Anbbit Dialogue| What Will Happen When DeFi Integrates with Perpetual Contract?
2020 was the year that DeFi projects erupted, and this year is the “golden age” of the entire cryptocurrency market. At the very beginning of this year, the price of Bitcoin surged, and the crazy rise in the price of DeFi projects, which attracted many industry practitioners devoted to the construction of DeFi ecology. As a participant and builder in the industry, the DODO USDT margined perpetual contract for the well-known DeFi project launched on the Anbbit Exchange is a new exploration. For this reason, Anbbit specifically invites the heads of the Zonff Partner Fund, and DODO projects to discuss together.
Guest Introduction
Zonff Partners Fund Partner
Colin
Zonff Partners is a portfolio fund focused on venture capital, quantitative funds, and calculated investments in the blockchain sector. Driven by industry cycle and in-depth research, a more complex management strategy is used to systematically capture structural opportunities in the blockchain development cycle. Invested in more than 60 projects, Zonff Partners owns a wealth of domestic and foreign industrial resources, and actively participates in all kinds of outstanding developer communities and autonomous organizations, aimed at working with entrepreneurs to promote the stable development of the industrial ecology. Currently, Zonff Partners focuses on the investment of open finance, Web3 infrastructure, physical industry applications, and trading eco-tracks.
Starting in 2020, the Zonff Partners has invested in DODO, Maskbook, Nest, KSM, DOT, UNI, McDex, Manta, Tidal, Konomi, Dorafactory, etc., and have heavily assetd Bitcoin and Etherum mining machines, which has made good gains.
DODO Asia Pacific PR and Community Cooperation Director
Shawn
DODO is a decentralized trading platform based on an original active market-making algorithm (PMM) chain liquidity solution. DODO supports the market-making strategy of professional market-makers, allowing for custom asset ratio, curve slope, cloth depth, etc., and allows anyone to crowdfund pools with the ability to issue new low-cost assets.
Anbbit CMO Elyza
Anbbit is one of the few platforms on the market to launch a highly leveraged USDT margined perpetual contract for DeFi projects, dedicated to building a global blockchain asset trading platform for global investment users to provide more secure, professional, and reliable blockchain asset exchange trading services.
Based on an understanding of the entire market and the control of industry trends, Anbbit has boldly integrated its main business continuity contracts with the DeFi project. As DeFi’s market infrastructure continues to be optimized, the wealth-making effect becomes more apparent, the number of users participating in DeFi investments in the market continues to grow, and the trading needs for DeFi projects are increasingly diversified.
Since its inception, Anbbit has been dedicated to observing and studying user needs, continuously optimizing derivatives trading-related functions, and providing the market with a more market-appropriate experience and services based on industry trends, combining rich industry experience with the real needs of cryptocurrency market trading users, innovatively proposing and continuing to try new breakthroughs.
The launch of a 1–50X DODO USDT margin perpetual contract is a small stop on Anbbit’s journey of continuous exploration and innovation.
Dialogue
1. DeFi projects are still very hot in the market at the time, but their share of the overall market is relatively small, so let’s talk about the prospects for the DeFi market.
Zonff Partners partner Colin: DeFi is the most defined opportunity in the digital currency sector, both bull, and bear. There are two paradigms in the original industry to raise the price, the essence of which is to find the interaction point between the cycle and the emotional side, thus completing the price fluctuations of the digital currency.
DeFi is the digital currency industry to produce ecological closed-loop areas, ecological value is to give the industry this clear direction of development, and provide effective business realization logic. At present, on the basis of the DeFi field’s cycle and mood to increase the fundamental data variables, we can calculate the cash flow and profit margin, forming a more grounded business investment logic based on the chain data, trading volume, trading address, and other data.
DeFi currently has a market capitalization of just 2 % and there is a considerable growth dividend.
Anbbit CMO Elyza: Many people believe that Bitcoin is a creative breakthrough in the history of cryptocurrencies, and the second breakthrough is the generation of DeFi. Why do they say that? Although DeFi is still in the early stages of development and application, it exists to meet the financial needs of some people, which are not currently available in traditional finance.
Based on the verifiability and transparency of blockchain infrastructure, DeFi’s goal is to build transparency and financial needs that can be open to everyone without any permission and without relying on third-party institutions, such as lending, trading, payments, and derivatives, which provides a lot of room for ordinary users to generate significant returns, so this is a different technology.
In the future, DeFi will go far beyond traditional financial institutions. Although DeFi is still a long way from Bitcoin, it has begun to take shape and has the potential to grow.
2. We see that DODO V2 Beta is already online on Ethereum and BSC main network, what are its main highlights? How can you get involved?
