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Crafting Finance – the first synthetic asset trading and issuance protocol on NEAR

Synthetic assets (synthetic assets) is an important component of Defi, not only providing Defi with derivatives such as long, short, leverage, but also acting as an important bridge between Defi and financial assets. traditional mainstream and even traditional commodity trading. It can be said that Dex AMMs like Uniswap provide the most basic trading capabilities for Defi, oracles like Chainlink provide price feed capabilities for Defi. 

With Crafting Finance – A synthetic asset issuance and trading protocol on NEAR will provide higher level financing to Defi, will integrate existing Defi and make Defi easier to use and more flexible. And in addition to the above advantages Crafting Finance What other highlights are there, please see the details of BTA HUB .

What is Crafting Finance?

Crafting Finance is a new generation asset aggregation protocol based on Wasm create freely tradable cryptographic digital assets using several assets as collateral to create aggregate assets for all asset classes and NFTs. 

Crafting Finance Multi-token (multi-token) collateral support for synthetic asset issuance, including native tokens CRF, NEAR, AURORA, BTC, ETH, DAI and USDT. Users can also directly forge all kinds of synthetic assets, such as bonds, stablecoins, custom assets and the like.

Crafting Finance based on the NEAR ecosystem and virtual machines (virtual machine) Its WASM is a new generation of virtual machines, more efficient and secure than the EVM. And Near brings efficient underlying infrastructure to Crafting through its own high-performance sharding and other capabilities, and brings more convenient multi-asset capabilities to Crafting via Rainbow Bridge, etc., so that assets from different chains can enjoy Crafting's asset commitment and enhanced aggregate asset trading functions.

The main functions of Crafting Finance

The main functions of Crafting Finance include: Forge , and Kingsman.

Forge (Forging Synthetic Assets)

The synthetic assets that are issued by the entire system are all created by the users who deposit some collateral. Initial collateral includes CRF, NEAR, AURORA, BTC and ETH, and the collateral ratio will depend on the variability of the collateral itself.

In the future, the collateral and collateral ratio may be adjusted through the governance mechanism of the community. When users deposit collateral and create aggregate assets, corresponding liabilities are created. When the user wants to unlock the collateral, it is obligatory for them to repay the loan, i.e. to cancel the previously created collateral aggregate.

To incentivize users to use CRF tokens as collateral, users who stake CRF will earn greater rewards.

The assets that are aggregated by staking collateral throughout the system can be divided into five different categories: NFT shards (NFTRAft), stablecoins (RaftStable), simple synthetic assets (Raft), left synthetic votes (BondRaft) and smart synthetic assets (UnivRaft).

NFT fragment (NFTRAft)

NFT is very expensive and currently has liquidity problems. NFT fragmentation is the way to solve all problems. Any user with NFT will be able to mint NFT and Crafting Finance shards that support both ERC721 and ERC1155.

Stablecoins (RaftStable)

Stablecoins are a very important part of synthetic assets, such as rUSD and rEuro, which can be used as denomination currency in the entire system as well as contract trading. Besides, stablecoins can also be used as loan collateral. Users can borrow stablecoins like rUSD and exchange it for USDT.

Simple Composite Assets (Raft)

Simple synthetic assets can be cryptocurrencies like rBTC and rETH, stocks like rAAPL, gold (rXAU) and any real world asset.

Synthetic Bonds (BondRaft)

Synthetic bonds are interest-paying synthetic assets issued by the system.

Smart composite assets (UnivRaft)

Smart synthetic assets means that users can issue any type of financial contract through this system. Through it, Crafting Finance can stimulate any financial derivatives and cover all assets around the world.

Sharing Debt Pool

After a user creates some aggregate assets, those assets can be put into a sharing debt pool (SDP) and the user will be assigned a fixed debt ratio that is the ratio between the value of the aggregate assets combination of users with the value of all assets aggregated assets in the entire system. 

“Fixed” means that this ratio will not change due to changes in asset prices and will be used to calculate user profit and loss. This rate will only change when a user creates a new asset or an existing user destroys their existing one.

Optional Joining of SDP

Due to the principle of the sdp trading mode that the user has to create any synthetic assets and joining the debt pool will automatically become a long-term asset holder. This means that, even if a user creates a stable coin, it automatically becomes a permanent position in the stablecoin, causing losses as other assets rise in price. This loss is called “Crafting loss”. This is like another form of loss in liquidity mining. 

To avoid these losses, Crafting Finance gives users the option of whether or not they want to join a debt pool. So users can opt out of the debt pool if they don't want to take the risk. In this case, the user can basically use the system as a lending platform and the system will charge interest on the assets the user generates. Interest rates will be decided by the community governance mechanism afterwards.

And to encourage users to join the debt pool as much as possible, Crafting Finance creates a mechanism to attract users to join the debt pool if they join the debt pool, they will earn more rewards.

Kingsman – DEX for Synthetic Assets and Contract Trading

Kingsman is an exchange that offers conversion of various synthetic assets and contract trading using the SDP trading method. This DEX is built in a way that does not require a counterparty and, therefore, has no transaction depth issues. 

All synthetic assets can be systematically converted and aggregated, and their conversion rates are determined by the actual external prices provided by the Oracle price data feed. 

NFT fragmentation

The distinguishing feature of the synthetic asset system is that it can mint any type of asset. Because of NFT fragmentation support, Crafting Finance will solve all the following disadvantages of NFT:

  • Lack of liquidity leads to excessive slippage during buying and selling
  • Valuation lacks the market, so it is difficult to value
  • Not a good collateral, low capital efficiency
  • A large amount of capital investment is required to have a chance of achieving a high NFT price

With Crafting Finance users will be supported with any type of NFT so they can participate in the Forge system and create small pieces of NFT, just like other synthetic assets.

