What is Flux Finance?

Flux Finance is a decentralized lending protocol developed by the Ondo Finance team. It operates as a fork of Compound V2 with additional support for both permissionless assets like USDC and permissioned assets like OUSG. The platform follows a peer-to-pool (P2P) model, allowing lenders to deposit assets and earn interest, while borrowers can take out overcollateralized loans by providing collateral worth more than the amount they borrow. Lenders receive fTokens, which represent their deposits and accumulate value over time through interest.

Borrowers on Flux can use their fTokens as collateral, and both borrowing and lending interest rates fluctuate based on market utilization. The protocol is designed to be secure, with multiple independent audits and a bug bounty program to ensure trustworthiness. Governed by the Ondo DAO, Flux Finance provides a decentralized framework for managing lending and borrowing operations, giving its community members control over the protocol’s future direction.