Lending Protocol Maple Finance Releases Version 2.0

Maple Finance’s lending protocol has been updated to version 2.0. The version upgrade focuses on increasing borrower diversification and enhancing risk management criteria.

Maple 2.0 has a new, more rapid default procedure. If a borrower fails to follow the conditions of the agreement, a pool delegate will be able to declare an early default, making the loan instantly due.

If no payment is made during the grace period, the delegate has the option to liquidate the loan, and all lenders in that pool would immediately incur losses while recovery measures are undertaken.

Another enhancement is that Maple 2.0 will allow lenders to deposit and withdraw funds from the platform at any time rather than wait for the present 30-day capital lock-up period to expire.

Last week, a delegate known as M11 experienced a $36 million default from the crypto company Orthogonal Trading, which borrowed from an M11-run pool on Maple. Orthogonal alleged that its cash was trapped on the defunct exchange FTX.

The Orthogonal default has raised concerns among crypto industry participants about the feasibility of uncollateralized lending. However, Maple’s CEO believes uncollateralized lending is required to lure participants from multi-trillion dollar financial markets to the blockchain.

The team thinks that the new upgrade will lessen the risks connected with its services that result from sector concentration. Currently, the majority of loan activity on Maple includes crypto companies and market makers in the digital assets field, which the lending protocol claims exposes the protocol to contagion risk from the impact of the FTX exchange’s demise.

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