Primex Finance x Satoshi Club AMA Recap from the 13th of June

By Satoshi Club | Satoshi Club AMA Recaps | 12 Jul 2022

Hello, Satoshi clubbers Another AMA took place in Satoshi Club and we would like to introduce to you the AMA session with our friends from Primex Finance and our guest was . The AMA took place on the 13th of June.

The AMA session was divided into 3 parts with a total crypto reward pool of $500

In this AMA Recap, we will try to summarise the most interesting points for you.

Part 1 — introduction and questions from the Telegram&WebSite

Mary | Satoshi Club

Hello Satoshi Club! We are happy to announce our AMA session with Primex Finance! Welcome to Satoshi Club

Gold Rocket | Satoshi Club

hello dear Satoshi Club

Mary | Satoshi Club

@avd_01 @dmitrytolok are our guests today

Welcome to Satoshi Club guys

Dmitry Tolok

Hello guys! Glad to be here!

Anton

Hi everyone,

I’m Anton, the product manager @ Primex.finance

Thanks for having me here.

Gold Rocket | Satoshi Club

Nice to e-meet you guys ❤️

Mary | Satoshi Club

We are excited to see you here today, it’s not easy day for crypto, but as i see you’re still here for tech

Dmitry Tolok

Yeah, definitely not an easy day but it doesn’t matter if you BUIDL

Mary | Satoshi Club

For sure, those who build will survive!

Let’s start our AMA

And we will start with introduction! Could you please introduce yourselves and tell us how did you get involved into crypto?

Anton

Sure, let me give a short intro

I’m Anton, the product manager @ Primex Finance, with a background in marketing and PR. Previously product manager @ Adoriasoft, blockchain software dev firm.

Dmitry is leading BizDev @ primex.finance, previously he was running BizDev in fintech firms and also has a background in banking.

We have been working together for a few years before building Primex, and, given we’re big DeFi enthusiasts we always wanted to build something totally decentralized

Mary | Satoshi Club

Decentralised, love this!

Gold Rocket | Satoshi Club

It’s brilliant

Mary | Satoshi Club

How long were you working on Primex DeFi and what is your project about? How different are you from another projects?

Dmitry Tolok

Primex started last summer as a concept and the actual development started around late September when we secured the first private funding.

It depends what you compare Primex with, if we compare it with lending protocols, then the biggest difference is how liquidity is used. Primex combines the 2 biggest DeFi use cases — lending and decentralized exchanges.

The key difference from lending protocols is that borrowers (Traders) can only use the liquidity for the one and only purpose — to trade on DEXs, it’s not transferred to any external wallets of traders before the trade is closed, that’s why they don’t have to overcollaterize the margin debt.

Dmitry Tolok

Essentially Primex is a liquidity protocol on top of DEXs that allows margin trading cross-dex in a truly decentralized way.

Mary | Satoshi Club

Did you have liquidations today?

Dmitry Tolok

No, fortunately not, we’re in a testnet mode, so all good for our traders for now

Mary | Satoshi Club

Ahaha, true

Gold Rocket | Satoshi Club

Also we would like to know more about your team. Who is on the project team core?

Dmitry Tolok

Sure, we have a team of almost 40 people at the moment and there are a few development streams with respective teams attached to them: smart contracts, UI/UX, infrastructure (keepers/notaries), mathematics of all the incentivization, and buckets/token design. So we have different types of engineers/mathematicians on the team, all are DeFi enthusiasts

Gold Rocket | Satoshi Club

Is your team anonymous?

Dmitry Tolok

No, totally not, moreover, we recently released a posting on our blog covering some of the team members and their experiences.

Gold Rocket | Satoshi Club

Great news

Thanks for great introduction, we will have several questions selected for the Part 1. Ready to start?

Dmitry Tolok

Sure, go ahead

Gold Rocket | Satoshi Club

Q1 from Telegram user @Ivvanna_Cahya

In Primex finance. Along with the technology behind the tool, i learnt that there are five important roles that need to be filled to maintain functionality, which are Lenders,

Traders, Notaries, Delegators, and Liquidity providers. understanding that this are the five basic people that makes Primex Finance Functions. Can you tell us more about the roles of each of the positions mentioned? How can we leverage any of this available position to Maximize profit? I seem not to clearly understand the Functions of the Primex Notary, which is said to function In the offline world, & gives people and institutions confidence that documents are genuine. Can you kindly explain this role well?

