Announcing Kunikum: ether-based decentralized equity derivative trading
We are proud to present the beta version of Kunikum, where you can trade the top US tech stocks, decentralized on the ethereum blockchain, with ether as the base currency.
Using our platform, you can put your ether to work: choose a stock and watch the 10% increase of the stock, yield a 10% return on your ether. In other words, you can trade equity derivatives with ether instead of your local currency or $USD.
And no — we are not trying to sell you a useless ICO :-)
Could you explain it in more detail?
Our ambition is to build a fully decentralized platform, but for now, a few manual steps from our side are necessary in order to ensure that everything goes smoothly, and that we can match all your trades. For example, this means we have not decentralized and automated the order book yet, but are working hard to do so.
Okay, so you might ask how this actually works.
Many start-ups within the cryptosphere are promising 100% decentralization. We are too, but we try to be transparent about how far we are with getting there. Not everything is decentralized just yet, but our trading and settlement contracts are — while our order book and matching are still manually handled by us.
Price signals of the stocks are sourced from the Google Finance API and corresponds 1:1 with what you will see there. The smart contract for settlement reads the price from the price oracle contract.
You do not have credit risk, as the collateral of your counterpart is locked in the same smart contract as your own and you do not have settlement risk as that is being handled by the smart contract. Furthermore there is no liquidity risk as we currently do not offer leverage trading.
Isn’t this too much of a hassle for trading stocks?
Say you are a long-term hodler of ether. You have probably accumulated large sums of crypto over time. You do not care about short-term price volatility since you believe that crypto currencies will be a permanent part of the future financial industry. You view bull markets as the proof of your predictions and bear markets as your opportunity to accumulate more. You might view your ether as assets you purchased for your local currency and you expect the value to rise over time — like stocks and real estate. But if you view them as digital cash instead, you could search for ways to make them work for you.
Making your capital work for you is one of the oldest tricks in the book of financial growth. It is surprising to see how few are doing it in crypto. We suspect the reasoning behind that is due to the community viewing crypto currencies as assets and not as a cash waiting to be invested. With Kunikum we are trying to give you an opportunity to do so — while maintaining all the benefits of blockchain; transparency, trustlessness and decentralization.
Okay, I’m in — how do I get started?
There are only a few easy steps for you to follow, in order to trade equity derivatives on our platform:
- Go to Kunikum.com and fill out the form in order to signal your trade to the market
- On the following page, send your ether to the deposit address (be sure, that you own the private keys to the address you are sending from — i.e. not an exchange address or a smart contract)
- Shortly after your deposit, we will send you a trade confirmation
Currently trades commence every Monday, where we send you a link to etherscan.io with your trade, deployed by our smart contract. This way you can see your and your counterparts collateral on-chain while the position is active.
When your position expires it will be automatically settled and you will receive your return on the ethereum address you sent your initial collateral from.
Smart contracts
Trying to be as open and transparent about our product as possible, we have a public GitHub and have deployed our smart contracts on the Ethereum blockchain after a lot of testing on Ropsten testnet.
Here are the currently deployed smart contract addresses:
- Trading and settlement contract: 0xce0e76ba29F1A2BAAc3a62791d5CFa92f79910A0
- Asset price oracle contract: 0x4b7a34f1eF5c78226e9Ca017595426188dAAC7ce
