SCRBL

The project acts akin to the normal lending protocol with a few extra steps. Instead of requiring the user to overcollateralize their positions, we require them to only provide partial collateralization to their loan. This is achieved by incorporating an on-chain credit score which will depend on users past loans. The credit score is tied to WorldID, which ensures that each person can only have one credit score. This prevents potential sybil attacks, where an irresponsible borrower might otherwise create a new MetaMask account to reset their credit score and avoid the consequences of their previous actions. If we give the user to immediately withdraw the loan, they will likely just run away and never come back. To solve this issue, we are using an escrow wallet where the borrowed funds will be stored and cannot be withdrawn until the loan is repaid. This escrow wallet will only be able to interact with whitelisted protocols e.g. Uniswap. This main use case for this project currently is margin trading. The project allows any kind of leverage on any protocol as long as this protocol is whitelisted at the escrow wallet.

It functions similar to a normal overcollaterlized lending protocol e.g. AAVE but with a few extra steps. Users only have to provide a portion of the value of the tokens they want to borrow in a form of collateral. Currently, the collateral is ETH. In order to do so they first have to verify their web3 wallet by verifying with WorldID. If they later would like to change the web3 wallet tied to WorldID they can do that with a simple function call. A special escrow wallet (smart contract) is deployed and funded with the borrowed funds. Users can interact with whitelisted protocols e.g. Uniswap or DyDx through this wallet ensuring they don’t just grab the money and run away with them. Liquidation is tracked by Chainlink Custom logic Automation. If loans health ratio goes below the health ratio they had at the start by 10% - the liquidation event is called and all the capital from escrow wallet are transferred back to the Manager contract. This will decrease their credit score. In case of successful loan repayment, users will be able to withdraw profits from the escrow wallet. This will increase their credit score. Worldcoin - The foundation of our project is WorldID, which ensures that each human can have only one credit score. This prevents manipulation and duplication of credit scores, similar to the functionality of credit scores in traditional banking. Chainlink - Tme-Based Automation is used to accrue interest on borrowers’ positions. Pyth - Provides the price feed data. Blockscout - Block Explorer will be used to monitor and track all transactions related to loans & everything else in the project. Circle - The loan is given in USDC. WalletConnect - Used to connect web3 wallet & onboard non-web3 native users through social/email connection.