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Plutos Network Reduces Derivatives Friction in DeFi




Plutos Network Reduces Derivatives Friction in DeFi

Plutos Network is a synthetics and derivatives trading platform unlike anything else in traditional finance. As a first, Plutos runs on several networks, and this translates into faster speeds, lower costs, and the highest security available. Using this multi-blockchain powered technology, Plutos seeks to do more than simply solve Ethereum traders’ current issues with low speed and high fees.

Decentralized finance has yet to find a secure footing in derivatives trading, with only about 3% of the entire DeFi market made up by this major sector of traditional finance. There is significant money being left on the table and Plutos will act as a gateway to access this.. 

Architecture Spread Out for Optimization

Plutos Network provides a full-scale solution to the limitations of other derivatives platforms. Substrate as well as Polkadot underlayer technologies improve interoperability, and the integrations of Solana and Binance Smart Chain (BSC) means flexibility, security, and scalability are optimized to the degrees a single chain platform cannot match. Asset collateralization is spread across multiple forms of supported deposits, including ETH and DAI, and working under a DAO Governance mode where users get a choice by vote, Plutos also provides the lowest possible collateralization rates (C-rates).

Through the support of these collateralized assets, Plutos allows users to deploy an array of customized derivatives assets in a decentralized way, so in as similar way to a synthesized bond, it can be used for amassing value or be traded with any asset of equal value no matter the underlying quality of that other asset.

Creating Synthetic Assets with Theoretically Infinite Liquidity

By staking Plutos’ native token, PLUT, users can mint synthetic assets such as pBTC, pETH, and pUSD. This makes the Plutos Pool essentially infinite in scale, as it does not depend on other parties to provide ready liquidity for trades. This framework opens the door for a variety of use cases. First, natural hedging occurs as investors from different countries do not need to bear the brunt of another currency’s movements, such as the United States Dollar (USD).

In this example, Europeans can collateralize their Bitcoin (BTC) or Ether (ETH) and mint EURO-based synthetics (EUX) instead of relying on USD stablecoins (USX). This also reduces the economic friction present in transferring EURO into USD, and a global interest rate market is in turn created as these assets adjust in rates without being tied together.

Trading with Fewer Frictions Means Optimized Trade

Through Plutos Network, the creation of synthetic assets means users can trade and realize profits without the roadblocks set by procedures and censorship that exist in today’s traditional financial markets. Plutos creates a trading environment where assets of different classes and kinds can be seamlessly traded for one another. Third parties, like escrow or a court, are also unnecessary to further facilitate trades as these trades are made in a trustless environment where code is law and debts must be paid 100 percent in order to release any funds held in code.

This also means assets can be managed more securely and efficiently, and there are several ways in which asset pools are handled automatically, depending on the best outcome for each asset: weighted pools for constant weight index funds, stable pools for soft pegs, and smart pools for ongoing parameter changes.

Tokenomics Ease Trade and Increase Rewards

The Plutos Network whitepaper estimates it will launch with a market cap of $850,000. Of the 100 million PLUT tokens initially minted, 70 percent will be allocated towards ecosystem growth, liquidity reserves, and a mining fund while the other 30 percent will be allocated for fundraising and the project team, including advisors. The 10 percent of this portion that goes towards the team will be locked until three months after the initial TGE (Token Generation Event), and the full amount will be vested over a two-year period. PLUT holders are granted governance rights for holding the token, and these rights can be used to make future changes in the way Plutos Network works.

PLUT will be a deflationary currency, as some of it will be bought back and burned on a regular basis. The tokens collected for burning will come from fees created during the issuance of derivatives and execution of trades. This deflationary aspect should add value to PLUT as the user base grows, and users can expect to receive the native token as rewards for issuing and trading derivatives as well as staking the token itself. The TGE for Plutos Network is expected to kick off this May.  

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