Demex's new permissionless money market allows traders to lend, borrow and liquidate on the Cosmos ecosystem, providing a DeFi solution to a TradFi problem.
SINGAPORE, Dec. 27, 2022 /PRNewswire/ -- Demex, a multi-chain decentralized exchange built on Carbon, developed by Switcheo Labs, has launched Nitron, a non-custodial money market. Nitron is the biggest money market in Cosmos. Users can now participate as lenders, borrowers or liquidators on loans permissionlessly.
Nitron supports different assets from the most popular blockchains such as Ethereum, Binance Smart Chain, Cosmos Hub, Neo, and more. Anyone can lend out their idle assets to earn a passive income, while borrowers are able to borrow this liquidity to improve capital efficiency.
Currently, it is difficult for users to hedge their exposure to certain Cosmos ecosystem tokens. By creating a permissionless money market, users can hedge their exposure or take short positions, while allowing others earn interest fees on their idle Cosmos tokens from the borrowers.
Nitron will launch with multiple ecosystem partners, such as Neo and other protocols who will bootstrap the money market by incentivizing lenders and borrowers through external rewards.
Nitron will also be partnering with various liquid staking providers (LSPs) , such as Lido, Stride Zone, pSTAKE and more, to accept Liquid Staking Assets (sometimes known as Liquid Staking Derivatives or LSDs) as collateral. LSAs are minted on a 1:1 basis of the tokens staked through these LSPs, and are value-accruing as the staking rewards from the underlying tokens are automatically compounded into the value of the LSA.
This allows for a strategy known as leveraged staking, which gives extra rewards to LSA lenders due to auto compounding. Leverage staking can offer a higher return with limited downside risk as LSAs grow in value over time relative to the non-staked token.
Nitron will also launch amplified pools, a type of stableswap that is often used to swap between similar-priced assets, such as liquid staked assets and other stablecoins. This feature will help to reduce the price slippage when users swap native tokens to their LSA version, offering a better trading experience for users.
Lending and borrowing protocols can result in bad debts if a loan falls too far below the position's collateral value. To avoid bad debts, Nitron is also launching with a public liquidation platform that anyone can participate in and earn bonuses for liquidating undercollateralized loans before they turn into bad debt.
Finally, Nitron is also launching a decentralized dollar-pegged stablecoin called Carbon USD (USC). USC will be overcollateralized by blue chip assets such as ETH, BTC, ATOM, USDC, and BUSD to ensure the peg remains strong, and will have its price peg supported by amplified liquidity pools.
Demex already supports spot, perp, and futures trading, as well as liquidity provision. The addition of the new features mentioned above will allow Demex to be a more powerful self-custody platform and further enhance users' trading experiences.
As DeFi ecosystems such as Cosmos grow and make finance easier and more accessible for users, it is clear that a powerful money market is needed, which is what Nitron offers. In fact, within just a few days of launch Nitron hit millions of dollars in TVL.
Visit Nitron, the money market for the Cosmos ecosystem and beyond.
Demex (or Decentralized Mercantile Exchange) is the cross-chain derivatives DEX powered by Carbon, and is designed to support any type of financial asset imaginable. Demex aims to make finance accessible and trust-optional while providing an intuitive and familiar user experience.
Demex is fully permissionless, allowing any user to list new markets, tokens, and participate in DeFi, giving control back to users for a truly decentralized experience. Learn more.
Samyukta Narasimhan, Switcheo Labs