DODO Shawn: Thank you for your attention, DODO V2 Beta is already listed on Ethereum and BSC main network, and with the same functionality, is a more common chain liquidity framework, to share two points:
The first is the new asset issuance tool, the crowdfunding pool. This is a tool for crowdfunding and asset issuance for projects or individuals. Anyone can launch a crowdfunding pool at DODO, provide a certain amount of tokens, and specify the unit price and issuance quota of tokens. After the end of the crowdfunding period, the open pool is automatically established, and the crowdfunding price immediately opens the spot market as the opening price.
Crowdfunding pools are an equal-opportunity way to distribute tokens and launch liquidity markets that can solve the problem of IDO scientists rushing away. Our first crowd-funded pool project ended this afternoon, 173 times oversubscribed. You are also welcome to pay more attention to the new projects on DODO.
The second is that there are several fund pool types on DODO, including public pools and private pools, which can implement a marketer’s strategy chain for private pools. Any project party and market-maker or individual can achieve a complete, efficient, and flexible market-making strategy by adjusting the three parameters of market median price, depth, and spread. DODO also supports unilateral currency-filling, or arbitrary rationing of bilateral assets, as well as improving capital utilization by setting curve slopes.
In addition, DODO currently has several pools that can be mined. Support for ETH USDT USDC WBTC mining on Ethereum, support for USDT and BUSD mining on BSC, about 50% annualization, just on-line CAKE mining in the afternoon, 134% annualization. Also, welcome interested friends to pay attention to.
3. Tokens for most DeFi protocols are generally governance functions, how is the economic model of DODO V2 designed?
DODO Shawn: We have done a lot of thinking and innovation in economic model design, hoping to give more platform value to token holders.
DODO is a governance token that holds DODO and has the proposal and voting rights to participate in community governance. You will also receive a subscription share of IDO and crowdfunding on the DODO platform, as well as a fee discount during the transaction.
Second, we also issue a membership voucher vDODO, a membership system for loyal coin holders. In addition to the same benefits as DODO, holders of vDODO receive fee dividends and membership bonuses throughout the trading platform.
In fact, this design in the CEX has been relatively common, coin security quarterly will come up with 20% of the net profit for buyback and destruction of BNB, this mechanism to achieve the binding of BNB and coin security net profit, so that BBNB has a value base, and share the profit of coin security.
VDODO is now officially online and more than 1,000 people have become members of the DODO platform.
4. What is the impact of DeFi and highly leveraged perpetual contract convergence on the cryptocurrency market?
Zonff Partners partner Colin: Contracts arise to meet swap and cross-period price protection and hedging needs.
DeFi field because of the flow of new mining, staking and other operations of high frequency, naturally appeared a large number of hedging scenes. The ideal presumption is to complete a series of interactions such as liquidity, trading, insurance, derivative hedging on the chain relying on smart contracts. But the change is certainly not a one-off, the first limit to the current performance of Ethereum has produced GAS fee, the perpetual contract on CEX is the most convenient and secure hedging option for institutions or large funds.
DODO Shawn：I think DeFi and Cefi are very difficult to separate, these are two complementary, the perpetual contracts on the chain will also be a big market.
Anbbit CMO Elyza：We can see that the entire cryptocurrency market is on a sharp rise, the bitcoin dominance crypto-financial services market will expand exponentially, no one can predict where the ceiling of cryptocurrencies is. More and more new investors, traditional institutions, and emerging investors are pouring into the cryptocurrency market, and the entire cryptocurrency financial industry needs more good technology, products, and services and waits for cryptocurrency participants to innovate and enrich. Some people think it’s the golden age of cryptocurrencies, but I think the market is a long way from the golden age, however, I hope it’s the near future.
In my opinion, one of DeFi’s attractions to countless people is that it can be combined with different blockchain applications, like Lego, to provide users with new financial products. For a central exchange like Anbbit, all we have to do is identify the market’s needs and guide users. From the current market demand, when investors do not meet the existing trading forms and they want to pursue higher investment returns, they will start to trade perpetual contracts and other derivatives, and this part of the user is also a senior player in this field, in terms of contract trading demand, often demands higher qualified trading experience and more precise operation. Therefore, in the future market, DeFi project-related derivatives will also be a new area of the cryptocurrency market.
5 . There are a lot of DeFi projects on the market, so why Anbbit chose DODO as the first listed perpetual contract?
Anbbit CMO Elyza：From a technical point of view, DODO is one of the few domestic DeFi teams with algorithm innovation as its core competitiveness, this is also the main reason for the market attention. The AMM algorithm, currently represented by Uniswap, validates the feasibility of the fund pool model DEX. But it also exposes problems such as low capital utilization, bilateral currency flushing, and earthy losses, and DODO offers more thorough ideas and approaches than all current scenarios.
