What is Cream Finance
The Cream Finance platform is built on the Ethereum blockchain and is designed to be highly flexible and customizable decentralized finance (DeFi) protocol, allowing users to create and manage their own lending pools.
The platform’s native token is called CREAM, which can be used for governance, staking, and liquidity provision.
One of the unique features of Cream Finance is its support for a wide range of cryptocurrencies and digital assets, including some that are not commonly found on other DeFi platforms. This allows users to access a diverse range of assets and create their own customized lending pools based on their specific needs.
Overall, Cream Finance aims to provide a decentralized, permissionless, and highly customizable platform for users to access decentralized lending and borrowing services, as well as liquidity provision and governance opportunities.
The history of Cream Finance
A group of programmers and businessmen headed by Leo Cheng established Cream Finance in August 2020. A fork of Compound Finance, a DeFi lending platform that was introduced in 2018, was used to develop the project.
By providing more flexibility and customization choices for users, the Cream Finance team aims to build on the features and accomplishments of Compound Finance. Cream Finance allows users to construct and administer their own loan pools, whereas Compound Finance only provides a small number of pre-defined pools. This is one of the main distinctions between the two systems.
Shortly after its debut, Cream Finance was subject to a well-publicized theft in which hackers used a flaw in the platform’s smart contract to steal cryptocurrency valued at about $37 million. To counter the assault, the group implemented a security audit and paid affected users from the project’s treasury as soon as possible.
Cream Finance has maintained its growth and product expansion despite the attack. The network introduced its governance token, called CREAM, in October 2020. This token enables users to take part in platform decision-making and get rewards for supplying liquidity.
Cream Finance has introduced a decentralized exchange (DEX) named CreamSwap in addition to its loan and borrowing services, enabling users to trade a range of cryptocurrencies and digital assets. Additionally, the site has connected with other DeFi protocols, such as SushiSwap and Yearn Finance, to give users more chances to earn incentives and improve their farming yield techniques.
In terms of total value locked, Cream Finance is currently one of the top DeFi protocols, and it has gained popularity among customers seeking a more adaptable and flexible loan platform.
How Cream Finance works
On the Ethereum blockchain, Cream Finance is a decentralized finance (DeFi) platform. Users can trade, lend, and borrow a variety of coins and digital assets. This is how it goes:
Borrowing and Lending Users can earn interest on their deposits by lending the platform their bitcoin. The dynamics of supply and demand on the market dictate interest rates, which might change depending on the asset and lending pool. Then, borrowers can obtain loans by using their own cryptocurrency as security. The asset and the particular lending pool determine the amount of collateral needed.
For instance, a user would first need to deposit a specific quantity of cryptocurrency as collateral, such as Ethereum or Bitcoin, if they wanted to borrow a particular amount of USDC stablecoins. In order to safeguard lenders from changes in the market, greater collateral is typically demanded than the loan’s worth.
Provision for Liquidity Users can provide liquidity to the network through Cream Finance in addition to lending and borrowing, earning benefits in the form of fees and CREAM tokens. By adding cryptocurrencies to a liquidity pool, users can partake in the fees made by platform transactions.
Adjustable Pools The support for programmable lending pools offered by Cream Finance is one of its distinctive characteristics. By defining the assets they wish to support and the interest rates they want to give, users can form their own lending pools. Comparatively speaking, this offers more customisation and versatility than other DeFi lending platforms.
Governance CREAM token holders can propose and vote on changes to the platform’s protocol and guidelines under Cream Finance’s decentralized governance model. As a result, users can influence the platform’s growth and direction.
Overall, Cream Finance is a flexible and customizable DeFi platform that allows users to access a range of financial services, including lending, borrowing, liquidity provision, and governance. Its decentralized nature and transparent protocol make it a popular choice among the DeFi community.
Can Cream Finance be trusted
Cream Finance is a decentralized finance (DeFi) platform that operates on the Ethereum blockchain, and like any DeFi platform, it comes with certain risks. However, Cream Finance has taken several measures to increase the security and reliability of its platform.
One of the key measures Cream Finance has taken is to undergo several security audits by reputable third-party firms to identify and fix any vulnerabilities in its smart contracts and platform. Additionally, the platform has implemented a bug bounty program, where users are incentivized to report any security vulnerabilities they discover.
In addition to its security measures, Cream Finance has also been transparent and responsive in addressing issues and concerns raised by its users. For example, when the platform was hacked shortly after its launch in 2020, the team quickly responded by reimbursing affected users and implementing additional security measures.
Furthermore, Cream Finance has developed a decentralized governance model that allows users to participate in the decision-making process for the platform and ensure that it continues to operate in a transparent and trustworthy manner.
Ultimately, while no platform can guarantee 100% security, Cream Finance has taken significant steps to increase the safety and reliability of its platform and has demonstrated a commitment to transparency and user empowerment. As with any investment or financial decision, it’s important to do your own research and understand the risks involved before using Cream Finance or any other DeFi platform.
Does Cream Finance charge a fee
Yes, Cream Finance charges fees for its services, such as lending, borrowing, and trading. These fees are used to cover the costs of operating and maintaining the platform and to provide rewards to users who provide liquidity.
The specific fees charged by Cream Finance vary depending on the service and asset being used. For example, when lending or borrowing, there are interest rates that lenders and borrowers must pay. These interest rates are determined by market supply and demand dynamics and can vary over time. The interest rates for each asset and pool can be viewed on the Cream Finance website or on other analytics platforms that track DeFi lending rates.
When trading on CreamSwap, the platform’s decentralized exchange (DEX), users are charged a fee for each transaction. These fees are paid to liquidity providers and are currently set at 0.3% of the transaction value. Additionally, users may also incur gas fees, which are paid to Ethereum miners to process the transaction on the blockchain.
Finally, Cream Finance also charges a fee for users who withdraw their funds from the platform. This fee is designed to incentivize users to leave their funds in the platform’s liquidity pools for longer periods of time and to discourage frequent withdrawals that can impact the stability of the pools. The withdrawal fees vary depending on the asset and pool and can be viewed on the Cream Finance website.
Overall, while Cream Finance does charge fees for its services, these fees are generally competitive with other DeFi platforms and are used to support the operation and growth of the platform.