The Base Protocol (BASE) is a synthetic crypto asset that derives its price from the total cryptocurrency market cap (cmc) at a ratio of 1: 1 trillion. BASE exists to maintain a stable pegged market price, the underlying asset - the crypto industry. The BASE to cmc post was kept stable via an elastic supply protocol.
BASE can be used as a temporary position, a "safe haven" between crypto transactions. Typically, one might trade into crypto "blue chips" to reduce risk exposure, or convert into stablecoins to eliminate risk exposure. Trading to BASE presents an alternative that maintains exposure to all cryptocurrencies, not just one. This can be riskier than trading blue chip, but in some cases, can act as a hedge against some isolated / unexpected ones. For example, the rapid decline in blue chips, or the fast emergence of new projects. Trading to BASE reduces the inherent risk of holding one coin, while absorbing the potential profit from several other coins. By far, the most popular safe haven crypto asset is Bitcoin, as it generally leads the direction of the industry and is historically the least volatile. The ability to "hold" the entire crypto market should present a useful trading alternative.
Reference Price
BASE also serves as a reference price for all cryptocurrencies. If a trader is speculating on altcoins (x), he will often track the price in terms of x / BTC rather than x / USD. This price reference illustrates how x is performing relative to BTC rather than USD, which is more important data for many crypto traders. If traders instead used x / BASE as their reference price, it would illustrate how x is performing relative to the crypto market as a whole, not just BTC. Reference price x / BASE should present a valuable alternative to the popular reference x / BTC price. BASE can also be used as a lending instrument to hedge leveraged crypto trading.
Traditionally, lending has been a challenge in crypto; if someone borrows 1 BTC to buy a car, they may be bound to borrow originally when it comes time to pay back that 1 BTC. This instability creates problems in borrowing crypto for general purposes, but can be useful if borrowing for crypto investments. Let's say a trader borrows 100 BASE to buy an altcoin, and the altcoin slumps along with the downward trend in the crypto market. When a trader goes to pay their 100 BASE back to the lender, he sees that BASE value drop too - a perfect correspondence to the crypto market. This means that when he repays the loan, he only bears the losses he took which are more than the total losses in the market. And vice versa, if the altcoin goes up, it will only excessively absorb the overall market performance gain. In this way, BASE can be used as a strategic hedge instrument to focus on leveraged trading crypto portfolios. The ability to speculate across the entire crypto market with one synthetic instrument lends itself to use cases like these and more. Those interested in exploring this use case can build Basic Protocols to create relevant, second layer products.
How It Works
Synthetic assets are assets whose properties have the same effect and value as other assets. BASE is a synthetic asset engineered to simulate the market pattern of its underlying asset - all cryptocurrencies. This allows the user to speculate agnostically on each token, not just one or a few specific portfolios.
BASE is built on an elastic supply protocol which programmatically expands / contracts the supply of tokens to achieve a target price balance. BASE's target price is one trillion of the total market cap of all cryptocurrencies: (cmc) x 0.1 ^ 12. When the market price of BASE (bmp) = (cmc x 0.1 ^ 12), BASE is in equilibrium. When this equilibrium is disrupted, the supply of tokens is adjusted. BASE is built on an elastic supply protocol that programmatically expands / contracts the supply of tokens to reach a target price equilibrium. BASE's target price is one trillion of the total market capitalization of all cryptocurrencies: (cmc) x 0.1 ^ 12. When the market price of BASE (bmp) = (cmc x 0.1 ^ 12), BASE is in equilibrium. When this equilibrium is disrupted, the supply of tokens is adjusted accordingly.
The expansion / contraction of supply is called rebases. Rebases occurs when bmp ≠ (cmc x 0.1 ^ 12) . When bmp> (cmc x 0.1 ^ 12), expansion rebase occurs. When bmp <(cmc x 0.1 ^ 12), rebase of contraction occurs. Expansion creates new supply, reduces scarcity and reduces prices from their target. Contraction destroys supply, increases scarcity and raises prices until they reach their target
Users will be able to purchase BASE in the Uniswap liquidity pool. Base Cascade rewards users who stake their BASE on a liquidity pool. The Cascade issues awards based on how long users stake their tokens on the pool - where more liquidity is provided, and longer, the bigger share of the pool they receive.
Crypto Index
The Basic Protocol acts as a one-stop trading instrument allowing holders to speculate on the entire crypto industry simultaneously, not just a single token or a few specific portfolios. This should be valuable to outsiders interested in crypto investing who don't know which asset they "should" buy. It will also be useful for institutional investors looking to diversify their crypto exposure across the industry, and general crypto traders looking to hedge or diversify their investments. The Crypto Index Base Protocol is the world's first and only cryptocurrency market tracker. By holding BASE tokens, users can get exposure to the performance of the entire cryptocurrency market.
Token
BASE allows traders to speculate across the industry with a single token. The Basic Protocol Team has compiled a 3-page document detailing the stages of the token sale, details of the total supply, and vesting schedule for all allocations.
Komentar
Posting Komentar