Why it's more capital efficiency?

Pluz Finance can achieve higher capital efficiency compared to traditional collateralized lending protocols like AAVE:

In traditional collateralized lending protocols, users need to first become lenders before they can become borrowers. The lending and borrowing rates are jointly determined by the supply and demand dynamics in the lending market. The collateralized lending model inherently increases the supply of loanable funds and reduces the demand, resulting in lending rates that are lower than the market equilibrium rate.

In contrast, protocols like Pluz Finance allow users to utilize their collateral and borrowed assets for yield farming simultaneously. Users can be pure lenders and pure borrowers, thereby capturing the true market lending rate. This enhanced flexibility and access to higher market rates leads to significantly higher capital efficiency compared to traditional collateralized lending.

Specifically, in Pluz Finance, users can deposit their assets as collateral and borrow other assets, using both the collateral and borrowed assets for yield farming. Users of Pluz Finance can achieve higher overall returns on their capital for both lenders and borrowers, resulting in greater capital efficiency.

The key advantage of Pluz Finance is their ability to decouple the lending and borrowing functions, allowing users to maximize the value extraction from their capital across both lending and farming activities. This structural difference leads to significantly improved capital efficiency compared to traditional collateralized lending platforms.