Investor Stories: UXD Protocol

Supercharging the Future of Finance with a collaboration between two of Solana’s premier DeFi protocols

On September 8, 2022, UXD Protocol announced a commitment to invest $1,000,000 from its insurance fund into Credix’s Liquidity Pool. UXD’s investment will be distributed across the Senior Tranche of all deals in the Credix marketplace with a ~12% targeted APY. This strategic investment will help scale Credix’s platform as we distribute funds to emerging markets, while providing robust capital protection and above-average returns to UXD and our other investors. From Credix’s perspective, we are honored to be partnering with such an innovative protocol and brilliant team.

“The Credix team has tremendous conviction in the business UXD has built, and we are excited to partner with them to help the protocol grow rapidly and capture market share in the fast-moving real-world asset space. Together we look forward to building the future of finance.” — Thomas Bohner, Credix’s Founder and CEO

This is just the beginning of a long and successful partnership.

At Credix, we regularly check in with our partners to ensure we are meeting their expectations and ask feedback on how we may improve our platform. We recently sat down with UXD’s founder, Kento Inami, to hear more about our partnership from Kento’s perspective and what might be ahead.

What is UXD Protocol?

• UXD Protocol is the issuer of UXD, a fully collateralized decentralized stablecoin backed by a delta-neutral position on Solana. We use perpetual futures contracts to stay delta-neutral and stabilize the peg. We are currently the second largest Solana-native stablecoin with 15M UXD in circulation, which is integrated with protocols across our ecosystem. We’ve seen tremendous growth and adoption since our Mainnet Beta launch in January 2022. With a strong community and dedicated core team, we’re excited to keep this momentum going!

Tell us about some recent key developments with UXD:

• We have recently introduced the Asset Liability Management Module (“ALMM”) for UXD. This will enable UXD to be backed by various low risk strategies, which will scale UXD to billions and also at the same time, make the protocol profitable. We see the ALMM as the next big step to diversifying our collateral base which will not only mitigate risk, but also help us become a central pillar of the Solana DeFi space as yield-bearing asset types integrate with UXD. This yield generation also changes the nature of UXP from a pure governance token to a productive asset as revenue will accrue to UXP stakers and the insurance fund. We see the ALMM as the endgame of stablecoins.

What role do you see Real World Assets (RWAs) playing within UXD?

• RWA investments will be a core part of the Asset Liability Management Module. By investing in RWA, we are able to back UXD with low risk, high quality loans, and generate yield for UXD Protocol. Investing in off-chain assets, such as those provided by Credix, diversifies our risk profile and helps mitigate systemic risks related to the cryptocurrency space. Additionally, investing in specialty RWAs, such as emerging market types, can provide significant yield generation while maintaining capital protection via optimally structured products. We plan to take a metered approach to this expansion and only partner with the best RWA specialists across DeFi.

What drew you to invest with Credix?

• We got to know Credix as we both grew throughout early 2022 and, as we began looking for RWA investment platforms to integrate the ALMM with, saw them as a natural fit. From a technical aspect, Credix is a great platform to integrate with since it’s natively on Solana and enables us to gain exposure to RWA, which is not readily available on our layer one. We’re passionate about organically growing the Solana ecosystem, so this was a major selling point for us. As we’ve dug deeper, we’ve been extremely impressed by the Credix team’s knowledge of its core markets, structured finance, and development. With a Senior position in their Liquidity Pool we are afforded significant capital protection and above-average returns all while diversifying our risk exposure. Seems like a win-win-win!

How has your experience been so far with Credix?

• It has been great! The team has been very helpful with providing information about the structure and helping us with the integration. We expect to collaborate closer in the future and see them as a long-term partner We’re both in growth stages and on approximately the same life cycle so joining forces to build together should be a real value-add to both platforms. Both UXD and Credix have some really exciting developments on the horizon. With each other’s support, we can supercharge those new rollouts and really solidify our positions as Solana’s premier protocols.

Interested in learning more or investing with Credix?

Contact August Widmer, head of protocol relations at august@credix.finance

Join our liquidity pool here

What do you see on the horizon for UXD, Credix, and / or the industry?

• I think RWA investing will become much bigger since interest rates in the real world are becoming higher and DeFi yields lower. So, more people who have capital locked up in DeFi will move it to RWA investing thus expanding platforms like Credix. UXD, through the Asset Liability Management Module, will have higher exposure to RWA investing through Credix which will diversify our collateral base and help scale the distribution of our stablecoin product. For UXD, the evolution of UXP into a productive asset as the ALMM gains traction should help drive its adoption and build out our protocol governance. Generally for both UXD and Credix, I see massive potential and successes on the horizon. It’s an exciting time to be building our protocols and market shares. The future is wide open with so much upside.

About UXD Protocol

UXD Protocol is a fully collateralized, decentralized USD-pegged stablecoin backed by delta-neutral positions using derivatives. Issued on Solana, UXD integrates with top derivative trading exchanges such as Mango Markets. Through this construct, the protocol seeks to solve the “stablecoin trilemma”, allowing UXD to be stable, capital efficient, and decentralized. Moreover, the stablecoin has native yield from the “funding rate” of the perpetual futures position it puts on, allowing UXD stakeholders to generate yield as a result. UXD Protocol is governed by the UXP DAO with voting based upon the governance token UXP. Visit UXD’s website or follow along Twitter to learn more.

About Credix

Credix Finance is a next-generation credit infrastructure built on Solana to give borrowers in emerging countries access to previously untapped capital via the world’s most sophisticated securitization platform. Credix runs the protocol that facilitates the transaction between the investors and the borrowers, making capital accessible at an attractive rate directly to local institutional lenders that then lend the funds to individuals and SMEs in their core markets. Investors can access these securitized, high-yield opportunities directly via the Credix platform. Accredited investors (hedge funds, private equity, etc.) can invest in credit deals directly, or can spread their risk by investing in liquidity pools, which are diversified across deals. Visit our website or follow us on Twitter to learn more.