• The barriers of entry to the conventional bond market are high, thus limiting the global issuer community to governments, credit-rated public institutions, and private corporations. DeBond Protocol, a Paris-based start-up, has developed a decentralized bond product and exchange aimed at creating a fully decentralized fixed income ecosystem without banks and brokers.

Paris :  The rise and global popularity of crypto currencies has shaped the creation of a new financial ecosystem. This trend seems to be irreversible. The Central American state of El Salvador started in September last year to accept Bitcoin as legal tender. IZEA Worldwide, a leading influencer marketing company kicked off 2022 by accepting Bitcoin and Ethereum for its services, disrupting the traditional way of settling bills with fiat money.

The Decentralized Financial environment, or DeFi, is based on blockchain technology and smart contracts. Crypto currencies like Ethereum are therefore not issued by a central bank or financial institutions, but virtual means of payment of the DeFi universe. While crypto hedge funds have been launched commercialized since, a decentralized bond and derivatives market was the missing link in the global rise of crypto currencies. Until recently.

Paris-based start-up DeBond Protocol, founded in 2021, aims to bank on this trend and simultaneously fill the blockchain-based fixed income gap by launching the ERC-3475 bond standards. A recent seed-funding attracted US500,000, valuing DeBond Protocol at USD12.5 million.

The Vision

Currently available DeFi protocols are based on ERC-20 LP (Liquidity Provider) tokens. But ERC-20 is a homogenized token using the same algorithm, thereby hardly capable of mirroring the complexity of modern financial tools.

DeBond Protocol proposes the ERC-3475 standard as a reverse redeemable bond standard, assigned to a unique algorithm that does not need an additional smart contract. In addition, ERC-3475 upgrades conventional liquidity provider tokens on the Ethereum blockchain. Usually based on ERC-20 tokens, ERC-3475 supports complex sets of data.

The Edge

  • Heterogeneity: Each bond is a unique and individual contract, enabling users to customize the underlying interest and execution conditions on a needs-based basis.
  • Fungibility: Bonds based on the ERC-3475 standard can be listed and traded on the DeBond Exchange (DEX) using the Dutch auction (the set price of a security is reduced successively until one bidder accepts the price).
  • Divisibility: Bonds can be split up and/or bundled for trading purposes in the secondary market as subordinated bonds.
  • Derivatives-eligibility: Tokens can be used as collaterals for derivatives like futures and options. This applies to both fungible and non-fungible tokens (NFTs). These derivative contracts can be traded on the DEX, too.

The DeBond Exchange (DEX)
DEX is being established to ensure bonds and derivatives launched in line with the ERC-3475 scheme. Trading bonds launched in the DeFi landscape is the missing link in the crypto universe, and it will help to lift crypto markets to the next level. Banking on the blockchain technology in favour of a new decentralized fixed income market will pave the way forward to a DeFi world 2.0.


Media contact:
Gérard Al-Fil
Marketing and Communications Manager
DeBond Protocol

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