THE IMPACT OF COVALENT IN DECENTRALIZED LENDING AND CREDIT

Ganesh Swami, a data analyst developer, and Levi Aul, who was the chief technology officer at a crypto exchange firm, as well as a systems engineer in a Vancouver-based firm started Covalent with the desire to help users access, analyze and obtain blockchain-related data without stress. Covalent, through unified blockchain API, is solving the big structural problems in the blockchain community by creating fast and easy access to large data sets.
Covalent featured platforms improve blockchain lending and remittance services by providing global access to its users. Crypto holders can now earn profit through decentralized lending, by allowing borrowers to access loans from lenders with a pre-determined interest rate.

Featured Blockchain Platforms
SALT, Ripio Credit Network, Everex, and Polymath are some of the blockchain platforms that render loan and credit facilities to their users.
1) Polymath: Polymath provides an avenue for trillions of dollars to be transferred to the blockchain market.
2) Ethlend: Loans can be accessed using digital assets as a backup. Lenders can spend money without necessarily selling their crypto.
3) Salt: Blockchain digital assets can be used as leverage to secure loans.
4) Everex: Everex improves blockchain lending and remittance services by providing global access to its users.
Sector Categorization
Some of the features of decentralized credit and borrowing that Covalent pays attention to are as follows:
1) Peer-to-peer correlations between borrowers and lenders.
2) The employment of risk evaluation tools to determine the loan-worthiness of security for the repayment.
3) The use of smart contracts for a credit agreement.
4) The utilization of virtual assets as collateral.
The Method of Auditing
Through the non-traditional process, Individuals and businesses can use Initial Coin Offerings and Crowdfunding to borrow money without going to the bank. Covalent employs the AUDIT method of data analysis, which stands for Actionable Understanding Data-driven In-depth Timely Information.
A — Actionable
U — Understandable
D — Data-driven
I — In-dept
T — Timely
Loan Assessment Using the Five C’s of Finance.
1) Character: The lender’s reputation will be examined before a loan can be granted.
2) Capital: Borrowers need to have a capital down payment that proves to the lenders that proves that they are serious about their intending investment.
3) Collateral: The importance of collateral can’t be overemphasized as it serves as a backbone for lenders in cases where borrowers defaults on the loan.
4) Capacity: It is a factor that examines the borrower’s ability to return a loan. E.g Debt history, salary of the borrower.
5) Conditions: Some conditions such as the purpose of the loan, interest rate, and principal influences the readiness of lenders to offer loans to borrowers.
Conclusion
The debt market is a very large market with many challenges such as risks attached to liquidity and hindrances to regional interoperation. Covalent plays a major role in helping businesses gain easy access to decentralized lending, network data by providing fast and comprehensive analytics tools. Covalent API is an effective tool for enterprises, as it does not require prior knowledge of blockchain coding.

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