What is Oxygen (OXY)?

Oxygen (OXY) is a DeFi prime brokerage protocol that allows users to enjoy various DeFi services, such as pools, staking systems, loans and credits, which are powered by DEX Serum and the Solana ecosystem. 

Uno of the protocols decentralized finance (DeFi) The fastest growing within the Solana ecosystem is the Oxygen (OXY) protocol. Oxygen, is a service of DeFi prime brokerage or DeFi brokerage, which uses the power of Left (LEFT) for its funtionability.

Its main objective is to provide a specialized service supported by the liquidity pools which are available in the Serum protocol. This in order to offer unique products and services to its users anywhere in the world. In addition, Oxygen also has its own utility token, which allows its holders to enjoy unique advantages for their possession, and at the same time, serve as economic leverage within the platform and others. DEX that operate with said token, such as Serum and raydium.

If anything, Oxygen seeks to democratize and expand access to decentralized finance, as well as non-custodial broker services that are safe, fast, and easy to use. Among the different services that we can find in Oxygen are crypto-collateralized loans, credit and leveraged trading, as well as a non-custodial wallet for the Solana ecosystem, closing a circle of services focused on empowering its users.

Oxygen was created in late 2020 by two co-founders of the well-known map app, Maps.me: Alex Grebnev and Victor Mangazeev. Grebnev is a former Goldman Sachs and Merrill Lynch employee, with extensive experience in fintech. Mangazeev for his part, is a technology entrepreneur, was CEO and co-founder of a service known as myDFS, a platform for fans of hockey and the KHL league.

What does Oxygen offer us?

First of all, Oxygen allows us to enjoy a prime brokerage that works in a decentralized way and which we can access with a few simple steps thanks to its operation on Solana. Oxygen's decentralized operation guarantees that the funds we place in the protocol are at our disposal at all times and are not controlled by a centralized entity, as is normally the case with prime brokerage in the traditional financial world.

Additionally, Oxygen is designed to offer efficient market options that are supported by Serum, the largest DEX in the Solana ecosystem. In this way, Oxygen offers its users services of loans, credits, trading, liquidity pools and yield farming, all integrated in the same space. In keeping with this objective, Oxygen has been deployed on Solana so that it is not only easy to access, but also economical and secure, enjoying the enormous scalability that this network offers.

Thus, with Oxygen you can obtain performance, borrow, trade directly with your funds and obtain commercial leverage against a portfolio of assets. It provides a more efficient way of managing capital and is unique from other loan protocols in the following ways:

1. Multiple uses of the same warranty. Oxygen allows you to generate a return on your portfolio by borrowing your assets and borrowing other assets at the same time.
2. Cross collateralization. You can use your entire portfolio as collateral when you want to borrow other assets, which means less risk of margin demand and settlement for your portfolio.
3. Market-based pricing. Oxygen uses an order book rather than following a preset market model that must be adjusted manually.
4. Oxygen is 100% decentralized, 100% non-custodial, and 100% on-chain. All transactions are purely peer-to-peer without the involvement of a centralized operator. The Oxygen protocol never has access to your private keys at any time.
5. Trade within the poolRather than forcing continuous deposit and withdrawal, Oxygen will allow users to interact with the Serum ecosystem and DEX directly from their pools, streamlining the process.
6. Sophisticated products: since Oxygen uses a general on-chain risk management engine that evaluates the common fund of each user, instead of a fixed loan model, it is designed to support arbitrary products: tokens, synthetic products, non-linear assets, etc. .; all of them cross margins on the same account.

Functions within Oxygen

Now, how can we access all these functions that Oxygen offers us? Well, for this you only have to go to its official website and use a Solana Web wallet to interact with the Oxygen dApp.

In this case, we recommend using a wallet such as Phantom or the Sollet extension, since they greatly facilitate interaction with the dApps on the Solana ecosystem. If what you want is greater security, you can use a hardware wallet such as Ledger, which also allows interaction with this dApp in a completely transparent and integrated way. Once you are connected to the Oxygen dApp, you will be able to enjoy the Oxygen user interface, which is quite simple.

