BabySwap is now assembled with our own Lending Network in partnership with Ola Finance, where users can supply or borrow commonly used assets.
Lending is the process of depositing (i.e. supplying) tokens to a pool. In exchange for providing liquidity to this pool, users receive interest on the tokens they have deposited. The interest that lenders receive comes from other users who are paying interest to borrow tokens. Lenders are able to withdraw their tokens at any time (as long as they aren't being used as collateral to borrow tokens and not all the tokens are being borrowed). There is no time lock or withdrawal penalty.
Borrowing is the act of taking a loan from any of the lending networks. Contrary to lending which has users supplying tokens to a pool of assets, borrowing is the act of taking tokens out of the pool of assets. BabySwap’s Lending network requires users to lend tokens before borrowing, also known as overcollateralization.