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It would be easy to tackle this answer with a simple problem and solution method-
  • Problem – On Kamino, lending returns are based on utilization rates and interest rate curves. When utilisation is low, a large portion of funds remain idle, leading to low APYs for lenders, while borrowers still pay high interest. This creates an APY spread where borrowers overpay and lenders under-earn.
    Solution – Paystream introduces a P2P matching layer that directly connects borrowers and lenders at optimised rates, eliminating idle capital and minimising the spread between borrowing and lending rates.
  • Problem – Kamino requires funds to be locked for a fixed duration, restricting lenders from accessing their capital when needed. This rigid structure doesn’t suit users with dynamic needs, such as freelancers, DAOs, or startups.
    Solution – In Paystream, lenders can withdraw anytime, even if their funds are currently borrowed, thanks to a dynamic liquidity system.
  • Problem – On Kamino, collateral supplied by borrowers remains idle, leading to capital inefficiency despite being overcollateralized.
    Solution – Paystream allows borrowers to earn yield on their collateral through routing capital, to fallback pools.
  • Problem- On Kamino, liquidity providers face risks from impermanent loss and out-of-range positions, which impact yield stability. Solution- Liquidity providers on Paystream can earn both:
    • Trading fees and incentives from Kamino.
    • Interest from underlying protocols
    This diversification reduces reliance on volatile trading activity, not to mention Paystream integrates Kamino’s dynamic liquidation mechanisms with programmable repayment schedules, offering more borrower-friendly terms while protecting lender capital.
Paystream is not a competitor, as it uses PLFs like Kamino under the hood; it simply provides a way of getting better rates while having the same guarantee, the same liquidity that you already get on other platforms.