Voltz Protocol Launches Revolutionary SOFR Trading on Avalanche Blockchain

Voltz Protocol Launches Revolutionary SOFR Trading on Avalanche Blockchain

Voltz Protocol is bringing one of the stalwarts of traditional finance, the Secured Overnight Financing Rates (SOFR), onto Avalanche's layer-1 blockchain, allowing anyone who can access Voltz to trade products tied to SOFR on-chain and broadening access to SOFR hedging with its on-chain solution.

SOFR – which Voltz’s new product is tied to through the Avalanche (AVAX) blockchain tech – is used to set interest prices on TradFi loans, bonds and other products in the United States

Voltz Pro­to­col, an auto­mat­ed mar­ket mak­er (AMM) for inter­est- price swaps, is bring­ing one of the stal­warts of tra­di­tion­al finance (Trad­Fi) on-chain.

Any­one who can access Voltz will be able to trade prod­ucts tied to the Secured Overnight Financ­ing Prices (SOFR) – a bench­mark used to set inter­est prices on loans, bonds and oth­er cred­it prod­ucts in the Unit­ed States – on Avalanche’s layer‑1 blockchain tech, reports by a state­ment Wednes­day.

SOFR is not trend­ing to the pub­lic, but it’s a key part of Amer­i­can finance. Bring­ing it into an on-chain envi­ron­ment is is still one more step toward shift­ing Trad­Fi onto cryp­tocur­ren­cy infra­struc­ture.

The End of Cen­tral­ized Exchanges in Amer­i­ca?

Even before the Voltz notice, cor­po­ra­tions and investors could already hedge their expo­sure to SOFR through con­ven­tion­al mar­kets, includ­ing Chica­go-based CME Group’s exchange. On the oth­er hand, in announc­ing its new prod­uct, Voltz stat­ed it was broad­en­ing access to SOFR hedg­ing with its on-chain solu­tion.

Only a hand­ful of insti­tu­tions have access to inter­est price swap mar­kets that allow them to hedge” SOFR expo­sure, Voltz CEO Simon Jones stat­ed in the state­ment. “The launch of SOFR on Voltz Pro­to­col changes this whilst simul­ta­ne­ous­ly bridg­ing the two finan­cial worlds by mak­ing tra­di­tion­al finan­cial mar­kets acces­si­ble on [ (DeFi) (DeFi)] rails.”

Red­Stone will be the ora­cle provider – AKA it will sup­ply the raw data on SOFR from the Trad­Fi realm.

The Rise of Bit­coin: US Cryp­to Hos­til­i­ty Fails to Slow Growth

Nick Bak­er.


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