PerlinX utilizes the Perlin token, also sometimes referred to as “PERL Coin”, to facilitate the creation of synthetic assets and crypto derivatives on the blockchain. Furthermore, thanks to UMA Protocol, Balancer Labs, and the Perlin Asset Liquidity Engine, Perlin also provides automated market maker (AMM) functionalities. The project is still in the very early stages of its development, with many features still to be rolled out and completed. That being said, the PerlinX GitHub repository suggests that a great deal of work has been going on behind the scenes in recent months. With a host of new exciting synthetic asset liquidity services in the works, PerlinX and “Perlin Network” are positioned to heavily disrupt the traditional derivatives market. But, what is PerlinX, and how does PERL Coin work?
In this article, we’re going to explore the PerlinX synthetic asset and asset liquidity platform. Also, we’ll discuss the PERL coin, and the staking facilities available on the platform. Furthermore, we’ll look at the PerlinX roadmap and discuss some of the exciting features on the horizon for the crypto derivatives platform!
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What is PerlinX?
PerlinX is a decentralized, blockchain-based synthetic liquidity pool and asset liquidity exchange. The platform facilitates the minting and trading of synthetic assets. Working in partnership with UMA, PerlinX will enable users to create all kinds of synthetic assets on the blockchain. This is achieved through the over-collateralization of the native PERL token, and the use of the Asset Liquidity Engine.
PerlinX is still in the very early stages of its development, with many features yet to be finalized. However, at present, the focus is on blockchain-based synthetic commodities and cryptocurrencies.
In the next PerlinX update, users will be able to stake PEARL tokens and earn rewards and incentives by providing liquidity. Following this, we can expect to see the introduction of pxTokens, along with liquidations, and disputes. This is in line with thorough, diligent testing and identifying potential attack vectors. The long-term goal of PerlinX is to create a solution for incentivizing synthetic asset minters and PERL token liquidity providers.
Harnessing the power of UMA Protocol, PerlinX is positioned to be a serious contender in the crypto derivatives space. Also, PerlinX utilizes the automated market maker (AMM) facilities of major decentralized finance (DeFi) protocols such as Uniswap and Balancer. In the future, we can expect to see more integrations like this as the PerlinX ecosystem expands.
Perlin
Perlin is the parent company of PerlinX. Working in partnership with the International Chamber of Commerce (ICC), Perlin is striving to make distributed technologies readily available and easy to integrate on an enterprise level. Perlin aims to create positive disruption to make communities, industries, and economies more efficient and inclusive. Furthermore, Perlin has a strong commitment to climate control and an eco-friendly, sustainable blockchain industry.
The ICC is “the world’s largest business organization”. It represents over 45 million companies and 1.2 billion employees worldwide. Furthermore, the ICC is in a unique position to encourage the adoption of blockchain technology to a tremendous degree. This partnership aims to expand the use cases of blockchain into new fields such as supply chain management, and anti-counterfeiting.
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Synthetic Assets and Crypto Derivatives
The crypto derivatives market is an emerging asset class that has taken the blockchain industry to new heights. Traditionally, to gain exposure to an asset, one would have to physically buy the asset, or trade derivatives of that asset. This usually comes with hefty fees and the need for brokerage accounts, which can be problematic in certain geographies. However, the use of synthetic assets has lowered the barrier for entry for an entirely new generation of investors that might not have been able to gain exposure to many assets previously.
Now that all kinds of real-world assets can be tokenized on the blockchain, the crypto derivatives market has the potential to heavily disrupt the traditional derivatives market. The derivatives market is estimated to be worth one quadrillion dollars. This makes it the largest untapped market for cryptocurrencies. With projects like Synthetix pushing the limits of what is possible with synthetic assets, PerlinX is entering the exciting territory. To learn more about synthetic assets and crypto derivatives, save our Crypto Derivatives Market Deep Dive article for later!
The PERL Token
The PERL token, or PERL coin as it is commonly referred to, is used for collateral and liquidity on the PerlinX platform. PerlinX users can stake PERL and provide liquidity using the PERL token. By doing this, users receive rewards in return. Furthermore, the PERL token can be collateralized to mint synthetic assets using collateralized debt positions (CDPs).
According to CoinGecko, at the time of writing, the PERL token is trading at around $0.15. The actual circulating supply of PERL tokens is not entirely clear. However, according to CoinMarketCap, the PERL token has a circulating supply of around 490,938,908 out of a maximum supply of 1,033,200,000 PERL. Soon, we can expect to see more updates regarding the utility and tokenomics of the PERL token. Further information will be released as PerlinX achieves key milestones set out in its roadmap.
