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In the future market, investment needs more specialized calculations and research, and risks need to be disclosed more transparently and strictly managed. In this irreversible wave, professional institutions gradually stand at the center of the stage.
Written by: Ad
In 2020, in addition to Bitcoin once climbing to a high point, Ethereum 2.0 and distributed financial DeFi are also rapidly emerging, becoming the most cutting-edge new outlets in the blockchain industry. At the same time, global mainstream payment institutions such as VISA, MasterCard and Paypal have also accelerated their deployment in the field of blockchain and digital asset payment. The New Deal of the U.S. Banking Regulatory Department allows banks to provide customers with digital asset custody services. Catalyzed by this series of positive factors, the digital financial market ushered in a new stage of development.
Traditional financial institutions are running into the market. This is a market-specific consensus starting in 2020. The once rash development of the digital financial industry is gradually fading away from its green appearance. The crazy bull market for retail investors that occurred in 2017 is gone forever.
The frequency of the occurrence of “under the sand” and “chickens and dogs ascend to heaven” will gradually decrease; in the next market, investment requires more professional calculations and research, and risks need to be disclosed more transparently and strictly managed. In this irreversible wave, professional institutions gradually stand at the center of the stage.
In the second quarter report on the digital financial product lending market, Credmark counted 85% of lending company data. In the second quarter of 2020, the scale of existing loans in this field reached US$4.632 billion, an increase of 90.62% from the previous quarter; the value of collateral exceeded US$8 billion in the same period. , An increase of 87.34% month-on-month.
Institutional customers dominate the digital financial lending market. In the second quarter of 2020, the stock loan ratio between institutions and retail investors was 3.5:1; the value ratio of institutional and retail collateral in the same period was 2:1. From the difference in the ratio of the value of stock loans and collateral, it can be found that institutional customers do have a very obvious advantage in the pledge rate.
So, where is the development of professional service providers in the market now? Does the new wealth management product really meet the needs of the market? In the future development, how should these service providers strive to seize market opportunities? This issue of Chain News will take everyone to explore the development status of service organizations in the digital financial field.
Overview of existing digital financial service institutions
So far, the current institutions providing digital financial services are mainly exchanges, wallets and professional financial service providers. The cost of launching financial services on the basis of supporting cryptocurrency transactions is relatively low. For wallets and financial service providers, the cost of supporting asset mainnets and user drainage has certain obstacles to their development of financial services, but this is also one of the opportunities for them to stand out from the track.
Binance <br>As the world’s leading exchange, Binance’s Binance Wealth Management provides one-stop integrated wealth management products and services. There are four categories of current products, fixed-term products, new currency mining, and asset management. Users can Perform asset management according to your own financial preferences.
Current wealth management is mainly Binance Deposit, which deposits digital assets on the Binance platform, deposit and withdrawal, similar to bank demand deposits. As the name implies, regular wealth management products are assets deposited or pledged for a fixed period of time. They are divided into four categories: Binance’s regular and irregular high-yield activities, lock-up staking, and DeFi mining. New currency mining refers to users participating in new currency mining projects by providing pledged digital assets. Asset management mainly refers to two categories: liquidity mining and dual currency investment.
OKEx’s financial products mainly focus on the three major products of Yubibao, lending and earning coins. Yubibao mainly has four forms: current, regular, event and holding rebates. Users can receive currency-based wealth management income through simple deposits in Yubibao, deposit and withdraw as soon as the funds are transferred, and can transfer the currency in the account to Yubibao account to obtain income, or transfer Yubibao’s coins to other accounts . It combines a variety of wealth management services, including currency value-added products, lock-in mining, loan investment terminals, and third-party DeFi services to provide users with more interest-bearing options. At present, coin-earning products have supported nearly 30 encrypted digital currencies including lock-up mining and Yubibao.
<br> wheat wheat wallet purse (MathWallet) is a general-purpose encryption wallet assets, has been upgraded to MATH, MATH relying on the wallet, is a multi-link chain and across the core of the block chain assets Hub, is the first to support the Intelligent currency One of the crypto asset wallets of the chain (BSC). Maizi Wallet includes four major financial services: investment, wealth management, lending, and payment. At the same time, the MATH VPoS mining pool has been launched to mortgage digital assets. It can also automatically reinvest according to the daily interest rate to maximize returns.
