What Is bZx Protocol (BZRX)?
bZx Protocol allows anyone to build applications that enable lenders, borrowers, and traders to interact with the most flexible decentralized finance protocol on Ethereum. bZx is a community-run project, governed by the community vote for all major changes to the protocol.There are a few core products that make up the bZx ecosystem and each of these products serves a different purpose within the ecosystem.
Whether you’re a lender or borrower, you stay in control of your keys. Never worry about opaque centralized exchanges getting hacked or stealing your funds. You can read Your audit by ZK Labs here. Build applications that empower lenders, borrowers, and traders with the most flexible decentralized finance protocol on Ethereum.
The base protocol audit is publicly available. All custody is retained by the base protocol. Both the base protocol audit and iToken/pToken audit were conducted by ZK Labs, a recognized leader in the space. Matthew DiFerrante, founder and lead auditor at ZK Labs, is a security engineer at the Ethereum Foundation and audits the Ethereum core protocol itself.
bZx Protocol Storage Key Points
|Coin Name||bZx Protocol|
|Circulating Supply||420,006,994.26 BZRX|
|Source Code||Click Here To View Source Code|
|Explorers||Click Here To View Explorers|
|Twitter Page||Click Here To Visit Twitter Group|
|Whitepaper||Click Here To View|
|Official Project Website||Click Here To Visit Project Website|
What does going long or short mean in trading?
Margin trading has two main aspects leverage and shorting. When trading with leverage, a trader borrows assets to increase the amount of assets they are trading. By doing so, they magnify the gains or losses of their trade. The borrowed assets are known as a margin loan. To obtain the margin loan, the trader puts up assets that serve as collateral. The terms of the margin loan specify a collateral-to-loan ratio.
bZx Protocol If the trade falls below the specified ratio, the trade is liquidated and the lender gets repaid using the trader’s collateral. Margin trading also includes shorting. When shorting, a trader essentially sells assets they do not own. The short investor borrows an asset and sells it with the expectation that the asset will lose value.
How are positions liquidated? Is there liquidity risk?
Positions are liquidated using Kyber Swap. bZx Protocol When a trader goes under margin maintenance (15%), they are only partially liquidated, bringing their current margin to 25%. Only liquidating as much as necessary reduces the risk of slippage from large liquidations. Anyone can initiate a margin call: the process is permission less and incentivized. The incentive to liquidators is a refund of your gas.
bZx Protocol There’s also no capital costs or risks like those experienced when liquidating positions on other protocols. This ensures redundancy in the margin calling process. Moreover, there is an insurance fund which protects lenders. In the case that a lender would lose their principal, the insurance fund will automatically disburse funds to the lender. This insurance is funded by a smart contract holding 10% of all interest that is paid by borrowers to lenders.
Are the smart contracts safe? Can I see the audits?
bZx Protocol The base protocol audit is publicly available. All custody is retained by the base protocol. Both the base protocol audit and iToken/pToken audit were conducted by ZK Labs, a recognized leader in the space. Matthew DiFerrante, founder and lead auditor at ZK Labs, is a security engineer at the Ethereum Foundation and audits the Ethereum core protocol itself.
Everything is Tokenized
iTokens and pTokens are powerful financial primitives. iTokens are tokens that constantly increase in value from earning interest, while pTokens are tokens that represent short and leveraged positions. These iTokens and pTokens can be composed into novel financial products, used as collateral for loans, or listed on any exchanges to instantly enable margin lending and trading.
Traders on centralized exchanges pay higher interest rates to compensate lenders for the risk of the exchange getting hacked. Decentralized margin lending makes trading more affordable. Taking a long position involves a simple swapping of one asset for another. For example, you could swap DAI for ETH because you think ETH will go up in value faster than DAI. Taking a short position is more complicated. A short position is betting that something will go down over time. Short positions require escrow, leverage, and margin calls.
Leveraged positions use the same mechanics as short positions, but with leveraged positions you’re able to borrow more than you have. For example, you could go 100x long on bZx Protocol. You can easily integrate bZx protocol into your exchange, wallet or web3 app. Make money with the assets you already hold in your wallet without giving up control of them. Interest rates on margin loans are often much higher than traditional loans while being far safer.