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MARKET Protocol

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About MARKET Protocol

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  1. There are plenty of solutions of that kind, for online wallets most popular ones are MyEtherWallet for Ethereum and ERC20 tokens, Mycelium is what a lot of people use to store their bitcoin, Coinomi for multiple currencies that's available on mobile, then there's Exodus wallet for desktop which has integrated Shapeshift, allowing you to even swap the coins without having to go to an exchange, or Jaxx, available both on mobile and desktop...It all depends on what you want to achieve, many are using paper and hardware wallets because they are by far the most secure way of keeping custody over your tokens. However, if you plan to rather have your tokens available for immediate trading, probably take a look into the solutions mentioned above, they aren't safe as paper wallets, but they are a far better solution than keeping your funds on an exchange. Just as a disclaimer, I am not providing anyone an advice, these are just some examples that I use myself, always choose a solution you feel you're most comfortable with.
  2. MPX is a decentralized exchange simulation powered by MARKET Protocol, which enables users to experience the benefits of derivatives on the Ethereum blockchain. Easily trade MARKET Protocol contracts to go long or short crypto assets, hedge your favorite token, gain cross-chain price exposure to bitcoin, and much more.
  3. No problem, if you are interested in giving the dApp a try and ran into any blocks or issues, please let me know 🙂 If you have successfully completed your first trade, we would appreciate your feedback provided by our user survey.
  4. MARKET Protocol, a decentralized framework allowing derivative trading of all assets, announced today the alpha release of their decentralized application (dApp), MPX. MPX by MARKET Protocol Experience the power of blockchain derivatives trading This release of MPX provides a simulated trading environment on Rinkeby, an Ethereum testnet, allowing users to trade MARKET Protocol contracts against a bot. MPX is powered by MARKET Protocol which enables users to experience the benefits of derivatives on the Ethereum blockchain. Users are able to easily trade MARKET Protocol contracts to go long or short crypto assets, hedge tokens, gain cross-chain price exposure to bitcoin, and much more. MPX highlights a number of features and capabilities made possible by MARKET Protocol: Trade new relationships not found anywhere else, like S&P 500/USDT, AAPL/USDT, GOLD/USDT and OIL/USDT Short sell assets without sourcing or borrowing them Use leverage safely, without margin calls or forced liquidations Trade without counterparty risk, since positions are collateralized on the blockchain How to start trading on MPX? This release of MPX provides a simulated trading experience on Ethereum’s Rinkeby testnet, allowing you to trade MARKET Protocol contracts against a bot. To try MPX, you must have the MetaMask extension installed in your browser. You can learn more and install MetaMask here. With MetaMask installed and set up, you have everything you need to get started. Navigate to MPX and switch MetaMask to the Rinkeby Test Network. Next you will need some testnet ETH and collateral. Just follow the prompts or check out this explainer demo to watch our CTO Phil Elsasser walk through the necessary steps to execute your first trade on MPX: MPX will give you a preview of MARKET Protocol and the benefits of derivatives on the Ethereum blockchain. With MPX, you can experience the flexibility of the protocol by trading simulated contracts to go long or short crypto assets and even off-chain assets. You can also experience the safety and security of the protocol first hand, because with MPX your risk is limited to the maximum downside of your position. Unlike other exchanges, you will never be exposed to auto-deleveraging, socialized losses, or theft by hackers.
  5. Interview with Market Protocol CEO Seth Rubin. To find more information on the project make sure you check out their telegram and website below.   [email protected] https://marketprotocol.io https://t.me/Market_Protocol_Chat   As always, I'm not a financial advisor - this video is not financial advice I'm providing a non-biased platform for the team to discuss their project. This interview is not an endorsement or promotion of any investment in securities. All opinions expressed are to not be taken as financial advice - do your own research before investing.
