Torches’ native token TOR is in the spotlight. Why’s that?
Torches offers Defi users interesting services. The founder team based this decentralized non-custodial liquidity protocol on KCC. Its users, wallets, and dapps will be able to participate as depositors or borrowers. While depositors will provide liquidity to the market to earn a passive income, borrowers will be able to borrow in an over-collateralized manner.
The Torches platform utilizes common pool-based mechanics. All funds deposited in its pool will participate in interest-bearing activities equally. Based on KCC, the platform utilizes extremely low fees, making it highly attractive for both low- and high-volume deposits and loans.
Besides, it’s very easy to navigate this platform. In order to use its service, customers will need to simply supply their preferred assets. After supplying, they will earn passive income based on the market borrowing demand. Moreover, depositing assets allows customers to borrow other assets by using their deposited assets as collateral.
According to the team, users can safely stake some tokens (for example, USDC and KCS) within the ecosystem to earn additional income. The company stores users’ funds in a system of smart contracts. Furthermore, the code of the smart contract is public and open source. Users will be able to withdraw their funds from the pool or export a tokenized version of their lender position.
The company stated that the risks related to this protocol are mainly liquidation risk (risk on the collateral liquidation process) and smart contract risk (risk of bugs within the protocol code). However, PeckShield has already audited Torches’ contract.
Is the Torches platform secure?
This protocol is open and transparent. All oracle services and smart contracts will be open to the public. Users can view them on Github to ensure maximum transparency. Besides, the platform has great safety protection, including the oracle mechanism, smart contracts, and an optimized business model. It also plans to adopt time-lock and multi-sign to ensure asset security to the maximum extent.
The company also created its own native utility token – TOR. This ERC20 coin is quite trending. The total supply of tokens is 100,000,000. The team plans to launch its ICO sale soon.
Torches is a decentralized app. That means, unlike KuCoin or other centralized platforms, users won’t need to register an account to use it. They just need a crypto wallet. To use this app, customers will have to move their assets from other blockchains to KCC. They can even use a variety of different cross-chain bridges to transfer tokens from BSC, Ethereum, or other networks, onto KCC. After that, they can enjoy the protocol’s benefits.
The company will also grant its investors different liquidation thresholds according to the liquidity and security of different assets. For example, the liquidation threshold of BTC will be 75%. Users can check the LTV on markets.
Furthermore, loan limit refers to the maximum amount of the loan calculated from the liquidation threshold of customers’ collateral. The team noted that it results from combining the total value of all assets in the account. When the traders convert the deposits to collateral, they can increase the loan limit. However, Torches protocol has also set a safety line of 90% to avoid the liquidation risk caused by the daily price fluctuation of users’ assets.
