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DeFi Cross-Chain Protocol Umee Makes a Move to Enter TradeFi

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Umee

Umee (UMEE), a layer-one blockchain created on Cosmos’ blockchain, has a goal of designing a universal cross-chain DeFi hub. This has always been its purpose since the very first day it was created. Thanks to the interoperability of the Tendermint PoS consensus mechanism that it uses, the project can be integrated with a number of chains, such as Cosmos, Ethereum, side chains, L2 chains, and even alternative base-layer protocols.

Now, however, the project announced something new, which will lead it to a new sector of TradeFi. It is on the move to create a holistic debt market ecosystem for Web 3.0, with the first-ever DeFi native yield curve, UDX.

The project noted that UDX will introduce a term structure of interest rates to crypto, and it will bring traditional bond markets into DeFi. Best of all, it will do it seamlessly as a proven risk assessment tool.

Essentially, the project is building an institutional lending DAO to help facilitate the transition of bond markets into DeFi lending. As a result,, the bond market’s efficiency should go up on all supported blockchains, including Cosmos, Ethereum, Near, Solana, and Avalanche.

The next step for Umee

Apparently, Umee’s developers noticed that the DeFi sector still lacks a yield curve equivalent to what traditional financial markets have to offer. DeFi is still quite new, and while it has been around for some time, it only went big around two years ago. As such, it is a young sector that is still evolving, and new breakthroughs are still quite plentiful.

The CEO of Umee, Brent Xu, decided that the lack of DeFi’s yield curve equivalent to the one from traditional markets is preventing DeFi from taking the next step on the road to maximum efficiency. As a result, Umee took it upon itself to create it, and along the way, to onboard the traditional financial sector into DeFi by giving its participants yet another highly useful feature that they might be missing from traditional finance otherwise. The result of this effort is UDX, whose yield curve can help with the creation of asset-specific interest rate structures.

Umee has been working on the expansion of its DeFi sector before this, of course. In the last 15 months, it managed to acquire nearly $40 million in funds, with $6.3 million raised in June 2021 alone, during the seed funding that had the goal of raising money to start building the bridge protocol for Cosmos and Ethereum chains.

Half a year after that, in December, the project managed to raise another $32 million during a token sale. Then, in February 2022, its mainnet launched, and while 2022 has been a pretty bad year for the crypto industry, this was still a huge move for the project. Now, Umee is taking the next step, and it shows innovation, the desire to enrich DeFi, push its adoption, and make it more efficient by introducing an element that traditional investors are familiar with.

To learn more about Umee, visit our Investing in Umee guide.

Ali is a freelance writer covering the cryptocurrency markets and the blockchain industry. He has 8 years of experience writing about cryptocurrencies, technology, and trading. His work can be found in various high-profile investment sites including CCN, Capital.com, Bitcoinist, and NewsBTC.