Folks Finance AMA Recap

We are glad to meet here: Benedetto Biondi|CEO at Folks Finance|@benbio

Hello 👋

Welcome, thank you for taking your time today! Our team has prepared some questions for you to start with: Let`s start with the introduction ! Q1: Can you introduce yourself and Folks Finance?

Hello everyone, I’m Benedetto Biondi. I am an engineer, and have led project development for three years at Blockchain Italia, a blockchain software house based in Milan. I am also a DeFi advisor in Algorand Miami Accelerator and at Climatecoin. At Blockchain Italia, we were a partner of Algorand, and almost two years ago, we started developing Folks Finance, where I became the CEO. Folks Finance is the leading lending protocol on Algorand, also offering Algo Liquid Governance. Through the deposit operations, Folks users can lend liquidity and start earning a continuous economic return instantly. Through the borrowing operations, the users can request crypto loans by locking deposited funds as collateral. Through the Algo Liquid Governance, users can participate in the Algorand Foundation governance without renouncing their liquidity thanks to the gALGO derivative minting 1:1 to the number of Algo committed.

Q2: What is the aim of Folks Finance? What makes it special/unique/different?

Folks Finance aims to offer the most efficient and flexible on-chain permissionless loans, and to build sustainable DeFi. One of the main innovations of Folks is the incentive system. Ordinarily in DeFi, especially in the lending protocols, users' incentives (often in governance tokens) are distributed consistently, boosting the incremental growth of the protocol TVL (total value locked). This is simply achieved by following one rule, low TVL corresponds to high incentives on deposits and borrowing and vice-versa. The users are being incentivized indistinctly and often earn higher Incentives on the borrow APR than the interest APR that the borrower has to pay. Since the revenue of a Lending protocol is taken explicitly from the borrow APR, this type of incentive system is unsustainable. Folks Finance developed an innovative incentive system rewarding only "good users." A "good borrower" is a user who repays interest, receiving a discount, “cashback,” over those interest repaid as an incentive. One more main innovation of Folks is the isolated smart contract per each loan. This allows the user to choose the best suit pair collateral/loan most efficiently, ensuring the best parametrization (LTV, Undercollateralization threshold, etc.) without giving up on users’ and protocol security. We also allow once the loan position has been open, any type of operation to be done on the position (reduce collateral, increase collateral, fully/partially repay).

Q3: Folks Finance has been the talk of the town lately, and its TVL has increased by more than 1000% according to Defi Lama. Can you explain what happened?

During 2022’s crypto crisis, Folks Finance introduced Algo Liquid Governance, a game-changing feature that transformed the existing governance system on Algorand and created new streams of opportunity — even while the market plummeted. This liquid governance system has lifted Folks Finance to new heights. When one participates in Algorand governance, they lock up their ALGO and cannot redeem or use them during a governance period. However, with the new liquid governance, everything works differently on Folks Finance. Folks Finance has improved governance, allowing users to unlock their liquidity during Algorand governance while simultaneously participating in Folks Finance governance. It has become possible thanks to the opportunities the Algorand Ecosystem provides for its projects and by introducing a wrapped version of ALGO — gALGO. gALGO is a token that investors mint (at a 1:1 rate to ALGO) when they lock up their ALGO for a governance period. It means that investors can participate in governance while still utilizing the value of their locked assets thanks to the gALGO they mint. The essential part is that they can use their gALGO freely in their Algorand Ecosystem: as collateral on Folks Finance, for staking on DEXs, or for purchasing NFTs. The utility of this groundbreaking advancement has been enhanced through solid partnerships with other projects in the Algorand ecosystem: AlgoxNFT, Tinyman, Pact, Humble, Algomint, and more https://folks.finance/galgoecosystem.html.

Thank you for such detailed and interesting answers! It is time to move to the community questions part. Let's remind AMA rules to the community😊 ❗️ AMA structure and rules: 👥 - Community questions part starts after the guest/guests finishes/finish answering the introduction questions asked by the moderator. Moderator unmutes the chat to allow up to 100 messages and mute it. - Each person is allowed to write only one message containing 2 questions, violators will be disqualified from participating in the reward distribution. - Copy-pasted questions from previous AMAs are strictly forbidden, violators will be disqualified from participating in the reward distribution. - All questions&concerns regarding AMA members should send in dm to @cryptodiffer_admin - Important, please don`t write to other CryptoDiffer team members, they won`t be able to help you. - Winners are chosen by Guests. I will open the chat at 2:06 UTC, check exact time on time.is Chat is muted! Thank you for your questions, everyone! Benedetto Biondi|CEO at Folks Finance|@benbio,please choose the questions you like and answer them! If you wish to have additional rounds, just let me know

I'm excited to hear that Algorand Governance Period 5 has commenced yesterday and will run until December 31st of this year. This is indeed a great news for those that will be participating, so in view of the forgoing, can you please tell us some of the benefits we stand to gain if we choose to use Liquid Governance over traditional Governance?

