Why?

Why do we do what we do...

If one truly believes that institutions are coming, or in the potential of mainstream adoption of crypto, then a key prerequisite for this happening is the ability to “harness volatility”. And that is the risk we choose to focus on and solve for initially – volatility.

Much as crypto evangelists might like to believe, there is undeniably one attribute that cryptocurrencies fall woefully short of, in their quest to be a digital representation of value. And that attribute is stability of value. Because of the inherent volatility of crypto, it struggles as a stable store of value, making it an ineffective medium of exchange. That in turn limits its widespread usage in the economy vis-à-vis fiat currencies and means that it is not commonly used to denominate prices or in financial statements, limiting its role as a unit of account.

Stablecoins were born as a response to this volatility and have become an essential component of the crypto ecosystem due to their unique attributes that combine the stability of traditional fiat currencies with the benefits of blockchain technology. As a result, stablecoins have come to play an outsized role in crypto. However, it is ironic that a movement whose ideological roots lie in decentralization, financial sovereignty, privacy and censorship resistance has come to rely on USD as a vital cog in its infrastructure.

We propose an alternative way of taming crypto volatility, a crypto-native mechanism that is not reliant on fiat currencies to achieve value stability. We do so using a proprietary risk tokenization technology called SMART. SMART is an acronym for “Split Mechanism for Asset Risk Tokenization” or “Risk Tokenization” for short. It allows for creation of derivatives for any asset. Perhaps the easiest way to visualize risk-targeting is thinking of it as a risk dial – not only can one turn the risk dial down to dampen volatility but one can also turn the risk dial up to amplify volatility, if one is so inclined. The best descriptor of SMART’s utility is the ability to “harness” volatility. That means that not only can one tame volatility, one can trade it, exploit it and in our specific case, tokenize it.