CloseCross — A New Kid on the Blockchain

Discover a hidden gem!

Yannick Zehnder
Sep 8, 2018 · 7 min read

Disclaimer: This article is for educational purposes only and does not provide financial or investment advice. The reader is aware that there are special risks involved in dealing with blockchain and cryptocurrency assets.

What good do markets do if there discriminate against the wider public? None!

There is a need for a fundamental change of market accessibility. With the introduction of blockchain technology, the technical fundament for that has been established. It is not surprising that the most successful projects in the cryptoshpere are finance based. The financial use-cases are just the most obvious and “easy” to establish. CloseCross does precisely that: making accessible a market (the largest there is) to the general public. That alone is more than impressive, but the way they do it is even more so.

I have a background in gambling and still use concepts from the domain a lot. The years I studied different forms of gambling (mainly sports betting and poker) formed my mind a lot. Now I am not saying derivatives are „gambling“ at least not in a negative way. However, the parallels are apparent. You find a prediction market that suits your knowledge, discover a market that you think you have a competitive edge, assess the risk, and if you like the upside, you stake it.

Now with derivatives, it is pretty much the same. The underlying outcomes are mostly based on the financial markets. The regular underlying assets are FX, commodities, and indices.

The trend for such markets is evident. The largest sports betting sites in the industry started offering “financial bets” recently so apparently there is a demand for it. Besides that, there are many (some of them somewhat shady) apps and websites promoting prediction marketings for financial products.

There lies a significant potential with one more thing: hedging. In the crypto economy and the blockchain ecosystem, all “assets” of whatever nature cannot be hedged. There are no call and put options (yet). With the possibility of creating a prediction market, there is also the possibility of hedging the price development of underlying assets.


Summary

  • Decentralized derivatives markets
  • Protected by patent (paper written and patent filed in 2008, US Patent, approved in 2011, in force until 2032)
  • Developed by a top-notch, well-connected team of industry veterans
  • ICO pending

The vision

Our purpose is to fundamentally alter the financial derivatives marketplace and structure and our aim is to transfer the value being traded from centralized non-democratic environment to our decentralized democratized protocols. By doing so, we will no longer be limited to the current derivatives market size of $1200 trillion (or $1.2 Quadrillion), we will increase the size of the market through this debottlenecking of market participation.

— CloseCross Whitepaper

The traditional derivative market has a huge potential for disruption. CloseCross will combat all problems listed in the graph below:


What makes CloseCross unique

Hard work first: MVP

CloseCross sets itself apart not only by the market they tackle but also by the technology they have in place. I am a huge fan of MVP concepts and tend to use that term in a rather broad way. But with CloseCross there is an MVP in the actual sense of the word ready to be launched. Development first, ICO afterward. Hard work first, money afterward. There are only very few exceptions to this mantra.

Market size

The most significant part, of course, is the size of the market that CloseCross tries to disrupt. The derivatives market is by far the largest global market. Depending on the numbers you look at the estimates vary between USD 800 and 1200 trillion (yes, you read that right, trillion). The

- An easy-to-use, accessible to all, 3-click trading

- Open to all — Employing a new, crowd-wisdom, source of market information

- Compatible with short-term hedging duration

- Eliminating unquantifiable risk while keeping unlimited upside

- 90% cheaper compared to current occasional trader charges

— CloseCross Whitepaper

Radical transformation process (disruption)

As the whitepaper puts it the fundamental changes implemented by CloseCross are: Centralized to decentralized, high investment needs to democratic participation, costly to inexpensive, complex instruments to intuitive, unquantified risk to fixed risk, and opaque to real-time transparency.

Revenue model

CloseCross will charge a fraction of the fees that are charged in the traditional markets. It is a fixed fee of 1.5% and no hidden fees. An important detail is that CloseCross has no possibility or incentive whatsoever to engage in front-running of any kind. The market is completely transparent and if they would participate in their markets that would only grow the pool and make the markets more attractive for the users.

