AllianceBlock is building a global decentralized capital market that brings together the world of traditional finance and the world of DeFi in one ecosystem. By using oracles and NFTs, among other things, the protocol can bring two different financial markets together in one synergistic ecosystem. This composition no longer pits these two worlds against each other, but creates a union that is the future of our financial world.
What is AllianceBlock (ALBT)?
The future of our current monetary system has been questioned for some time. With the development of crypto, more and more possibilities have been added and we can clearly state that crypto will be a large part of our financial future. More and more investors are finding their way to crypto, as the market is also becoming more accessible.
AllianceBlock (ALBT) aims to bring together and connect the world of traditional finance with the world of decentralized finance ( DeFi ) to be the future of investment banking.
AllianceBlock (ALBT) is thus building a decentralized financial ecosystem that simplifies the access of various capital markets, that of traditional finance (TradeFi) and DeFi. They act as a bridge between both markets. So they want to reshape the entire market by decentralizing the entire decision-making process. They achieve this by assigning a governance function to their native token $ALBT.
AllianceBlock is, as it were, a bridge that connects all financial markets and makes communication and operational functioning possible. As you can see in the example below, it connects almost all aspects. Currently, TradeFi’s investment market, traditional financing, is diametrically opposed to the DeFi world for many reasons. The AllianceBlock ecosystem wants one big financial market where the possibilities are endless.
The traditional financial investment market is characterized by private banks and stock exchanges, etc., but they do not offer access to the world of DeFi. Conversely, the world of DeFi also lacks access and integration to the traditional market. Both markets also work completely differently and are based on different principles, which is why it is necessary to allow both markets to communicate with each other and to achieve integration in an efficient and effective way.
Necessary in the implementation is the use of oracles. This will be done through the use of smart contracts , collecting external data and implementing it on the blockchain . It extracts off-chain data and uses it to realize on-chain analytics and implementations. To make this possible, AllianceBlock has a partnership with ChainLink (LINK).
We currently have several blockchains, each of which is undergoing beautiful developments and growing in turn. For example, the Ethereum ecosystem is currently the most dominant with various decentralized applications (dApps) being built to create more applications. Although this is essential for the development of crypto, communication from this ecosystem with other blockchains is still difficult.
This creates a need for global interoperability. And this is realized by the principle of overledger. This overledger is a blockchain operating system that connects to other blockchains, but also connects existing networks with blockchains. This allows the creation of multi-chain applications, better known as mApps. This development is groundbreaking in crypto technology.
How does AllianceBlock (ALBT) work?
The ecosystem is divided into three different layers. Each tier has a specific purpose and individually they help grow DeFi projects, thereby also attracting traditional financial markets.
In the DeFi layer, they offer cross-chain interoperability. This makes communication possible with other existing blockchains to enable the realization of mApps here, among other things. In addition, this provides extra liquidity and volume. Work is also underway here on its own decentralized exchange , better known as a DEX. Users have access to a dashboard where they can consult all the data analysis and information that the protocol uses.
Data is of course essential in this overledger between the traditional financial market and the world of DeFi. The AllianceBlock Data Tunnel collects large amounts of data for both DeFi projects and traditional financial institutions to use.
Regulations and Compliance
The world of DeFi has a lot of freedom thanks to the lack of a know-your-customer procedure. Such a procedure is standard in the traditional financial world. After all, you cannot open bank accounts without identifying yourself. In this layer, the AllianceBlock protocol enables DeFi projects, protocols and DEXs to introduce a scalable regulatory framework that can help them grow further so that institutional organizations can participate in the world from DeFi.
New parties can join AllianceBlock to bridge the gap between traditional finance and the world of DeFi. In doing so, AllianceBlock verifies the identity of the person or organization. This concerns a know-your-customer procedure but also an AML check (Anti-Money-Laundering). After this check, this data is automatically sent to the framework that is responsible for all legal matters. For example, an investor profile is created on the AllianceBlock platform.
Once active on the platform, their personal profile is used to match projects that fit their investment preferences. For example, it may be that there is only interest in interoperability with NFTs or a DEX. These are all optional. This profile is then given a certain reputation score. This reputation allows them to build authority on the platform by, for example, setting up projects, doing promotions or giving feedback to the community.
This score is essential and is also part of the consensus mechanism that AllianceBlock uses. Investors can promote a project they believe in by using their governance function. This entry will depend on their reputation score, whether or not they are authorized to participate and/or how weighted their vote will weigh. This keeps it democratic.
AllianceBlock has a total supply of 1 billion ALBT tokens. Of these, 40 million were sold in a private sale worth $500,000. At the time of writing, there are 311 million tokens in circulation. Nearly half of these tokens are distributed and returned to the ecosystem.