The first screen that you will see is the Market screen in which you can see the cryptocurrencies that are supported by the protocol. You will be able to see currencies such as USDC (the main asset within the platform), ETH, BTC (in its tokenized forms on Solana), SRM, USDT and SOL. Along with these currencies you will be able to observe important data such as:

1. Total Market within the protocol.
2. Loan market.
3. Credit market.
4. APR of the deposits of each crypto.
5. APR of the credits of each crypto.
6. Initial and critical LTV of each crypto (relevant data to make and request loans).

Create a pool in Oxygen

One of the functions available in the Markets tab is the option to create a pool (Create Pool). This option allows us to inject liquidity into the protocol in order to receive rewards for the different operations that can be carried out in said protocol. Again, the options available to perform this operation are the same currencies supported by the protocol, and it is as simple as choosing the currency that we want to use for our pool.

This operation will allow you to obtain interest that comes from each of the loan operations carried out in Oxygen, basically a joint yield farming and staking strategy that generates commissions. At this point you only have to indicate the amount of currency that will enter the pool.

At the end of the process, you will have created your first pool within Oxygen and you will begin to receive commissions as said pool is used in the different operations. In addition, in order to control your portfolio within Oxygen, you will be able to see a series of clear statistics about the pool, its assets and performance during its operation.

Apply for a loan on Oxygen

If you have entered assets within the protocol, the system will automatically allow you to use these assets as collateral to request loans. The crypto-collateralized lending system is a standard of the DeFi ecosystem that guarantees capital efficiency at all times and reduces the risk of liquidation due to portfolio diversification.

Thus, your indicative loans will be placed in a loan order portfolio with the parameters you want. The interest you pay is determined by the market interest rate of that order book plus the protocol fees. The maximum amount you can borrow in total is the same:

Total loan value = initial LTV (%) * Value of the set after the loan operation

Keep in mind that the initial LTV is the maximum amount of initial debt allowed as a percentage of total assets to take a new position. It is a weighted average by the value of the initial LTV of all the assets in the pool. Additionally, the loans have a limit on the amount loaned by the rest of the participants within the protocol, with the intention of maintaining its stability. Taking this into account, you can request the loan you want and return it within the established conditions.

The Oxygen Token (OXY)

The Oxygen protocol has created the OXY token, as a utility token within the platform in order to:

1. Allow a decentralized governance system that uses the OXY token as a voting power system.
2. Allow OXY token holders to benefit from reduced operation fees within the protocol.

However, the project developers have clarified that as the protocol continues to evolve, additional service fees may be charged, which will also contribute to the purchase and burning of OXY. Regarding the governance system, the system is quite simple: each OXY token represents one vote and the token holders will vote on the binding governance initiatives related to the Oxygen Protocol.

To propose an upgrade, a user must have at least US $ 1.000 worth of OXY tokens and lock those tokens. Likewise, you must follow the community guidelines for such action. Once the proposal is presented it is submitted for review and then to a vote, at this point, the blocked OXY will be returned to the proponent.

Government actions can potentially include the following types of proposals:

1. Economy and rates of the Oxygen protocol.
2. Modification of risk management, settlement, data sources and other properties
3. Decide on the assets available on the platform to lend / borrow

All proposals are subject to a 3-day voting period. And, any address with voting power can vote for or against the proposal. If the majority is in favor of the proposal, it will be implemented after 2 days.

OXY token distribution

Another important part of the OXY token is its distribution which follows the scheme shown in the following table:

Thus, the 10 billion tokens of the protocol will be released within the next 5 years, beginning in December 2021. This would make it one of the longest vesting tokens in the ecosystem, in order to achieve good health within the same.

Conclusions

Oxygen (OXY) is another DeFi protocol over Solana which tries to promote the adoption of financial services on this network relying on Serum. In this point, competes Raydium, another DeFi protocol on Solana with a similar mechanic.

However, the ability to perform in-pool and on-chain operations, along with a powerful roadmap that includes such interesting things as operations with NFT, synthetics and integration with Maps.me, make this project acquire a significant appreciation in its short time of life.

Links of interest