EthCash(ETHC) Protocol:The innovative Decentralized Synthetic Asset Platform

Published in
4 min readMar 15, 2021

There is already widespread use of synthetics in the DeFi space, especially in 2021. Synths asset that performs mirror image and price anchoring for target asset. It does not mean holding mirror assets, for gaining returns by the price fluctuation and risk. The synthetic asset would simulate the price behavior of underlying assets which could stock, bonds, gold, foreign stocks, and various traditional or crypto indexes and other assets, and trade everything, including pop culture, Meme markets, personal token markets, and so on. Synthetic assets release greater liquidity than native crypto assets, and synthetic assets shine in the year 2021.

Synthetix is the hot project of the synthetic asset field to represent the current development trend. The feature of Synthetix is to mint the platform’s native stablecoin sUSD as over-collateral SNX. SNX can create new Synth assets. The price fluctuation of synths assets can influence all user’s SNX Staking debts. Synthetix key advantage is that Synthetix’s synthetic assets can be many combinations in the DeFi world.

At present, many projects choose to be followers of Synthetix, which copy Synthetix to EOS/Polkadot and other chains. This approach has not verified feasibility. There are also other projects to drive the development of the synthetic asset field with Synthetix. Today, EthCash Protocol is a creative project.

On the product design, EthCash Protocol has mentioned the goal of “Provide Cashflow for Ethereum EthCash”, which similar to hot DeFi protocol Synthetix, Mirror, and UMA’s vision. Even in the blockchain world establish financial assets that already have a suitable consensus. It provides users more openly on the market.

Crypto space relies on consensus, on the other hand, U.S stocks, gold, and a series of other commodities have been verified for a long period. It is easier to accept for investors who are familiar with the traditional financial market and not familiar with the crypto world. These on-chain synthetic assets can reduce the entry barrier of Robinhood after Robinhood has cooperated with Wall Street. Also, it brings unlimited possibilities for participants in the crypto world.

EthCash illustrated officially that the main features of EthCash are:

First of all, EthCash Protocol applies multi assets to mint stable coins eUSD. It is unlike Synthetix that uses a single platform coin SNX to mint stablecoins sUSD.

Secondly, the different model of debt pool, EthCash Protocol has an obvious liquidity pool. Meanwhile, it can connect external liquidity.

Thirdly, users can use higher leverage on EthCash Protocol, which is different from Synthetix to create new synths sBTC and iBTC. Besides, EthCash Protocol still maintains all advantages of Synthetix’s synthetic assets, that is low fees, no slippage, and unlimited depth of transactions. The transaction and derivatives of DeFi features provide “unlimited liquidity”. Otherwise, EthCash has tried to optimize the issue of high staking rate and improve fund utilization rate, which is based on the foundation of Synthetix and Mirror.

Realize Approaches

EthCash Protocol has adopted a flexible and practical strategy to bring mainstream traders into the DeFi world on a large scale.

The core goal aims to make general crypto users trade from centralized exchange to the DeFi world. Users can be staking DeFi tokens including ETH、WBTC、USDC、USDT、UNI and other DeFi tokens, ETHC (EthCash Protocol’s native token) and other main ERC-20 tokens, mint eUSD because it can choose freely staking rate as minting stablecoins. Also, it uses a higher leverage rate when creating a new synth. EthCash empowers more users to have more choices freely.

After users mint stablecoins, they can choose stablecoins in other trading scenarios, or synth the stablecoins into other assets, such as cryptos, gold, stocks, and other assets. The synthesis adopts the method of oracle price feeding, which supports non-slippage trading and unlimited trading depth.

How to ensure liquidity and improve cash utilization efficiency?

To gain a large scale of user adoption, this is important to have liquidity and cash efficiency on a derivative trading platform. EthCash Protocol draws on the transaction model of Peer to Pool liquidity promoted by Synthetix to provide users with advantages such as unlimited liquidity and zero slippage, so it improves greatly of users’ trade experience. Peer to Pool is a platform to create a liquidity pool, but mostly DeFi users help to add liquidity. It trades as over-collateral to another party.

The synthetic asset field drive the development of “Go-Oracle”

The transaction price is a combination of real-time price indices from many price aggregation websites, to avoid the situation of manipulating prices and extreme price spikes. Meanwhile, EthCash Protocol brings a better user experience to develop oracle technology innovation. Synthetic cryptos price is provided by Chainlink on the Ethereum platform. While gold, oil, stocks and foreign stocks and other assets’ price is obtained by the authoritative institution through API. EthCash Protocol can provide free SaaS service and multi-assets price oracle technology as a single open-source project.

EthCash Protocol believes that through the design of “unlimited liquidity + real-time price index”, the trading experience of contract investors on the EthCash Protocol platform will be better than the experience of many centralized and decentralized derivatives platforms on the market and also easier to use. In terms of leverage (cash utilization efficiency), trading fees, transaction gas fees, and cross-platform transactions, the EthCash team also attends to have certain advantages compared to core centralized exchanges and decentralized exchanges.

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