Andre Cronje launches decentralized Forex on Ethereum

0


Key points to remember

  • Andre Cronje posted a blog post detailing his new DeFi business, Fixed Forex.
  • Fixed Forex allows users to strike and trade various fiat pegged stablecoins by providing collateral.
  • The final version of Fixed Forex will be rolled out on top of Curve Finance.

Share this article

Cult DeFi architect Andre Cronje has announced a new decentralized stablecoin exchange protocol called Fixed Forex.

Andre Cronje unveils fixed Forex

Andre Cronje has built a new DeFi protocol based on forex markets.

Cronje announced the project, called Fixed Forex, in a blog post on Friday. It allows users to issue and exchange various fiat peg stablecoins including US Dollar (USD), Euro (EUR), South African Rand (ZAR), Japanese Yen (JPY), renminbi (CNY) and others.

Cronje, who is best known for building a range of notable DeFi projects including Yearn Finance, Keep3r Network and multichain.xyz, detailed his new venture in the announcement. He explained how users can mint fiat peg stablecoins and trade them with other assets on the Ethereum network.

Users will need to provide collateral in the form of other crypto assets to strike stablecoins through the protocol. For minting fiat currencies, the protocol will calculate loan-to-value (LTV) ratios and dynamically accept collateral in accordance with lending protocols such as Compound, Aave and Iron Bank from Cream Finance. Cronje noted that the amount available to strike against the collateral would be proportional to the channel liquidity available on Fixed Forex.

Additionally, unlike decentralized stablecoin issuers, Fixed Forex has incorporated “soft liquidations,” a mechanism that ensures that a user’s collateral will not be fully liquidated upon a withdrawal from the market. Instead, the protocol will liquidate only a minimal amount of funds to repay debt and maintain the collateral ratio.

The Fixed Forex contract is currently unaudited and therefore it is risky to add funds for purposes other than experimental. According to Cronje, the final version of the project will be deployed on top of Curve Finance.

The foreign exchange market is currently worth an estimated $ 6.6 trillion. Despite the immense size and popularity of forex in traditional markets, it has largely remained outside of Ethereum’s burgeoning DeFi ecosystem. This may be due to the complex dynamics within the forex markets, as well as the slow transaction times and high fees that Ethereum can be subject to.

If successful, Fixed Forex could be one of the first projects to overcome the challenges of implementing a large scale decentralized currency exchange on Ethereum.

Disclaimer: Andre Cronje is a shareholder of Crypto Briefing.

Share this article


Leave A Reply

Your email address will not be published.