What Is Primex?

Primex is the first cross-chain prime brokerage protocol that allows users to exchange data and assets amongst several networks. It was developed to solve the De-Fi market’s liquidity fragmentation issue by creating a platform for spot margin trading. It is also backed by leaders from different DEXs and blockchains.

Primex was created to offer a solution to liquidity access without the user having to deal with traditional banking. The platform allows lenders to bypass banks and borrowers to access liquidity without the need for middlemen.

The protocol is part of a new set of projects that seek the development of a digital asset trading world. With the influx of real-world markets into the world of blockchains, a truly decentralized form of margin trading is needed. Primex has come up with a solution by providing access to loans so traders can open and close trades.

History of Primex

Primex was officially launched in 2021 after being worked on by several experts in various technological fields. The protocol was founded with a particular goal in mind; to infuse lending and decentralized exchanges to form a fully functional platform that enhances swaps across several ecosystems.

These members started working on this project after realizing that crypto traders often had to meet collateral requirements and that there were no cross-chain features for leveraging non-custodial crypto trading.

The platform was spearheaded by Vlad Kostanda and Dmitry Tolok who worked on the original Adoriasoft project (a blockchain development and solution firm) for up to four years. Dmitry was in charge of the business’s commercial development projects while Vlad was the CEO.

Features of Primex

As a leading cross-chain prime brokerage protocol, Primex has come up with major features to ensure that the project is a success. Some of the protocols’ features include:

Leveraged Cross-dex Trading

Primex introduces a new level of leveraged trading in De-Fi. It gives users a chance to have leveraged positions across multiple DEXs.

Risk management for assets, trading pairs, and traders

Lenders on Primex are able to spread their risk across multiple assets, specific traders, and credit buckets. Credit buckets are smart contracts that have a set of rules that are put in place by a notary chosen by the community. These rules help lenders manage their risks, by giving users control over risk management, increasing their transparency and security.

Yield farming backed by margin fees

Yield farming is a form of investment that involves users locking up crypto in dApps (decentralized applications) for rewards. Trading generates a lot of returns for the platform, meaning traders pay fees to the protocol for every margin trade they make. These lenders gain interest from these fees.

Fixed Interest rate for lenders

Lenders have the chance to earn a fixed interest rate from Primex by locking up their funds for a certain period of time. The fixed interest earned is backed by trading fees. This is achieved by using the network’s stablecoin, PMX, which is backed by collateral and maintained by algorithmic rebalancing.

No collateral to open a position

Traders only need to lock in the deposit to open a leveraged position. The protocol doesn’t transfer funds to wallets outside its protocol, and in case of liquidation, the locked assets are sent to the protocol TVL. Traders don’t use their own wallets to interact with DEXs; instead, they use smart contracts built into the protocol.

AI-based trader scoring

Primex utilizes artificial intelligence algorithms to assist traders in evaluating their overall performance. To be specific, the network makes use of a decentralized network of machine-learning-based nodes to constantly evaluate traders and generate a score for them.

Traders with effective trading strategies are more likely to get higher scores, while those with weaker strategies will be scored lower by AI. This is a huge advantage for users with high scores since they will be able to survive high volatility and preserve their positions. This

How does Primex Work?

One of the major issues facing De-Fi is low liquidity, which Primex addresses. To ensure that the system operates smoothly and efficiently, specific individuals and organizations are assigned distinct roles and responsibilities. Primex has five specific roles played by certain parties in the protocol. The roles include:

• Lenders
• Traders
• Otaries
• Delegators
• Liquidity providers

Primex Lender

Primex was developed to facilitate leveraged margin trading across DEXs. Leverage is made up of capital or assets put up by a person for a trader to borrow to open a position. These people are usually referred to as lenders on Primex.

In Primex, lenders place their assets in more than one credit bucket, which is obtained from fees collected based on completed trades. These credit buckets are governed by smart contracts and can only function after the terms laid out by the smart contract are fulfilled.

Lenders earn incentive interest on the funds added to the liquidity pool. The money earned is gathered from the fees obtained from completed transactions. Any user with digital assets who understands the risk involved could become a Primex lender. This includes the everyday user, professional traders, banks, and brokers.

Primex Trader

Primex traders are pivotal to the Primex network. They make use of the assets offered to the credit buckets by lenders to make trades and generate profits. Primex offers traders access to the assets in the credit buckets. This helps traders have more capital to use for trading, but it cannot be transferred to external wallets like lending protocols.

Primex Notary

The Primex notaries perform tasks very similar to those of a validator. They assess the risks taken by lenders on the platform to ensure the success of the network. There are two types of notaries in Primex:

• Bucket Notary: These notaries assess the risk profile of a credit bucket. This assessment helps Primex lenders understand the likely risk and also the possible rewards that are involved.
• Trader Notaries: This is still in the works for the v2 rollout of the system. Trader Notaries will make use of AI tools to constantly determine the risk profile of every Primex Trader based on their trading history.

