How XDFi Brings Institutions to Flare with Compliant Futures

• Sindric Solutions has unveiled a novel DeFi trading platform powered by Flare Network.
• The XDFi platform promises to onboard institutional investors seeking sophisticated and compliant crypto exposure.
• Developers claim XDFi will launch soon on the Flare testnet.

Despite DeFi ‘s potential to democratize financial services, compliance with existing regulations has hindered institutional adoption. The main hurdle to DeFi compliance has been the question of how to ensure that only eligible investors are allowed to trade on a protocol without a centralized intermediary or compromising user privacy. 

Enter Sindric Solutions’ XDFi, a 24/7 trustless and non-custodial futures contract platform powered by Flare. This compliant decentralized futures protocol promises to open the door to institutional investors on Flare.

A First of Its Kind Approach?

Announced on Wednesday, February 21, XDFi leverages Flare Network ’s enshrined data oracles and a third-party KYC tokenization (KYCT) service to create an environment in which institutional investors can be certain that all trades are conducted with eligible counterparties. “This KYCT approach is the first of a kind for DeFi,” Sindric Solutions asserts.

According to developers, XDFi will leverage Flare Time Series Oracle to facilitate the daily settlement of purchased contracts at accurate prices. At the same time, the protocol will use a cloud-based price-matching algorithm to connect buyers and sellers. The platform further seeks to allow users to place sophisticated market orders, such as limit and stop orders.

At launch, XDFi will only support Bitcoin (BTC) and Ethereum (ETH) futures contracts. However, the project’s developers disclosed that support for more assets like XRP, DOGE , Gold, and Silver is being planned.

Commenting on XDFi, Flare co-founder Hugo Philion suggested that the project was the perfect fit for Flare Network’s data-driven goals.

Though a release date has not yet been disclosed, Sindric developers hinted that a test version would launch of XDFi on Caston 2, the Flare Network testnet , in the near future.

On the Flipside 

• XDFi is not the only project seeking to create a compliant DeFi environment for institutional investors. In December 2023, Web3 infrastructure firm Ankr launched Ankr Verify ,  a zero-knowledge identification solution powered by a third-party KYC provider to allow DeFi protocols to set entry criteria.
• XDFi has yet to launch, leaving room for doubt as to the extent of its actual functionality.

Why This Matters

With regulators growing increasingly concerned about compliance in the crypto space, protocols such as XDFi are expected to play an important role in shaping the industry’s precedents. In the short term, they also provide a valuable entryway for institutional investors seeking a more native crypto experience and an avenue to explore the potential of blockchain technology. 

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