Hello, World: Genesis of P2P Finance
Hello, there, and nice to meet you. We waited for some time to speak the first words but needed to lay the foundations first. Now that we have been ongoing for nearly 2weeks, we have gathered enough data to start polishing everything for a better customer experience, which is being deployed this week.
The whole project inception process started way back in March 2020 during the notorious crypto market crash fueled by cascading liquidations. A time when a lot of grey hairs popped up on crypto traders’ heads.
If one followed the liquidations closely on the largest derivatives and margin trading exchanges, some of the price dynamics looked suspicious, to say the least. First of all, there were no significant exchange inflows at that time, which usually precede massive price declines. Also, the arbitrage bots were not 100% operational during the crash as the price spreads between the biggest exchanges were inconsistent with their operational parameters. Things just seemed off, but there’s no way of accessing information to verify what truly happened due to the enterprise walls imposed by centralized exchanges.
In the aftermath of the events, there were many complaints voiced that big lenders and centralized exchanges may have manipulated the markets and forced liquidations upon crypto traders.
It all boils down to the selection and usage of oracles, the software that feeds price information from the market into trading engines. To function properly, the industry needs the ability to verify the legitimacy of those oracles at any point in time and Chainlink already provides this service, but not to the standard required — it only broadcasts the average price of the asset but does not get the data in a decentralized way, therefore it can still be manipulated.
To make matters even more complicated to verify, exchanges use a basket of oracles to determine values, multiple of which are centralized ones and, by definition, corruptible. It was a sad reality back in 2020 as it is today. With P2P we decided to initiate the change and put a new standard for the DeFi industry.
Once the idea of P2P Finance was born, Cardano stood out as the best L1 for the project — at the time, Cardano had just released the Shelley update and started transitioning to the Proof-of-Stake consensus mechanism. Right now, the Alonzo phase is upon us and smart contracts are about to be fully functional on Cardano, making it the perfect timing to release P2P Finance to the public.
From the very beginning, it was kind of obvious that a science-based, peer-reviewed blockchain like Cardano is going to take off. With the rigorous approach they adopted, it was just a matter of time until talented development teams started migrating and deploying on it.
What’s unique about P2P finance?
Likewise in the previous bull runs, while the market is hot, plenty of new projects are popping every day. Sadly, a lot of them are ill-thought concepts without any backing, others are just copies of already existing protocols, it’s hard to find something that stands out.
However, if you can bring a unique business and some innovation to the space, people will pay attention. That’s what the P2P Finance ecosystem is bringing to Cardano and the whole blockchain space. The feedback we’ve been getting so far from VCs and private investors only reaffirms it.
P2P finance proposes a full suite of Decentralized Finance services, on-chain derivatives, and numerous rewarding community incentives propelled by the native P2P token.
P2P Swap — a digital asset swap (AMM) for permissionless high-frequency trading;
On-chain Derivatives — margin trading on P2P Finance platform where margin requests are fed by lending reserves from P2P Finance liquidity providers;
Cardanow IDO Launchpad — an incubator for projects on the Cardano blockchain;
Wait there is more. The key innovation that is yet to be introduced to the DeFi industry is on-chain referrals by P2P finance. This neat functionality will allow the true project promoters to transparently earn proportionally to the value they bring.
There is a selection of projects coming up that offer no token utility from the start and mention only vague plans on how the token will be used in future development, whereas P2P finance is focused on instant utility and platform growth. We understand that in order for a protocol to bootstrap itself, user activity, liquidity, and engagement must be rewarded.
The whole P2P ecosystem is focused on giving the ability for retailers to generate passive income through various streams depending on their field of engagement. Active users on P2P finance will have the opportunity to stake digital assets in exchange for up to 30% APR, participate in liquidity farming by depositing their LP tokens for a share of the reward pool, claim their DAO title to boost passive earnings, lend their assets on-chain to margin traders and earn P2P tokens in exchange for attracting new users to the ecosystem.
There are a lot of truly exciting things that are coming to the Cardano blockchain and we promise they will not disappoint. Our development schedule is tight, but the team’s mindset is on fast delivery — so stay tuned.
More information to follow soon.