Hello from the halls of Hxro Network headquarters! It’s been a whirlwind few months as we have been getting ever closer towards launching our network protocols to Solana’s mainnet.
Here is what we are here to cover today:
✔ Derivatives Protocol to launch on devnet in a permissioned alpha mid-Feb 2022.
✔ Parimutuel Protocol is live on mainnet in closed alpha. Multiple centralized third-party platform operators currently building to the protocol through SDK. Public alpha Feb 2022.
✔ $HXRO token to migrate to SPL in coming weeks. Working with Wormhole to facilitate transfer methods.
✔ Hxro Network staking to go live once SPL migration is implemented and parimutuel protocol is on mainnet. The growing Hxro Network community of core engineers and contributors is going to start sharing regular development updates and the vision of the Network’s future. Today\’s post will give you a brief overview of our progress towards mainnet. We will follow up in coming days with separate posts discussing each part of the network in greater detail.
Hxro Network is a derivatives liquidity primitive built on the Solana blockchain. The network consists of a series of protocols, designed to provide critical on-chain infrastructure to facilitate derivatives trading, settlement, and risk management, as well as other critical functions within the Hxro ecosystem.
Since we launched the project, the Hxro ecosystem has attracted engineers, traders and business operators who have joined from some of the biggest names in both traditional and decentralized finance. All of them share a common vision to architect foundational infrastructure for decentralized derivatives in a way that can have a materially positive impact on the incumbent derivatives marketplace.
Our founding contributors are a cooperative of both traditional and crypto-specific professional trading firms, technology companies and exchange operators.
The Network is focused on providing a true money Lego block to the Solana ecosystem. Network contributors envision a world where the majority of derivatives transactions for a wide spectrum of markets route through Solana infrastructure and settle into Hxro Network liquidity.
Over the last 9 months, network contributors have collaboratively designed and developed five separate protocols:
AMMs (SAMM and THEO)
Here is a quick overview and update on the development of each:
The Hxro Derivatives Protocol is one of the most anticipated builds in the Solana ecosystem. It is being built by a group of engineers who come from some of the best and most sophisticated trading firms globally. While we will release an upcoming post to dig into the details and launch of the Hxro Derivatives protocol in coming days, it is worth discussing a brief overview and current status.
The Hxro Derivatives Protocol is a collection of highly detailed smart contracts that allow for the creation and exchange of ANY cash flow-generating derivatives instrument. This gives network participants the power to easily construct and launch a market for any type of perpetual swaps, futures, standardized options, exotic options or fixed income markets. This can include traditional derivatives types that already exist, like those mentioned above, or new experimental markets like power perps and everlasting options.
Additionally, the protocol is designed to easily facilitate and support classic derivative market structures such as exchange-supported spreads like calendars, butterflies, and condors, as well as complex options spreads.
Building this as a modularized Lego block is one of the many features that make the protocol a true ecosystem primitive. It is designed to work alongside Serum Core v4 (AAOB) to enable orderbook creation, and Pyth Network as its data oracle.
An additional and significant breakthrough was made in the network’s development of the protocol’s risk and margin engine. Today, most DeFi derivative protocols are limited to isolated or instrument-specific margin. This can create considerable friction and capital inefficiencies for traders. To date, there is no concept of true portfolio margining in DeFi, similar to what you would receive via a risk and margin engine at the leading traditional global exchanges. Hxro will be the first on-chain derivatives primitive to enable risk-based portfolio margining of all trading accounts, updating dynamically with market conditions. This breakthrough unlocks significant capital efficiencies for Hxro derivatives users and creates a better and more comprehensive approximation of risk at both the account and network level.
The v1 of the protocol is nearly complete and currently undergoing rigorous testing by contributing engineers. The next step is launching the protocol into a devnet alpha. We are initially creating a permissioned-access sandbox environment that will allow users to participate in a limited number of markets under live conditions. Participants will mostly be connecting through various automated trading systems. There will also be a pilot application layer front-end operator who will roll out its unique trading UI for non-algo traders to access the market. The first markets to be launched will be perpetual futures and expiring futures. The goal is to proactively stress test the protocol in every way possible in an effort to debug and fix any unforeseen issues. We are targeting this to launch in Feb 2022.
We encourage you to join the Hxro Network Discord and let us know if you are interested in participating.
Parimutuels are a market type that was originally introduced by Hxro.Trade (formerly Hxro.io) in January 2019. Network contributors have built an on-chain protocol designed to facilitate this unique, dual-outcome market type with a pool-based payout function.
Protocol Description The Hxro Parimutuel Protocol delivers on-chain, peer-to-peer liquidity and market functions for a simplified, dual-outcome parimutuel market. The protocol is designed to solve for the liquidity consistency problem typically faced in nascent markets, and will support applications specializing in market segments including trading, prediction markets, and sports wagering.
We are pleased to announce that contributors recently launched the Parimutuel to mainnet in a closed alpha!. An SDK was built to facilitate the onboarding of multiple platform operators. Integration efforts are underway to provide their users with access to the network’s parimutuel markets. We will go into greater detail around parimutuels in an upcoming post. ______________________________________________________________________________________________________
SAMM AND THEO
SAMM and THEO are the network\’s AMM protocols designed to build a foundational layer of liquidity in the network\’s parimutuel markets and standardized options markets. To keep this update brief, you can read about both of these AMMs here:
The v1 of SAMM is currently in testing along with the parimutuel protocol. The network\’s goal is to launch SAMM in the second phase of the parimutuel protocol alpha, which is expected to go live next month (Feb 2022). The contributing team building the v1 of THEO has already completed the design and initial build of THEO’s risk, pricing and inventory management system. We expect THEO to be rolled out later this year after the launch of both futures and options.
As Hxro Network protocols launch to mainnet, transaction fees will accrue to Network participants including staked HXRO token holders. The staking contract is now complete and in testing on Solana devnet. The concept and design for the Hxro staking contract did not yet exist on Solana and therefore had to be built from scratch. This largely had to do with the variable time-lock features we implemented in the design. For more information on staking protocol design, you can reference the Hxro Network Litepaper v1.1 here (https://docs.hxro.network). Once the staking protocol has been audited we plan to release this code into open source.
At launch, HXRO token holders will be eligible to stake their tokens to the Hxro Network. Rewards will be funded by network transaction fees and additional reward pools to incentivize early staking and network participation. Your staked token weight will double as your voting weight in network governance. In exchange for staking and governance participation, staked token holders will be rewarded with a pro-rata share of network transaction fees allocated to the staking pool. This will initially be set at 50%, but may be adjusted through network governance. The remainder of network fees will be split between reward and incentive pools, insurance funds, AMM surface and probability providers, and the network treasury.
We anticipate the launch of network staking to coincide with the launch of the parimutuel mainnet alpha, both of which are expected in February, barring any unforeseen delays. It is important to note that as part of staking coming live, we will be migrating the HXRO token from ERC-20 (which it was originally minted on) to a native SPL token. We are working with the team from Wormhole to create methods for current holders to easily swap from ERC-20 to SPL, and will release more information on how this swap will take place.
We are so grateful for the continued excitement and support that we have received from the entire crypto community, the Solana ecosystem, and most importantly our coveted Network partners, contributors and loyal community members. As mentioned, we will be providing the community with detailed posts on each of the network’s protocols over the course of the next two weeks as we approach our public launch cycle!
For more information on Hxro Network, please visit us at: https://hxro.network
To stay informed and to become part of the Hxro Network community, please make sure to join our main community channels on Discord here : https://discord.gg/N94CXsP4