The thing is, that when fiat appears on the scene, it brings along with it the appearance of centralized parties.
The only centralized role on the INLOCK platform is the matchmaking role (connecting loan requests and lending providers). The paying out of loans could be considered centralized in this regard, since it comes from a specific financial institution. The loan doesn’t go through our platform, the lender pays it directly to the borrower. The platform only gets income from the ILK tokens paid for platform usage. Collateral management and contract management are carried out in a completely trustless way, they run on blockchain. The most important part of the model is what happens to the crypto placed as collateral: the customers crypto is locked into a smart contract for the duration of the loan. If the exchange rate volatility necessitates it, the collateral manager liquidates his own crypto, not the customer’s collateral. The collateral manager will only receive the customer’s crypto from the smart contract, if the contract termination is declared legitimate. Signed credit contracts are stored on an internal blockchain, which is a permissioned blockchain, also independent from the platform.
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