FinNexus Is Building A Crypto Supermarket for DeFi Assets
What the crypto world needs now is access to a diverse range of tokenized assets with real value.
Founder and CEO of FinNexus Boris Yang’s words may surprise many observers of the crypto industry:
“One of the biggest challenges facing the potential token investor today is lack of asset diversity”
— Boris Yang, FinNexus Founder & CEO
How is it possible that lack in asset diversity is a major problem? Binance, Bittrex, IDEX, and all the countless other centralized and decentralized token exchanges today have thousands of different tokens available for trading? While the number of tokens available is in the thousands, the unfortunate truth is that the vast majority of them share similar characteristics as assets. Their value is almost entirely speculative, with an extremely small number of tokens currently serving any sort of real world use. Even many of the most highly hyped tokens backed by teams of talented designers and engineers have yet to produce any widely used products which could provide a basis for their token’s value. This situation is what Boris aims to address with his ambitious new project, FinNexus.
The Road to FinNexus
As one of the main designers of the well known cross-chain and privacy-focused blockchain project Wanchain, Boris Yang is no stranger to the worlds of both blockchain and finance. From his time working with Wanchain as well as other decentralized and traditional financial services organizations, Mr. Yang eventually came to identify a number of key issues that have been holding back the adoption of blockchain-based assets. He ultimately identified three pain points:
- Diversity — The vast majority of blockchain based assets share a similar investment profile.
- Convenience — Access to blockchain based investments is currently very inconvenient.
- Value — The value of most blockchain assets is almost entirely speculative, leaving very few options for digital asset investments with real value.
FinNexus plans to address these pain points through a series of stages. FinNexus will begin its life as a semi-centralized tokenized asset hypermarket built on Wanchain. Having observed other blockchain projects struggle to achieve liftoff, the team believes that true decentralization can only be bootstrapped in this way. In the long run, however, the vision for FinNexus is to evolve a fully decentralized protocol of protocols that support the issuance, tracking, sale, and exchange of a wide range of crypto, traditional, and hybrid crypto/traditional tokenized assets across multiple different blockchains and traditional markets. The first chain that’s already been incorporated into this strategy is XRP Ledger.
“The vision for FinNexus is to evolve a fully decentralized protocol of protocols supporting the issuance, tracking, sale, and exchange of a wide range of crypto, traditional, and hybrid crypto/traditional tokenized assets across multiple different blockchains and traditional markets.”
FinNexus 1.0 — A Crypto Supermarket for Tokenized Assets With Real Value
In its first iteration, FinNexus 1.0 will focus on the tokenization of assets with real world value. Its first asset is UM1S, offered in conjunction with its token distribution on Bitrue starting on May 11, which is a short-term corporate bond-like tokenized asset offered by one of the companies also incubated by Superatom. The UM1S token will give crypto investors the chance to earn an attractive fixed interest rate on a tokenized stream of cash flows offered by a reputable company, in contrast to what you get on other savings assets offered by centralized exchanges — a promise of return from the same counterparty with whom investors are letting custody their digital asset. That’s not safe!
For the investor’s convenience, interest on the asset will be paid out in USDT at the end of the life of the token, which is scheduled to occur precisely 3 months after FNX begins to trade on Bitrue. Although UM1S is only available to those who participate in our ICTO on Bitrue, later tokenized assets that utilize this model will be able to be purchased directly through the FinNexus platform. Purchasers will be able to manage it as one of their assets through their Wan Wallet or, in the case of other on-chain assets like XRP (see video), FinNexus will partner with a reputable wallet provider of that chain.
Following the launch of this first asset, UM1S, offered in tandem with Superatom, FinNexus 1.0 will onboard further digital assets that use this Assets Distribution Protocol (ADP) — read more about ADP in our 2020 roadmap! — in cooperation with other with other organizations.
The Significance of Tokenizing Real World Assets With Real Value
The tokenized bonds launching with FinNexus 1.0 are a direct response to the pain points identified above (diversity, convenience, & value). They give crypto investors options for diversifying the risk/return profile of their investment portfolios while still taking advantage of all the advantages brought by blockchain technology. In contrast to short-term fixed-rate investment products offered by centralized exchanges that typically pay interest based on returns from quantitative trading of cryptocurrencies, the assets tokenized using FinNexus’ ADP protocol cluster will not be exposed to the same systematic risks such as a crash in cryptocurrency prices or a technological failure of the quantitative trading system’s AI. The FinNexus platform will make the entire process simple and easy to manage, even for newcomers to the blockchain world who may be unfamiliar with blockchain wallets, private and public addresses, etc.
“Compared to cryptocurrencies, our ADP-based assets can resist systemic risks such as market crashes. They are a good option for investors who wish to hedge the risk of investing in crypto, but still wish to invest in blockchain products.” — FinNexus CEO Boris Yang
This protocol is an interesting hybrid as it really is targeted toward enterprise use but for public consumption. As I’ve said previously, UM1S is first in a series of tokenized products of real world assets. So the cash flows of, in this case a Southeast Asian lending platform Uangme, are what create the return on the UM1S token, which coincidentally will be released on Wanchain. UM2S, UM3S, … UMnS… will be similar tokenized products of real world assets that are created using our ADP protocol. For example, UM1S is on Wanchain; UM2S wil be on XRP; UM3S could be on another chain. We also plan to offer this service to other enterprises that are looking to tap into the crypto markets as an alternative source of funding. So, theoretically, there could be another series of tokenized assets TX1S, TX2S, …. TXnS… and so on.
What’s most exciting is that, in addition to these diverse bespoke tokenized assets based on actual real world value, our platform users will also be able to mint their own collateralized bitcoin options tokens. This is something that the team is working hard on right now and hopes to release by the end of Q2 or maybe the beginning of Q3. With the ADP-based tokens and these options products, you can really see how the FinNexus as crypto supermarket strategy is shaping up quite nicely these days!
Moving Forward
FinNexus 1.0 is currently supporting development for three different products:
- Wandora Box — a fun price prediction game where you can use WAN tokens to guess on where the price of WAN, ETH and BTC is going… and earn WAN if you guess correctly!
- Real World Tokenized Assets — a collection of tokens created by our ADP protocol cluster where the inputs are 1. the collateral portfolio of different real world assets, 2. the stablecoin or other crypto token (USDT, USDC, DAI, USDX, XSGD, etc.) used to settle the principal and interest upon expiration, and 3. the type of blockchain that the token rides on (WAN, XRP, ETH, etc.)
- Fully Decentralized Bitcoin Options Protocol — FinNexus will use WAN’s existing cross-chain protocols with Bitcoin and Ethereum to pioneer a protocol suite for the fully decentralized issuance of tradable options tokens for Bitcoin. Later, other crypto-assets and tokenized real assets will be added to the options platform.
The FNX token will be available available for purchase on Bitrue starting May 11. More info here and here.
About FinNexus
FinNexus is building an open finance protocol to power hybrid marketplaces that trade both decentralized and traditional financial products. The FNX token will live on the Wanchain blockchain to take advantage of the most robust cross-chain capabilities currently available in the industry. The first products FinNexus will release are innovative tokenized assets with value based on real world cash flows that live on Wanchain and XRP Ledger. The second product to be released is a fully decentralized bitcoin options model
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