Binyin Wallet <br>Blockinwallet was established in September 2019. It is a Singapore financial service platform under Binyin Mining Pool. Its customer base is mainly for miners and wallet users. It is currently applying for MAS compliance supervision. The Binyin mining pool was founded in November 2017 and was established by the original core team of BTC.com. It supports mining in all mainstream currencies. Its computing power for BTC, ZEC, LTC and other currencies often ranks first.
HyperPay is a digital asset wallet that integrates custodial wallets, self-managed wallets, co-managed wallets, hardware wallets and other services. It also has wealth management, currency transactions, legal currency transactions, lightning exchange, mortgage lending, market tracking, multi-signature co-management, and assets Hosting, merchant payment and other functions. HyperPay business is oriented to both B-side and C-side users. For ordinary currency holders, you can choose to manage financial wallets. For large asset customers and institutional users, you can choose self-managed wallets and co-managed wallets or customized hardware wallet solutions.
Professional financial service provider
Matrixport is a one-stop digital asset financial service platform, which mainly provides digital asset trading, lending, custody and payment services for enterprises and individual users. Matrixport is a digital asset financial service platform established by Bitmain co-founder Wu Jihan. CEO Ge Yuesheng and founding team members are also from Bitmain. The company is headquartered in Singapore, with offices in Hong Kong, Switzerland and other places. Matrixport has launched digital currency transactions, digital currency custody, pledged loans and other products, and more innovative products will be launched one after another.
PayPal Finance <br>PayPal Finance is a comprehensive encrypted financial service provider. PayPal was established in August 2018. It mainly provides encrypted asset deposits and loans, asset management, brokerage, and brokerage for high-net-worth qualified individual investors and institutional investors. Comprehensive financial services such as derivatives trading. After PayPal Finance established its core customer base, it gradually launched customized new products based on customer needs, such as the official PayPal Private, which is similar to China Merchants Bank Golden Sunflower’s private customized services for high-net-worth customers.
RenrenBit (RenrenBit) is a blockchain digital bank that focuses on C2C digital asset lending services. The platform provides information matching between borrowers and lenders, pledge custody and risk control. Its founder is Zhao Dong, an early practitioner of the currency circle, a shareholder of Bitfinex, and a major OTC trader.
From the perspective of market development, the current wealth management products that are highly accepted in the digital currency field and have a wider range of users are mostly single-currency gain-based products with stable returns and low risks. With the expansion of the financial attributes of digital currency derivatives, more institutions and investors have more abundant and differentiated requirements for the allocation and benefits of financial solutions.
Some investors are willing to pursue medium and high-yield diversified wealth management products on the basis of taking certain risks. More diversified investment categories such as dual currency wealth management, staking, lending, and strategic trading pioneered by Matrixport are gradually appearing in the market. Have a place on top.
Lianwen will start with Matrixport and analyze its layout of its financial products to explore how professional service providers can seize market opportunities in the digital finance era and expand their services to a wider range of financial institutions and high-net-worth individuals.
Matrixport’s road to digital finance: comprehensive products and services
Digital financial professional service providers first helped miners to hedge their risks and protect the value of their assets. But in the more than ten years of vigorous development of cryptocurrency, participants have evolved from early cypherpunks to Bitcoin miners, and expanded to more and more mainstream investment institutions. Cryptocurrency has moved from a small circle to a larger world. These changes have accelerated the emergence of the professional field of digital financial services.
According to functions and needs, Matrixport’s products can be divided into loan and wealth management, asset custody, trading and one-click “CeDefi” products. Matrixport provides digital asset financial services for mining machines, mining pools, quantitative funds, digital currency lending platforms, digital currency funds, exchanges, OTC traders, etc., and has launched more than 50 products from product categories.
Borrowing and financing
On the road to inclusive digital finance in the encrypted world, Matrixport equips the market with comprehensive products and services in a timely manner, and constantly updates according to the market to meet the financial needs of customers at different stages, helping customers to reduce risks, achieve wealth preservation, and increase value. .
