Router now has cross-chain DeFi security thanks to a partnership with Union, a platform that offers bundled protection and single-source risk management solutions. For Router Protocol and its users, Union can deploy collateral optimization (C-OP) instruments as well as bundled insurance coverage.
Despite the fact that the DeFi industry has been on an almost constant parabolic rise, it still has major issues with over-collateralization (OC) and capital performance.
With the growing number of DeFi protocols on the market, making better use of collateral has become one of the most relevant discussions in the industry. Many people agree that most lending protocols’ typical 150 percent over-collateralization ratio has a negative impact on everything from yields and risks to DeFi composability.
This is where Union comes in.
Collateral Optimization (C-OP), a collateral security product that embeds directly into its own lending protocol and generates a composable “lego block” for other blockchain protocols, solves the issue of over-collateralization. The protocol tackles the issue of over-collateralization, in addition to smart contract security, which has become a must-have for DeFi.
Router Protocol will benefit from safer and more effective liquidity provision through blockchain networks by using Union’s smart contract and over-collateralization security.
Router protocol is looking forward to collaborating with the Union team to improve Router Protocol’s stability. Users of the Router Protocol would be secure when using the cross-chain bridges to connect with other blockchains on the market thanks to the bundled security.
By incorporating Union’s C-OP into Router, the protocol would be able to boost the capital efficiency of its pools, resulting in increased liquidity on the network. Individual users and protocols using Router’s bridges should be certain that they will be covered from price fluctuations on the upside.
UNION is a multi-token technology network that incorporates bundled security and a liquid secondary market. DeFi participants use a single modular framework to handle their multi-layer risks through smart contracts and protocols. UNION reduces the barriers to entry for retail consumers thus setting the foundations for institutional investors. UNION’s full-stack DeFi security is comprehensive, modular, and incorporates TradFi’s battle-tested capital and pricing models into the DeFi ecosystem.
About Router Protocol
Router Protocol is building a suite of cross-chain liquidity infra primitives that aims to seamlessly provide bridging infrastructure between current and emerging Layer 1 and Layer 2 blockchain solutions.