London-based Oxygen is announcing the launch of its blockchain platform for repurchase agreements (Repos). The repo platform is claimed to be the first of its kind by the project’s leaders who also happen to be the founders of Changelly, an instant cryptocurrency exchange with over 1.6 million users.
Oxygen will all give people a chance to maximize the benefits of their crypto holdings, allowing them to earn income, increase the liquidity of their holdings, and get a broader look at the crypto market by getting directional investment views across a range of cryptocurrencies.
The team is headed by CEO Alex Grebnev, an experienced financial markets professional who is an accomplished business leader and has held top leadership roles at the Bank of America, Merrill Lynch and Goldman Sachs.
MONETIZING CRYPTO-ASSETS WITH REPOS
Repos are a way for those interested to raise short-term capital and can be seen as being equivalent to a short-term collateralized loan. This is because dealers provide securities as collateral in return for some agreed upon payment with the dealer committing to repurchasing the securities at a later date and at a higher price, thus acting as an interest payment.
Oxygen is targeting a broad range of crypto asset holders with a variety of economic goals, including token holders that want to earn more income or gain access to capital themselves and crypto investment funds looking to make even more money from their portfolios by lending it to others for interest payments and so on.
A “CryptoRepo transaction” works just like any other repurchase agreement, with the obvious difference being that the exchange involves borrowing cryptocurrency — with the debtor committed to returning the creditor’s cryptocurrency with interest at a future date.
Additionally, because the exchange is done on a platform built on top of the Ethereum Blockchain— it will be able to take advantage of smart contracts — dehumanizing the repo exchange and eliminating any need for trust to facilitate it. Oxygen will utilize decentralized exchange technology to bring crypto investors and traders the full benefits of repo.
LEVERAGING SMART CONTRACTS TO PROCESS TRANSACTIONS
The smart contract on the Oxygen platform will be a way to clear and settle purchases, essentially acting as an automated clearing house and is a fundamental piece to the project’s transaction processing. All transactions will be recorded on the Ethereum blockchain where users will be able to manipulate and interact with the smart contract using its Ethereum address.
The smart contracts initiates the repo when both the lender and borrower send their respective items (loan assets and collateral) to the smart contract’s address where it locks in the collateral and sends the loan to the borrower and continues to track all ongoing transactions.
Oxygen is supporting all ERC20 standard tokens with a cross-chain solution currently in development. Once the solution is available to consumers, then the project’s team plans to integrate it into the platform — making Bitcoin, Litecoin and other cryptocurrencies available as well.
Source: The Merkle