AllianceBlock’s native token is a utility token, meaning it is used to keep the ecosystem operational. This is used for several aspects:
- Transaction Fees: Every transaction in the network will be accompanied by a small fee in ALBT tokens.
- Strike : you can strike your tokens in the network.
- Token burn : 25 to 50 percent of all transaction costs will be burned every quarter.
- Exchange : In further development, the team wants to develop a DEX where the ALBT token will keep the exchange operational.
The Gensis block was minted at the beginning of 2018 and despite the fact that the team has already achieved a lot, AllianceBlock is still at the start of a very nice development. Here we discuss the main objectives on their roadmap for the coming period:
Thanks to DeFi, investors have greater transparency, decentralization and enable peer-to-peer transactions. To bridge the gap between traditional financing and decentralized financing, they want to launch their own decentralized exchange. The ALBT token is the foundation of this exchange. Transactions and all associated costs will be made with the ALBT token. Due to the principle of overledger and interoperability, they want to use this DEX to become the dominant decentralized exchange where all types of tokens can be traded, cross-chain.
AllianceBlock’s DEX works like other Automated Market Makers (AMMs) like UniSwap, but with a new mathematical framework and approach that aims to minimize the problem of impermanent loss. This new mathematical formula improves the world of DeFi and opens the world of DeFi to new investors thanks to its reduced risk.
The world of DeFi is inextricably linked with the world of non-fungible tokens (NFTs). AllianceBlock has a partnership with RAMP DeFi. They offer solutions for, among other things, the liquidity problem of NFTs. Thanks to RAMP DeFi, users can receive staking rewards, but at the same time free up more capital with the same asset to reinvest.
Currently, the barrier to entry to DeFi is relatively high for regulated financial institutions. Through the partnership with RAMP, AllianceBlock says this will open the way for regulated institutions to enter the world of DeFi. The aim of the partnership is to provide liquidity solutions that enable traditional financial institutions to digitize illiquid assets into NFTs and then convert them into liquid funds.
Currently, NFTs are still limited to digital art, in-game objects and the like, but thanks to AllianceBlock, valuable assets such as commodities, real estate and even gold or silver can be converted into an NFT.
Traditional financial clients
While not a short-term goal of AllianceBlock, the influx and onboarding of traditional financial organizations is key. Only in this way can the protocol effectively bridge the gap between the traditional financial world and that of DeFi. We see more and more applications that make this possible.
The ambitious protocol already has a very nice list of partnerships in a very short time. It is of course not self-evident to connect two completely different financial markets, certainly not without the necessary partners. Essential here is the use of oracles to transfer data from the traditional world to on-chain. ChainLink (LINK) is a very nice partner here. The principle of global interoperability thanks to the overledger brings us very quickly to Quant (QNT). Quant ‘s network aims to connect the entire crypto ecosystem.
We are already seeing partners from the traditional world such as London Stock Exchange and Money 20-20. This is a Fintech conference with more than 6000 participants from more than 82 different countries. Think of Mastercard and Visa, but also Forbes and JP Morgan.
Rachid Ajaja is founder and CEO of AllianceBlock. As an engineer graduate, he has a passion for analytics and data science. Over the past decade, he has been involved in developing and implementing various methodologies to help organizations with risk management, among other things. In 2017, he even built and implemented a scalable deep-learning model in Artificial Intelligence. He was also a quantitative analyst at Barclays.
Matthijs De Vries is founder and CTO of AllianceBlock. As a software developer, Matthijs was responsible for various software development departments at PostNL. Afterwards, he focused on designing and developing Artificial Intelligence products. Among other projects, he has also developed an analytical algorithm in the field of veterinary diagnostics.
Besides founder, Amber Ghadda is also no stranger to JP Morgan. There she was a fixed value as a trader. She started her career at Goldman Sachs and moved to JP Morgan in 2012 where she focused on equities, as well as lending and commodities.
Amber earned a bachelor’s degree in Science and Technology from McGill University in Canada. Afterwards she managed to obtain two additional masters: Neuroscience & † Nanotechnology followed by a PhD in molecular medicine in Italy.
In recent years we have seen an expansion in the possibilities that crypto has to offer. In addition to trends such as GameFi and NFTs, crypto is gaining more and more adoption and there is more interest from the traditional financial markets. Institutional organizations do see a future in this new blockchain technology and governments and organizations are therefore massively looking for opportunities to implement this new technology in current financial policy.
AllianceBlock (ALBT) therefore wants to connect the global financial markets so that trade between TradeFi (traditional financing) and DeFi (decentralized financing) is possible for everyone. Currently, the biggest hurdle is that there is no correlation between the two variants. Recent macroeconomic news has shown us that there is a need for this connection. In this way, problems such as impermanent loss can be solved and we can face a new financial future in which we can all enjoy the benefits of blockchain technology.
Thanh Lanh Tran(1989) is Chief Editor from BitcoinUSD.com