Osmosis and UX Chain Propose Merger to Create Comprehensive DeFi Hub
Osmosis, the largest decentralized exchange on Cosmos, and lending protocol UX Chain (previously Umee) have put forward a proposal to merge with each other. If approved, this merger would result in the integration of UX Chain’s lending logic and algorithms with Osmosis’ DEX, creating a comprehensive DeFi hub within the Cosmos ecosystem.
Strategic Plan for the Merger
The proposal outlines a strategic plan for the merger, which will involve integrating UX Chain’s codebase onto the Osmosis Chain. This integration aims to combine the capabilities of both platforms, including blending shared total value locked across the networks. During this initial step, both chains will continue to trade their respective tokens separately.
In the subsequent step, there is a possibility of combining the two tokens through a token swap or migration. The configuration of the token swap will be determined through community governance processes.
Separate Governance Votes for Each Network
Each chain will have separate governance votes from their respective blockchain networks. The community governance will manage the processes independently towards achieving consensus on creating the DeFi hub.
Unifying Capabilities and Adding Value
The proposed merger also aims to enable UX Chain to add value to Osmosis’ mesh security by leveraging combined expertise or merging validator sets. This collaboration could lead to the development of advanced liquidations, native margin trading, and MEV markets.
Funding and Support
The development teams behind Osmosis and UX Chain have previously secured significant funding. UX Chain raised $32 million through a CoinList coin offering in 2021 and received a $6.3 million seed round led by Polychain Capital. Osmosis, on the other hand, raised $21 million in a token sale round with Paradigm as the leading investor.
Hot Take: A Merger to Enhance DeFi Capabilities
Osmosis and UX Chain’s proposed merger represents a significant consolidation within the Cosmos ecosystem. By combining their strengths, they aim to create a comprehensive DeFi hub that offers advanced features and functionalities. This collaboration has the potential to benefit both platforms and enhance the overall DeFi capabilities within the Cosmos network.
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