This AMA has occurred on the Matic Network telegram channel (https://t.me/maticnetwork) on September 09, 2020.
All questions were answered by Oropocket co-founders Tarusha Mittal and Mohit Madan, AMA was moderated by Arun Philips, the Marketing specialist at Matic Network.
Firstly, can you tell us a little bit about OroPocket and what you are trying to build with the Open Finance Protocol?
OroPocket offers asset-backed banking.
With Open Finance we’re trying to tokenize real-world assets such as Gold, Stocks, ETFs, Energy, etc.
We’re building a ton of services on top of it, including instant exchange(without the need of an exchange), instant very low-cost loans, and earnings yield(rental) on your assets.
The idea is to create an open ecosystem where institutional investors can participate and move the capital from traditional markets to Defi.
We don’t just peg the price of the asset, but take actual physical asset – put it up on custodianship, get it 100% insured and tokenize it. 🙂
Bringing real-world assets to the Blockchain means greater exposure to these traditional assets for crypto users.
Yes, not just for crypto users, but the next generation of blockchain adopters – ie institutional investors and funds.
The Crypto market of course gets an added advantage of diversifying their portfolio and earning yield on these assets.
Can you elaborate on how OpFi is bridging the gap between Defi and traditional finance?
Right now the total market cap of the crypto world is <400 Billion dollars, where are traditional markets trade over 300 Trillion every year.
Big money is not able to enter the DeFi space because of the
lack of liquidity,
availability of limited assets
complex learning curve
We eliminate all these entry barriers and enable users to instantly trade, lend, earn, and develop on the open finance protocol. The fungibility between an asset-backed token and actual physical assets gives the traditional market the confidence to trade on OpFi.
Opfi is creating bridge by ensuring that users can interact with traditional assets in a decentralized fashion.
Unlike synthetix – this is a positive sum game.
We are chain agnostic – meaning that a user holding USDC can move it freely between chains and invest in assets that might have been out of their reach earlier.
Could you tell us more on Why you chose Matic? I'm sure the community would love to hear.
You know how a pencil is useless without a hand?
That’s exactly what Matic offers to Open Finance.
Let me elaborate.
The highly scalable network infrastructure and high throughput of the Matic network allow us to deploy highly complex financial instruments on the OpFi network.
The low fee model enables micro-transactions.
Finally, before we move to questions from the community, I would like to hear your thoughts on how you think OpFi is going to change the future of Blockchain, and what are your plans ahead.
Giants like Nasdaq, LSE, SGX, etc are all wanting to use blockchain technology. With OpFi they can simply plug and play.
We believe OpFi could bring in the next billion users to directly interact with the blockchain. No boundaries, no limitations, open for all and inclusive.
Opfi is an open protocol, aimed at making Defi more inclusive, ensuring the users are a part of a positive-sum game, all the while creating value for the ecosystem by the cross-chain aspect, inherent to this protocol.
Now come’s the questions from the KICK-ASS community!!
How is the burning rate controlled? Since every purchase of gold burns coins. In a situation where there are millions of gold purchasing and selling will the coins run out?
The actual supply is only limited by the amount if physical asset. For example, if we have 1000 grams of physical Gold in our vaults, there can only be 1000 GOLD tokens. As the vault grows, with it the tokens grow(and the other way around).
Oropocket has been great, but as an investor, we're always concerned about the loss of hackers. So #Oropocket has any mode to help users like me more secure?
Security is the most important point of focus for OroPocket team. In terms of physical asset security, we deploy military grade security to the vaults, and have 100% insurance on assets. For digital, users can enable several level of security including 2FA, automatic account lock, private key scrubbing etc.
Funds Security is the main Priority for me! So, Can you tell us How Our Funds are safe & Secure in the OroPocket Platform? What if Unfortunately OroPocket Hacks or suffered from Security Breach, then is there any insurance available for the recovery of the user's Funds?
All our assets are held by custodians and under bailment so even if Oropocket shuts down tomorrow, your assets would be safe. While OroPocket assets are 100% insured – you can actually move the assets to your own Matic address, thereby making sure that you’re free from any attacks on the platform itself.
Some exchanges were hacked recently. This is not the first time that DeFi shows its vulnerability. Do you worry about a trust issue? Why can’t code audits avoid security problems?
This does not concern us much, as OpFi allows you to directly interact with the smart contract. You don’t even need to have an account on OroPocket.com in order to participate in the OpFi network. With Opfi – one procures the gold tokens by interacting with a smart contract and not with any centralized exchange which is at risk of hacks.
A celebrity said decades ago "gold is money everything else is credit", do you think this thinking fits with what Oropocket offers?
We’re running PoC with Gold and Silver and would be adding more asset classes soon.
Compared to DDAO/XAU/PAXG, with OroPocket you get the following advantages:
Gold/Silver backed debit card to shop online, offline, or even withdraw cash at ATM.
Delivery of the physical asset.
Earn a yield on assets
On moving forward through your roadmap, what are your most important next priorities? Does OroPocket team have enough fundamental ( Funds, Community, etc. ) to achieve those milestones?
The next feature would be SIP, using which you can regularly invest in assets.
You set an amount > Give authorization > Set frequency and the amount is auto deducted from your bank and assets are purchased.
This allows users to build there wealth over a period of time.
After this, we have international remittance lined up.
When you say stocks and ETFs, do you mean you would further tokenize these stocks on blockchain?
Yes, that’s correct. Soon you’ll be able to trade Apple, Google, Reliance shared on Open Finance Protocol.
How can you do "no" price slippage?
The price is derived from oracles and not manipulated by any orders, this ensures you can do high volume orders without having to worry about paying a premium. You can find more details about it here: https://openfinance.oropocket.com/open-finance-opfi/architechture/instant-trade
Did u guys face any legal compliance issues due to Indian laws while dealing with asset-backed tokens? If yes, can you please elaborate?
In India, there’s no legal framework for bullion trading hence our parent company is based out of the UK. We’re completely compliant. We have partnered with industry leaders like Galmarly and Marsh Ltd for custodianship & insurance.
The end game is to tokenize everything and make it available for the users to gain yield from the assets, what's your 5 year plan?
Move institutional investors from traditional markets to OpFi.
Are you guys using erc1400 token standard?
We will very soon be using the ERC1400 standard as is already retro-compatible with ERC20.
Couldn't find your smart contracts on GitHub.. not open source?
Not yet, OpFi is still in testing and deployment. ETA: 15 Oct.
It has been proven over and over, adoption is a vital part of a project's success. What's being done by Oropocket to drive global adoption amidst the typical crypto regulations and legislation?
Since real world assets are highly regulated, we completely support the regulations. In fact the Open nature of OpFi allows on chain KYC solutions to be plugged in.