After three years of the bear market and various market consolidations, cryptocurrency has again become a mainstream media topic. Things have changed since the last bull run of 2017. Many new protocols are driving this renewed interest with cryptocurrency. DeFi or decentralized finance is the talk of the town today. DeFi is allowing us to be our own bank and perform lending/borrowing activity without the intervention of any third party or custodian. The smart contracts of DeFi are bringing the next generation financial revolution. Forget KYC/AML. You just need a wallet to take part in the movement. DeFi basically originated on Ethereum blockchain and even today majority activity is taking place there only but some other blockchains are showing high hope to take forward this high-velocity game. EOS is one of them.
Image Source – DeFi ecosystem
Defibox = Uniswap+MakerDAO+AAVE
Defibox is a one-stop DeFi shop on EOS. Newdex, the largest EOS DEX, is an investor in this project. With the rise of DeFi on Ethereum, there was a need to build an AMM model like Uniswap on EOS. That’s how Defibox saw the light of the day. As per Master Huang, the founder of Newdex, Defibox should be seen as a combination of Uniswap+MakerDAO+AAVE. It has a swap feature like Uniswap. The unique AMM allows swapping any EOS token to another with lightning speed. The liquidity for exchange transactions is provided in the form of on-chain pools. You can provide liquidity to Defibox and earn trading fees. BOX is the governance token of Defibox and you can obtain BOX by liquidity mining. You can generate USN (a stablecoin) by staking EOS on Defibox too. The process is quite similar to the generation of DAI by MakerDao.
Defibox swap screen
$14.55B USD value is locked in DeFi now. The figure is growing exponentially but EOS DeFi has very low volume. The main problem is the liquidity of assets. DeFi on EOS can’t sustain by considering EOS as the main asset. It is important to note that even on Ethereum, the number one DeFi asset is WBTC (wrapped Bitcoin) and not Ether. One solution is to wrap tokens on EOS. pTokens, issued by a cross-chain wrapping company called pNetwork, are doing a fantastic job on Defibox. pNetwork holds the original asset by using smart contract and issues 1:1 asset on EOS. They’ve issued 132.7 PBTC on EOS till now. EOS/PBTC pool on Defibox has 45.25K EOS swap volume now and the liquidity pool has 53+ pBTC and equivalent EOS. This is definitely good liquidity. pTokens can bring many assets to EOS.
Liquidity growth in EOS/PBTC pool
Top markets on Defibox: EOS/PBTC is ranked 3
Defibox also made a strategic collaboration with Organix recently. Organix is an EOSIO based synthetic assets issuance and trading protocol. They mint synthetic assets with excess collateral backup and the price of those assets are synchronised with the external real assets’ prices through the oracle. Organix brings cryptocurrencies, commodities, fiat currencies, indexes and inverse assets to EOS by over-collateralization of OGX tokens. It is possible to use Organix’s non-slippage trading mode within Defibox if the two selected tokens are oTokens during the swap. The cooperation between Organix and Defibox can be a win-win for the EOS ecosystem.
Defibox is changing
Master Huang, Newdex founder, wrote a detailed blog post and it is a must-read if you’re enthusiastic about EOS DeFi and want to know the future direction of Defibox. Defibox team decided to choose ‘Same Right with Same Token’ recently. Previously Defibox Foundation was receiving 50% from transaction fees reward to cover the daily operational cost of the team. The move is being appreciated by the community. Defibox is an anonymous organization but they’re working to build a biological organization. The role of Defibox Foundation is prominent in the ecosystem and they’ve promised not to sell one single BOX token in the secondary market within one year as they don’t want to put pressure on the price of BOX token. They want to integrate BOX price to the inner values of the team. As per the community voting, the BOX token (approximate 5.8% of total BOX supply), originally given to Newdex, will be taken back. The foundation will launch a BOX Saving System (BSS) and use the taken-back BOX to reward the users who lock BOX. This will lead to long term price stability of BOX.
Defibox is doing well. Decentralization of the project was much debated earlier but every project starts in a centralized manner. Defibox is no exception. Defibox is already managed by the community. It is offering permissionless listings, on-chain transparent transactions, intermediary free trading and on-chain oracles within such a short period. The top markets have decent trading volume and new markets are being spontaneously added. Uniswap has already proved that the market is ready for decentralized asset transfer. Ethereum’s arbitrary gas fee is a big problem with DeFi. EOS offers feeless transactions and a platform like Defibox is ready to capture the opportunities. The liquidity problem can be solved through token bridges. Wrapped assets and synthetic assets can make wonders for Defibox. Ultimately only innovation retains its trails in the market.
Note: This post was first published here for Cryptowriter in association with voice.com.