Cryptocurrency exchanges are critical in liquidity provision in the multi-billion digital asset space.
With Bitcoin and crypto prices edging higher and more institutions eager to trial blockchain-based technology not only in trading but in payment and investment, crypto exchanges are necessary on-boarding ramps.
The trouble with centralized versions is increasing theft cases through hacks and, in some cases, data leaks.
By 2021, billions of coins had been illegally siphoned by nefarious agents acting on their own or, in extreme cases, sponsored by rogue states.
DeFi Innovation with Fiat is a Missing Link
Therefore, as blockchain and crypto gain mainstream adoption, ramps should be more client-facing with minimum attack vectors.
The rise of decentralized finance (DeFi) and decentralized exchanges enabling trustless token swapping has gained steam over the last few months.
Still, the crypto community continues to innovate
Nimiq is no exception.
Admittedly, new users prefer cash—or fiat currencies as the primary means of exchange and conduit into crypto.
However, the current system's problem is the sacrifice of decentralization and privacy in coin acquisition, a move that goes against the very tenets of crypto.
While fiat is essential, there are no convenient solutions that enable the trustless acquisition of leading cryptocurrencies without giving up personal details; until now.
Nimiq: A New Way into Crypto
Nimiq OASIS is a non-custodial, smart contracts-powered protocol. It allows users to swap fiat for crypto in a decentralized manner without giving up their personal information through registration squeezes.
As such, the user retains control of funds and pays a 1.25 percent fee. No registration is needed and creating a self-custodial web wallet takes seconds only.
The solution is designed from the ground up as a new 'next-generation' crypto on-/off-ramp with "non-custodial fiat-to-crypto atomic swaps."
At the moment, users can only buy Bitcoin and NIM—the native token of Nimiq.
Selling will be enabled in Spring 2021 once the full release of Nimiq OASIS—which is currently in public beta, is activated.
OASIS: For Non-Custodial Swapping of Fiat to Crypto
OASIS is a Nimiq original innovation that simulates blockchain behaviors on off-chain systems.
It took the protocol years of research, regulatory finesse, and development to release the solution in public beta in February.
OASIS release is a victory for DeFi and the beginning of a shift towards crypto tokenization. When OASIS is integrated into a bank's systems, it can make fiat appear like a token in the blockchain.
Their first instance of OASIS supports the Euro, enabling NIM and Bitcoin's purchase using fiat without registration.
It follows their partnership with TEN31 Bank, a fully licensed bank in Germany of which Nimiq is a shareholder. In this arrangement, the respective blockchain will process crypto smart contracts (HTLCs). At the same time, the bank will integrate and process fiat smart contracts.
Nimiq also has Fastspot—a liquidity service to enhance user experience. It provides liquidity for OASIS swaps at 0.25 percent fees. OASIS, in turn, takes one percent of fees. All profits are used to buy back and lock NIM tokens.
Nimiq Roadmap: Plugins and More Integrations
They also plan to extend to Latin America through a partnership with a Costa Rican payment processor. In the coming years, they aim to offer support for major currencies worldwide, not just the Euro.
Through their Nimiq wallets, users can swap Bitcoin and NIM in a non-custodial manner. Besides adding support for more fiat currencies, they also plan to add more coins like ETH and LTC for usage outside of Nimiq's wallet.
On the other hand, Nimiq already created a WooCommerce plugin for merchants who want to receive crypto. In the future, the merchants will be able to get paid in crypto but receive cash on their bank account automatically.
Preparation for the Albatross Hard Fork
Presently, the web-native payment protocol plans to transition to Nimiq 2.0 via the Albatross hard fork.
The protocol said there would be significant enhancements of speeds once they shift from a Proof-of-Work to a Proof-of-Stake consensus algorithm. “Albatross”, which is also an original innovation of Team Nimiq, will make the Nimiq protocol one of the fastest single-chain protocols in the world.
Accordingly, they eventually plan to stop mining and introduce new validators to power the high-performance blockchain with limited smart contracting capability for payments and efficient and non-custodial swapping of fiat to crypto and vice versa.