The trading process

Along with the democratization of a multi-trillion USD market CloseCross also drastically simplifies the processes of participating in the derivatives market. With only 3 clicks or taps on your mobile phone, you can enter any prediction market.

CloseCross team

Vaibhav Kadikar, CEO and founder

Vaibhav Kadikar is an industry veteran with many years of experience in the traditional markets. CloseCross is his brainchild. He is somewhat of a visionary because he wrote the first paper on a peer to peer derivatives platform and patented the idea for the underlying technology of CloseCross back in 2011. CloseCross is like a top of the shelve wine that was stored to perfection.

Marcin Zduniak, CTO

Marcin has been developing on blockchain since 2014 and by now teaches and supports other Fintech startups with his knowledge. He holds an MSc in Digital Currency and has contributed to various projects around the globe. His blockchain interests include Ethereum, Corda, Stellar, Hyperledger, and Bitcoin.

Ian Simpson, CMO

Ian Simpson is a very well connected and established part of the cryptoshpere. His marketing excellence is sought-after at Block Collider, The Crypto Valley Association, and many more. He also is a contributor to the well-established crypto network “Coindesk.”

Other team members

Laura Westby, General Counsel
Patrick Schilz, Network Advisor
Shahar Larry, Strategy, Innovation, Storytelling
Stefan Deiss, Strategic Advisor
Simona Camilleri, Legal Advisor
Quentin Issele, Product Advisor
Ariel Hajbos, Graphic Designer
Chris Burns, Talent Advisor

Competitive set

As briefly described in the introduction, there are many competitors in the space beside the classic derivatives dealers. I would exactly describe every one of them as a “derivatives” market provider, but they offer at least some markets that are similar to the derivatives market.

CloseCross competitive set

The CLOX Token

(Attention it is called by its old name “CLX” in some documents still.)

  • Token Name: CloseCross Token
  • Ticker/Symbol: CLOX
  • Total Supply: 10’000’000’000 CLOX
  • Tokens offered in ICO: 3’000’000’000 CLOX
  • Soft cap: $5m
  • Hard cap: $30m
  • Price/Token: $0.01

Token purpose

From the CloseCross whitepaper:

The CloseCross Token (CLOX) serves three purposes:

Access to the CloseCross peer-to-peer settlement protocols as well as proprietary algorithms. Holding CLOX is a pre-condition to participation in peer-to-peer derivatives space.

Payment of facilitation charges (“gas”) for transactions on the platform.

Unit of value that serves as a common denominator currency for all market participants.


The Encore

CloseCross is somewhat of a hidden gem, or at least it is so far. It has definitively raised the attention of some heavy-weights such as the group around Speculative Rationality. They were a major player in the success of Block Collider. Let’s see what the future holds for the community. You definitively have the fairly rare chance to join a community where you might get the chance to say “been there back when we were a small group of super early adopters.” Join their Telegram-group here!



Thank you for reading — if you liked what you read, feel free to clap, share, like and comment. Also feel free to suggest any improvements and corrections to the article in the comments below!

For extra “thank yous” here are my donation addresses:

BTC: 1PaYx6B7DVhMhcY9JFbTs1czLFtH6oEWcM
XEM: NDYKAE-YR3YCV-NOO36B-KSH5OC-N6KFV2-CLABPX-LBS6
ETH: 0x762bd7dcd23aec62d1a5bd3e3b2b57bb1b64026d
LTC: LfLWQ6ec2z89DM3VhjyCRZrHtb7EuJrdzu

This article can be changed at any time without notice.

Zehnder Advisory

Covering emerging and bleeding edge technologies — Blockchain, IoT, FinTech

Yannick Zehnder

Written by

Bleeding edge tech enthusiast, marketing adept, advisor, investor. Man of many hats.

Zehnder Advisory

Covering emerging and bleeding edge technologies — Blockchain, IoT, FinTech

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