How Sovryn's Bitcoin Trading Platform Stacks Against CeFi

23 Oct 2020

Sovryn is a non-custodial and permissionless smart contract-based system for Bitcoin lending, borrowing and margin trading. A DeFi platform for Bitcoiners, Sovryn has been live on RSK mainnet for roughly two weeks now, allowing users to trade Bitcoin natively and permissionless on a decentralized application. Without trusting a centralized entity or buying an altcoin, you can finally trade Bitcoin and power the system with Bitcoin. #ThisIsHowWeSovryn

Trading

Currently Sovryn features margin trading up to 5x leverage, all done on-chain. Since Sovryn is built on RSK (a Bitcoin side chain), it benefits from lower block times which average 30 seconds. This enables these transactions to resolve much more quickly than what could be done on the Bitcoin main chain.

• Swap-Exchange — a low cost, low-slippage, AMM allowing instant trades between BTC and DOC (a Bitcoin-backed stablecoin).

• Margin Trading — Creates up to 5X long/short trades, allowing users to borrow leverage from the lending pool.

• Lending Pool — Allows HODLers to earn interest by lending tokens to margin traders and borrowers.

• FastBTC Relay — Allows use of Bitcoin almost instantly with smart contracts and decentralized products, from any Bitcoin wallet.

Coinbase Pro's fee brackets

Above is a chart detailing Coinbase Pro’s different fee brackets for trades. The true winners here are the whales, who are capable of making 6–7 figure trades. At Sovryn, we treat traders the same regardless of how deep their pockets are. We believe all people are deserving of the same financial instruments with no special privileges.

Fees on Sovryn

For all trades on our platform, the default fee is 0.15%. To put this in perspective, this is half of the default Uniswap trading fee of 0.3% and less than half of Coinbase Pro trades under $10,000.

Security

A chart of Sovryn’s security checks vs Ethereum DeFi & CeFi

Sovryn has a handful of extremely crucial benefits over centralized exchanges when it comes to user security:

• No KYC — Users will never have to provide personal identification of any sort to participate in Sovryn’s trading platform.

• Noncustodial — No counterparty risk. Your keys, your coins. We really mean that. Your coins are entirely in your custody and you can deposit or withdraw as you see fit, with no one’s permission needed.

• No centralized entity calling the shots — Sovryn exists entirely on the blockchain, making it censorship-resistant and immune to total shutdown by any authorities.

• Trustless — You will never be subject to an institution’s lack of integrity while holding your funds, because they’ll never get their hands on it. You are also not trusting a multi-signature wallet to onboard your Bitcoin.

Decentralized Governance

Sovryn will be in the hands of a distributed group of stakeholders, who will ideate and propose new refinements to the Sovryn platform.

Decentralization is achieved by transferring control of the system’s smart contracts (i.e. the private keys) to a system of community governance. The SOV token will be a form of decentralized equity, “Dequity”. Its holders will have the ability to manage the protocol by staking and voting. In doing so, they will earn the right to the revenue the protocol generates. By staking it, holders will be able to actively participate in management of the protocol, changes to features and distribution of revenues and rewards. Reminder - no token is required to utilize Sovryn and trade Bitcoin. It is mainly used as a way to stake in the success of Sovryn and have voting power in its proposals.

Keep on the lookout for future announcements from Sovryn.