UMA Protocol Integration
UMA Protocol is another such synthetic asset protocol. Perlin Network has partnered with UMA to facilitate the creation of synthetic assets that represent real-world assets using UMA’s Data Verification Mechanism (DVM). The UMA DVM works much like an oracle. In a nutshell, oracles aggregate and communicate reliable and immutable off-chain data to smart contracts. To learn more about oracles, be sure to save our Oracle Deep Dive article for later! Or, to learn how oracles work on a technical level, see the Chainlink 101 course at Ivan on Tech Academy. We cover making API calls with the industry’s largest oracle, handling decentralized data, and how to create your own decentralized lottery from scratch!
The synthetic assets created are what are known as pxTokens. pxTokens can come in many forms. Each represents a tokenized asset on the blockchain, including pxGold, pxOil, and pxCarbon. Also, the native UMA token is used to incentivize liquidity providers (LPs) on the PerlinX platform by rewarding them for their participation. This forms part of the Asset Liquidity Engine.
Balancer Labs Integration
Created by Balancer Labs, Balancer is a customizable automated market maker (AMM) and decentralized exchange (DEX) built on Ethereum. Furthermore, Balancer is one of the most popular decentralized finance protocols for borrowing and lending. AMMs use smart contracts instead of order books to facilitate peer-to-peer token swaps for use across various decentralized applications (dApps) and smart contract-enabled blockchains. Moreover, this is achieved without a centralized entity or third-party intermediary. As with UMA token rewards, the Balancer integration allows users to earn BAL tokens by staking PERL and providing liquidity. This also forms part of the Asset Liquidity Engine.
Staking with PerlinX
PerlinX offers an attractive annual percentage yield (APY) on staked assets. Users can keep track of all positions using the sleek, intuitive dashboard. Also, PerlinX rewards users with generous incentives for providing liquidity and staking PERL. Users that stake the PERL coin receive Liquidity Provider Tokens (LPTs) that are proportional to their share of any given pool. Liquidity providers (LPs) can then stake LPTs to earn PERL coin rewards, plus Balancer token rewards. Furthermore, LPs will soon be able to receive UMA token rewards.
Both Balancer Labs and UMA Protocol have played a crucial role in the development of PerlinX by facilitating some of the most robust automated market maker (AMM) and synthetic asset infrastructures. In turn, this has aided PerlinX by increasing trader adoption and composability, while bringing capital to the platform. In time, PerlinX plans to integrate these services with the traditional financial sector to facilitate the mass adoption of cryptocurrency.
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Perlin Network GitHub
As the project is still so young, many of the features are yet to be implemented. However, a quick look at the PerlinX GitHub repository (actually named “Perlin Network”) would suggest that there is much to come in the future for Perlin Network. Perlin Network appears to be working on several developments, including a native crypto wallet, Rust smart contract integration, and much more! The PerlinX GitHub repository suggests that the project has undergone some serious work, and continues to develop and build. Keep your eyes peeled for further developments and updates from the PerlinX GitHub repository!
Why use PerlinX?
PerlinX is the latest crypto derivatives platform to take the blockchain industry by storm. By offering collateralized synthetic asset minting along with automated market maker (AMM) functionalities, PerlinX and the PERL coin could firmly be established as the go-to crypto synthetic platform in the near future alongside the likes of Synthetix and UMA. Furthermore, the hybrid approach combining synthetic assets with liquidity mining is something rarely seen in the crypto space.
What is PerlinX - Summary
With many features in the pipeline, there’s no wonder people are beginning to get excited about Perlin Network. With an active community and a thriving GitHub repository, the future looks bright for Perlin Network. The opportunities available in decentralized finance (DeFi) and the derivatives market position Perlin to be at the forefront of blockchain innovation in the coming months.
To further ameliorate the issues around Ethereum gas fees, PerlinX announced that it will integrate Binance Smart Chain (BSC) to expand the platform’s user base and invite more liquidity. As the platform continues to develop, we can expect to see several major integrations announced in the coming months!
Blockchain technology has seen a phenomenal increase in adoption in recent years. From investors, traders, DeFi, and synthetic assets, to non-fungible tokens (NFTs) and use cases within fashion, art, real estate, and the energy industry, blockchain is becoming difficult to ignore! It’s no wonder blockchain technology was voted the number one in-demand skill on LinkedIn.
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