  6. #DeFi was created as a shared community for projects developing open source financial primitives guided by the principles of interoperability, open source, accessibility and transparency. Learn more in the official announcement!
  7. @drolemom That is correct in case if you lose your private keys, so same scenario like any wallet (online one)...I would say that using HW is safer from a standpoint of general custody of funds because that way you aren't dependent on the software developers of online wallets and much safer than keeping money on exchange, where the usual scamming/hacking occurs...but the downside of the HW is that the person using them should really know exactly what they're doing...so if you feel like you know enough about encryption and ECDSA, I would recommend to use hardware wallets as a way to keep custody of your crypto you aren't planing to trade soon.
  8. MARKET Protocol is especially excited to announce its latest partnership with ChainLink, the industry leader in decentralized oracle networks and securely providing data to smart contracts. Oracles are crucial for inter-blockchain and off-chain functionality; they are key to decentralized derivatives trading systems’ incorporation of all asset types. ChainLink’s reliable and secure network connections enable MARKET Protocol derivatives traders to create highly complex derivatives smart contracts. MARKET Protocol contracts can now be made using any/all market data, on-chain events, and off-chain events, which will allow them to become a superior alternative to legacy derivatives contracts. MARKET Protocol MARKET Protocol’s vision is to bring the $100+ trillion derivatives market to the blockchain by powering the safe, solvent & trustless derivative trading of any asset. You can trade stocks, cryptocurrencies, and traditional assets. MARKET Protocol smart contracts are always solvent and transparent. Our revolutionary framework offers leverage without margin calls or funding liquidations. MARKET Protocol is open source, allowing users to create decentralized exchanges (DEX) and decentralized apps (dApps) of their own. There are many additional ways in which derivatives traders can benefit from using MARKET Protocol: To purchase crypto assets through the use of smart contracts. To trade ICO tokens before they are officially distributed or have begun trading. To allow traders to decouple price volatility from the token utility. To eliminate the need to manage multiple wallets or exchanges, thereby enabling safer trading. To trade non-crypto assets, including stocks (TSLA, AAPL), commodities (oil), or even kitchen spices. To short crypto assets, earning a profit from declining prices without the need to borrow the asset. ChainLink and the Use of Oracles A partnership with ChainLink, the leading provider of secure oracles, with a proven record of execution in the blockchain and fintech space, benefits MARKET Protocol and its platform users by strengthening the reliability through decentralization aspect of the platform’s protocol and derivatives contracts. ChainLink’s expertise lies in bridging smart contracts with key off-chain resources, data feeds, various event APIs, and traditional bank payments. An “oracle” is used to assure secure interaction to effectively allow private and public blockchains interactions. ChainLink is a leader in decentralized oracle solutions and their expertise is a perfect fit for MARKET Protocol’s development of a platform that securely utilizes off-chain market data, cross-chain events, and on-chain trading relationships for any asset class. Because decentralized systems are dependent on the honesty of their nodes to achieve a consensus with the most truthful outcome, ChainLink utilizes a system that prevents potential issues resulting from faulty nodes. ChainLink handles the risk via three basic complementary approaches: ● Distribution of data source, ● Distribution of oracles, and ● Use of trusted hardware Fig 1: Example of two-level request distribution. Learn more at the ChainLink whitepaper. ChainLink’s oracle network was designed to enable secure delivery of data on-chain, inter-blockchain communication and traditional off-chain payments functionality. This partnership is beneficial not only for MARKET Protocol and ChainLink but also for the entire derivatives industry. To start your own ChainLink, visit their website. To learn more about their latest developments, join them on Telegram or Twitter. To learn more about MARKET Protocol , its partners, team members and development progress, join the ongoing discussion on our Telegram, subscribe to our newsletter and follow MARKET Protocol’s website blog.
  9. MARKET Protocol and ChainLink Team Up to Enable Off-Chain Asset Trading on the Ethereum Network

