Comdex: A new revolutionary DeFi player for the commodities space and an infrastructure provider
History of finance
The origin of finance can be traced to the start of civilization. Four thousand years ago, in Babylon, the fundamentals of modern mathematics arose. People realized that with numbers and mathematics, they could measure lands, tax people, and conduct business. India, China, Greece, and other parts of the world were the ground where science and innovation started having a mark on society.
With Decentralized ledger technology, we can reimagine the world of finance in a more trustless and transparent way, free of corruption and information asymmetry. In the last few years, we have witnessed many situations where big players can directly control the outcome of a case even when the odds are against them. LME (London Metal Exchange) stopped the Nickel market from trading in recent history and later went as far as reverting trades after a historic price spike in nickel. Market manipulation, naked short positions, and the Gamestop episode are just a few reasons we need decentralized finance and exposure to synthetic markets. We believe one-day blockchains could be the base of every economy.
Why we need Comdex
Comdex is an app-specific blockchain built using the Cosmos SDK. To ensure that the same transactions are recorded on every machine in the same order, Comdex uses the Tendermint consensus algorithm. This tech stack guarantees flexibility, resiliency, and quick transaction finality, trustless and decentralized.
With strong protocol fundamentals, Comdex can start building bridges between the legacy system, often called Centralized Finance to the new emergent Decentralized Finance. The first step is to have all the building blocks or tools to accommodate the global financial system.
What the future brings
We started the year with the Integration of the CosmWasm module into the main chain; this addition exponentially increases the potential of the upcoming Decentralized synthetics exchange. With this live, Comdex started an Incentivized testnet where people can purchase synthetic assets like cGold, cSilver, cOil, mint cAssets using the CMDX token as collateral and even provide the synthetic commodities in liquidity pools in an Osmosis-like fashion. The Comdex Decentralized Synthetic Exchange is easy to use and introduces possibilities for the Cosmos ecosystem to have exposure to many commodities prices for the first time in crypto.
Note that the $CMDX token is not just a staking token used to secure the chain and pay transaction fees. Users can start governance proposals to add new assets to the exchange. The commodity market is vast, to say the least; $CMDX holders will have a lot of fun adding new assets when the mainnet launches.
Let’s see how many products can you think of in the given categories:
1. Metals
2. Energy
3. Livestock and meat
4. Other agricultural products
We can’t wait to see the governance proposals for new real-world assets going live on the exchange!
With the current uncertainty in the markets, geopolitical tensions, and higher than expected inflation, Comdex can introduce new ways to diversify and earn passive income for the crypto nation.
Comdex will expand to Ethereum in the second part of the year. The Cosmos vision has always been to be cross-chain compatible. In the second part of the year, we are expanding to Ethereum.
Comdex will launch the enterprise trading platform for micro, small and medium enterprises to build further the trust needed to ease and enhance their access to financing. This platform (ShipFi) will be the bridge between CeFi and DeFi. Small and Medium Enterprises play a significant role in most economies, especially in developing countries. SMEs account for most businesses worldwide and are essential contributors to job creation and global economic development. Formal SMEs contribute up to 40% of national income (GDP) in emerging economies. These numbers are significantly higher when informal SMEs are included. However, access to finance is a crucial constraint to SME growth; it is the second most cited obstacle facing SMEs in growing their businesses in emerging markets and developing countries. The enterprise platform will serve as an on-ramp for digitalizing commodity trades. This can then be funded by establishing synthetic debt assets.
The next step is a reliable overcollateralized stablecoin $CMST, often treated as a gold standard for decentralized economies. Lending, borrowing, minting assets, and stable pools are some features that stablecoins provide to the user. With IBC enabled, $CMST will be free-flowing and a synonym with security and stability for the entire ecosystem.
With all the tools available, thanks to the cosmos interoperability and the smart contract language CosmWasm, we expect to see many DeFi applications running on the protocol and eventually expanding to other chains. We are thankful for all the tools in Cosmos. The tools we build will be available for other projects to facilitate and speed up the development of decentralized applications, which will help the Internet of Blockchains grow and reach the people who need democratic access to finance the most.
