Irreplaceable tokens could become a bridge to link the old financial system to the emerging fintech world in the near future. During a recent interview, Liquify CEO Adrian Lai – an investment firm and an incubator for decentralized finance platforms – reported Coin telegraph china Synthetic assets, NXT and digital securities are redefining the way capital markets operate.
Lai specifically believes that the value of synthetic assets can give every person in decentralized finance access to essentially any asset, as long as there is a reliable data feed. This emerging trend between traditional finance and Defy is unavoidable.
Lai also pointed out that as the convergence between security tokens and digital currencies increases, we will see an increase in activity between traditional finance and cryptocurrency. They said that:
“We are seeing a merger of security tokens, utility tokens and NXTs. NXTs can now also represent real assets, which were not considered many years ago. The convergence of traditional finance and the crypto space is growing more and more.”
Lai gave centralized exchanges as an example, stating that some of them are moving beyond the traditional understanding of being just a trading site. Platforms like Blockify and Coinbase provide retail-centric services such as savings accounts and crypto payment options – services that make these platforms work, at least partially, like traditional financial institutions.
Lai explained that synthetic assets tend to mimic other investment products. They can combine various derivative products such as futures, options, or swaps to simulate an underlying asset. These underlying assets may include stocks, bonds, indexes, commodities, currencies, or interest rates.
Although the convergence of traditional finance and the crypto industry is unavoidable, Lai believes that the current crypto industry still faces challenges such as liquidity risk and reliable data Oracle: “There simply isn’t enough information in the crypto space. When In many cases, if someone wants to trade non-liquid assets in cryptocurrency, there is not enough pricing data and other supporting information on the blockchain to facilitate trading. “
Lai also pointed out that even though there is a lot of hype around NXT, the current NXT market is only a digital collectible market, which does not require much liquidity. While Lai believes this collectible market is likely to remain here for a long time, many changes have to be made to help the wider NXT market grow further.
He believes that breaking NXT into multiple parts for investment purposes can become a new trend for the digital collectibles market:
“NXT can also represent real property, and creating a fraction of NXT from real property is a good way to provide traditional finance risk for crypto. In this case, liquidity is important because you trade a fraction of real property. Want to do. “
According to Lai, tokenization has been done primarily through security token products. However, he believes this will change due to Daffy, as giving the token to the property with Daffy can make the token more accessible to all:
“While security tokens are backed by real-world assets and their ownership is legally recognized, the liquidity of security tokens can vary, and we have seen in many cases that when security token owners want to sell their holdings, They may not be able to execute the business at the best price. “
Lai believes that the maturity of DIFI and tokens of real-world assets through the DIFI protocol will have greater potential than using the traditional security token offering model: “tokenizing assets in a decentralized fashion Opens up a lot of liquidity for the owners of. Also, it gives real-world property exposure to all users of Defy. “
As Cointegraph previously stated, 2021 will probably be an important year For Defy that will change the way financial services are used. So, can tokenization also play a role in this?