     

    1*nyYjOI-RM_PH5h5s_cTe5w.png

     

    MARKET Protocol is especially excited to announce its latest partnership with ChainLink, the industry leader in decentralized oracle networks and securely providing data to smart contracts. Oracles are crucial for inter-blockchain and off-chain functionality; they are key to decentralized derivatives trading systems’ incorporation of all asset types.

     

    ChainLink’s reliable and secure network connections enable MARKET Protocol derivatives traders to create highly complex derivatives smart contracts. MARKET Protocol contracts can now be made using any/all market data, on-chain events, and off-chain events, which will allow them to become a superior alternative to legacy derivatives contracts.

     

    MARKET Protocol

    MARKET Protocol’s vision is to bring the $100+ trillion derivatives market to the blockchain by powering the safe, solvent & trustless derivative trading of any asset.

    You can trade stocks, cryptocurrencies, and traditional assets. MARKET Protocol smart contracts are always solvent and transparent. Our revolutionary framework offers leverage without margin calls or funding liquidations. MARKET Protocol is open source, allowing users to create decentralized exchanges (DEX) and decentralized apps (dApps) of their own.

    There are many additional ways in which derivatives traders can benefit from using MARKET Protocol:

    To purchase crypto assets through the use of smart contracts.

    To trade ICO tokens before they are officially distributed or have begun trading.

    To allow traders to decouple price volatility from the token utility.

    To eliminate the need to manage multiple wallets or exchanges, thereby enabling safer trading.

    To trade non-crypto assets, including stocks (TSLA, AAPL), commodities (oil), or even kitchen spices.

    To short crypto assets, earning a profit from declining prices without the need to borrow the asset.

     

    ChainLink and the Use of Oracles

    A partnership with ChainLink, the leading provider of secure oracles, with a proven record of execution in the blockchain and fintech space, benefits MARKET Protocol and its platform users by strengthening the reliability through decentralization aspect of the platform’s protocol and derivatives contracts. ChainLink’s expertise lies in bridging smart contracts with key off-chain resources, data feeds, various event APIs, and traditional bank payments.

     

    An “oracle” is used to assure secure interaction to effectively allow private and public blockchains interactions. ChainLink is a leader in decentralized oracle solutions and their expertise is a perfect fit for MARKET Protocol’s development of a platform that securely utilizes off-chain market data, cross-chain events, and on-chain trading relationships for any asset class.

     

    Because decentralized systems are dependent on the honesty of their nodes to achieve a consensus with the most truthful outcome, ChainLink utilizes a system that prevents potential issues resulting from faulty nodes. ChainLink handles the risk via three basic complementary approaches:

    ● Distribution of data source,

    ● Distribution of oracles, and

    ● Use of trusted hardware

     

    0*6BVp1mrSVk1ytpz1

    Fig 1: Example of two-level request distribution. Learn more at the ChainLink whitepaper.

     

    ChainLink’s oracle network was designed to enable secure delivery of data on-chain, inter-blockchain communication, and traditional off-chain payments functionality. This partnership is beneficial not only for MARKET Protocol and ChainLink but also for the entire derivatives industry.

     

    To start your own ChainLink, visit their website. To learn more about their latest developments, join them on Telegram or Twitter.

    To learn more about MARKET Protocol, its partners, team members and development progress, join the ongoing discussion on our Telegram, subscribe to our newsletter and follow MARKET Protocol’s website blog .

  10. MARKET Protocol and ChainLink Team Up to Enable Off-Chain Asset Trading on the Ethereum Network

     

    chainlink.png.9645486ef0a0ede07f29935da70aa4a5.png

     

    MARKET Protocol is especially excited to announce its latest partnership with ChainLink, the industry leader in decentralized oracle networks and securely providing data to smart contracts. Oracles are crucial for inter-blockchain and off-chain functionality; they are key to decentralized derivatives trading systems’ incorporation of all asset types.

    ChainLink’s reliable and secure network connections enable MARKET Protocol derivatives traders to create highly complex derivatives smart contracts. MARKET Protocol contracts can now be made using any/all market data, on-chain events, and off-chain events, which will allow them to become a superior alternative to legacy derivatives contracts.

     

    MARKET Protocol

    MARKET Protocol’s vision is to bring the $100+ trillion derivatives market to the blockchain by powering the safe, solvent & trustless derivative trading of any asset.

    You can trade stocks, cryptocurrencies, and traditional assets. MARKET Protocol smart contracts are always solvent and transparent. Our revolutionary framework offers leverage without margin calls or funding liquidations. MARKET Protocol is open source, allowing users to create decentralized exchanges (DEX) and decentralized apps (dApps) of their own.

    There are many additional ways in which derivatives traders can benefit from using MARKET Protocol:

    • To purchase crypto assets through the use of smart contracts.
    • To trade ICO tokens before they are officially distributed or have begun trading.
    • To allow traders to decouple price volatility from the token utility.
    • To eliminate the need to manage multiple wallets or exchanges, thereby enabling safer trading.
    • To trade non-crypto assets, including stocks (TSLA, AAPL), commodities (oil), or even kitchen spices.
    • To short crypto assets, earning a profit from declining prices without the need to borrow the asset.