Anton

That’s correct. Lenders and Traders are the pillars allowing the protocol to function, Lenders provide liquidity to credit buckets and Traders use that liquidity to trade with margin on multiple decentralized exchanges that are integrated with Primex. Lenders are incentivized by the interest rate and Traders have an opportunity to trade in a truly decentralized way and without interacting with centralized components.

To allow the traders to happen, we also have a role of a Keeper in the system, which is responsible for closing the trading positions when a certain price target is reached or to make a liquidation. Since we have neither back-ends nor centralized order books, we need to have someone to make a special transaction to close the trading position, Keepers are doing this.

I assume that you’re referring to the Trader notary in your last question.

Gold Rocket | Satoshi Club

Really smart idea

Mary | Satoshi Club

Guys, as i understand you’re totally decentralised and no one of members don’t need KYC verification?

Anton

Trader notary is an Ai-powered scoring mechanism that is a part of V2 of the protocol. It’s a special type of notary responsible for scoring traders based on the onchain data, we decided to skip the dKYC part of it, it’s only for scoring traders. It’s also a decentralized component nominated by community.

We also have community-nominated Credit Bucket Notaries that can introduce new credit buckets (liquidity pools) to allow margin trading for more assets. Credit Bucket Notaries are also staked and supported by community in a decentralized way.

Mary | Satoshi Club

And i want to ask — do you have any countries restricted?

Anton

Right.

Dmitry Tolok

We would refrain from the KYC aspect as much as we can as our goal is to make trading accessible for everyone, regardless of their geographical location. We’re not a centralized or semi-centralized infrastructure.

Mary | Satoshi Club

And btw do you use decentralised or centralised servers for your DeFi?

Dmitry Tolok

Nope, we don’t. We don’t host any back-ends or order books. The back-end function is done by so-called Keepers in Primex, which are community-hosted instances incentivized to make special transactions to close Trading positions. This is how we’re different from some non-custodial derivative platforms in the space.

Mary | Satoshi Club

Gotcha

Gold Rocket | Satoshi Club

Thanks for your great answers

Mary | Satoshi Club

Thank you for your answers! Ready to proceed?

Dmitry Tolok

Sure!

Gold Rocket | Satoshi Club

Q2 from Telegram user @UncleStrange1

Primex Finance is on a mission to improve the experience of trading assets on decentralized exchanges (DEXs). Traders can borrow funds below the liquidation price and maintain positions and each trader will be continuously scored based on their trading history to enable access to riskier credit Buckets. Can you provide more information on the process of how traders can borrow money? What are the requirements? Is there any form of verification process attached to it? What is the maximum amount a trader can borrow at the first time? How many times can a trader borrow money to stay in position after being liquidated? Can you tell us how many levels of Credit Buckets there are?

Anton

Sure, our mission is to close the gap between lending and decentralized exchanges and provide a truly decentralized infrastructure where Lenders and Traders can exchange value.

As for the Trading scoring mechanism, it’s a special type of decentralized notary in the system that is scoring Traders based on their past performance using onchain data. We do not plan to introduce any identity checks/KYC for traders on top of this for now.

There will be Credit Buckets available for all Traders, without specific requirements to the score, so anyone can use them.

Traders with high scores, though, will have an opportunity to open so-called underdeposited positions, meaning that they still can keep the position open even if they drop below the liquidation price to some extent. And in case of liquidation, they can later repay the debt to the protocol later to restore the score.

Anton

It’s a great feature we’re already working on but it won’t be present in v1, it’s on the roadmap for v2. DeFi hasn’t solved the scoring problem so far so we’re taking the challenge here. Such a scoring mechanism will provide more flexibility to both, Lenders and Traders.

Credit Buckets will be divided into several tiers based on the risk level, e.g. top 10 assets by liquidity on DEX, top 10–50, top 50–100 and custom buckets introduced by the community (including those with the scoring requirement). Lenders than will be able to diversify their risk by funding less and more risky buckets.

Mary | Satoshi Club

What was the most difficult to design (develop) in your DeFi? And what are you the most proud for?

Lol, it seems you partially answered before i asked

Dmitry Tolok

The most difficult is to connect all the roles in the protocol and incentivize them so that the infrastructure of the protocol is functioning smoothly. The Notaries and Keepers are rather sophisticated as well as the mathematics related to how interest is calculated etc.

As for the Trader Notary — it’s a great experimental feature not really present in DeFi yet.

