DeFi Asset Addition Procedure: Rikkei Finance
With the announcement of a new asset addition to our protocol coming up this week, it is time we revise the selection procedure behind it.
The aforementioned selection procedure is a 5-step in-depth evaluation that adopts multiple liquidity-measuring models.
STEP 1: DATA CRAWLING
Using public listing platforms, basic information surrounding an asset is submitted to RiFi’s selection database. Said information includes: price, volume, market cap, circulating supply, total supply. As these data is collected, the bid-ask spread model is utilized to extract the current supply and demand of the asset in question based on its price action.
STEP 2: FILTER
As a certain amount of asset input has been set up, our team will categorize them into different groups based on their circulating supply, total supply, as well as trading volume. Groups that fail to meet up with the platform’s criteria at a certain point in time will be eliminated.
STEP 3: LIQUIDITY MEASURE AND RANKING
A number of critically-acclaimed, de facto models are adopted during this process to maximize the accuracy of our team’s liquidity measurement:
1. The Turnover Ratio:
2. The Bid-Ask Spread:
4. The Hui-Heubel Ratio:
(Appendix A, https://arxiv.org/pdf/1412.5072.pdf)
STEP 4: ANALYSIS & ASSET SELECTION:
Shortlisted assets after the liquidity-measuring process will be contacted by our team, where both parties discuss if the terms and conditions of collaboration.
STEP 5: ASSET ADDITION
As an asset addition has been sealed, special events, voting sessions, and announcements that benefit investors of both the asset and the protocol will be made as the asset go live on our platform.
This procedure was built by senior financial advisors and DeFi architectural experts from Japan, Australia, USA, and Vietnam, with the aim to build Rikkei Finance as a safe and secure lending protocol that actively assists its users in their yielding and risk management processes as they deposit to and borrow from our platform.