Vigor is a protocol based on the EOS blockchain that will be launched to the public soon, and will allow users to request and make loans, as well as store value to offer liquidity and receive rewards.
Although at first glance the operation of Vigor.ai sound quite similar, and even equal to ecosystems DeFi (decentralized finance), the protocol Vigor is based on the blockchain de EOS and has a Decentralized Autonomous Community (DAC) made up of 21 custodians and more than 100 supervisors who guarantee high decentralization and transparency.
Vigor is a collateralized lending protocol where users can use native EOS tokens to receive or make loans, as well as generate profits by holding their tokens within the protocol platform. In the words of its developers, Vigor is the future of DeFi ecosystems, offering features such as collateralized and low-volatility loans, with automatic mechanisms that allow efficient management of funds in situations of short-term sales, risks, compliances, among others, unlike other well-known and widely used DeFi protocols, such as MakerDAO.
“The first completely free and decentralized multilaterally collateralized utility token protocol.”
For its part, in the Vigor protocol, the Tokens VIG are issued once users lock up tokens as collateral to take out a loan. VIG is Vigor’s native token that maintains peg to the US dollar. It is a utility token used within the protocol to pay premiums and receive rewards, but does not provide voting rights to its owners within the DAC.
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How does Vigor work?
In whitepaper Vigor developers express that it is a financial engineering innovation project that creates a stablecoin backed by other cryptoassets without a central counterparty, allowing participants to separate and transfer both volatility risk and risk related to price changes across smart contracts (smart contracts) as collateral.
Stablecoins can be created and lent within the protocol once native EOS tokens are introduced as collateral or guarantees on Vigor, which will be backed by insuring users within the collateral pool.
Vigor is a project that introduces a secure collateralized lending system, similar to current DeFi ecosystems, but completely decentralized and transparent. In addition, it introduces only two types of participants, which are: borrowers y insurers. The first, the borrowers, are those who are responsible for depositing the native EOS tokens as collateral, taking out loans and paying a commission fee to secure their collateral.
At the same time, underwriters are responsible for depositing EOS native tokens as collateral securities, assuming loans with insufficient collateral, and recapitalizing such loans when the value of the collateral falls below the loan amount. Underwriters receive rewards based on the level of creditworthiness they provide to Vigor. Simply put, borrowers will be the ones requesting and taking out loans, while underwriters will be the ones providing liquidity to the protocol.
Benefits of the new protocol
First, Vigor, as a protocol, allows users to borrow and take out loans against their own assets on the EOS blockchain. Furthermore, Vigor also facilitates the transfer of volatility and risk from built-in token price changes, something that is not yet available on the EOS mainnet or other DeFi protocols.
As a Decentralized Autonomous Community (DAC), Vigor has custodians, candidates and associates who are in charge of making decisions within the project. However, there is no hierarchy within the DAC, but rather it is a global community with participants located all over the world, who maintain active communication through various channels to present their proposals and ideas, which will be rejected or approved as consensus is reached among all those involved in the community.
Likewise, Vigor's design allows it to enjoy a solid, balanced and robust financial structure, which is resistant to sudden or extreme changes in the prices of collateralized assets. Likewise, Vigor has high standards in regulated risk management, to guarantee a higher level of scalability than current existing protocols, manageable governance and greater leverage capacity for borrowers and insurers.
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