    ChainLink and the Use of Oracles

    A partnership with ChainLink, the leading provider of secure oracles, with a proven record of execution in the blockchain and fintech space, benefits MARKET Protocol and its platform users by strengthening the reliability through decentralization aspect of the platform’s protocol and derivatives contracts. ChainLink’s expertise lies in bridging smart contracts with key off-chain resources, data feeds, various event APIs, and traditional bank payments.

     

    An “oracle” is used to assure secure interaction to effectively allow private and public blockchains interactions. ChainLink is a leader in decentralized oracle solutions and their expertise is a perfect fit for MARKET Protocol’s development of a platform that securely utilizes off-chain market data, cross-chain events, and on-chain trading relationships for any asset class.

     

    Because decentralized systems are dependent on the honesty of their nodes to achieve a consensus with the most truthful outcome, ChainLink utilizes a system that prevents potential issues resulting from faulty nodes. ChainLink handles the risk via three basic complementary approaches:

    ● Distribution of data source,

    ● Distribution of oracles, and

    ● Use of trusted hardware

     

    0*6BVp1mrSVk1ytpz1

    Fig 1: Example of two-level request distribution. Learn more at the ChainLink whitepaper.

     

    ChainLink’s oracle network was designed to enable secure delivery of data on-chain, inter-blockchain communication, and traditional off-chain payments functionality. This partnership is beneficial not only for MARKET Protocol and ChainLink but also for the entire derivatives industry.

     

    To start your own ChainLink, visit their website . To learn more about their latest developments, join them on Telegram or Twitter .

    To learn more about MARKET Protocol , its partners, team members and development progress, join the ongoing discussion on our Telegram , subscribe to our newsletter and follow MARKET Protocol’s website blog.

