Ola Finance proposes to build and deploy a lending network in partnership with Voltage Finance. Ola will build and maintain the technical aspects of the lending network while providing ongoing risk advisory support. As the owner of the customized, branded lending network, Voltage has the power to list tokens, adjust parameters, and request additional features.
The Voltage lending network will not only provide lending/borrowing capabilities for the token ecosystem of Fuse Network (ie. VOLT, FUSE, etc.) but also serve as a source of revenue for Voltage Finance. As borrowers pay interest, a percentage of that interest will be removed into a reserve fund which will be split between Ola and Voltage. The percentage of borrower-paid interest getting removed (ie. the “Reserve Factor”) is one of many parameters determined by Voltage.
Ola Finance is a technology provider that offers lending-as-a-service to its partners. Ola enables projects to own their own white-labeled lending network while receiving ongoing technical upkeep, risk management advisory, and custom product development support. Each lending network is highly customizable, allowing the owner to select which tokens are supported and tune a variety of related parameters.
Voltage Finance is the DeFi hub native to the Fuse blockchain. They offer a powerful suite of DeFi tools including trading, yield farming, and staking. The native token of the platform, VOLT, serves as a governance token which gives the community the final say on major decisions that affect how everyone interacts with the protocol. Community proposals can be posted on forum.voltage.finance for discussion before being brought to a vote (pending significant traction) on https://snapshot.org/#/voltagefinance.eth.
The Voltage lending network, built on top of Ola’s platform, will include a number of safety mechanisms and risk management features. First and foremost, a recent upgrade introduced two important corrections to Compound’s original codebase thereby enabling support for ERC-677 and ERC-777 tokens. These two corrections are:
- Global Re-Entrancy Locks:
The original locks implemented in Compound’s codebase prevented re-entrancy within a single Money Market (MM), but not across multiple MMs. The Global Re-entrancy Locks prevent this kind of cross-market re-entrancy.
- Corrected Checks-Effect-Interaction Pattern
When calling borrow and redeem functions, this correction makes it so that we first register the “effect” (ie. the loan taken or collateral withdrawn) before completing the “interaction” (ie. sending the tokens to the user). This fixes the original Compound code which has this logic reversed.
These changes were reviewed as part of our most recent audit. The audit, conducted jointly between the Solidifed and Oak Security teams, was the second audit that Ola Finance has undergone. Both audit reports can be viewed here.
As an additional measure of accountability, Ola Finance has created a public Token Report to confirm that the token standard and transfer logic for all tokens (across all Lending Networks) has been thoroughly reviewed for possible re-entrancy vulnerabilities. This Token Report is consistently updated and can be reviewed here.
While risk prevention mechanisms are the golden standard, Ola also offers a number of unique, hard-stop parameters which significantly limit potential damage to the lending network:
- Active Collateral Cap (ACC)
The ACC represents the maximum value of a particular asset that can be used as collateral across all users, at any given time. The ACC has multiple benefits, such as limiting fraudulent borrowing power (eg. price manipulation attack) or the amount of an asset seizable through liquidation.
- Borrow Limit
The Borrow Limit caps the total amount of an asset that can be borrowed across all users, at any given time. This cap can prevent a potential exploiter from borrowing all of the funds from a particular market.
Outside of Ola’s immediate architecture, a couple service integrations will offer additional protection for users. First, Ola is in the process of getting listed on InsurAce, a leading insurance provider in the DeFi space. This will allow users to purchase optional coverage over their funds, further protecting them against various risks. Second, Ola is completing its bug bounty listing on Immunefi. This program will offer a payout to white-hat hackers who securely report any contract vulnerabilities and aid in the revision of Ola’s smart contracts. As with all lending networks deployed on Ola, the list of utilized smart contracts will be made publicly visible in Ola’s gitbook.
Ola provides Voltage Finance the infrastructure to easily bring lending and borrowing capabilities to the Fuse blockchain. The variety of security measures - both preventive and reactive - can be flexibly adjusted, helping the safety of the lending network without compromising its scalability.
The polling process begins now and will end in one week, at 14:00 UTC on 10/07/2022. After this, a Snapshot vote will be put up.
- Deploy a Voltage Finance Lending Network
- Do nothing