Oddz Chain — A New Paradigm Towards Powering DeFi Derivatives

Published in

oddz finance

4 min readJul 13, 2022

GM!

The last time we introduced something new was with Options v2. Our v2 upgrade added advanced option trading features such as auto-exercise, secondary market, strategies, deviation-based pools, and auto-compound staking. Since then, we’ve been educating you on options concepts while our team has been hard at work behind the scenes building DeFi’s future.

We understand that DeFi innovations have been stagnant in recent months, considering the bear market. However, it has had no influence on our ability to build, and we have been consistently growing through the bear.

We’ve been working on our promised roadmap, and most of it is now live and on time. But, wait! We’ve something more (or rather something massive) to add to our roadmap. Yes! We’re introducing the Oddz Chain, a standalone blockchain network for powering DeFi derivatives.

Don’t be taken aback! We’ve got a lot more information on what we’re creating or adding to our long-term roadmap down below.

Oddz Chain — What is it?

Oddz chain will be a standalone blockchain based on Cosmos SDK and Tendermint consensus. It will feature an on-chain orderbook, matching engine and native Automated Market Makers (AMMs). The chain will be built to facilitate cross-chain trading, especially derivative market trading.

Why a Standalone Blockchain ?

The existing blockchains have latency in transactions and take a lot of cost computation to have high throughput similar to centralized exchanges. Even developing an onchain orderbook, and a matching engine is not feasible because of the limitations with Layer 1s and Layer 2s. Hence, developing a stand-alone blockchain will be feasible and cost-effective.

Why Build on Cosmos ?

Cosmos’ goal is to make it simple for developers to develop blockchains while also breaking down barriers between blockchains by allowing them to transact with one another. Moreover, blockchains may utilize Cosmos to preserve sovereignty, process transactions quickly, and easily connect with other blockchains in the ecosystem.

It simplifies this through a collection of open source tools such as Tendermint, the Cosmos SDK, and IBC, which are meant to allow developers to easily build custom, secure, scalable, and interoperable blockchain applications.

How will Oddz Chain Differ From Others?

We will be different from other blockchains in a variety of ways, primarily with our on-chain order book, match engine, and AMM.

Matching Engine and On-Chain Order Book

Protocols typically employ off-chain order books to settle trades. But, these order books are partly centralized and prone to trade collisions and front running. Oddz chain, on the other hand, will employ an on-chain orderbook. We will facilitate placing, canceling, and filling orders on the blockchain. Furthermore, orders will be processed and matched by our matching engine before being executed as a trade.

The engine will be deployed as a sidechain of the Oddz chain for faster settlements. Orders will be matched on the sidechain but settled on the main chain for improved efficiency. Additionally, the matching engine will be trade collision resistant and front running proof. With all of this, we aim to eliminate centralisation and improve chain efficiency.

Orderbook and AMM

Adding to our on-chain order book will be an AMM. Oddz chain will combine a traditional order book and matching engine with liquidity pools of an automated market maker. Trades will be seamlessly matched against the best combination of limit orders and pool liquidity for the lowest-cost execution without any additional effort.

With this AMM orderbook approach, traders will be able to trade through an orderbook at the best possible price in liquid markets or through AMM in illiquid markets. Moreover, it will always allow for tight spreads and high accessible liquidity

Besides that, users will benefit from liquidity provision opportunities through which they can earn returns.

One-Stop Blockchain Solution for Derivative Markets

The ultimate vision with oddz chain is to power derivative protocols. We will support almost any financial asset from derivatives to synthetic assets without compromising security, speed or cost.

Natively we will support:

Perpetual swaps
Options
Prediction Markets
Other financial markets products
AMM for all products

Users will also benefit from low to near-zero gas fees on the Oddz chain. Even protocols working on derivative markets can join the Oddz chain for increased throughput and to take advantage of the high performance matching engine.

About Oddz

Oddz is a trustless on-chain options trading platform that expedites the execution of call and put options contracts, conditional trades, and futures. It allows the creation, maintenance, execution, and settlement of trustless option contracts, conditional tokens agreements, and futures contracts in a fast, secure, and flexible manner.

It employs the synergies of Ethereum, Avalanche, Binance Smart Chain, Polkadot, and Polygon to unleash the potential of a decentralized options market. It focuses on building solutions that can propel the DeFi ecosystem by simplifying options trading and enhancing the user experience.