  11. I have been a professional derivatives trader since 2005 with experience trading in almost every asset class. This is my 2 cents on how a company I am building could have prevented the OKEx bitcoin futures fiasco!
  12. A lot of people think of their cryptocurrency wallet as merely a digitized version of a real wallet that is used for storing funds. However, it doesn’t actually store cryptocurrencies. Rather, it saves a pair of public and private keys that grant access to one’s digital belongings. In a nutshell, a public key is a string of alphanumeric characters that serves as an address that others can use to send you cryptocurrencies. Likewise, your private key is what allows you to send money to others. You basically use these two keys to sign off ownership of your coins. There isn’t a physical exchange, mind you. The transfer of funds is simply recorded on the blockchain ledger with the difference of the balance in the sender’s and recipient’s wallet. Remember: You cannot compromise on the safety of your keys; if you do, it’ll lead to a tearful goodbye to your digital assets. It is imperative to keep them safe. Always have backups! Unlike real-world wallets that store your change and old receipts, cryptocurrency wallets do much more than that. These wallets enable users to interact with the blockchain, to send and receive funds, keep track of the remaining total, and some even have swapping features to convert cryptocurrencies for another. Hence, they act as an interface to the blockchain ledger. Like cryptocurrencies, wallets are pseudonymous in nature as well. (However, since wallet addresses are stored on the public blockchain, there is a theoretical possibility to reverse engineer the identities of wallet holders.) Ever since Bitcoin came into the limelight, a number of cryptocurrencies have sprouted up. Instead of using different wallets for different coins, many wallets support a multi-coin/ multi-currency option. They can therefore store a variety of altcoins, mitigating the need to hold separate wallets for each one. (No single wallet stores all cryptocurrencies). As is the case with cryptocurrencies, there has also been a surge in the number of wallet services being offered today. Each comes with its own level of security and convenience of access. The best wallet for you depends on your requirements and your practices. (More about this in a bit!) Often called a full node/full client wallet, cryptocurrencies also offer their own official ‘’core wallets.’’ These wallets are quite secure, stable and also able to make backups (which is, we reiterate, extremely important). Examples of core wallets include Bitcoin Core Wallet, Litecoin Core, and Ethereum Wallet, to name a few. However, since they download the ENTIRE blockchain, with data containing about every historical transaction, core wallets are heavy and slow. Other types of wallets fall under a broad categorization of hot and cold storage. Hot Storage At its simplest, hot storage refers to wallets that are connected to the Internet. This type of storage is largely typified by software wallets, which in turn can be broken into four distinct categories. Hot storage has the advantage of providing quick and easy access to one’s cryptos. Some software wallets also support access through multiple devices, so cryptocurrencies can be easily be carried around. As convenient and user-friendly as they are, hot wallets are also the riskiest to use; they have a high susceptibility to hacking attacks and theft. Often private keys are stored online and are controlled by a third-party, increasing vulnerability. In addition to this, if your device gets damaged or misplaced, the wallet is lost as well. It is therefore advisable to use hot wallets, just like you use your real-world wallet: Store only a small amount of money for day-to-day spending. As mentioned before, software wallets include the following: 1. Web/ Exchange-based/ Cloud Wallets This is a web-based wallet and is often hosted by exchanges themselves. Since you have instant access to your wallet, web wallets are a very fast way to complete transactions. Creating a wallet is super easy and can be accessed from any device or server with an internet connection. Some online wallets can also manage multiple currencies and even swap one currency to another. Some online wallets are also called custodial wallets because private keys are saved on third-party servers — a feature that heightens the security risk. Since exchange-based wallets have had instances of shutting down or being hacked, it is imperative not to store ALL your assets on these wallets. Online wallets are ideal for small amounts of cryptocurrencies only. Make sure to use reputable exchanges, and to enable two-factor authentication to add an extra layer of protection. You can also spread your cryptocurrencies on a variety of exchanges to diversify your assets. Coinbase is one such popular example of an exchange-based custodial wallet, while blockchain.info is an online wallet for Bitcoin. 2. Desktop Wallets Desktop wallets are software programs installed on a computer/laptop and accessed directly from that device. The keys are stored on the hard drive and offer much better security. Two examples of desktop wallets are Exodus (which has a great interface and supports multiple currencies)and Jaxx (good privacy and security and feature-rich). A desktop wallet is still prone to malware, keyloggers, and hacks. Loss or damage to the device also causes your wallet to be inaccessible. To be on the safe side, you could opt to use a dedicated device (for example, an old laptop), or partition your desktop for digital assets. Another important point is to stay safe online! Avoid using public Wi-Fi connections, clicking unknown/phishing links, and downloading suspicious files. Last but not the least, install a really good version of an anti-virus software and firewall. 