Petro: Bringing Fuel Trading to DeFi
The multi-billion dollar global market for traditional fuel cards is already well established, providing businesses with greater control over their fuel management and motoring expenses. An increase in the adoption of smartphones then helped bring fuel cards into the digital sphere, with the ability to capture mileage, fuel consumption, and vehicle data in real-time.
Building on this, the growth of decentralized finance now offers the potential for fuel markets to become tokenized using smart contracts, where businesses can buy and sell fuel ahead of time and optimize their fuel management over a longer time horizon.
Fuel trading startup platform, Petro, is seeking to do just that, tokenizing derivatives of oil, gas, and electricity products to leverage the existing fuel card market and introduce fuel trading to defi. It allows fuel suppliers to create liquidity pools to earn additional revenue from their products and consumers to buy futures when price meets expectations, helping create a mutually beneficial ecosystem.
So how does the platform work, what can it offer to suppliers, businesses, consumers, and traders, and what comes next?
How Does It Work?
The Petro platform allows for the creation and trading of fuel derivatives, with an architecture managed over four stages: Petro.Pay b2b, Petro.Pay b2c, Petro.Swap, and Petro.Swap Defi.
Petro.Pay b2b
Petro.Pay b2b allows businesses like truck fleet operators, taxi firms, and logistics companies to purchase the fuel they need from suppliers like gas stations and oil depots. The platform consists of Super Admins (the Petro technical team), Admins (business consumers), and Users (the employees or contractors of those businesses).
Once registered, businesses can make deposits, buy from fuel suppliers on the platform, invite users, check the transaction history and analytics, and set fuel card limits and restrictions for the associated smartphone app. Users can then refuel at any of the stations available in the network that have been authorized by an administrator.
The platform automatically offsets suppliers under the contract price, allowing Petro to fully automate fuel accounting. The interconnected system ensures the transparency of transactions and balances via HyperLedger Fabric, an enterprise-grade permissioned distributed ledger framework.
Petro.Pay b2c
Petro.Pay b2c also allows retail customers to use the system and purchase fuel.
Retail users who register for accounts and purchase the app-based fuel cards create additional liquidity for the fuel suppliers. In return, retail users can buy the same cheaper fuel as businesses by purchasing in advance when prices are lower, rather than paying more ad hoc.
Petro.Swap
Petro.Swap takes things a step further, allowing oil, gas, and electricity suppliers to attract even greater liquidity via tokenized derivatives.
Auditors prove that the fuel suppliers actually have a declared amount in supply. Insurers confirm that insurance was also taken out to cover the risks related to transactions.
Fuel suppliers can then issue a futures contract for the supply of fuel and tokenize it, limited by the result of the audit so that fuel suppliers cannot issue more tokens than are backed by their available supply. The contract tokens can then provide bulk liquidity to Petro.Swap Defi. If futures prices are attractive, fuel suppliers can introduce more token liquidity for additional profit, allowing them to secure greater funds for further business development and commodity turnover.
Petro.Swap Defi
Petro.Swap Defi provides an Automated Market Maker (AMM) on the Ethereum network, creating a liquidity pool for the tokenized oil, gas, and electricity market where fuel suppliers can sell deliverable futures contracts.
The tokenized assets can then be freely traded between crypto traders against cryptocurrencies and stablecoins, providing an additional investment opportunity in the energy market. Businesses are also able to not just buy fuel directly on Petro.Pay, but also deliverable futures on the defi platform to send back to their account and redeem. Fuel suppliers can remove liquidity from the pool whenever prices are too low to reduce the supply and incentivize demand.
The Roadmap
Petro is currently raising $500,000 for further product development, marketing, and legal purposes, having already secured several partners for its pilot product.
All four stages of development are expected to be complete by Q4 2021 while aiming for 100,000 app installations, 10,000 active users, and 50,000 liters of daily fuel transactions within the same timeframe.
The initial pilot launch will help demonstrate the optimization, liquidity, revenue, and trading opportunities compared to traditional fuel card systems, with the potential to capture a significant share of the existing multi-billion dollar market by combining the benefits of both fuel management applications and tokenized fuel trading.
News and Updates
To keep up to date with the above products and latest releases, follow the links below:
Website: https://www.petro.systems/
Twitter: https://twitter.com/PetroSwap
Telegram: https://t.me/petro_official_group