Thanks for the question Abisola. The liquid Governance firstly allow you to keep your commitment liquid by minting gALGO at 1:1 rate. second it is being incentivised with additional APR from 7M Algo incentives agreed from the Algorand Foundation Moreover, the Liquid Governance allows you to early claim your rewards so you do not need to wait the three months commitment.

✅ I read that for the first Governance periods special gALGO tokens were created for those periods, correct? This changed from the fourth period onwards, what was the reason for this change? Now the same gALGO tokens can be used in all periods?

the Algorand foundation design limits our Liquid Governance flexibility. Moreover, it was unsure for how long this system would have kept. Therefore at the very beginning we launched gALGO3 and then during the G4 we switched model to a unique gALGO that is the same between each period.

I'm curious about the Folksy Guy NFTs. Most NFTs nowadays are without utilities and end up as mere collectibles. What are the utilities of the Folks Finance NFTs and what innovate benefits does it provide to the holders? Will holders of these NFTs be able to participate in the Liquid governance?

yes, there has been done a treasure hunt that gave holder opportunity to partecipate. We are integrating Folksy guys in other community activities. One more is being announced later this week. So stay tuned

Can you tell us more about the Loan Notifier and how it works? What information do we need to provide to successfully get notified of emerging liquidation on our portfolio? Lastly, do we need to pay to get access to this feature or its free?

it is a tool we built for our community. you can set a notification to discord, telegram and email. This notification alerts you live on the risk of having your loan liquidated. you can customize at what liquidation margin set the reminder

Security In Lending and Borrowing Protocols Is Very Necessary So , Have You done MULTIPLE AUDITS to makes Your Platform Secure and Have You Introduced the BUG BOUNTY PROGRAM For the Users ?

yes we have done 3 audits, and also we have running a Bug Bounty on Immunefi

How do you solve the scalability problem? Proof of Stake Is PPoS a scalable infrastructure? What's the difference, have you ever experienced an outage? =============================

algorand never expirienced a down, it is always working perfectly and never had problem of scalability since it the team is scaling up the protocol always in advance.

I Found that Algorand Governance Period 5 will begin on October 1st , So Could You Please tell us More about the ALGORAND GOVERNANCE PERIOD 5 and How Users Can Be Part of the Governance Which Token is Important to stake and Hold For this and What Benifits the DAO MEMBERS will get ?

you can participate in Governance by simply holding and committing your Algo. You can learn more about Folks Finance and liquid governance here https://docs.folks.finance/

🥳🥳🥳🥳🥳🥳🥳🥳🥳🥳 How will you grow Algorand DeFi adoption and Algorand TVL? Will there be further development of Liquid Governance in V2?

this governance is directly being incentivised from the Algorand Foundation. In the next quarter we are looking forward to launching new features for the liquid governance

How is Folks Finance planning to Bring in More Users to invest in the Project? How Can Token holders Look for more opportunities to Earn in Your Project?

Yes we are targeting to increase the audience. I suggest you to follow our official channels to stay updated https://t.co/YUIausytcI

What is the Difference Between fToken and frToken and what is the use of These tokens in your Staking Mechanism?

ftoken is an intereast bearing token that rapresents your deposit and the accrued deposit APR. frtoken is a reward token that is used as a mean to rewards the protocol users

As You have Already Completed your AUDIT with THREE Auditors, Which is Really Good, In future Do you have any Plan to do Another Audit with Some well-known Auditor Like Certik?

we are about to launch our V2 we are being audited from Certik, Trail of Bits and Vantage Point

Few days ago, CryptoDiffer came up with an Infographic showing the Top 15 TVL Gainers of Q3, surprisingly Folk Finance topped the table with a TVL of about $85.2M. I'm curious to know the secret behind this huge accomplishment in spite being in the bear season?

We launched a killing feature for Algorand DeFi which laverage a potential growth of 4B Algos.

I have experienced that Many Defi Projects don't use Algorand chain, Do You see that this chain will attract more projects as we go Further?

yes! algorand is growing quickly. Most important part is that we want to build a sustainable and long term DeFi ecosystem @deniscryptodiffer I will be answering last two questions.

Onborading Traditional Users Or the New Crypto Users Are Really Tough , So Is FOLKS FINANCE platform is made in Such a Way that NEWbies CRYPTO USERS Can also Start With Your platform with your platform ?

yes, we target this as one of the main purpose of UX/UI. The protocol V2 will be very simple and easy to use.

Tell us more about the $gALGO Bullish Bounty Event, Who can participate in this bounty Event, when will it end and on what criteria will winners selection be based on, are there rules we need to be aware of?

anyone can partecipate at the contest! It is a contest for web3 creators, but we designed in a way that anyone can take part. you can read all the details here https://galgobullish.folks.finance/