– Cryptocurrency startup Ostium Labs raises $3.5 million in funding
– Aims to combine traditional commodities trading with crypto
– Develops protocol for digitized commodities perpetual swaps
– Supported assets include oil, bitcoin, and foreign exchange pairs
– Traditional assets in crypto have had limited volume compared to stablecoins
– Investors are interested in bringing real-world assets on-chain
– $1.6 billion raised across 188 funding deals in the segment
– Partnership with Chainlink to differentiate from other companies
– Derivative pricing based on novel pricing fee mechanism
– Trades settled in USDC
– Crypto-native traders may seek alternative to stagnating crypto derivatives
– Monthly bitcoin futures volumes have been consistently decreasing
– DEX-based perpetual swap platforms have low trading volume
Title: Ostium Labs Raises $3.5 Million to Combine Traditional Commodities Trading with Crypto
Cryptocurrency startup Ostium Labs aims to revolutionize the world of commodities trading by developing a new protocol for digitized commodities perpetual swaps. Backed by influential investors including General Catalyst, LocalGlobe, SIG, and Balaji Srinivasan, Ostium Labs seeks to create a more transparent and flexible alternative to conventional derivatives platforms, appealing to both traditional commodities traders and crypto-native traders.
New Protocol for Digitized Commodities Perpetual Swaps:
Ostium Labs is developing a protocol that will enable trading in perpetuals tied to key assets such as oil, bitcoin, and foreign exchange pairs including the Australian dollar, the pound, euro, and yen. This platform seeks to bring real-world assets on-chain, offering an upgrade in consumer access and transparency in tangible assets.
Investor Interest in Real-World Assets on Chain:
Investors, including LocalGlobe, are eager to see real-world assets migrate on-chain, spanning commodities, real estate, and stocks. The current traditional system is considered less efficient than settling on crypto rails, which offers reduced trading volumes and higher fees. With $1.6 billion raised across 188 funding deals in the segment, there is a resurgence of interest in incorporating real-world assets into the blockchain technology.
Partnership with Chainlink for Derivative Pricing:
Ostium Labs believes its partnership with Chainlink will differentiate it from other companies integrating real-world assets into their blockchains. The project plans to use Chainlink’s novel pricing fee mechanism for derivative pricing. This development facilitates decentralized finance projects by providing pricing feeds that enable high-speed, low-latency trading, bringing asset price data on-chain much faster. Trades on the Ostium Labs protocol will be settled in USDC.
Appeal to Crypto-Native Traders:
Given the stagnation in crypto trading activity, crypto-native traders are seeking alternative options to crypto derivatives. Monthly bitcoin futures volumes have consistently decreased since March, while DEX-based perpetual swap platforms have seen under a billion traded per day. Ostium Labs aims to attract these traders by offering a more diversified range of assets and a technologically advanced platform.
Ostium Labs’ $3.5 million fundraising round will support the development of its protocol for digitized commodities perpetual swaps, offering a transparent and flexible alternative to traditional derivatives platforms. The company’s collaboration with Chainlink and focus on bringing real-world assets on-chain sets it apart from other players in the market. With investor interest in incorporating tangible assets on the blockchain, Ostium Labs aims to capitalize on the growing demand and bring a technological upgrade to the commodities trading industry.
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