NAOS’ approach to growing the DeFi playing field is to scale real world assets (RWA) on-chain, and to build an all-encompassing ecosystem of innovative fintech solutions. In this ecosystem, NAOS and its partners will co-evolve capabilities around RWA, and push the boundaries for the next generation of DeFi innovations.
NAOS has a simple business model — provide real world borrowers with an alternative funding source from DeFi. In practice, the bridge between CeFi and DeFi requires redesigning product services, user behaviors, customer experiences and organizations. An ecosystem mindset is required to capture the inevitable shift in the economy and business landscape. We believe that a conscious partnering model is the best way for NAOS to pursue its mission.
Looking at various ecosystem models, global tech juggernauts such as Google and Amazon created ecosystems organically with their own products and services. On the other end of the spectrum, Alibaba and Tencent created partnership-driven ecosystems that offer vast networks of diverse yet complementary products and services to keep users engaged at all times.
While Google and Amazon may have directed user behaviors in search and e-commerce, Alibaba and Tencent are actively/passively involved in ALL aspects of a user’s digital activities. In other words, Alibaba and Tencent do what Amazon, eBay, Paypal, Square, Google, Facebook, Twitter, FedEx, Warner Brothers Studio and Netflix do in the United States.
The Alibaba/Tencent ecosystems created a network effect that not only accelerated the adoption of mobile internet in China, it also fostered a positive and vibrant environment for innovation. Ecosystem participants were able to focus on value-added innovations where they were experts in, without getting bogged down with the basic tasks. Take Alibaba for example, a merchant is able to access payment, advertising, logistics, inventory/warehouse management and customer service solutions provided by Alibaba or its ecosystem partners from the first day of operation.
Aspired by the collaborative nature of the industry, the NAOS Protocol is designed to replicate the Alibaba/Tencent model. Our ecosystem framework emulates the basic functionalities of traditional finance, laying a strong foundation for a RWA-based DeFi infrastructure.
Data: enable instantaneous access of real world data on-chain, including asset pricing, loan performance, transaction records, etc.
Tools: enable execution of financial transactions, including data analytics, notary services, contract signing/validation, asset appraisal/valuation, KYC/AML, etc.
Insurance: provide flexible, economical and quantifiable solutions to mitigate financial risks
Distribution: access to retail/institutional lenders and corporate/individual borrowers globally
Liquidity: access to on/off-chain sources of funding, capital and liquidity
Asset Originator: access investment grade real world assets approved by accredited validators
Credit: provide solutions for credit-based financial transactions, including credit scoring, risk assessment algorithm, etc.
OTC: enable frictionless exchange of fiat and crypto
Derivative: create new classes of financial instrument consisting of real world and crypto assets
Exchange: provide marketplaces for the trading of the new RWA-Crypto derivative
Investment: create investible financial products, including money market, ETFs, etc.
Stable Coin: provide solutions for RWA-backed stable coins
Transfer: enable timely, secured and compliant transfer of real world assets among parties.
Security: provide technical solutions to safeguard the digitalization of real world assets
Tax: provide bookkeeping and accounting solutions compliant with local tax and regulatory guidance
We rely on our partners to help further define the scope of the above mentioned categories, needless to say, we’re also excited about working with protocols to expand the overall ecosystem. As DeFi is still in its infancy, a partnership-driven ecosystem will be the catalyst to transform the industry. As Steve Elop, CEO of Nokia, adequately recognized:
“The battle of devices has now become a war of ecosystems…. Our competitors aren’t taking our market share with devices; they are taking our market share with an entire ecosystem”
As we continue building the NAOS Protocol, we will be mindful that it takes a strong team, sound business model and great products to build a great company; and it takes an ecosystem to build an empire.