Coinversation Protocol is a synthetic asset issuance agreement and contract trading platform based on the Polkadot contract chain. It uses the CTO and Polkadot DOT issued by the project as collateral to synthesize any cryptocurrency or stock through smart contracts and oracles. Off-chain assets such as bonds and gold. By mortgaging CTO or DOT, users can mint some kind of synthetic asset, such as US dollars, and they will automatically become longs of the asset. Users can also convert minted assets into other assets through the trading platform, so as to achieve the purpose of shorting the asset and longing other assets. The assets minted by users are the liabilities corresponding to the entire system, and the proportion of each user's liabilities has been determined at the time of mortgage, so that the respective profits can be calculated. Because such a mortgage pool model does not require a counterparty, it perfectly solves the problems of liquidity and transaction depth in DEX.
The main functional modules of the entire system are: synthetic assets minted with mortgages, decentralized contract exchanges, debt pools, fee pools, and oracle machines. The workflow of the system is described as follows.
1. Users can mint the system's default stable currency CUSD by mortgaging CTO or DOT. The mortgage ratio of CTO is 800% (tentative), and the mortgage ratio of DOT is 500% (tentative), that is, CTO worth $800 or DOT worth $500 can mint $100 CUSD. The user's mortgage ratio should be higher than this specified ratio as much as possible, that is, when the price of DOT falls, the mortgage ratio may be lower than 800%. At this time, the user should replenish DOT or return (destroy) a part of CUSD. The system stipulates that users who are greater than or equal to the specified mortgage ratio will receive a dividend of transaction fees in the fee pool as an incentive.
2. The stable currency CUSD minted by mortgaging CTO or DOT is a kind of synthetic asset and the standard currency of the entire system, that is, all debts are converted into CUSD for calculation. At the same time, CUSD is also a stable currency, and its value in the system is always defined as $1. CUSD can be converted into other synthetic assets in decentralized contract exchanges, such as cryptocurrencies such as CBTC, CETH, CDOT, foreign exchange such as Euro, Japanese Yen, RMB, and even gold and various stocks, supporting both long and short sales. All these assets are system-synthesized rather than real assets, and their conversion rates are determined by external real prices provided by oracles. This conversion process does not require a counterparty, and users can always convert all their CUSD into any synthetic asset supported by the system.
3. It should be noted that the respective debt ratios of all users in the system are determined when mortgaging CTO or DOT to mint CUSD, and have nothing to do with the prices of other synthetic assets after conversion. The debt ratio will only change when users mint or burn CUSD. The sum of all user debts is the debt pool, because changes in asset prices will cause changes in debt, and the profit of each user can be calculated through the constant debt ratio.
4. When the decentralized contract exchange performs synthetic asset conversion (that is, trading), users need to pay a 0.3% (tentative) handling fee, and these handling fees enter the system fee pool. The fee pool distributes dividends to users who meet the required mortgage ratio in the entire system every two weeks (tentatively), and the dividend ratio is determined according to the debt ratio. For new users, they need to hold the debt for more than a certain number of days or use it for a certain number of days (to be determined) in order to be eligible for fee pool dividends.
Target
Target
Advantage
Advantage
team
team
Coinversation Protocol was founded by a doctoral team in economics in the United States. It also has a technology development and operation team in China. The members come from Alibaba, Ant Financial, Peking University and other first-tier technology companies and universities.
