The United Arab Emirates has well and truly announced its entry into decentralized finance (Defi).
And what an entrance it has been, with Crypto Price Index, the blockchain Defi startup backed by an Emirati royal family recording a mind-blowing 2,300% increase in token valuation in fewer than 30 days since its launch on July 15th, 2020.
Hotbit exchange, who listed the native tokens CPI on the same day as its pre-sale, could hardly have picked a better partner for listing, with CPI token jumping rapidly to achieve a US dollar valuation of more than 20 times its listing price.
This positive growth bodes well for the Defi platform in the Gulf, leading it to list at even more exchanges now, following the incredible demand for CPI tokens. They will now be available on an expanded open market at the BitForex, Bilaxy, and DigiFinex crypto exchanges.
Anyone even nominally active in the crypto space will by now have heard of Defi. Finally, the concept of sovereign money -- the idea that only the owners of funds and assets should be the sole controllers of their destiny -- has latched on, even in the consciousness of traditional players of finance and economy. And thus the programmability, security and digital nature of crypto assets has now entered into the realm of financial services, bringing with it the decentralization that made the Bitcoin idea so attractive in the first place.
But as the number of Defi platforms and assets continue to churn out at rapid pace, tracking them and considering them for investment becomes ever more difficult. While crypto assets are superior and Defi takes them a step further, they still lack the structured management tools of traditional finance, with derivatives like futures, options, and indices like the S&P 500 for stock markets able to help traders and enthusiasts to manage their investments.
But the calls for these tools have not been ignored. Crypto Price Index, through its CPI tokens, allows traders to form a basket of the top 200 digital assets, to track their price performance and spread their risk.
The fact that it has been barely a month and the demand for CPI has been through the roof shows that tools like CPI have been precisely what the markets have been waiting for. From a $5 price on listing day to its current price of $115, CPI demand has not abated.
To accommodate liquidity demands, CPI has decided to list on three additional crypto exchanges: Bilaxy, BitForex and Digifinex. This will ensure more access and equal opportunity for more participants.
And to provide even further good news, it has been announced that Sheikh Abdullah Bin Rashed Al Sharqi has taken on the role of project co-founder, lending his keen knowledge of business and wealth management to CPI. This is not the first involvement of the UAE royals, with them already becoming part shareholders in CPI since 2019.
The strategy of early round funding from accredited investors, forgoing the traditional ICO/IEO route of crypto projects, has put CPI in a strong position, as early investors have also agreed to lock their funds to prevent early divestment.
CPI CEO Herbert Law summarized CPI’s market potential:
“My thought is since we restricted previous token sales it will allow a smooth transition to trading in the secondary markets. This prevents the big sell offs commonly seen in the crypto market that are a result of poor planning.”
And with some reports suggesting less than 2% of crypto is locked in defi, there is much room to grow for the sector, more so with powerful tools like CPI facilitating their rise.
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