# Silo Unveils V2 Protocol on Sonic
## Introduction
Silo, a prominent non-custodial decentralized finance (DeFi) lending platform, has introduced its highly anticipated V2 protocol on Sonic (S), marking a significant milestone in the evolution of decentralized lending ecosystems. This article provides insights into the features, security measures, and future plans of Silo V2 as it expands its market reach.
## Silo V2 Markets
Building upon the success of Silo V1, which facilitated substantial loan volumes across multiple isolated pools on Ethereum and various Layer-2 solutions, Silo V2 introduces innovative twin-asset lending markets. These markets offer enhanced flexibility for deployers by allowing customization of parameters such as loan-to-value ratios, liquidation thresholds, oracles, and interest rate models. The platform aims to provide a diverse asset range to cater to varying market demands.
## Key Features of Silo V2
Silo V2 boasts several key features designed to empower market creators and enhance DeFi lending experiences. Notable functionalities include permissionless market deployment, inter-market connectivity through optional hooks, yield optimization through idle liquidity deployment on decentralized apps (dApps), and the creation of regulated asset markets. The protocol also facilitates the creation of fixed-term lending structures for specific asset categories.
## Silo V2 Security Measures
To ensure third-party integration and bolster risk management, Silo V2 adheres to ERC-4626 standards and implements a dual-oracle system. These features help calculate crucial metrics such as loan-to-value ratios and liquidation thresholds, thereby minimizing the risks associated with bad debt. Additionally, the platform offers a range of liquidation and interest rate options to accommodate various market structures and asset types, including stablecoins and real-world assets.
## Revenue and Incentive Mechanisms
Silo V2 introduces deployer revenue, an optional fee system that rewards market creators for their contributions through an ERC-721 token mechanism. This feature incentivizes market customization and innovation while safeguarding the overall ecosystem from potential disruptions caused by issues within individual pools. The platform’s collaboration with Sonic emphasizes speed and developer-friendly tools, further enhancing its utility and appeal for DeFi enthusiasts.
## Future Deployments and Conclusion
Looking ahead, Silo has announced plans for future deployments on prominent blockchain networks such as Arbitrum (ARB), Base (BASE), and other Ethereum Virtual Machine (EVM) Layer-2 solutions. The platform’s expansion signifies its commitment to offering advanced decentralized lending solutions and catering to a wider user base. Silo’s integration of the V2 protocol on Sonic marks a significant development in the DeFi landscape, positioning the platform as a key player in the evolving decentralized finance sector.
*The original article was published on Finbold.*