See How FIRMO plans to revolutionize the Financial System Equation
What is FIRMO?
Firmo is a decentralized financial protocol that executes financial contracts on the blockchain technology. It is designed to integrate with and support the advancing decentralized cryptographic community such as: Peer-to-peer lending platforms, decentralized exchanges, price prediction platforms, cryptocurrency analytics markets and so much more.
Firmo plans to revolutionize and hence transform some very key "strong holds" of both the conventional and cryptographic financial system.
The overall financial system has evolved through a series of stages and has since the creation of Bitcoin in 2008 by Satoshi Nakamoto, been on a constant proneness to rapid revolutions and reforms.
Bitcoin was invented as a cryptocurrency - a digital asset designed to work as a medium of exchange that uses cryptography to control its creation and management, rather than relying on central authorities (trusted third-party) in other to effect transactions.
Source
Cryptocurrency has to a large extent helped to solve the problems encountered with the operations of the conventional financial sysytem, such as:
Trustlessness: Cryptocurrency removes this need to have to first "trust" someone before transacting with them. This is possible by incentivizing every actor in the network to not debase the currency and not commit fraud. To that light, I really do not need to "trust" anyone to trade, the system protects me from undue acts. Unlike the case of fiat, when I must be assured that my money's worth will be safe.
Decentralization: With cryptocurrency, no single person or organization is able to affect the supply of currency or exert significant influence over it without the approval of the majority. Unlike conventional operations where banks and the government possess the sole authority to create and distribute finances and everyone else remains at their mercy.
Immutability: This feature allows users to view their transaction history at anytime without alterations and makes it impossible to erase or delete any transaction or even edit the contents of the transaction. Unlike when we'll have have to wait for the bank to deliver to us the month end summary of our transactions which could be manipulated to effect or conceal fraud.
However, the wide adoption of Bitcoin and other cryptocurrencies, isn't devoid of its own challenges. Due to its highly secure channel fraudsters and other hackers have been on their toes to device more solid means to execute their operations, hence being a thing of concern especially to new adopters of the technology.
Some of these risks include:
Fake addresses: Phising of websites especially for ICOs and token sales are no news today. That's why participants are being adviced to manually type the web address of the page they are going to visit in order to send their cryptocurrency for tokens.
Fake wallet details: Here, in an incident where a hacker gains control of a website and changes the wallet address during a token sale, then the funds sent to that wallet address are gone.
Market manipulation: There's usually this subtle activity in the crypto-space that results in a kind of manipulation of prices to make investors and traders sceptical of their purchases that they sell-off cheap. Thus, exposing themselves to a losing risk.
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Firmo has set to eradicate these and many more risks in the financial system with its reliable uncover domian tool called FirmoLang
What is FirmoLang?
"FirmoLang is a non-Turing complete domain specific language, designed with the explicit intention of diminishing the margin of error in self-executing contracts on decentralised platforms.
FirmoLang enables a stable and secure environment for versatile and exotic contracts. The language has been formally developed to ensure a clear and exact representation of contracts, in order to enable their automatic validation, execution and analysis of contracts. With this, developers would be able to formulate exortic and smart contracts, regardless of their level of experience. This will also help to curb the underlying obdurate risks associated with cryptocurrencies and the blockchain technology as earlier outlined above.
Firmo also plans to use what they refer to as Firmo Protocol to further secure and automate smart contracts.
What is Firmo Protocol?
Firmo Protocol integrates with FirmoLang to enable users such as financial institutions, cryptocurrencies exchange platforms and individuals seeking to create automated and secure financial contracts on a distributed infrastructure to leverage on the Ethereum Virtual Machine (EVM) technology.
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The Firmo Protocol is designed to operate with a wide selection of external liquidity providers and exchanges. And also allow users; Financial institutions, Cryptocurrency exchanges, businesses and Private users to create a secure type of smart financial contract called Smart Derivatives that offers financial products such as futures, loans, options and swaps.
My major attraction to the contract models Firmo brings is its Zero Coverage collateral accounts and margins. Unlike most conventional financial institutions i.e. banks, one could execute a smart contract (get loans) with little or no collateral. I think this will foster more transactions in the system due to the rapid transactions that will be triggered in the Firmo community.
Other accounts margins that users could choose from are also available, such as: The Full Coverage (which Firmo aims to launch with) and Variable Collateral Coverage Read more?
If you're like me with little understanding of some key financial terminologies, you may find the following definitions useful as they'll help you understand the idea in my concluding paragraph.
1. What is a Derivative?
"A derivative is a financial security with a value that is reliant upon or derived from an underlying asset or group of assets. The derivative itself is a contract between two or more parties based upon the asset or assets. Its price is determined by fluctuations in the underlying asset. The most common underlying assets include stocks, bonds, commodities, currencies, interest rates and market indexes."
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2. What is Tokenization?
Tokenization in the blockchain domain entails converting rights to an asset into a digital token. It is essentially the process of representing real-world assets on the blockchain using these digital tokens. Tokenization or digitization of assets is made possible
through representing physical assets using distinctive identification symbols.It allows ownership rights to be transmitted and traded on a digital platform.
By token generation through a Smart Contract, value can be ascribed to the token relative to the real asset. Due to the unprecedented level of transparent information that can be made available on the blockchain, tokenization is making many assets much more attractive to wide-ranging investors.
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Conclusion
The introduction of derivatives to tokenized assets, depending on the particular underlying asset will leave investors at a state of appreciation when its value rises and depressed when the value decreases. For me, I think that tokenizing an asset class using the ERC20 format will be great. For instance, Crystal Token (CYL) has Ethereum as its underlying asset which I believe is great for every investor.
More Information & Resources about RoadMap and Team?:
Firmo Website
Firmo TechnicalPaper
Firmo Telegram
This is my entry for the writing contest hosted by @originalworks. Link: https://steemit.com/crypto/@originalworks/200-steem-40-bonuses-sponsored-writing-contest-firmo
Firmo2018
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