While decentralized autonomous organizations [DAO] have been in existence for years, they have experienced an exponential rise in interest and value, thanks to the proliferation of the budding decentralized finance [DeFi] market. Through DAOs, DeFi protocols become truly decentralized, dispelling the need for a central authority system.
These decentralized protocols, albeit designed as alternatives or solutions to traditional financial systems, are problem-laden. One of such sticking points is the high volatility associated with assets. For investors to make returns on their investments, over-collateralization, which significantly reduces profits, has become a norm.
Another flaw is the risk associated with minting new assets. Ordinarily, these risks could be mitigated by short and long-term positions but that is not the case with most of the DeFi protocols. They require investors to make more investments in a bid to offset these risks. Whilst these major drawbacks have stalled possible growth, a plethora of protocols have been launched to proffer solutions to the lingering sticking points, one of such is ISSUAA, a next-generation decentralized finance protocol for real-world assets on the blockchain, as stated on its website.
ISSUAA Offering Derivatives of Real-world Assets
Per a recent press release, this protocol in the billion-dollar DeFi market attempts to create derivatives of real-world assets on the blockchain, thus, offering investors numerous asset classes like stocks, commodities, crypto assets, and precious metals all in one marketplace.
Set up as a decentralized autonomous organization, this protocol promises seamless and hassle-free purchase of various asset classes by investors.
According to the aforementioned press release, this incipient DeFi protocol seeks to enable the transparent, fast, and cost-effective creation, minting, and trading of synthetic assets, reflecting the price of underlying real-world assets. Additionally, ISSUAA seeks to provide investors and liquidity providers [LP] with an alluring and profitable tokenomics.
Leveraging the principles of DAO, the DeFi protocol is not only community-driven but democratic, offering all ISSUAA Protocol Token [IPT] holders exclusive governance and voting rights.
Juxtaposing With Existing Competitors
With the cost of minting tokens at an all-time high [ATH] partly due to the incessant rise in the price of Ethereum gas, it has become quite a depressing affair to create or mint tokens on various protocols.
Attempting to solve this sticking point and the others facing the trillion-dollar crypto market, ISSUAA is proposing a capital-efficient, advanced, and next-generation synthetic asset minting protocol devoid of the prior stated drawbacks. While competitors like Synthetix and Mirror, two advanced protocols, require investors to over-collateralize, ISSUAA eliminates this by offering short and long token pools on each asset, minimizing risk while also ensuring that every dollar is impermanent and working for the good of investors.
ISSUAA, as stated by the press release, offers a superior yet low-risk farming yield. Liquidity providers, as revealed by the development team, earn a whopping 0.25% on each trade that is executed on the ISSUAA marketplace. Besides that, LPs will also be rewarded weekly.
The IPT Governance Token
Armed with a native token, ISSUAA Protocol Token, this DeFi platform cum marketplace seeks to further reward users — 60% of IPT, per the press release, will be shared amongst network users. Additionally, each week, 3% of what's left of the allocated 60% of IPT will be given to users.
Per the aforementioned source, the developers of this protocol are seeking to build an active, quantitative, and high-level community not only for investors and liquidity providers but for everyone on the network. Utilizing DAO facets, ISSUAA is creating a community-governed and democratic network where all IPT holders reserve the right to vote for or against proposed suggestions.