lenders after the collapse of centralized lenders like Celsius and Voyager. “When you make loans at Clearpool, you’re in control, not someone else,” Alcorn said. ‘Launching on Polygon brings these benefits to a broader network.’

Clearpool’s decision to launch on Polygon has been in the works for months since it launched on the Ethereum network in March. The integration aims to increase user efficiency and improve platform scalability.

Polygon “enables protocols like Clearpool to scale through capacity improvements, transaction speeds and lower gas fees,” Alcorn said. The proof-of-stake sidechain verifies its status on the Ethereum mainnet, but uses its own validator set for security and its native token, MATIC, for transaction fees.

Accessing unsecured lending capital efficiency is a key development, according to Hamzah Khan, head of DeFi and labs at Polygon, who said in a statement, “As we onboard the next 1 billion users into Web3, lending protocols like Clearpool will help pave the way to assign.”

Alcorn echoed that sentiment. “Projects within the decentralized finance ecosystem that solve real-world problems, like Clearpool, are thriving during this broader market downturn,” he said.

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• Bessie Liu

  blocks

  reporter

  Bessie is a New York-based crypto reporter who previously worked as a tech journalist for The Org. She earned her Masters in Journalism from New York University after working as a management consultant for over two years. Bessie is originally from Melbourne, Australia. You can contact Bessie at [email protected]

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