Oikos Exchange, OKS Tokens and Synths: How It Works

in #oikos2 years ago


Oikos brings an innovative decentralized finance platform on the Tron network by making synthetic digital assets available to both crypto-natives and the unbanked in the society.
One may ask, what exactly is this synthetic asset? Synthetic assets are like pseudo assets, they give users the access to own and trade some assets without actually owning the main assets. Currently, there are five classes of synthetics run by Oikos which include fiat currencies, commodities, indexes, cryptocurrencies and inverse cryptocurrencies. Oikos fiat Synths include sUSD, sEUR, sKRW, and many more; our commodity Synths include synthetic gold and synthetic silver, both measured per ounce; our cryptocurrencies include sBTC, sTRX, and sBNB, with more to come; and our Inverse Synths inversely track the price of those available cryptocurrencies, meaning that when BTC’s price decreases, iBTC’s price increases. Our current cryptocurrency indexes are sDEFI and sCEX (and their inverses), which respectively track a basket of DeFi assets and a basket of centralised exchange tokens.

As can be seen from above, all the examples of Synths given are real world and real digital assets. What Oikos does in essence is to open up access to these assets so people can trade them without actually possessing the underlying assets themselves.

How Does Oikos Synths Work?
Oikos Synth Assets are duly backed by collateralized Oikos Network Tokens OKS locked into a smart contract at a ratio of 800% that can be executed to initiate a transaction. These locked OKS tokens are staked at a ratio of 800% in order for the holder to mint and trade Synths on the Oikos Exchange platform. The Synths track the prices of the main assets they represent but because they are Synths, they offer a range of more beneficial options to the staker.

Why Stake On Oikos
There are several ways that OKS holders are incentivized and encouraged to stake their tokens but for the meantime, I will look at the main two ways.
Exchange Rewards: for every transaction on Oikos Exchange whereby anybody exchanges one Synth to another, an exchange fee is charged. This fee is between 10-100 bps but usually pegged at 0.3% of the transaction and displayed during the transaction process. The fees are sent directly to the fee pool where it is shared on a weekly basis by all stakers and according to their various holdings.

The second incentive to mint or stake is the Staking Rewards. Oikos protocol has a unique inflationary monetary policy supply schedule that is in-built. Starting from the first year according to this schedule, a weekly addition of 1,442,308 OKS tokens will be added and by week 234, a terminal rate of 2.5% perpetual inflation will have been achieved. It is from this pool that staking rewards will be paid out pro-rata to OKS stakers so long as their collateralization ratio maintains the expected threshold.

Apart from affording a staking reward pool, the above mechanism performs another role of helping to ensure the stakers maintain optimal collateralization ratio which currently stands at 800%. Any price move against this ratio, whether positive or negative will have to be counterbalanced to return the ratio to normal. If the value of OKS or Synths rises to push the ratio above 800%, holders adjust by burning Synths and if the value pushes the ration below 800%, adjustments are made by minting more Synths.

Oikos System Architecture: Minting Synths

To mint a synth (for example sUSD), an OKS holder is expected to lock his OKS tokens as collateral in the Oikos smart contract. Here are the steps for Minting sUSD:

Oikos contract checks and ascertains that the staker's collateralization ratio is below 800% before he can proceed with minting
Adding the staker's debt to the Debt Register and the value is equivalent to the amount minted and stored in form of sUSD
Once debt is assigned, the Oikos smart contract executes and instructs the sUSD contract to issue the requested amount. The sUSD contract then adds the new amount to its total supply and updates the user's wallet with the newly minted sUSD.

For every increase in OKS value, a proportionate portion of the staker's OKS automatically unlocks and becomes available so the staker can either use it to stake again and mint more Synths or withdraw to the exchange.

Oikos and its decentralized exchange offers users the option of owning and trading synthetic assets whose prices are tagged to their underlying real world assets. They also provide liquidity and seamlessly exchange for traders.

To learn more about Oikos, visit any of the following links:






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