How will assets be exchanged in OTN?
The OTN foundation and IQ Option broker are proud to present the Open Trading Network, a project that will bring isolated and disorganized blockchain-powered systems together and create a unified all-in-one network. Four major categories of people can be expected to benefit from the OTN: individuals, businesses, traders and regulators.
To each his own. Thanks to the OTN, individuals will get access to the universal e-wallet. The latter can be used to easily and securely store different cryptocurrencies in one place. Businesses will get the infrastructure to tokenize their services and distribute them among customers. Traders will enjoy low commissions and an opportunity to trade a huge variety of assets. Regulators, in turn, will have access to extensive data and a chance to observe deals in great detail. The Open Trading Network will offer all this and much more.
Like the Internet connected separate computers and isolated networks into a world wide web, the OTN project is destined to bridge isolated blockchain networks. And just like the Internet, the OTN will contribute to the emergence and development of radically new products, services and even industries that will shape the landscape of the future economy.
The OTN is designed as a decentralized trustless network that will carry out the cryptocurrency exchange in a quick, transparent, and secure fashion. The platform will also meet the requirements of all the parties involved in the process. Created in collaboration with IQ Option, the project will benefit from a partnership with an international financial company.
Different participants, of course, have different requirements. And the Open Trading Network will be able to meet them all.
Ordinary users want to trade and store all assets in one place. With the OTN there is no more need to manage several wallets, one per each cryptocurrency. Bitcoin, Ether and other altcoins can be effectively used with the universal crypto wallet.
Cross-chain exchange is another feature, available to the platform users. Due to availability of regulatory tools, all transactions will comply with legal requirements.
When working with blockchain-powered products and services, businesses may want to tokenize their own assets instantly and offer them to the market, accept cryptocurrencies as a payment tool and transfer them to the currency of choice, access extended smart-contract crowdfunding and loyalty capabilities. All of the above-mentioned features will make their way to the Open Trading Network in a number of iterations.
Traders and regulators
With the help of this platform, traders will get access to fast and protected transactions, investment insurance and flexible contracts. Regulators, in turn, will be able to view transactions and related data, as well as identify users with the help of digital signatures.
The Open Trading Network will use the original token, named OTN token. The latter will be used for cross-chain deals, insurance and remuneration of traders. The token can be expected to benefit from the future development of the whole project.
In order to receive OTN tokens, traders have to trade crypto and crypto CFD instruments in the IQ Option trading platform. The commission, paid to the broker, is proportionate to the amount of tokens received. This is currently the only way to get a hand on the original token.
The OTN will introduce innovative decisions that will set it apart from the rest of the market. It is true that several companies operate in this field already. Only by doing something differently and better can a suchlike project succeed.
Easy access. Everyone can easily access and benefit from the use of the OTN. The system is designed with all parties in mind, not only big banks and finance professionals.
Insurance coverage. The smart contract functionality guarantees the fulfillment of all terms, listed in the contract. The former, however, operate within a single blockchain. Insurance coverage, in turn, is a way of providing the guarantees between the blockchains and to all market participants.
Efficient tokenization. With the help of the Open Trading Network, any asset can be effectively tokenized and later distributed among market participants. Both digital and conventional assets can be tokenized with the help of OTN.Assets.
Guaranteed interaction. By using the OTN, traders will make their cross-chain exchanges fast and safe. It would be possible to exchange BTC for ETH with a guarantee from the OTN system. Additional instruments can be easily connected in the future, as well.
Speed and integration. It is not enough to connect separate blockchains into a unified system as high speed is essential for certain kinds of operations. Modular architecture and optimization of the trusted quorum are introduced to achieve maximum speed.
The Depository, the Tokenizer, the OTN.x node, the quotes provider and the OTN Exchange constitute the backbone of the Open Trading Network. Each part of the system is responsible for a particular function, guaranteeing stable and smooth performance of the Open Trading Network as a whole. Modular design makes the whole system failproof and gives the possibility to introduce new features as soon as they are finished.
How to Exchange Cryptocurrency with OTN
OTN exchange will be offering fast, decentralized and 100% collaterized exchange transactions between the blockchain networks. The latter means that at any stage of the exchange process you will have your cryptocurrency or a tokenized asset of the same value in your OTN wallet. You don’t need to transfer funds to any particular exchange.
At last, no exchange will ever get hold of your funds!
For a user the exchange process will take seconds and only require several clicks. OTN will carry out all the job for you. Seamlessly and efficiently.
So how will it work?
Three main stages — tokenization, exchange and detokenization — are enacted automatically in smart contracts. We will skip the complex details and demonstrate you the flow in 8 steps.
Imagine that Bob wants to exchange his Bitcoin (BTC) to Ethereum and Alice wants to exchange her Ethereum (ETH) to Bitcoin.
1) Bob and Alice request the exchange within the OTN wallet;
2) OTN verifies the transactions and forwards Bob and Alice the addresses of their Depositories (the Depository stores the assets, while guaranteeing their security with own OTN coins as collateral. Any participant of the network can become a Depository);
3) OTN wallets send BTC and ETH to respective Depositories in the native blockchains (BTC and ETH here). Bob and Alice don’t need to process the return addresses manually.
4) OTN tracks the transfer of cryptocurrency and instantly issues OTN.BTC to Bob and OTN.ETH to Alice. 1 OTN.BTC = 1 BTC and 1 OTN. ETH = 1 ETH.
Depositories provide collateral in OTN coins for the tokenized assets (as per the real-time BTC/OTN exchange rate). Note, that the actual collateral is larger than the real value of the asset, that is why Depository is demotivated to steal the assets.
5) Now the actual exchange of tokenized assets takes place. OTN.BTC gets exchanged to OTN.ETH on the real exchange (centralized or decentralized);
6) As a result, Bob receives OTN.ETH and Alice gets OTN.BTC.
7) The final stage is detokenization of these assets. It is fulfilled by OTN automatically.
8) Bob receives ETH and Alice receives BTC.
As you can see, tokenization lies in the heart of the exchange process. When your cryptocurrency gets tokenized, your OTN.Asset serves as a smart contract. It ensures your rights of the real asset ownership.
Thus, you don’t need to trust any of the trade participants, guarantees are ensured by the very design of the OTN network.
*IQ Option is a brokerage company and does not provide OTN tokens to clients. All tokens are provided by the OTN foundation. The OTN foundation confirms that it does not sell OTN tokens and that the activity is non-commercial.