Unlike the lender and trader role, which is open to anyone, the role of a Notary is only for persons with actual financial authority and know-how. The position requires a lot of calculations, and if any mistake is made, the notary will lose a portion of their deposit. The notary is charged with a difficult task and, as such, has the trust of the network’s community. To ensure they are trusted by everyone, the network’s Notaries are nominated and voted for by members of Primex.

Primex Delegator

A Notary needs to have a financial stake in the network to make sure they make decisions that are favorable for it. It is not guaranteed that these notaries will always have such funds available, and that is where the job of a delegator comes in.

A delegator offers the Primex governing token to guarantee a Notary. This process requires the delegator to have the utmost trust in the Notary. Since a portion or all of their stake could be lost if the Notary acts in bad faith or makes a mistake in their calculations. Delegators on the platform could be anyone who possesses the Primex governing token.

Primex Liquidity Provider

A liquidity provider, or LP, performs a much different task from that of the Primex lender. A liquidity provider is needed when there are not enough assets in a credit bucket to meet the lending being asked for. The liquidity provider will make the required assets available to keep the bucket functioning.

The liquidity they offer is tradable for other assets within the credit bucket. This means the liquidity provider can provide one type of asset and gain a different one in return. Liquidity providers are compensated by earning interest on the assets they provide or by earning Primex governance tokens.

What Makes Primex Unique?

For any project to be successful, it has to have some kind of impact on the ecosystem. Primex aims to impact the De-Fi system by impacting the traditional finance sector. Below are a few issues the De-Fi sector faces and how Primex solves them.

Fragmentation of digital asset markets

Several De-Fi assets are available for users all over the world; however, they are built on different decentralized exchanges and projects. This is an issue for users who want to use advanced trading strategies to earn greater returns. Primex, however, solves this issue by being a cross-chain protocol that incorporates several DEXs into its platform.

Faux decentralization in De-Fi

Some De-Fi projects are not fully decentralized because they have a governance structure controlled by certain people, and as such, these users have the power to blacklist accounts anytime they want. Primex solves this by being a community-governed network open to everyone.

Overcollateralization in lending protocols

Most users tend to lock up more than borrow when using other lending protocols. Primex traders can only lock in their initial deposits with the help of smart contracts and borrow liquidity to increase their trading positions. They do not have the option of transferring the borrowed liquidity to external wallets.

Primex Roadmap

Primex was developed with a goal in mind, and to achieve this goal, the developers created a roadmap that would greatly improve the project’s success. The roadmap was designed to slowly improve the project while remaining user-friendly. It was further divided into the following five stages:

Primex Alpha

This is the roadmap for the original launch of the project, and it incorporated certain factors like:

• Isolated Margin
• Market and Limit orders
• Stop loss/Take profit
• Cross-DEX trading
• Liquidations
• Independent keepers
• Integration with oracles
• DEX selector
• First credit buckets
• Public testnet-Rinkeby

Primex Beta

This is the second stage of the Primex project, and it mainly focuses on improving the user experience and breaking down the distribution of the platform’s governing token.

Primex V1

The third phase is centered around four major features; audits, the platform mainnet launch, community voting, and multiple language support.

Primex V2

The fourth phase of Primex or Primex V2 focuses majorly on the network’s cross-chain features and the trading and lending abilities of the platform, such as cross-margin trading, cross-chain trading support, AI scoring, and efficiency notaries.

Future Features

This fifth phase of Primex is essential to the future of the network since it primarily consists of features that could place the platform ahead of the competition once they are fully incorporated. These include:

• Under-deposited trading positions (loans for experienced traders when approaching liquidation)
• Fixed interest rates for lenders
• Optimized fees for opposite open positions
• Under-collateralized lending

What is the PMX Token?

PMX is the network’s governing and utility token. It also serves as a means for holders to vote on delicate issues within the network, like future governance processes and many more. The PMX token also serves as an incentive for different participants in the Primex ecosystem and is important to Primex Notaries.

PMX Tokenomics

The PMX token will be distributed in the following ways:

• Team and advisors: Team members and advisors will earn 21% of the available PMX token with a 4-year vesting period.
• Strategic investors: These investors will receive 23% of the tokens with a 1.5-year vesting period.
• Treasury: 11% of the PMX token will be supplied to the Primex Treasury, which will be geared towards operations that facilitate the growth of the ecosystem.
• Inflation: 10% of the tokens will be distributed to inflation, which keepers will earn for holding the token and other purposes.
• Community: 35% of the PMX token will be distributed to members who have been actively participating in the ecosystem since its alpha and beta testnet launch.

Conclusion

Primex is combining the best of a community-governed system and a truly decentralized blockchain to develop a network that adequately solves the issues that plague the De-Fi ecosystem. De-Fi services are not going anywhere soon and Primex is ready to take its place as one of its leading networks.