We’re proud to have really great progress so far, even though not everything is visible yet except for some interfaces in our Alpha. The code and some hardcore mathematics will be open-sourced a bit later, stay tuned!

Gold Rocket | Satoshi Club

Sounds good! Thanks for your great answers! Are you ready for the next question?

Anton

Sure

Gold Rocket | Satoshi Club

Q3 from Telegram user @MudaraSilva

By locking funds for a specified time, lenders on Primex have the opportunity to fix their interest. I could not see any information about these tiers. Can you briefly explain about the interest rates for each time period? Does the rate depend on the time period or will the investment size also be calculated? I hope you offer better rates for longer time frames. When a lender choose a long period and wants to unlock his funds before the deadline, is he allowed to do so by paying an unlock fee? What are the charges/fees related to this feature? What is your anti-whale mechanism to prevent whales from investing their funds? How do you ensure the safety of locked funds? What will happen to them if Primex has to face any unforseen situation?

Anton

The fixed interest rate is a part of v2 of the protocol and will not be present in v1 yet. V1 will have dynamic rates for Lenders.

We’re designing the fixed rate to be based on the fees that Traders pay when having their positions open over time, so we always have a constant flow of fees from Traders that can be paid to Lenders willing to lock their liquidity for longer periods of time to earn fixed interest. We will have cooldown periods so Lenders will have to wait a little bit before they can withdraw the locked funds.

The safety is secured with smart contracts, there’s no centralized party controlling the funds.

Mary | Satoshi Club

Ok, what about audit? Any thoughts about insurance? You know, no one can be 100% sure in security and a lot of incidents in crypto show that it’s true

Dmitry Tolok

The code is not yet frozen as we’re in our Alpha-Beta stage so we will likely have our first audits in a couple of months from now, but be sure there will be a few leading audit firms doing audits. We fully understand the importance of this considering how many incidents there are in the space.

Mary | Satoshi Club

Super

Mary | Satoshi Club

Thank you for your answers! Ready to jump to the next question?

Dmitry Tolok

Sure!

Gold Rocket | Satoshi Club

thank you very much for your answer and for your responsible attitude to this issue

Gold Rocket | Satoshi Club

Q4 from Telegram User @Highpee

Even though Primex was launched in June 2021, it was in February 2022 that you did your seed funding with a successful raise of $5.7 million from your strategic investors. I am curious to know more about these seed investors and how they were able to make investment commitment into your project, since up till now, you have no token and no tokenomics has been officially released by you? How has this fund been utilised in the development of your project so far and why does it look like development is stuck in Primex Alpha Phase? When do you expect your token design to be out and when is IDO or other presale events scheduled to start?

Dmitry Tolok

There were certain delays in announcements as we raised funds a bit earlier than the entire round was announced, so that kickstarted the development. Primex started as an idea in Summer 2021 and then we started designing the protocol’s logic and its architecture, the active development process began in late September 2021 when we received the first funding from our Lead investors.

The funding is being used to cover the core development of the protocol, we’re definitely not stuck with the Alpha as we just recently released it to collect some first feedback from our community, the actual dev / token design is beyond Alpha now and we are planning to release Beta in several weeks.

Mary | Satoshi Club

Who are your Lead investors? Can you name them?

Dmitry Tolok

We’re working on a big posting that covers token utility and tokenomics, it’s a very important topic and we’d like to cover it in full within the few weeks, likely closer to the Beta release, please follow our official medium (https://blog.primex.finance/) and stay tuned for updates.

Sure

The round was led by Stratos and Coinfund, we also have positions of GoldenTree (a large traditional hedge fund) and a few big market makers such as Wintermute, GSR, and Ledgeprime that also help us with the overall advice on protocol design given their trading and market-making experience. The round was successful and we were significantly oversubscribed.

Mary | Satoshi Club

Ohhh, you prevented my ‘wen token’ question

Congratulations it’s really big achievement!

Mary | Satoshi Club

Thank you for your answers! Ready to proceed?

Gold Rocket | Satoshi Club

Famous and influential names

Anton

Yeah

Gold Rocket | Satoshi Club

Q5 from Telegram User @Dalboto22

Early contributors of will have access to Primex test versions and will be able to provide feedback on Primex functionality and interfaces. Thank you for these opportunities. What are the requirements to be considered an early contributor? What is the deadline to register on the platform? Is there a minimum amount of contribution? Generally, early birds receive tokens with a considerable discount. Does Primex offer that opportunity too? If I contribute later, can’t I join with the community and provide feedback? Is it mandatory to be an early bird to receive governance privileges?