3. Mobile Wallets These wallets run as an app on both Android and iOS devices. It brings portability, ease, and practicality to serve as a great option for those actively trading or using cryptocurrencies. Mobile wallets also have a number of features such as storing keys to allow for payments on the fly, or instantly transferring funds through near-field communication. Mobile wallets are lightweight because they are only a subset of the blockchain ledger and, therefore, they work with Simplified Payment Verification (SPV) technology. Again, mobile wallets can be compromised if damaged, misplaced, hacked, or infected with malware or keyloggers. Remember to tighten your security like Fort Knox. Breadwallet, Mycelium, Coinomi, Electrum and Copay are a few examples of mobile wallets. 4. Multi-signature Wallets Multi-signature (or multisig) wallet, as the name suggests, requires more than one signature to authorize and complete a transaction — just like a shared bank account. This division of keys is ideal for use by businesses and families, creates more security, and acts as a backup in case you lose your key. Cold Storage The term ‘cold storage’ denotes storing cryptocurrencies on wallets not connected to the internet, and these are comprised of hardware and paper wallets. Cold storage is similar to a safety deposit box or vault, or a savings account. They are best utilized for long-term storage of large sums of cryptocurrencies. As improved security and reliability is, cold storage has a few shortcomings as well (theft, environmental damage and human error), so it is advisable to be diligent about such methods. 1. Hardware Wallets Hardware wallets are dedicated wallet devices, often in the form of a USB stick. Just plug it in to an internet-enabled device to transfer assets. Even though transactions are made online, the keys are stored offline. Thus, hardware wallets are one of the most secure methods of storing cryptocurrencies, in addition to being portable. Some hardware wallets come equipped with an OLED screen for displaying and verifying important details, while other features can also include the ability to be restored using seed phrases in case of damage, loss or malfunction of the device. Ledger Nano Sand Trezor are great options (among many others!) for a hardware wallet. 2. Paper Wallets A paper wallet is one of the easiest and safest types of wallets and is basically a QR-coded printout of the access keys. These can be generated via programs that randomly generate the private and public keys. But, as it’s simply a piece of fragile paper, make sure to keep it safe from environmental destruction, thievery, and human error. Your wallet is only as secure as your practices. As a rule of thumb, make multiple encrypted backups of access keys and seed phrases. Use reputable wallet services and make sure to employ updated software with the latest security enhancements. Implementation of extra layers of security protocols, two-factor authentication, and long and lengthy passwords help to dissuade potential attacks from hackers. Remember the golden rule: store just a small amount on hot wallets, keep the rest tucked away safely in cold storage. Future ways of handling custody of crypto We have previously discussed all the ways of storing crypto and issues associated with keeping your funds on exchanges, but there are many potential problems that might arise as a result of the fact that keeping custody over your funds in a sovereign way for many non-tech savvy participants might be an extremely complicated process. But why do we take ownership of the tokens in the first place? Cryptocurrency market participants are currently mostly owning coins and tokens in order to get exposure to their price movement. Many of the digital assets sold as utility tokens still require the development of the associated platforms and the ones that can be used for a certain utility at this point in time, lack a proper hedging mechanism. Due to the aforementioned factors, we believe it is very important to enable the price exposure to digital assets without having to take ownership of them. That’s why we have created a decentralized derivatives framework called MARKET Protocol. Our contracts allow you to use any ERC20 token as a base currency to settle an agreement with another market participant, where the value of your agreement depends on the price movement of a reference asset which can be any cryptocurrency, stock, bonds, gold etc. In plain English, with MARKET Protocol you do not need to directly exchange asset A for asset B to be exposed to it, so there is no risk from issues associated with transactions. But you still need a safe and trustless mechanism for custody of asset A and settlement with the other side of the trade. The solution: smart contracts! All funds that are traded using MARKET Protocol contracts are deposited into the smart contract collateral pool which is connected to another smart contract that holds any remaining funds that are not traded. Our whitepaper provides insight into the entire process: from depositing funds to contract deployment, trading, and settlement of the trade. In order for crypto assets to be used for the specific purpose they are created for, besides having a platform built that would require them as a payment or participation mechanism, we need a “tool” that would help us keep their valuation more stable. For example, if you’re using Siacoin to pay for cloud storage, you want to be sure that the value you are getting for your money is better than traditional services, which is highly dependent on the actual price of the token. Besides the hedging, derivatives are contracts that represent a good price discovery mechanism, that can help decouple token utility from market volatility. For the cryptocurrency markets to evolve and reach a higher level of mass adoption, we need to build safe and trustless frameworks for custody and trading of assets, and also empower participants that want to consume the utility of tokens and associated platforms with a way to achieve higher price stability. To learn more about how MARKET Protocol is addressing these issues, visit our website and join ongoing discussion on our Telegram chat.
