Flow Traders Opens New Institutional Gateway to DeFi With Cap and EigenLayer

Liquidity supplier and ETF marketplace shaper Flow Traders has gone unrecorded arsenic an relation connected Cap, a protected backstage recognition marketplace built atop the EigenLayer mainnet.

The motorboat provides a “blueprint for however organization concern comes on-chain,” Sreeram Kannan, Founder and CEO of Eigen Labs, said successful a connection shared with Decrypt.

As an autonomous verifiable work (AVS) connected the EigenLayer network, Cap enables Flow Traders to entree EigenLayer's slashing, redistribution, and unsocial involvement features, bringing organization superior to the protocol.

This illustrates that large firms tin interact with decentralized protocols without compromising connected accountability and hazard absorption standards, Kannan explained.

While accepted recognition markets typically trust connected contracts and collateral arrangements, Cap uses EigenLayer's slashing and redistribution features to make "self-enforcing fiscal guarantees" that tin beryllium automatically and transparently executed done code.

EigenLayer's slashing mechanics means operators tin beryllium penalized if they neglect to grant indebtedness terms, collateral requirements, oregon repayment schedules. These penalties tin past beryllium repurposed alternatively than burned done redistribution, enabling a signifier of “protocol-level insurance” for organization DeFi.

The infrastructure provides "customizable, automated fiscal tools that are afloat transparent, but arsenic harmless and well-managed arsenic accepted finance, meaning institutions get some spot and protection," Kannan said.

He added that EigenCloud, the verifiable unreality level powered by the EigenLayer protocol, is seeing expanding organization DeFi adoption acknowledgment to its quality to blend Ethereum's information with a higher grade of programmability than the Ethereum Virtual Machine.

With on-chain information providing greater levels of transparency than successful the TradFi space, Cap’s usage by Flow Traders "validates that crypto infrastructure has matured beyond speculation into production-grade organization finance."

"Traditional concern is coming on-chain done verifiable rails, backed by cryptoeconomic guarantees,” Kannan said. “Cap is however they're onboarding, and EigenLayer is the lone infrastructure that tin enactment this almighty usage case."