Other modules

Debt Pool

Debt Pool is the aggregate pool of assets generated by all users. It records a real-time inventory of all aggregate assets in the system. According to the amount of aggregate assets generated by each user, Debt Pool also records each user's debt ratio. Whenever a new aggregate asset is created, the system's debt ratio must be recalculated.

Fee Pool

Users who trade or convert synthetic assets on the DEX will incur transaction fees. The fee rate is set at 0,3% and all these fees are included in the Fee Pool. And all fees will be converted to CRF using auction or DEX. 40% of fees will be distributed as rewards to users who meet the specified collateral ratio throughout the system, and the reward ratio is determined by the debt ratio.

Another 40% will be cancelled. The remaining 20% ​​will be reserved for future system maintenance and development. The system stipulates that only users who have CRF collateral and participate in SDP can receive rewards, as an incentive for holders to hold CRF tokens for the long term. Because collateral prices fluctuate, and it is regulated that only users who meet the collateral ratio are eligible for the bonus.

Interest Pool

Users who opt out of SDP will pay interest on their aggregated assets and the interest will enter Interest Pool. 80% of profits will be converted to CRF and converted CRF will be destroyed as another way to support the price of CRF tokens. The remaining 20% ​​will be reserved for future maintenance and development.

Oracle

Since contract transaction prices need to be read from outside sources and Oracle is a very important part of this project. In the first phase, the system will use centralized oracles provided by the project team, and in the future it will introduce more secure decentralized oracles.

Token

Details about Crafting Finance token (CRF)

Token name: Crafting Finance

Symbol: CRF

Blockchain: Ethereum

Current circulating supply: 62.000.000

Current total supply: 2.000.000.000 VND

Token Allocation

40%: for liquidity Incentive.

19%: for offering and sales rounds.

1%: Initial liquidity.

14%: for ecosystem partners.

6%: Marketing for the project.

5%: for advisors.

15%: for the team.

Economics

CRF is a project token as well as a governance token. Therefore, all matters of Crafting Finance including increase or decrease of collateral types, adjustment of mortgage rates, types of aggregates, etc., can be determined by voting for for investors holding CRF tokens.

Crafting Finance has 3 ways to encourage investors to hold CRF tokens for a long time, including: 

1. All unallocated and future tokens that will be released annually will be used as rewards depending on the type of user. According to whether users use CRF as collateral and participate in SDP, there are four types of users in the system:

  • Users who use CRF as collateral and participate in SDP will earn 60% of these rewards.
  • Users using CRF as collateral but not participating in SDP will earn 20% of these rewards.
  • Users who use other tokens as collateral but join the SDP will earn 20% of these rewards.
  • Users using other tokens as collateral and not participating in SDP will earn 0% of these rewards.

2. Fees collected from trading in Kingsman will be charged to Fee Pool. And all fees will be converted to CRF using auction or DEX. 40% of fees will be distributed as rewards to users who meet the specified collateral ratio throughout the system, and the reward ratio is determined by the debt ratio. Another 40% will be cancelled. The remaining 20% ​​will be reserved for future system maintenance and development. The system stipulates that only users who have CRF collateral and participate in SDP can receive rewards, as an incentive for investors to hold CRF tokens for a long time. Because collateral prices fluctuate, and Crafting Finance stipulates that only users who meet the collateral ratio are eligible for the bonus.

3. Users who opt out of SDP will pay interest on their aggregated assets and the interest will enter the interest pool. 80% of the profits will be converted to CRF tokens and the converted CRF tokens will be destroyed as another way to support the price of the token. The remaining 20% ​​will be reserved for future maintenance and development.

Team of Crafting Finance

Currently, the project has not been updated on the official channels of Crafting Finance.

backers

Crafting is backed by leading venture capital funds like Signum, LD, Longhash, CMS, NGC and many others.

Competitors

Projects working in the field of synthetic assets such as: Synthetix (SNX), Uma (UMA), Mirror Protocol...

Comparison table of outstanding projects in the field of general assets and Crafting Finance

Roadmap

Quarter 3/2022

  1. Launch Zhangqian instance, RaftBond online for issuance and trading.
  2. Fractional NFT will be available online and will support blue-chip NFT.
  3. Debt Pool split support.

Quarter 2/2023

1) Launch Thorvaldsson instance, which will support UnivRaft. Users can use it to issue smart assets.

2) Will launch a Web-based smart asset platform, users can write their smart contract on the platform to issue any type of asset.

Quarter 3/2023

Launch of the brand new oracle system that can provide the price of every asset across the market.

Crafting Finance's communication channels:

Website: http://crafting.finance/

Twitter: https://twitter.com/craftingfinance

Telegram groups: https://t.me/craftingfinanceofficialgroup

Telegram Channels: https://t.me/craftingfinanceofficial

Discord: https://discord.gg/89upsrRUNY

Media: https://medium.com/@craftingfinance

Summary:

DeFi (Decentralized Finance) and Synthetic Assets (Aggregate property) is undergoing very rapid changes. Synthetic assets are an important platform that provides broad and global access to financial markets. Synthetic Assets It also gains traction with DeFi enthusiasts as it brings a tool available to traditional traders into the crypto world. And Crafting Finance – The first synthetic asset project built on NEAR with its best features will provides higher level financing for Defi, more flexibility and ease of use. 

Posts by BTA HUB about Crafting Finance in order to help people have more information about a project on general property built on NEAR for the purpose of reference only, providing information and not as investment advice! Thank you for watching!

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