Anton

There are pretty much no requirements, anyone can test the platform and participate early, all the feedback is helping us a lot as our goal is to build the protocol and all the interfaces. There will definitely be interesting opportunities for early community but we cannot announce them now.

The Early User program is now ongoing and you’re most welcome to participate — http://primex.finance/earlyuser

Mary | Satoshi Club

Oh, it’s my passion to try new platforms

Gold Rocket | Satoshi Club

Satoshi clubbers, test it please!

Mary | Satoshi Club

When do you plan to fully launch your platform?

Anton

We’re planning to release V1 later this year or beginning of next year

Mary | Satoshi Club

We will wait and follow your updates

Gold Rocket | Satoshi Club

By the way, share with us your roadmap

Dmitry Tolok

We are planning to release a fully decentralized cross-dex Spot trading app with different kinds of orders first and connect with a few DEXs on ETH mainnet first. It will already be possible to split the trading position across multiple DEXs depending on its size and the liquidity in the respective pair and later we will release the Margin trading app after our liquidity mining event. It will happen either later this year or beginning of next year.

After that, we will be deploying on a few other EVM-compatible chains so there will be lots of big updates.

Gold Rocket | Satoshi Club

Thanks for your great answers ready for the last question of this part?

Dmitry Tolok

Sure

Gold Rocket | Satoshi Club

Q6 from Telegram user @Cheriemike

I read that Primex plans to introduce two features in it platform they are “Under Deposited Trading Position” and “Under Collateralized Lending.So can you briefly summarize both features?Why did you decide to feature “Under Collateralized Lending” and not “Over Collateralized Lending”?.Which set of audience are both features meant for and what do both features especially Under Collateralized Lending comprises of?And will investors be able to access substantial credit without collateral with under-collateralized lending and how does “CREDIT DELEGATION” comes into play in the collateralized lending features?Please explain Thank

Dmitry Tolok

The key thing is the funds can only be borrowed for a specific purpose — to make swaps on DEXs, the funds are not transferred to external wallets of Traders and therefore, should not be overcollateralized.

Traders use Primex smart contracts to access liquidity to amplify their trading positions using leverage on DEXs like Uniswap.

Traders also do not collateralize their margin debt, they only lock their initial deposit but if there’s a liquidation, the initial trader deposit will be taken back to the Credit Bucket.

Underdeposited means those trading positions with additional buffer to borrow funds and not be liquidated, this is available for Traders with higher scores starting Primex v2.

Mary | Satoshi Club

Thank you for detailed answers!

Guys, we came close to the live part of our AMA session now! Do you feel the breath of storm? It will be a storm of questions from our community

Mary | Satoshi Club

Ready for them?

Anton

Yes, let’s go

Gold Rocket | Satoshi Club

Amazing first part of AMA

Mary | Satoshi Club

Let’s go

Part 2 — live questions from the Telegram community

Q1 from Telegram user @adaatalay

Does Primex have a native token? If yes, what are the use cases and its role in the ecosystem?

Dmitry Tolok

For example, there will be multiple staking opportunities, including staking for all kinds of notaries and keepers that support the infrastructure as we have no centralized back-end that processes orders, etc.

The PMX is a governance token that will be needed to participate in votings for new notaries, introducing new credit buckets (liquidity pools), new digital assets, etc.

There will also be multiple incentives for traders, e.g. trading fee rebates if they stake PMX, etc. LPs and early Lenders will also be incentivized for providing liquidity.

Please follow our official medium for a larger, more detailed posting on tokenomics, we will definitely share it with everyone (https://blog.primex.finance/).

Q2 from Telegram user @Shiva_shivi

There are many Lending Platforms in the Crypto space?
How different is Primex’s Lending Platform?
What main Tools does the Platform provides?

Anton

As for the differences between Primex Finance and the other DeFi protocols, such as lending platforms, DEXs, DEX-aggregators, etc, we introduced the following components to the market:

Primex Credit Buckets. Credit bucket is a smart contract where Lenders provide liquidity and traders access that liquidity to fund their margin debt. You can find more information here: https://blog.primex.finance/an-introduction-to-primex-credit-buckets-e2678441dd67

Cross-DEX, cross-margin trading. We’re not limited to a specific DEX. In Primex traders can open leveraged positions across multiple DEXs and the position can be opened on one DEX and closed on another.

