Synthetic asset trading is fast becoming one of the fastest growing De-fi spaces on the blockchain. Having the capability to trade fiat derivatives based assets on the stock market through blockchain tokenization, which are minted through open-source protocols has everyone’s mind on the next chapter of the bullrun.
The Synthetic Assets Trading Space
The two most popular blockchain currently running the synthetics assets trading space are Synthetix and Mirror, where both platforms allow for the minting of synthetic assets using their derivative tokens. One thing notable in the dAssets interoperability is the limited categories of assets available for liquidity trade mirroring including accessibility to the assets, and here’s where the new Kid-On-The-Block will start creating a greater impact in the dAsset trading space.
Introducing The Duet Protocol, an on-chain parallel space governed by DAO allowing users to be able to mint synthetic dAssets.
World’s first multi-chain dAsset protocol
It is the world’s first multi-chain, synthetic asset protocol that innovates through the implementation of a hybrid asset on-ramp synthenization feature known as “Over-Collateralization” and a unique on-chain based algorithm-stabilized mechanism known as “Algo-Pegged” that will allow users to burn or re-burn the native token $DUET to mint dAssets. In relativity, the duet protocol will essentially allow users or traders, in this case, to replicate the real-world tradable assets in the decentralized finance ecosystem in a smoother, simpler user experience direction.
On the DUET Protocol, DeFi is used to link “Fiat Assets” such as stocks and bonds together with “Sharp Assets”, or known generally as cryptocurrency tokens, to mint not only stable, natural dAssets, such as DuetUSD, DuetEUR but also “Sharp” synthetic financial assets such as $TSLA or $AMZN. Powered by Duet DAO, the Duet protocol relies on community governance to set parameters such as adding new collaterals, mintable assets, and electing committees to jointly vote on proposals.
The Duet Protocol is an open and multi-chain aggregating platform which features exponential enhancements such as Multiple CDP, Yield Enhancements, Duet Utility as well as DAO Governance.
A unique protocol with interoperability and compatibility for minting dAssets
To onramp these FIAT assets onto the blockchain, there are 2 methods in which the Duet Protocol implements; The Over-collateralization (OC) Minter and the Lite Minter.
The Over-Collateralized Minter is a protocol whereby it directly uses the existing digital assets in the blockchain world in order to synthesize through over-collateralization (OC). By taking advantage of OC, this would allow for the synthetic assets to be minted on a higher price as compared to the actual value of the dAsset deposits in the liquidation pool, thereby reducing a users volatility-risks associated when trading in dAssets.
Users are then able to mint dAssets using standardized investment tools such as DuetUSD, DuetEUR, DuetJPY and so on, with the general stablecoins such as USDT and USDC are also accepted on the Duet Protocol’s system. Duet Protocol takes it a step further by allowing users to mint dAssets using BTC, stocks, ETFs, commodity features, NFTs as well as other assets that have liquidity or acceptance.
When compared to Mirror protocol which only accepts UST and Synthetix accepting SNX & ETH as collateral, Duet Protocol accepts a wide array of high-quality assets as an underlying dAsset that can cover over $1.3 trillion in market value, and it even accepts unique collateral, which includes the LP tokens as well as the lending deposit tokens in order to improve the capital efficiency of users’ funds and improve the composability of the agreement.
Duet designed a unique algorithm-stabilized mechanism which allows users to mint dAssets with 100% capital utilization and trade them with the system in nearly 0 slippage. The Lite Minter accepts DUET as fuel and mints a synthetic asset of equal value to the fuel. All the minted assets will be endorsed by the system token DUET. The price fluctuation of the dAsset can be passed to the DUET pool, and the burn and recasting of DUET will help stabilize the price of the dAsset.
To summarize, the Duet Protocol has an algo-based hyper-collateralization model, any asset class can be minted on-chain, the collateral earning multiplier can reduce the opportunity cost of user migration, DeFi coupling modules can empower various on-chain protocol combinations, Music theme NFTs offer entertaining gamification themes, unique token releasing scheme can enable and ensure project sustainability, it has broader collateral acceptance, and is governed by a DAO.
You can get the latest updates on Duet on their Twitter @https://twitter.com/duetprotocol