From the perspective of Matrixport loan products, it is mainly divided into two types: basic loan and “zero interest loan”. The basic loan product supports the borrowing of USDC, USDT, BTC, BCH, ETH, LTC, and supports four pledge coins of BTC, BCH, ETH and LTC. The basic loan amount is between 1,000 USDT and 200,000 USDT, and large borrowing needs can be purchased through customized products. Matrixport’s zero-interest loan product integrates stop-profit and stop-loss products into digital currency loan products. The loan product mainly has three features: zero interest, no need to cover up and crash protection, which provides a strong guarantee for miners’ fund protection under extreme market conditions. Matrixport provides miners with a zero-interest loan solution, which not only better avoids risks, but also solves the pressure on the flow of funds of miners.
In addition, Matrixport also created the first dual currency wealth management product in the industry in October 2019. This novel product quickly became popular in the industry after it was launched. It gained the attention and use of users in more than 20 countries within a month of going online. , Binance also launched similar products.
Different from the traditional form of digital currency wealth management, dual currency wealth management products judge the settlement method based on the “pegged price” to ensure that one of the two digital assets will receive income. For example, BTC/USD(S) dual currency investment, the pegged price is “8000 USD”. When the BTC market price is lower than 8000 USD, the settlement will be priced in BTC, and the income will be more BTC; when the BTC market price is higher than 8000 USD, It will be settled in USDC and will earn more USDC. Provide customers with a tool to automatically buy bottom and cash out at the target price (pegged price). At present, dual currency wealth management provides several products including Bitcoin, Ethereum, and USD stable currency. The optional purchase period ranges from 1 day to 163 days, which can provide higher annualized income (30-200% annualized as common Income range).
As the first company in the industry to launch dual currency wealth management services, Matrixport’s dual currency wealth management products mainly include BTC, ETH and BCH three mainstream crypto assets. The optional purchase period of the products ranges from 1 day to 140 days. There are six major products. The highest annualized rate of return exceeds 900%.
Relatively speaking, Binance Dual Currency Wealth Management products were officially launched on August 20. They are mainly divided into three major product areas: BTC area, USDT area and BUSD area. However, its dual currency wealth management products are currently sold due to limit restrictions. Out of stock, the official annualized rate of return ranges from 6.00% to 160.00%.
Cactus Custody is a third-party institutional custody service provider launched by Matrixport and a Hong Kong trust company. Cactus custody originated from Bitmain’s internal custody system, and later developed into a fully functional third-party custody after Matrixport was separated from Bitmain.
Since most of the customers who need custodial services are 2B customers, security and business continuity are paramount to both customers and service providers. For security, Cactus Custody chose to manage private keys in the industry’s highest-level HSMs (hardware security modules) and a proprietary multi-layer heating and cooling storage system. The core custody infrastructure is deployed in the four-level data center of the bank vault on three continents. Eliminate single points of failure through system heterogeneity, dual-center settings and remote disaster recovery mechanisms to ensure the highest security and business continuity. Also through the design of responsibility isolation and zero trust system, it is guaranteed not to rely on any single person.
In terms of compliance, Cactus Custody not only holds a Hong Kong TCSP license, but also strictly abides by the “anti-money laundering” regulations in all operating jurisdictions, conducts KYC with the highest standards, and has suspicious transaction reporting procedures for on-chain and off-chain transactions. In addition, Cactus Custody also cooperates with Elliptic to integrate on-chain transaction monitoring, and monitors all on-chain transactions through Cactus Custody and Matrixport to meet regulatory requirements and protect customers from digital financial crimes.
Up to now, Cactus Custody can support 39 digital assets, and safeguard the security of more than 50 institutional customers and digital assets worth about 1 billion U.S. dollars, and provide customers with uninterrupted, highest-quality asset security and business continuity guarantees.
Bit.com is a professional derivatives exchange launched by Matrixport and specializes in options. Bit.com’s strategic positioning is to serve institutional and individual clients from all over the world, including miners/hedges, prime brokers, proprietary dealers and funds.
