Fractal, a well-established trading company, aims to enter the world of decentralized finance with Tokemak, a project the team describes as a “decentralized liquidity reactor” for DeFi.
On Tuesday, the company announced a $ 4 million investment round led by Framework Ventures, the DeFi investment fund known for its Synthetix and Chainlink games. Other major funds such as Electric Capital, Coinbase Ventures, North Island Ventures, Delphi Ventures, and ConsenSys also joined the tour.
Funding comes in preparation for Tokemak’s release scheduled for the end of the second quarter of 2021, in which its liquidity network will be visible on the Ethereum network.
In short, Tokemak provides a one-stop unit of liquidity for decentralized exchanges. Carson Cook, Tokemak founder, explained to Cointelegraph that the project is “a network designed to create sustainable liquidity for new and established DeFi protocols.”
For the liquidity provider, Tokemak acts as a one-way return platform where they can deposit reserve assets such as Ether (ETH), USD Coin (USDC) and Dai, as well as tokens for projects using Tokemak. The Tokemak platform will then stimulate the liquidity of robotic market producers and other market creation opportunities. Key to this concept are TOKE holders who act as “liquidity managers” and express their preference for where the funds will be sent.
Tokemak’s main mission is to provide liquidity for new projects. In most cases, they have to devote a large amount of resources and efforts to increase the liquidity of the token market, including growing crops. Tokemak allows them to stick to liquidity through a one-way offering – for example, by distributing some tokens among token reactor pools. Tokemak’s liquidity pool can then be automatically directed to their token market, even if it depends on the wishes of the liquidity managers. TOKE holders may want to incentivize some groups over others as the token provides partial control over Tokemak’s reserves.
As explained by Cook, the Tokemak class of users can drive when they reach the maximum gain of the protocol:
“Marketers can access Tokemak to increase trading capital and generate commercial profits. Market makers are likely to perform the following functions: pricing, which provides asset prices in professional markets such as order book markets, quote request systems, etc., and liquidity managers who use TOKE to channel liquidity to the markets. where they can be most effective with commercial capital. ”
Cook said Tokemak is also expected to be useful for “humble farmers,” given that TOKE will be distributed through liquidity transactions. Bowers can also see the platform as a way to increase market depth.
The protocol creates an innovative pool of stock exchange liquidity that plays a somewhat similar role to Yearn.finance and other return protocols that are constantly looking for the most profitable strategies for users’ assets. Given the importance of TOKE, distributing your code wisely is probably the key to success.