Recent years have seen a significant evolution in financial projects as emerging tech popped up to complement existing market ecosystems. Much of this change was triggered by the 2008 financial crisis; it was barely a year later that Bitcoin was born. Since then, technological financial projects have become more common with the market peaking after the 2017 crypto bull-run. In fact, this niche has given rise to what some tout as the 'wild west' of the 21st century.
While it was Bitcoin that kicked off the hype, other innovations around digital assets and blockchain are also proving to be interesting. The industry has grown to offer a wide range of technological financial products as stakeholders navigate around the nitty gritty to polish this emerging class of assets. Notable innovations include Decentralized Finance (DeFi) projects which run on smart-contract based platforms such as Ethereum. In addition, crypto exchanges and affiliate programs have also been rolled out to tap the growing demand for FinTech products.
Given this opportunity, a number of innovators are trying their luck by launching products in line with the latest crypto trends. This has not been successful for most of them and some have had to wind up their operations prematurely. Nonetheless, the growing space of technological financial products continues to thrive with following projects featuring among the top 5 in 2020.
1. Buytex Network
This unique partnership runs a crypto exchange dubbed 'Buytex' that is powered by its native token, BUX. Though recently launched, the Buytex crypto exchange leverages innovation to facilitate the storage and transaction of digital assets. Its value proposition as per the Buytex website includes minimal commissions, constant updates and scaling, data protection, unique trading tools and stable operational support round the clock.
In addition, Buytex Network has a unique affiliate program based on BUX tokens. The program is designed to promote the use of its crypto exchange and grow community participation. Unlike the common ICO approach, Buytex Network has implemented a comprehensive allocation protocol to reward its users.
Interestingly, this initiative is quite diverse given it offers six unique income plans pegged on the ownership of BUX tokens. These income models are built around a 52-week duration but use different investment multipliers depending on the volume of BUX tokens held. Users can earn as much as 5% weekly by participating in the Buytex Network affiliate program.
The Decentralized Finance (DeFi) market has grown to over $1 billion according to stats from Defi Pulse. Kava is among the market leaders in this space; the platform enables its users to leverage their digital assets to mint USDX loans. Basically, users collateralize their assets through Kava's multi collateral CDP system before leveraging these positions via the platform's decentralized CDP's. Built on a Proof-of-Stake (PoS) consensus, Kava also facilitates the transition of ongoing positions into stablecoins for consolidation in case of a market turmoil.
Notably, the famous Binance Exchange token 'BNB' was recently added to Kava's lending portfolio after a community vote. This means that BNB users can mint USDX stablecoins on Kava by staking their digital tokens. Furthermore, Kava has allocated incentives worth 3,848,000 KAVA towards BNB users who leverage their tokens for Collateralized Debt Positions on its DeFi network. With Binance leading in crypto exchange volumes, Kava is optimistic of scaling its liquidity base to $10 million.
Just like Kava, Raise operates in the Decentralized Finance (DeFi) space but with a focus on stable business loans. Ideally, the platform creates a market for loan borrowers and investors at zero cost based on the transparency of smart contracts. The concept involves a borrower setting their minimum and maximum interest rate limits; these specifics are recorded on the loan smart contract which is immutable once deployed. To match with suitable investors, a reverse dutch auction is then run via the loan contract.
Based on this approach, the invisible hand of demand and supply balances the Annual Percentage Rate (APR) expected by investors with compatible interest rates posted by loan borrowers. According to an interview with the Chief Product and Technology officer at Raise, Francesco Vivoli, the upside of unsecured loans offered through their platform are higher yields,
"The main benefit is higher yields for investors. Our APRs ranges from 7 to 20%, which offers significant premium over other investment instruments out there."
Nominex is a leading crypto trading platform that allows its clients to earn and entertain via its ecosystem. The exchange accepts a number of fiat currencies including USD, EUR, RUB IDR and KRW for crypto asset purchases not limited to BTC, USDT, ETH, XRP, BCH and BAT. Users can also withdraw up to 3 BTC in a day through the Nominex exchange with minimal KYC requirements. Notably, it is one of the few crypto exchanges that currently support Visa debit and credit card purchases.
Once on the platform, traders can apply Nominex's advanced trading orders to capitalize on crypto price movements. These transactions are executed within the Nominex network at a fee of around 0.01%. Other than crypto trading services, the exchange also runs an affiliate program based on its native token, NMX. Users who leverage NMX tokens for transactions can get up to 50% discount on trading fees and 10% payout from referral business. In addition, a Binary affiliate program provides the opportunity to earn 4 different types of bonuses from 1 million referrals.
Nominex has since featured in the International Business Times among 6 disruptive use cases of blockchain technology. The review highlights,
"Nominex makes people’s dreams its top priority: providing top-quality education, eliminating social inequality and giving literally everyone equal access, including the unbanked, definitely no more inflation and over 6 ways to make serious money in parallel, lowest fees and so many bonuses and discounts that in fact there are negative fees."
This cryptocurrency trading platform dubs itself as a 'one-stop crypto exchange' given its diversified range of technological financial products. Its users can buy, sell and manage their crypto portfolio in a few clicks. Notably, it is one of the crypto exchanges with a liquid spot and derivatives trading market. As for the latter assets, OKEx offers crypto futures, options and perpetual swaps with up to 100x leverage. Currently, BTC futures within the exchange have already hit an average of $1.5 billion in daily volume.
A recent interview with OKEx CEO, Jay Hao, revealed that their focus is on three issues; security, innovation and reliability. He went on to comment on the vision of OKChain, the OKEx blockchain platform whose testnet was recently announced,
"We want to build a decentralized and open public chain to empower every participating node with the same power to run and issue decentralized apps freely. Eventually, we hope OKChain could be as decentralized as Bitcoin."
With volatility finding its way into traditional markets that were previously stable, digital asset innovations are no longer a concept of the future. Some market analysts have even argued that the COVID-19 pandemic fast-tracked innovations around technological finance. It is, therefore, not surprising that blockchain and cryptocurrencies are setting the stage for virtual markets to thrive in a global economy.
However, these innovations are not short of challenges given the ambiguity in issues such as regulation. Decentralized projects have had to take a more 'centralized' approach in efforts to remain sustainable and viable. While this is the case, technological financial innovations are adjusting to prevailing market conditions by seeking alternatives such as registering in tax havens or jurisdictions with advanced crypto laws. Going forward, projects within this industry are expected to boom hence the rush by both governments and big tech like Facebook to match the pace.