Decentralzied Keepers, for liquidation and executing positions (including limit orders, stop loss, take profit, etc)

AI-based trader scoring. Starting from V2 Traders will be continuously evaluated by a decentralized network of ML-based nodes. The scoring defines traders’ risk levels and available buckets. High-scoring traders can survive high volatility and save their positions even when they’re approaching the liquidation price. It’s totally new to the market.

Q3 from Telegram user @habibi_ve

What are the benefits and risks of lending money within Primex Finance vs. other lending protocols in the ecosystem?

Dmitry Tolok

The benefits for Lenders are:

multiple Buckets to lend to, which means diversification
higher interest compared to other platforms, because of no-collateralization

Q4 from Telegram user @MdLuffyo

Do you have any instructional videos or training materials that show how the protocol works and enable them to understand the features of the interface so that Primex finance lenders and traders around the world can use and understand Primex?

Anton

Thanks for the question. Sure, we already have guides for our Alpha, it’s available here:
https://docs.primex.finance/guides/

Moreover, we’re publishing multiple materials explaining how the protocol works and covering the aspects of its interface. We are starting with some basic information, explaining the roles and how our credit buckets (liquidity pools) function, and will later be covering all the mathematics and advanced details of the protocol.

Early user feedback is especially important for us to improve the interface and make it as intuitive as possible.

Q5 from Telegram user @hana4544

Does the Primex Platform have the role and privileges of the Liquidity Provider? And how is it exceptionally rewarded?

Dmitry Tolok

Yes sure, LPs is a separate role in the system that can provide multiple assets that can be rebalanced in the protocol depending on the demand for a specific asset. Since there’s a risk of impermanent loss for LPs, they are incentivized with PMX. This is how their reward structure is different from Lenders. Lenders only get interest in the assets they contributed.

Q6 from Telegram user @captainprice111

I understood that Primex finance is an EVM compatible cross-chain liquidity protocol. So which mainnet will Primex debut on first? Can you share with us the order on which networks Primex will be run?

Anton

That’s true! Primex Finance is an EVM-compatible cross-chain liquidity protocol, so we are following such networks as Moonbeam, Polygon, Arbitrum, Avalanche, ZK-sync, and how their communities develop and DEXs grow. Likely to launch in ETH mainnet first, the others are also on the roadmap. Stay tuned for updates!

Q7 from Telegram user @emmy066

Primex will be launched on the ETH mainnet as far as I understand. Why do you prefer the ETH chain when considering gas cost and speed? Will you support other cross-chain and blockchains?

Dmitry Tolok

The main aspect is liquidity, we will need to connect with DEXs that have liquidity and ETH mainnet is leading so far, but we’re great fans of other EVM projects and ecosystems such as Moonbeam, Arbitrum, AVAX, and others, so we’re following those too.

We’re cross-chain and will be integrating with DEXs on multiple EVM chains over time.

Q8 from Telegram user @YRUSelling

You are using Ukraine flag with your name.

So I want know that are you from Ukraine? Whole team is from Ukraine?

Anton

80% of the Primex core team are Ukrainians. But the team is fully decentralized and we’re all over the world.

Q9 from Telegram user @eylulaydin93

I noticed you mentioned that there are a number of experimental features for v2 of the protocol that you need to test and get feedback on before going public, so how can we test these experimental features and what are these features? When do you plan to release the beta for V2 and how can we be notified?

Dmitry Tolok

Yes, one of them is Trader Scoring with under deposited feature, another is dynamic Credit Buckets introduced by the community, Fixed interest as well.

Please follow our official Twitter: https://twitter.com/primex_official and medium for updates on our releases: https://blog.primex.finance/

Q10 from Telegram user @Raisbelys

You say that your protocol is not limited to a specific DEX, do you mean that your protocol works with several DEX? How is this possible? Who are you able to work with several DEX? What are the advantages of your multi DEX protocol? Have you thought about integrating DEX into your protocol?

Dmitry Tolok

We integrate with multiple AMMs of multiple DEXs and the main advantage is that Traders can access more markets/liquidity in a decentralized way. Simply put, we achieve some level of market defragmentation that way.

From the tech standpoint, we make Primex credit buckets interact with AMMs of those DEXs. So it’s a soft of prime brokerage protocol on top of DEXs allowing using decentralized liquidity to margin trade.