Introducing Loans V2: a more flexible, and capital efficient Maple Finance

Published by Lucas Manuel, Smart Contracts Lead, Maple Finance @lucasmanuel_eth

Maple Finance is an institutional capital marketplace powered by blockchain technology. Developed to solve the inefficiencies seen in traditional systems, Maple brings the corporate credit market 100% on-chain using smart contracts to remove time and cost frictions, and blockchains for immutability. Today the Maple platform has found product-market fit amongst crypto-native institutions needing access to capital to power their business operations.

To meet customer demand we have refactored our Loans smart contracts to provide more options and a better experience for users of the platform. Using proxy patterns, the Maple team is now able to iteratively improve and deploy new features to Loans, and continue to grow use cases into the future. Loans V2 sees transaction costs lowered and increased capital efficiency for not only Borrowers, but LPs and Stakers as well. Let’s dive in.

Refactored smart contracts to facilitate quick, iterative product developments

We have refactored how our contracts are built so we can iteratively develop and enhance our product moving forward. This means that we can quickly build and deploy new features that support wide ranging Pool strategies and Borrower preferences.

The contracts now facilitate the creation of different loan types and structures as well as new features to meet Borrowers, Lenders and Pool Delegates’ needs such as amortizing loans, balloon loans, bullet loans, short term loans and open ended loans with different interest rate structures and options.

Improved capital efficiency for borrowers with refinancing options and frictionless liquidation tools

Refinancing options

We’re introducing refinancing options to provide flexibility and improved capital efficiency to better support Borrowers in an ever changing commercial environment.

With Loans V2, Borrowers can request to refinance their loans with an updated amount, interest rate, collateral ratio or any of the other terms within their loan structure. After review and approval by the Pool Delegate, the loan can be refinanced accordingly. This functionality enables Borrowers to roll over into new loans with different terms without having to repay their original principal amount, meaning improved capital efficiency and ease of doing business on the Maple platform.

Collateral Liquidation

Staying with the theme of capital efficiency, we’re introducing a new liquidation module to make collateral asset liquidations easier.

In the event of a default, all collateral is seized by the Pool and auctioned off at a small constant discount from the current market price. Using flash loans, this allows market participants to perform liquidations with highly efficient strategies, regardless of their starting capital. This significantly increases the amount of capital that can be recovered from liquidations, reducing the potential losses of both LPs and Stakers.

Increased transaction efficiency to reduce the cost of doing business on Maple

Finally, we introduce more efficient smart contracts so Borrowers and Pool Delegates pay less gas fees when making transactions on the platform. The cost of deploying loans has been reduced by roughly 90%, and loan transaction costs have also been significantly reduced, as outlined by the table below.

We’re busy planning V2 of our Pool product, looking to improve composability, capital efficiency, and general flexibility on the Pool side for LPs, Stakers, and Pool Delegates. If you’ve any product feedback or ideas, we’d be happy to take them on Discord.

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