The Income Benchmark Revolution in the DeFi World: TreehouseFi's DOR Mechanism
In traditional financial markets, the familiar benchmark interest rates are LIBOR and SOFR, which allow investors and institutions to refer to a standard to assess borrowing costs or yield levels. However, in DeFi, there has been a lack of such transparent benchmarks, with significant interest rate disparities across different platforms, making it difficult for investors to make comparisons. TreehouseFi attempts to address this pain point through the DOR (Decentralized Offered Rates) mechanism.
The design concept of DOR is to create a decentralized benchmark for on-chain interest rates. The roles are clearly defined, with Panelists providing interest rate data, Operators responsible for operations, and Referencers utilizing this benchmark. Multiple parties participate together to form a relatively fair and transparent interest rate reference.
For ordinary users, the significance of DOR lies in the fact that you don't have to be confused by a plethora of dazzling annualized rates; instead, you can use DOR as a reference, just like traditional financial investors look at SOFR. This way, the fixed income in DeFi becomes easier to understand and accept, paving the way for institutional entry.