  13. @Granat exactly! It's all about the trust, or better said, finally not having the need to trust anyone before you decide to transact with them. So much time and money will be saved by eliminating third-party supervision.
  14. Replacing Your Need for Tether with Decentralized Stablecoins Although cryptocurrencies have potential to be used as a medium of exchange and are observed by market participants as a potential store of value (bitcoin in particular), they are far from a perfect unit of account. This is where stablecoins, coins with a value ‘pegged’ to a stable asset like gold or more commonly the US Dollar, come in. The advantage of stablecoins is that, unlike traditional cryptocurrencies, they have comparatively less volatility. Therefore stablecoins have a more universal use case and potential for real-world applications. For instance, payment of wages or buying groceries, or in the case of recently announced project Bifrost, sending aid across the globe where it’s most needed. One such example of a stablecoin is Tether, currently the most commonly used blockchain bridge between cryptocurrencies and fiat currency. Tether is a fiat-collateralized stablecoin, and it’s pegged, or in this case tethered, to the US Dollar. Hence, one Tether token (USD₮ is the ticker) equals $1. Simply put, Tether is a digital representation of dollars held in the vaults of the issuing company. In addition to the dollar, Tether also supports Euros (EUR₮) and the Japanese Yen (JYP₮). It is an idea to store, send, and receive currency in a 1 to 1 ratio across exchanges, platforms, and wallets quickly with minimal to zero transaction fees. Tether is created by Tether Limited, which keeps these fiat currencies in reserves that are, according to the company, regularly assessed, verified by professional auditors, and then posted public. Tokens in circulation should therefore always match the reserves. Many concerns have been raised, such as Tether’s centralization, the 30 million dollar hack, the speculative nature of the relationship with popular exchange Bitfinex, release of more coins than actual reserves to back them up, and more recently, the cancellation of the very audit that was supposed to negate all these fears. These are the exact reasons why there needs to be better decentralized solutions. Luckily there are more emerging every day. Here’s a list of a few alternative stablecoins to Tether. DAI After two and a half years of development, DAI was officially launched in December 2017. Unlike Tether, Dai is a decentralized crypto-collateralized stablecoin created by the MakerDAO community. DAI is an ERC20 token whose value is soft-pegged to the USD and is backed by collateral Ether. The token offers more decentralization because it is created via smart contracts on the Ethereum blockchain. Together with currency collateralization and interest adjustments, Dai ensures stability relative to the US dollar. DAI provides the benefits of blockchain technology without the volatility experienced by cryptocurrencies. Merchants and end users don’t have to worry about the price fluctuations. In simplest terms, DAI is just a loan against Ether (ETH). Although the token can be easily bought on exchanges, the system also has a clever way of creating DAI. Using the MakerDAO platform, users can leverage their ETH holdings into smart contracts known as Collateralized Debt Position (CDP) by first converting the ETH into Pooled ETH (PETH) through a series of steps. This locked PETH enables the user to draw out DAI, which they can trade or spend as any other ERC20 token. The collateralized PETH cannot be used until the outstanding debt is paid off in DAI. Tokens used to pay down the debt are destroyed, consequently removing them from the circulating supply. It is important to note that generating DAI also accrues an annual interest fee of 1%, called the Stability Fee. Creating DAI is understandably complicated, but it reaps many benefits. For example, you can easily get a loan using your ETH or buy ETH on margin. Users are also incentivized to sell DAI on exchanges when it reaches over $1 (which essentially is free money. Woot!) When DAI is valued under $1, one can also purchase DAI and pay off the debt at a discount. Important to notice that these types of arbitrage opportunities are very rare since the system uses an ingenious mechanism of creation and destruction coupled to supply and demand of DAI to ensure that it matches the $1 peg. A demand for DAI raises its price to greater than $1, incentivizing users to create more DAI. When DAI is less than $1, the supply is an incentive to pay down CDP at a cheaper rate, thus removing DAI from the system. The system also cleverly manages ETH price fluctuations. Multiple oracles work to provide price data, and if the value of ETH goes below a certain threshold, the CDPs are liquidated. Maker auctions the locked ETH to any DAI holder who can pay off the debt on a particular under-collateralized CDP. Another token in the system is the Maker Token (MKR), which serves as a fail-safe to the entire system in case of a coordinated attack. MKR has three distinct uses: Remember the Stability Fees accrued on a CDP? This is only payable in MKR. The token is ‘burned’ when fees are paid, removing MKR from the system. This encourages the value of MKR to increase over time. Furthermore, if the collateral in the system is less than DAI in existence, new MKR tokens are automatically created and sold to raise additional collateral. Lastly, MKR holders can also vote on the governance of the system and on proposals to implement changes in the network. All in all, DAI is a promising solution to volatility. This stablecoin uses collateral to back its value and interest rate adjustments to stabilize its price, thus providing a number of financial opportunities, in addition to benefiting other ‘addressable markets’ such as minimizing risk in gambling markets, promoting international trade at minimal cost without interference, and in building transparent accounting systems. DIGIX DigixGlobal, a Singaporean based company, has brought a refreshing take on stablecoins with a new initiative called DigixDAO. Their