At the start of the new year in 2021, decentralization trading is still in a fast-growing market, with DEX continuing to grow, with DEX trading volume hovering around $2 billion in the last 24 hours. As a member of the DEX circuit, DODO’s 24-hour trading volume has exceeded $300 million. DODO’s short-term trading volume has climbed so fast that it has delivered a satisfactory answer to the layout since August 2020. For Anbbit, DODO’s technological innovations and performance in the market provide the basis for Anbbit to select DODO tokens as the first highly leveraged perpetual contract to be launched.
6. From your own respective perspectives, what is the impact of DODO’s sustainable contracts in the market?
Zonff Partners partner Colin: First of all, in the Field of DeFi DEX, DoDo is a highly innovative product, such as VDoDo membership system, IDO token issuance, etc., differentiated product positioning will bring new trading needs for DeFi field.
For example, users can hold DoDo tokens, become members, and participate in IDO token issuance, at the same time hedge on permanent contracts.
DODO Shawn: Thanks to Anbbit for its support of DODO and the launch of DODO’s sustainable contract. I agree with Colin very much that exchange contracts can help DeFi users hedge their risk.
From a project perspective, then, DODO’s perpetual contracts will provide DODO with better liquidity and more attention.
Second, users who hold DODO or take on the DODO platform can hedge through contracts if they need it.
Anbbit CMO Elyza: In the perspective of Anbbit, from June to the present, DeFi’s lock-up market value has risen from $1 billion to nearly $5 billion, the surprising growth potential has exploded, and the previous question mentioned that DODO, as a hot DeFi project in the market, also has good technical performance, so we want to participate in the development and expansion of DeFI ecology in a more innovative way.
At present, Anbbit as a focus on cryptocurrency contract exchanges, we can list DODO / USDT trading pairs on the spot sector, and also provide market users with DODO perpetual contracts, the specific response can cause, but also depends on the reaction of the subsequent market. However, it is undeniable that with the gradual development of cryptocurrency market, users’ trading needs will also be diversified. Anbbit’s current DeFi permissibility contract is also a small step in our efforts to provide diversified services to our users.
7. Between the risks of the DeFi project itself and the integration of high leverage, please talk about your perception of opportunities and risks?
We’ve talked a lot about opportunity in the previous question, and I won’t go into it here, I’ll focus on risk, actually, there is a certain amount of risk for the DeFi project itself. The main risks to DeFi today are contractual security risks and liquidity risks (or liquidation risks), but for some Market-tested DeFi projects audited by security companies and subject to long-term operations, these risks are also less. But for the average user, technology is extremely attractive to them, and their main concern is the rise or fall of the DeFi token price in the market. Although some projects are indeed excellent, in the early stages of development, it is inevitable that there will be a bubble in currency prices. In addition, projects now issue their own tokens at little cost, and dozens of new projects are launched every day on decentralized exchanges, many of which are designed to address the recent hot DeFi, DAO, and NFT hotspots. Therefore, in the mixed market, investors still need to be highly judgmental to avoid FOMO. At the same time, high transaction costs, limited risk tolerance at existing market interest rates, and lack of interoperability are also factors affecting DeFi’s development.
As a financial derivative of the cryptocurrency market, it is not mature for sustainable contracts. The entire trading industry is still in an exploratory phase, which is a very early stage, and the DeFi derivatives are riskier especially.
8. What are the prospects for the integration of future DeFi projects and sustainable contracts? Will it become the new wealth code?
Zonff Partners partner Colin：At present, Heco and BSC bit DeFi ecology has brought more new users, and this group of new users is not familiar with the complex operation of DeFi, and stay in the stage of filling the money mining, for the subsequent hedging, borrowing, insurance operations, need to have an educational stage, and the use of CEX perpetual contracts is a good way.
Anbbit CMO Elyza: In the last question, we talked about risk, but as you know, risk and return are often positively related. But on this issue, I can only say that DeFi will grow rapidly in 2021, but I can’t guarantee the price. But for now, there are still a lot of DeFi prices in the market, this still needs to continue to wait and see. Whether it’s blockchain or DeFI, it’s at a very low level, and although there are already some application examples, it’s very limited. Now DeFi itself is complex and fragile, but there is a lot of room for development. As far as DODO is concerned, it is still visible that the current currency price is rising in the market, and if the perpetual contract is added, the user will have more room to make a benefit. Anbbit supports a 50x leverage multiple for USDT margined perpetual contracts, which provides a good way to make more money.
With the development of the industry, more and more industry participants are needed to participate in construction. The market is up and down, but the industry infrastructure still needs to be improved, we can see their determination from the attitude of industry contributors.
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