Liquidity providing can be simply defined as a creation of free-flow of market transactions by market providers for the market users. This can be related to the kind of atmosphere created in a typical traditional market where buying and selling takes place to ensure a continuity of such a market.
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Similar concepts also can be applied in the Crypto market environment which require consistent users to keep track of the transaction to ensure smooth market operations and continued flow of supply of the liquidity provision. It is widely known that, since the emergence of Blockchain technology, an application called a smart contract plays a vital role in implementing decentralized application deployment and expanding the functionality of the blockchain system. Smart contracts running on the blockchain system architecture have the characteristics of openness and transparency, guaranteed execution, non-tampering, and no dependence on trusted third parties, which can meet the deployment of various decentralized application scenarios, such as Defi projects that have developed rapidly in recent years.
Managing the liquidity providing is one of the vital aspects in Defi project such as Block Occean; since several markets has been created to ensure crypto assets can be exhanges smoothly among the players smoothly without having to go through a complex process of intermediaries. Although, the transactions are significantly lies based on two major categories namely; Centralized (CEX) and Decentralized (DEX), both need liquidity provision to survive. Several exchanges especially from recent years (e.g., 2016) to date have fizzled out even though some of them started well, while some they couldn’t sustain their liquidity provisions talk less of improving it. It is then suffice to say that to take out liquidity provision outside of the entire crypto space, the whole space might even have to go extinct regardless of the great future that has been posited to lie ahead of it.
Moreover, intermediaries are critical to providing liquidity because they connect buyers and sellers across time and enable supply of assets to meet demand in a timely fashion. Liquidity providers can be on either side of a transaction, as buyer or seller. By entering and holding positions they bridge the gap between market participants. In this way, they quite literally make a market for an asset.
A liquidity provider is a user who funds a liquidity pool with crypto assets she owns to facilitate trading on the platform and earn passive income on her deposit.
Liquidity pools are leveraged by the decentralized exchanges that use automated market maker-based systems to allow trading of illiquid trading pairs with limited slippage. Instead of using traditional order book-based trading systems, such exchanges use funds that are held for every asset in every trading pair to allow trades to be executed.
While trading illiquid trading pairs on order book-based exchanges could lead to suffering from great slippage and the inability to execute trades, the advantage of liquidity providers is that trades can always be executed as long as the liquidity pools are big enough. For this reason, liquidity providers are seen as trade facilitators and paid with the transaction fees paid for the trades that they enabled.
Black Ocean projects provide unique features that address the existing challenges of the liquidity provision of the Defi projects to ensure such liquidity provision would remain relevant and efficient for a very long time.
The prime and unique idea of the Black Ocean is to fulfill a growing market demand for fast trading of large chunks of crypto assets. This involves creating opportunities for brokers and institutional players to fast sell or buy big amounts (> 100k$/5BTC) of crypto without touching the price on the open market. Thus, Black Ocean provides a wide range of services such as custody, loans, fiat channel, etc. to corporations and professional players only. Retail customers may only access to Black Ocean through a professional broker.
Black Ocean involves two types of pooling services: Dark pool and Liquidity pool.
It is important at this stage to quickly explain these two types of pooling services are:
- Dark pool provides customers with liquidity and execution for large orders (more than 100k$/5BTC) without any market impact and public data.
- Liquidity pool provides customers with liquidity, execution and order book (only MM and retail orders) for their own order flow, which is based on their own retail customers base.
For a better understanding of the two types of the two pooling services emphasized upon, we can refer the reader to the whitepaper of the Black Ocean project via its website: bo.market.
Also, it is quite pertinent to reiterate that the idea of Black Ocean’s Decentralized pool is to provide whales and institutional players from the DeFi sector of the crypto world, who are allowed to manage big amounts of trades without any counterpart risks and market impact. A whole range of professional tools are available for customers – leverage, funding, different types of orders, possibilities to add additional symbols for designated deals, etc.
Block Ocean: Fly Token
The fly token is a unique custom token of the Black Ocean project created and saddled with the role to provide token holders with opportunities of obtaining trading rebates, covering network expenses and gaining additional benefits for liquidity provision and funding. The Fly token was designed for delivery to customers as an opportunity for getting discounts and additional benefits from VRM – related projects. Fly is based on the Ethereum smart contract chain, thus is a ERC20 token, however, the company won’t write off an option of a likelihood to move a part of token supply to different blockchain networks in the future.
The token is an essential part of VRM’s business, which is a main asset for managing the full range of the company’s relationships with partners, customers and employees.
On a final note, this piece would like to provide us with some information on some other important parts such as the targeted audience, product description and security. Starting with the product description, it can be compartmentalized into three segments:
- Scalability determined to be achieved by designing methodology dynamically pivoted to meet changing market demands.
- Custom built software that is adaptable over time based on improvements in hardware and language enhancements over time coupled with efficiently coded software tailored to meet application needs that is free of redundant code.
- Competitive advantage by deploying software development methodologies proven over 25 years of designing and building traditional equities exchanges, HFT and algorithmic trading platforms in the USA, Korea and China.
The targeted audience included wallet users, OTC merchants, banks, HF traders, Exchanges. Etc. Black ocean also seeks to protect her customer via making some provisions for Client risk management, transaction risk mitigation and finally via settlement and storage.
$ FLY IDO & IEO (GATE) : https://twitter.com/FrankLinYield/status/1381172229329842176?s=20