Xodus Finance: A DAO Built Different
Blockchain has made a lot possible in a short period. Who would have thought collaborating with total strangers on the internet to build something of great importance would be an easy feat? However, the introduction of blockchain has laid a solid foundation upon which groups of individuals can come together to achieve a greater aim.
One of the ways Blockchain has made this possible is through the establishment of Decentralized Autonomous Organizations (DAOs). Several DAOs have emerged over the years, each with its different goals, aims, and rules governing them.
When it comes to tokens regulated by DAOs, the DAO sets the tune for the token and determines the direction it will take. A DAO could introduce the token it governs as a rebase token with a rebase function or it could set it to take on another form entirely. What is a DAO and how does the rebase function come into play here?
Amid these questions, how does Xodus Finance fit into the narrative? What is it about the Xodus Finance DAO that fits the narrative of being built differently? With these many questions, where are the answers? Look further down.
What Is a DAO?
Simply put it is a member-owned community with no centralized leadership in view as described by Ethereum.org. It represents a safe place to commit funds to certain causes and collaborate with strangers. As Forbes put it, Bitcoin is mostly seen as the first fully functional DAO given its autonomous functions, coordination via a consensus mechanism, and laid down a set of rules. Since then many DAOs have emerged, while some were successful, some were not so much.
In the midst of these DAOs, an interesting DAO (Xodus Finance) is train rattling with its set of unique offerings. Xodus Finance is seen as the next iteration of a DAO. How so? It is focused on evolving the rebase/DAO space. The evolution will be achieved by the collateralization of tangible real-world luxury assets that are independently certified.
They will be luxury assets that appreciate while users are also holding digital assets. Partakers will get an attractive yet sustainable APY as a reward for staking and holding within the Xodus Finance network.
Regarding real-world assets, Xodus Finance will target the acquisition of luxury assets like fine art, vintage wine, luxury watches, precious metals, among others. This is in addition to acquiring digital assets like stable coins, NaaS protocols, NFTs, project tokens, liquidity injection, and many more.
What Is Rebase?
Rebase tokens can be described as tokens that regulate their circulating supplies automatically as the token’s price fluctuates. In other words, they are designed such that the circulating token supply automatically increases or decreases concerning the token’s price volatility. This process is called the Rebase Mechanism.
Both the Rebase tokens and Stablecoins have one characteristic in common: they both have price targets. The difference between them is that, unlike stable coins, the rebase tokens possess an elastic supply. As such, the circulating supply is regulated according to demand and supply with no change in the token units held in the wallets of users.
As observed by Xodus Finance, there is a gap between what is available to people seeking rebase tokens and what they want from rebase tokens. People seek rebase token protocols looking for a safe investment vehicle. However, they are often met with an unsustainable and unrealistic return, which is different from what they are accustomed to in the traditional investment settings.
Xodus Finance shaped their concept as a result of their observations of the current rebase token space. As such, they want to provide that middle ground with safe investment projects tuning out realistic returns in the digital space that are common to the traditional investment world.
Something Different From the Usual
Xodus Finance plans to generate revenue for the protocol using the project’s portfolio. The generated revenue will then be redistributed accordingly using XOD tokens. It features a system that allows both newbies and experienced contributors easy access to the protocol for the diversification of their holdings. This way contributors can avoid doing tedious research and hard work personally.
Nevertheless, planning must be maintained to ensure liquidity, such as adding a 15-day cool-down period. Cool-down periods like that can be described as buffer zones, which allow the team to plan and work 15 days ahead of market conditions. This operation is quite similar to lock-in periods of some staking tokens and investments with periodic withdrawal or fees. Considering the rate of evolution of the DeFi space, this can be seen as an advantage.
In addition, the road map of XOD draws a long-term plan for contributors to stake and earn rewards from various sources of income with the $XOD token. Projects under the Xodus Finance will be rigorously checked to protect XOD contributors from bad projects.
The Infrastructure Powering Change in the DAO Sector Through Xodus Finance
Every project operates with different chain requirements, which include transaction speed, fees, scalability, and security. Most especially, both low transaction fees and hastened transaction speed are becoming a must in the DeFi space due to token utility.
Currently, Fantom, on which Xodus Finance is built, positions itself to be the fastest blockchain network with new features constantly added to keep the network updated at all times. Within 1–2 seconds, transactions are confirmed; making the transaction speed faster than other blockchain solutions.
In addition, transaction fees are less than a cent on the Fantom network. Thus, allowing just anyone to easily navigate through the ecosystem. What makes the Fantom network more unique is that Fantom does not rely on other blockchains for security.
As a layer 1 blockchain, Fantom possesses its native security protocol and it is also fully compatible with EVM (Ethereum Virtual Machine). In addition, smart contract languages like Solidarity and Vyper are supported on the Fantom network earning it the developer-friendly moniker.
The change in the narrative of DAO brought about by Xodus Finance could steer people towards what they want from a rebase token –a safe investment vehicle with a sustainable and realistic return.
Presently, extremely positive APYs have a negative impact on community members thereby resulting in serious market volatility, huge profit loss, and unsustainability. Mitigating the risks involved is a thing many DAO have tried. While some have succeeded in part, others are still struggling. Xodus Finance positions itself as a problem-solving protocol that has a proper understanding of these risks and how to analyze a series of factors contributing to or aggravating them.