Expirable and Tokenized Trade Contracts Goes Live On Arbitrum
By Nerly Shammah Dec 29, 2022
The decentralized finance market has seen great expansion in developments and utilization since its inception, the major catalyst for this growth has been its unique application of blockchain technology to revolutionize finance, contract management and settlement.
DeFi, despite the bear market turbulence, is still speculated to be the next phase of the banking system with intermediaries excluded from the picture. As its core merits, the decentralized finance ecosystem is packed with numerous applications and projects set up to facilitate trades, autonomously settled via smart contracts, designed to eliminate intermediate flaws.
Contango, a revolutionary DeFi expirable trade contracts platform, joins the crypto evolution with the launch of its public beta of Contango expirable contracts fully integrated on-chain with the help of smart contracts, enabling DeFi to offer trade contracts similar to futures on centralized exchanges but without the third-part or custodial factor.
In the light of FTX going down in flames, Contango is one of many other emerging projects with game changing products laced up to foster the decentralized finance market adoption. To name a few, in our recent coverage, the Ramp Network was featured as a payment gateway designed to bridge the gap between fiat and crypto exchange without the need for a custodian. Similarly, Contango emerges as a financial product platform that empowers futures traders without any third party risk as it autonomously operates.
What Is Contango?
Contango brings expirables to DeFi, allowing users to buy and sell crypto assets at a given price and date in the future. Contango brings a unique atomic model that powers its tokenized contract trades, whereas the system is not reliant on liquidity pools or order books.
Given this, users can open expirable positions on Contagon without worrying about the undeterminable funding rates/fees. The Contagon protocol borrows from the fix rate markets, swaps on the spot market and lends back to the fix rate market each time a position is created on the platform.
Following its release on December 15, 2022, Contango empowers traders looking to take a bet on the cryptocurrency markets while putting off the risk of leveraging centralized exchanges to play the markets. As per the announcement, Contango expirable positions are not only autonomously settled, but they are tradable.
This is a new model of financial contracts, leveraging the attributes of Non-Fungible-Tokens to power trade contracts. Each position created on Contango is tokenized and can be traded on a secondary protocol. Additionally, these positions can be used as collateral for borrowing on secondary platforms, opening a door for limitless leverage of cash flow.
Contango considers present ecosystem needs which includes ease of trade and utilization, low cost and efficiency. Positions created on Contango can be easily edited and readjusted by adding or removing collateral in the same single atomic transaction - therefore saving on gas fees and drastically reducing the need for subsequent block confirmations time. Currently live on Arbitrum, the new phase of expirable trade contracts has arrived the decentralized finance market.