crowdsale exceeded all expectations when it met its 5.5 million USD hard cap in just twelve hours, instead of the intended thirty days! DigixDAO harnesses the power of blockchain technology for its immutability, transparency, and security to tokenize gold. Gold has been the safest and most stable store of value since time immemorial. It is, therefore, a gold-backed stablecoin protected from the inherent price volatility of cryptocurrencies. DigixDAO is built on the Ethereum blockchain and incorporates the use of smart contracts. Digix has developed a unique protocol called Proof of Asset (PoA) verification (also known as Proof of Provenance) for proving the existence of assets and ownership. The DigixDAO network uses two tokens: The Digix Gold Token (DGX) represents 1g of physical 99.99% London Bullion Market Association (LBMA) standard gold that is stored in a custodian vault. PoA is a process that records possession of an asset. It establishes a chain of custody using digital signatures from the listed Vendor as well as receipts of purchase and deposit, which is then stored in a decentralized database. This successfully creates a Proof of Asset Card (‘Gold Asset Card’). Using smart contracts, these PoA Cards can then be minted into existence to create fungible DGX tokens. Each token equates to 1g of gold and is divisible up to 0.001 grams. DGX token provides the means to liquidate gold assets for easy spending and trade and to stabilize the inherent volatility seen in cryptocurrency. DigixDAO token (DGD) enables token holders to pledge the token, and reap the rewards, for vetting and approving proposals related to the growth of the network. DGD holders also receive quarterly rewards on the total DGX collected through transaction fees. There are 2,000,000 DGD tokens in existence, with 15% allocated to developers. Both DGX and DGD work together and are a key component to the DigixDAO infrastructure. After the partnership with DAI, Digix is also looking to expand to other metals and commodities. DGX can be used as a store of value for escrow services, in-game currency, allow wealth inheritance to be passed automatically to heirs, for crowdfunding opportunities, and P2P lending and microfinance. eUSD by Havven Havven, an Australian based cryptocurrency, is a decentralized payment network that employs the use of a stablecoin to enable day-to-day transactions. According to the company, Havven’s 30 million USD token sale, which ended in February, was the largest of any Australian blockchain-based startup. Havven uses a unique system of two tokens — The Havven token acts as collateral, while nomins serve as the stablecoin. Nomins are issued by Havven token holders who lock up Havven as collateral. Havven recently released the first iteration of Ether-backed nomins called eUSD — an ERC20 token that is designed to hold the value of nomins stable at $1 USD. The release of eUSD is intended to act as a test to allow the Havven team to observe and extract data that will assist in strengthening the network, as explained by the founder of Havven “The launch of eUSD demonstrates that we are committed to releasing a working version of the platform as soon as possible.” It is, therefore, the initial step in the launch of the next project of Havven-backed nomins (nUSD). Havven backed nomins pegged to other currencies such as EUR, GBP or YEN, to name a few, is expected to be released by the end of this year. This is how the network works: Alice uses ETH to acquire havvens. A collateralization ratio only allows 20% of the Havven tokens to be issued as nomins by escrowing the rest of the Havven tokens. These nomins are then sold for ETH by the system, and the ETH is deposited into Alice’s wallet. The value of Havven comes from the fees generated from the network that completes a transaction in nomins. The issuance system then keeps the price of the nomins stable at $1, enabling everyday payments. There is a simple conversion tool to convert ETH into eUSD, which in turn is also redeemable for ETH. This can be done through a Chrome or Brave browser and the MetaMask extension at a 0.5% conversion fee. Once nUSD is launched, there will be a window for converting eUSD back into ETH. Cryptocurrency market participants have multiple decentralized solutions to choose from when it comes to using the asset and dollar value backed tokens. MARKET Protocol team is a strong proponent of scaling the blockchain and its native assets through price stability, and therefore we have recently announced a partnership with all the projects mentioned above. We look forward to enabling the future decentralized derivatives traders with the best tools for proper risk management and decoupling price volatility from a token utility. To learn more about other use cases for MARKET Protocol, visit our website, read our whitepaper and join the ongoing discussion on Telegram.
  15. No matter how good your token incentives model is, market volatility is always able to diminish all the benefits associated with holding or using those tokens. Also, many projects don't put more than a minute into defining their token supply and creation rate based on the principles of behavioral economics in order to work towards their platform higher utilization through proper incentives. They only care about the price. But even if that's the case, they don't currently have an efficient way to protect proper valuation due to the volatility. The ability to hedge against it is a crucial feature for a higher level of digital asset adoption. By choosing the appropriate position on the derivatives market, utility token holders would have an opportunity to protect from market volatility and that way avoid potential losses associated with consuming the utility of a token. With MARKET Protocol contracts that have stablecoins like DAI, Havven, and DGX used as reference assets, traders are empowered with a very novel protection mechanism. To read the article in full, visit: https://medium.com/market-protocol/the-revolution-will-be-incentivized-f6fddb3f7c93

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