• paragism

Defibox – EOS DeFi Game Changer in Making

Updated: May 16, 2021

Decentralized finance or DeFi is definitely on the rise. DeFi started as an experiment in early 2017 but it has really gained extreme momentum since 2020. Post pandemic, the socio-economic situation changed and now DeFi has become a billion-dollar industry that runs without the intervention of any third party or centralized authority. People like DeFi because of its trustlessness. Whereas DeFi basically originated on the Ethereum blockchain, it expanded to other blockchains also. Ethereum’s arbitrary gas fee and scalability issue are not going to be solved very soon and many other blockchain ecosystems are grabbing the opportunity very well. EOS is one of them and the DeFi ecosystem is being built very fast on it.

Defibox is an AMM (Automated Market Maker) based DEX on EOS. The popularity of Uniswap proved the demand for AMM based DEXs for permissionless swaps and Defibox was one of the first such DEXs which bagged significant TVL (Total Value Locked) on EOS. The unique AMM of Defibox allows settlement of any trade with lightning speed. The liquidity of the trades comes from on-chain pools and anybody can provide liquidity to the pools. The liquidity providers earn trading fees after providing liquidity and all the transactions are verifiable on EOS blockchain real-time basis.

Defibox swap screen - From Defibox

Although Defibox is primarily an AMM based DEX like Uniswap, it has incorporated a few different features. BOX is the governance token of Defibox and you can mine BOX by providing liquidity to Defibox. Due to the liquidity mining, the APY becomes quite high as you get continuous BOX tokens after providing liquidity. BOX holders can participate in the voting process to determine important parameters of DeFi protocol. EOS+BOX is the second biggest pool on Defibox and the liquidity providers participating in the particular pool can receive 75% of various protocol revenue rewards of Defibox. Defibox is concerned about maintaining the value of the BOX token and so they’ve prepared a BOX savings system where you can get different APY according to different locking periods and the locking rewards are free to be claimed anytime. The liquidity rewards also can be claimed anytime. You can also generate a stablecoin called USN if you stake EOS on Defibox. The process is similar to the generation of DAI on MakerDao. Thus, Defibox incorporates many features of popular DeFi protocols and amalgamates them very well to provide multiple benefits to the users.

Top 5 markets of Defibox – From Defibox

EOS-USDT APY breakup - From Defibox

Defibox 2021 roadmap says that they are going to establish ‘Defibox Eco development Foundation’ similar to ETH Foundation or Web3 Foundation. It will focus on developer community development enabling improvement of the platform. Defibox will gradually become more open and facilitate a diversified development environment. Defibox has the ambition to embrace multi chains down the line to participate in cross-chain DeFi. The project also mentions in their roadmap that they want to improve the depth of the liquidity pool by enabling a single-side liquidity providing mechanism.

Defibox is definitely doing well. They’ve marked a niche by providing swap, stablecoin and lending service under the same platform. The desire to become a one-stop DeFi shop is very clear but liquidity is a big problem of the DEXs. Wrapping various tokens on the EOS blockchain is a viable solution and pTokens issued by pNetwork is doing a great job with collaboration with Defibox (EOS-PBTC is the fourth biggest pool on Defibox with 110K+ 24 hours swap volume). Organix is another company that made strategic collaboration with Defibox sometime back. EOSIO based synthetic assets issuance and trading protocol of Organix mints synthetic assets with excess collateral backup and the price of the assets are synchronized with the external assets. Organix can bring a lot of liquidity to Defibox. Bringing liquidity is always good but utilizing liquidity is most important. Defibox is also providing liquidity to traditional EOS DEX Newdex after they innovated to become a DEX aggregator in the changed market situation. When an AMM based DEX connects its liquidity depth with an order book based DEX, the game is a win-win for both. The market is ready for various experiments and the project has remained successful with its empirical approach. True decentralization will be the key to the success of Defibox in the near future.