Supply chain finance goes on – chain through the Amplify Defi platform

Decentralized Finance (DeFi) is probably the next crypto trend that will last in terms of value proposition given the ongoing developments in this nascent niche. Today, the innovators in this space are working towards moving traditional finance on-chain as they forge a path for the paradigm shift. With barely a year since huge amounts of capital started flowing into the DeFi ecosystem, it now enjoys over $20 billion in Total Value Locked (TVL).

The past few months have seen the rise of fundamental DeFi projects ranging from exchanges, lending platforms and derivative markets. In fact, the space has evolved so much that some innovations have tapped into the $275 billion Supply Chain financing market. This is one of the most liquid markets globally, but faces some challenges when it comes to accessibility and fairness in the allocation of financing.

With DeFi in the picture, even small SMEs can now get contract credit or asset mortgage credit from an ecosystem like AMPLIFY. This Ethereum-built infrastructure is designed as a B2B2C platform that connects the traditional supply chain finance market with DeFi. While there a couple of projects that have pivoted on this niche, only a few make the cut when it comes to solid fundamentals.

Supply Chain Finance on DeFi

Despite being around for decades, supply chain finance has not fully achieved the purpose it was designed for. Some might even argue that the whole arrangement only favors certain market players who fit the credit rating ‘criteria’ of institutions in this industry. This has been a major setback to small time businesses looking to break even or access credit for operation scaling.

The likes of AMPLIFY are gradually changing such narratives by taking traditional finance on-chain via the Ethereum blockchain. AMPLIFY’s B2B2C model is a combination of the traditional finance B2B ecosystem and B2C platform; it uses an on-chain governance protocol to create a credit network that caters for smaller units in the market. That way, even non-core entities and sub suppliers can access credit without the hustle of going through a financial institution.

Ideally, AMPLIFY plans to digitize the whole supply chain finance market as part of pooling more liquidity into DeFi. Stakeholders seeking to access credit from this platform get the experience of a decentralized market, which comes with perks like a level playing field. This upcoming DeFi platform is gradually redefining supply chain finance through blockchain.

AMPLIFY’s Fundamentals and Tokenomics

The AMPLIFY platform is pretty seamless and gives users an opportunity to lend or borrow assets just like they do in the current supply chain finance market. Only this time, there is no third party to place caps or barriers that would have otherwise been unfair. AMPLIFY’s MVP 1.0 can be integrated with the metamask browser wallet, after which interested prospects can participate in the on-chain financing market.

Like other DeFi initiatives, AMPLIFY has developed a governance token dubbed ‘AMPT’ to sustain the fundamental aspect of decentralization. This token gives the AMPLIFY community a voting opportunity to decide on the future of the project. While it is yet to find its way into big exchanges, AMPT’s Initial Exchange Offering (IEO) was run via the Smart Fundraising Campaign (SFC) initiative and hosted on Emirex exchange.

The AMPT tokens have also been built as an incentive for liquidity mining; basically, users can earn these governance tokens when they provide liquidity to AMPLIFY. They will be released based on a curved auction so as to maintain the underlying value while rewarding early adopters that contribute to scale AMPLIFY’s DeFi supply chain finance ecosystem.

Conclusion

DeFi is slowly forming the future of finance and will probably be here to stay, a concept that only few have understood. However, this burgeoning sector is currently in the experimental phase which means that it may take a while and a couple of mistakes before stakeholders get it right. That said, there has been a growing interest in DeFi by both institutions and regulators in the recent past.

It comes as no surprise that DeFi innovators continue to build finance-oriented products, especially those linked to highly liquid markets. AMPLIFY which is among this bunch intends to scale its product suite to feature other operations like trading, insurance and revenue aggregation. This in itself could greatly influence the platform’s value proposition as retail and institutions start to embrace DeFi.

Parting shot, traditional finance will inevitably meet DeFi and most assets that are traded off-chain in today’s world will soon be integrated on-chain. This will probably spell the beginning of a new era in finance, powered by decentralized blockchains and crypto assets. 

---