We Need to Decentralize the Financial Product Ecosystem
Blockchain technology has made a significant impact in the financial space. Blockchain startup token sales have democratized fundraising, but this is just a small piece of the entire financial system. The landscape of financial products and derivatives in the non-crypto financial marketplace is vast: options and futures, interest rate swaps and swaptions, credit default swaps and asset-backed securities, and even more exotic options are all ripe for decentralization.
The market needs someone to implement a broader set of democratized financial products — Olympus Labs aims to fill that role.
Our mission is to define the protocol for crypto-based financial products and to build a decentralized, privacy-preserving ecosystem of financial products, services, and applications with unrestricted access for all.
The Need for a New Approach
While the current set of non-crypto financial products was created to meet a wide array of investor needs, there remain significant failings.
Problems with existing (non-crypto) financial products:
1. Inaccessibility
Institutional complexity, lack of channels, and high costs present significant barriers to the average retail investor.
2. Lack of transparency
Risky products are often designed to benefit the underwriter at the cost of the investor.
3. Centralized product structuring and pricing
A few large investment banks control the market, leading to noncompetitive pricing for financial products and reduced returns for investors at sale.
4. High cost
Structuring costs, transaction costs, and relatively wide bid-ask spreads increase costs for all parties.
5. Lack of liquidity
For derivative/complex financial products.
6. Inefficiency
Simply getting quotes for a product requires significant back-and-forth while dealing with multiple counterparties.
7. Rigidity
Inefficient and time-consuming process result in the inability to react quickly and flexibly to a fast-changing market.
8. Underdeveloped cryptocurrency-based derivatives
Lack of simple and cost effective cryptocurrency-based derivatives to hedge cryptocurrency risks, manage a cryptocurrency portfolio, and take on desired exposures and positions.
Current crypto financial products market
The cryptocurrency marketplace is sorely lacking in even basic derivative products necessary for portfolio construction, risk management, and exposure targeting. Aside from vanilla put and call options on major cryptocurrencies such as bitcoin, there is a general lack of crypto-based derivative products.
There are a few key reasons for this situation:
- The overall market was not mature enough to incorporate financial derivatives.
- Lack of an exchange to provide liquidity for these financial products
- Lack of a standard protocol to create, evaluate, and trade these financial products
Olympus solves these challenges and more in its groundbreaking crypto-based financial derivatives marketplace. All Olympus financial products will be based on smart contracts. Some of the benefits of doing so are:
- Achieve leverage without the need for margin
- Make the return profile of products clear and transparent
- Easily tradable across existing exchanges.
The financial products in the marketplace will meet investors of all risk appetites, from the risk- averse to the risk seeking. Below are a sample of product types that will be available:
- Fixed Income Products
- Market Indices
- Leveraged ETFs
- Binary Options
- Options
- Futures
The Olympus Ecosystem
The blockchain solution.
Olympus meets the world’s growing investment needs with a wealth of financial product offerings in a robust, decentralized financial ecosystem.
The 7 pillars of the Olympus ecosystem:
- A vast marketplace populated with a myriad of financial products and financial derivatives
- A new, robust protocol to democratize the creation and exchange of financial products
- Partnerships with exchanges to provide liquidity to the financial products in the marketplace
- Seamless transferability of financial products and investment portfolios through global integration of all parties in the decentralized marketplace
- Simplified investment in derivatives, easily accessible to all
- Homomorphic encryption to protect investment strategies and portfolio construction
- Zero-knowledge proof to provide user anonymity and privacy
With its novel and robust application of blockchain technology, Olympus Labs is bringing the power of blockchain to the palm of your hand. Launching in January 2018 with its base suite of decentralized apps, Olympus will introduce the public to blockchain-powered financial tools.
Stay tuned for more updates on the project at http://www.olympuslabs.io/
