DBLP and Regulatory Compliance

TL;DR

  • The DBLP core infrastructure is complete, testing has been a success and the technology is ready for use.
  • New regulatory developments that have become apparent can’t be ignored, advice has been engaged on this topic.
  • The regulatory developments pose consequences for the basis.markets project and stakeholders, they pose blockers to the originally proposed DBLP architecture and tokenomics.
  • The basis.markets project will move forward in its current form as all initial development has concluded this month as planned and communicated. In its current form however it will be restricted to Solana devnet as no custody of third-party funds in its current architecture/design will be taken.
  • There are several ideas as well as a road forward that potentially comply with the regulatory requirements. This is in active development however and will be proposed and implemented in accordance with the DAO.

Technology Overview

DBLP-A Smart Contracts

DBLP time-flow architecture of the smart contract (DBLP-A)
DBLP architectural overview
Tokenomic adjustments need to be reflected within the smart-contracts

DBLP-B Supporting Infrastructure

A peek behind the scenes into our data infrastructure and yield extraction machine

Regulatory Developments

https://bit.ly/3HvXVGE

Implications for the basis.markets project and the DBLP

  • Yielding NFTs
    Providing yield to the NFTs places these into a regulated asset framework.
  • Yielding BASIS Tokens
    Places it within the same category. Careful thought will need to go into how value is shared with token holders within a future-proof setting.
  • bmNOW market
    In essence, an algorithmic stable coin has been created backed by a tentative yield not exposed to directional risk but still exposed to risk (counterparty risk, execution risk, liquidity risks, smart contract risk, etc). As evidenced by the UST collapse and subsequent legal proceedings in the works, algorithmic stablecoins can’t fly under the regulatory radar any longer, and the RFIA formalises this. Value appreciation of invested assets will need to find a wholly decentralised and permissionless path back towards their contributors.
  • Custody of Funds
    As can be seen in the technology architecture above, the DBLP in its current form transfers funds from the permissionless space and is allocated to algorithms and mechanisms which are developed, controlled and executed by the basis.markets project. This again triggers EU and US regulations.

DBLP devnet release and beyond

Impact and next steps

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basis.markets

basis.markets

A decentralised liquidity pool owned by you, powered by our Basis Trade Engine. Next-level returns. Delta-neutral yield. Real-time insights.

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