ExNetwork
Published in

ExNetwork

To DeFinity and Beyond: The Future of Traditional FX and Digital Asset Trading

International trades have been around since modern man started exploring outside of their homelands. For millennia, people have traded thousands of types of goods, from spices and textiles, to abstracts like knowledge and even services. With the introduction of foreign currency market, cash, too, had become a traded commodity of sorts.

FX Market and Crypto

Foreign exchange is one of the oldest concepts known in modern civilization, and is regarded as the biggest financial market to date. The Foreign Exchange (FX/FOREX) Market is one of the most liquid financial markets in the world, valued at over $1.93 Quadrillion with an average volume of ~$6.6 Trillion daily.

With Cryptocurrencies on the rise, the technologies behind blockchains and decentralized finance (DeFi) paved the way for the integration of FX in the digital space; namely, the DeFi space. Crypto trading in itself is like a mirror-image of FX, with tokens representing their own valuations up for exchange.

Institutional investors diving into crypto have grown exponentially in the past few years. In fact, the number of crypto traders grew 60% from just 2020–2021. With traditional FX, brokers serve as intermediaries conducting transactions on behalf of the investor. As DeFi adapts more traditional uses, intermediaries are moving towards the digital space in the forms of decentralized trading protocols.

DEFINITY NETWORK

DeFinity presents itself as a solution and improvement on the traditional ways of conducting FX transactions with its usage of smart contracts. The project is focused on providing real-time settlement and clearing for spot FX trading as they merge traditional finance with DeFi.

Bridging together decentralization technology and traditional brokerage, the platform is geared towards Central Bank Digital Currencies and its place in the future of financial services.

Innovation

As the brainchild of teams consisting of both blockchain experts and finance professionals, it only makes sense for DeFinity to combine the fiat and crypto systems of its parent companies: DMALINK and WeOwn [$CHX], a FOREX trading liquidity platform, and a layer 1 and layer 2 technology company, respectively.

DMALINK is an Electronic Communication Network which enables participants to transact financial exchanges, and will spearhead the sales aspect of DeFinity. WeOwn, on the other hand, is the technology provider, and has pioneered developing hybrid blockchains for the financial services sector since 2017. Under the wing of two experienced teams, DeFinity aims to provide DeFi services to the FX market, offering traditional FX, stable coins and CBDC’s (in future).

Focus

DeFinity aims to build the next-generation in FX, with more transparent and scalable operations. Unlike traditional brokers, price makers and price takers can directly transact without interference. Its perceived success is derived from two points of focus currently generating an upwards trend: Stablecoins, and Central Bank Digital Currency (CBDC).

STABLECOINS: Stablecoin is a relatively new asset class that has the potential for more price stability as price is pegged to a cryptocurrency ($BTC, $ETH), traditional currency (USD, JPY), or real-world commodity (metals, textiles).

Stablecoins have been increasingly popular among investors, with an average volume of $59B, and total monthly volume increasing from $30.8B in 2020, to $384B in 2021 — a whopping 12,470% growth and counting.

CBDC: Central Bank Digital Currency, or CBDC for short, is an upcoming asset class in crypto that pegs a digital token to the official currency of a given nation. While CBDC is poised to be regulated by respective national authorities, its groundbreaking entrance into the digital space will bring liquidity, regulatory oversight, and anti-money laundering controls with reduced fees and traditional intermediaries.

Besides these two, DeFinity FX is basically a one-stop-shop for your financial needs, presenting itself as a link transitioning fiat to crypto. The platform offers tools to other services like precious metals trading, real-time settlements, and more.

Features

The platform utilizes state-of-the-art technology, and features unique selling points not found in other DeFi platforms, as it caters to the financial services sector. Some features include:

CLARITY: In keeping up with the times, DeFinity launched their app Clarity, and the more advanced Clarity PRO; for retail investors and institutional investors, respectively.

AMM FEATURES: DeFinity features a hybrid on-chain order book and built-in AMM functions to provide necessary tools to conduct trades trustlessly and instantly, allowing for reduced slippage and impermanent loss.

INTEROPERABILITY: DeFinity was built to be accessible to all, and integrates via side chains or bridges to Cardano [$ADA], Ethereum [$ETH], Polkadot [$DOT], and Binance Smart Chain [$BTC].

ESTABLISHED BASE: Combining the forces of both its parent companies makes DeFinity a powerful player in its industry, with the mission to create a decentralized, more efficient, and cost-effective FX market.

DMALINK has an existing client base, which includes 50 of globally-acclaimed banks and hedge funds, and a daily trading volume of $1B. These aspects are set to bring more attainment and liquidity into the platform with ready-partners supporting its operations.

$DEFX Token

$DEFX is the utility token used within the platform with 3 main uses: Governance, Staking and Trading, and Rewards.

GOVERNANCE: As a Governance Token, $DEFX holders can participate in major decisions within the protocol. More tokens held, more voting power.

STAKING AND TRADING: As with any platform, fees incurred from staking and trading may be paid in $DEFX, and network providers can stake their tokens against trading pairs to receive 0.25% of the fees from the trade pair.

REWARDS: Token holders can enjoy benefits such as reduced platform fees for both Clarity and Clarity Pro, and usange and promotion of the API’s integration services.

Tokenomics

Ticker: $DEFX

Token Type: ERC-20
Token Supply: 171,516,755
Initial Circulating Supply: 8,238,095
Hard Cap: $2,600,000
Seed: $500,000
Private Round: $1,800,000
Public Sale: $300,000

IDO Details

$DEFX will IDO exclusively on Cardstarter — Cardano’s top launchpad recognized for supporting successful and upcoming projects. Details are as follows:

Start Date: 25 May 2021–15:00 UTC/8:00 PST

Price: $0.1

Initial Market Cap: $823,810

Requirements: Hold at least 100 CARDS to participate

KYC Verification?: Yes

CHALLENGES

Being the first of its kind utilizing such technology, DeFinity does not have direct competitors. Instead, the platform will have to compete with the familiarity of traditional institutions in its goal of attracting more investors into DeFi. A pioneer of financial blockchain technology is Ripple, which operates similarly to DeFinity FX:

RIPPLE [$XRP]: A controversial name in the crypto space, Ripple is a B2B blockchain service also integrating financial institutions into DeFi. The protocol has already been adopted by several top fiat institutions such as Bank of America, American Express, Standard Chartered, and more. The project aims to advance finances into an increasingly inclusive financial system.

Ripple has announced their support of CBDC, as it plays a critical role in modern financial blockchains. Ripple is set to include CBDC services in its platform.

CONCLUSION

In a much awaited crossover between crypto and fiat, DeFinity FX provides not only the platform, but also the solution in providing much-needed liquidity into the DeFi space. The transition from traditional to digital is not a straightforward path, and it’s refreshing to see projects like DeFinity building upon it, and improving the systems we’re familiar with.

With so much on their plate, only time will tell whether DeFinity can deliver their concept properly and ensure the project as a serious player revolutionizing crypto trading, and changing the DeFi landscape for the better.

--

--

Get the Medium app

A button that says 'Download on the App Store', and if clicked it will lead you to the iOS App store
A button that says 'Get it on, Google Play', and if clicked it will lead you to the Google Play store