Bit.com’s self-built transaction engine with all intellectual property rights provides matching of 10,000 TPS per second, and introduces a portfolio margin mechanism to improve the efficiency of the institution’s capital use. At the same time, it adopts a more scientific and gentle gradual liquidation mechanism to provide maximum customer positions protection of. Thanks to its lending business and transaction engine, Matrixport can provide the lowest interest rates and transaction prices in the industry, allowing the cost of leveraged transaction customers to be significantly controlled.
In the six months since its launch, Bit.com has reached a level of about 200 million US dollars in daily trading volume. In addition, Bit.com also launched BCH options on February 1 to fill the gap in the BCH options market.
One-click “CeDefi” product
The DeFi fire in 2020 is a portrayal of the urgent needs of market participants for diversified financial products. However, due to the high learning costs and operational difficulties for ordinary users such as liquid mining, and the large amount of funds entering the market The interaction cost of the Ethereum network has risen sharply, and the DeFi boom is still far from achieving true “inclusiveness” from the level of the number of users.
In response to this situation, Matrixport has launched a simplified one-click “CeDefi” product in response to market demand, taking into account the convenience of Cefi and the flexibility and transparency of Defi, and has launched a series of products that are well received by the market, such as current machine gun pool and smart selection And other products, it can help customers automatically switch between different DeFi high-yield projects, compound interest investments, current or large T+1 redemptions, and combined with mortgage lending, that is, mortgage BTC/BCH/ETH and other currencies to lend USDC/USDT for liquidity Functional mining and other functions enable BTC/BCH/ETH holders to directly invest in DeFi income, which greatly facilitates customers and enriches the scene.
At the same time, Matrixport also provides users with a combination of DeFi and derivatives investment product “Trend Zhiying” to help customers obtain excess returns in unilaterally rising or falling markets.
The power of digital financial services
Digital financial professional service institutions can provide a complete system and relatively personalized services, which can adapt to different customer needs, and are also convenient for supervision by regulatory authorities, so as to achieve compliance and legal operations and reduce systemic risks. In the long-term development and precipitation of traditional financial models, countless operating models and new gameplay have evolved, and these traditional financial derivatives have gradually infiltrated the digital financial field of encrypted currencies.
Matrixport first launched its product in October 2019, and it has been online for 1 year and 4 months. In the past year or so, Matrixport has accumulated trust and reputation in the industry based on its rich financial product matrix and product innovation speed, rigorous and prudent risk control management, and professional compliance operations. Criticize quite loyal “fans.”
Matrixport CEO Ge Yuesheng told Lianwen, “Matrixport’s AUM (asset management scale) has exceeded 1 billion U.S. dollars in just over a year, and its loan balance exceeds 200 million U.S. dollars. The current wealth management scale exceeds 300 million dollars.”
With the expansion of services to a wider range of financial institutions and high-net-worth individuals, Ge Yuesheng hopes that Matrixport’s vision to become a “digital currency bank” is gradually being implemented. In 2021, Matrixport will shift its focus from building a product matrix and service system to market and customer service. Investment in this area will continue to increase, and the service area will also expand to more regions in Asia Pacific and Europe.
As Ge Yuesheng said, “In this era of digital financial services, Matrixport hopes to continue to lead the digital currency industry in innovative financial services and bring more professional and secure services and products to the industry.”
“2020 is not only the first year of digital currency financial services, but also the first year of mining financial services. A large number of structured products and lending products have experienced explosive growth and applications in 2020.” Ge Yuesheng was talking about 2020 The changes in digital financial services in the year are expressed.
Digital finance is accelerating, and the industry has ushered in structural changes. How to comprehensively deploy and provide precise services is the focus of development. A complete and leading product line, combined with professional and efficient security services, will enable the project to have a better market reputation and customer reviews. Based on the deep cultivation of the industry and the understanding of the market, Ge Yuesheng believes that 2021 will be a surging bull market, and preparing for a large number of customers and institutional funds will become the focus of Matrixport in 2021.
In Ge Yuesheng’s view, the reason why Matrixport has been able to develop into an industry-leading professional financial services organization so quickly is that, compared with its peers, it must always emphasize “full service” based on its rich industry resources and leading technical capabilities. “And “Professional Products”. Services and products increase user stickiness, and the synergy between businesses can also make a single product more competitive.