Centrifuge operates as a decentralized protocol for asset financing, effectively bridging the gap between decentralized finance (DeFi) and real-world assets (RWA). Its mission is to reduce capital costs for small to medium-sized enterprises (SMEs) while offering investors a steady income stream. The project's primary objective is to create returns that aren't influenced by the fluctuating nature of crypto assets, aiming to transition real monetary value from traditional fiat currencies into the cryptocurrency realm.
Businesses leverage Centrifuge to tap into the liquidity that DeFi provides. They achieve this by tokenizing tangible assets, which they can then use as collateral to secure funding through Tinlake, a decentralized application (DApp) designed for lending. The Centrifuge network is developed on Polkadot (DOT), ensuring fast transactions and minimal fees, while Tinlake accesses liquidity from Ethereum (ETH).
Centrifuge democratizes access to liquidity, offering investors returns and rewards in CFG tokens. It connects assets like invoices, real estate, and royalties to the DeFi ecosystem. Moreover, borrowers benefit from being able to fund their real-world assets without relying on banks or middlemen.
Who Are the Founders of Centrifuge?
Centrifuge was established in 2017 by Lucas Vogelsang and Martin Quensel.
Lucas Vogelsang, a founding engineer of Centrifuge, also serves as the company's CEO. He co-founded the e-commerce venture DeinDeal in 2010 and successfully sold it to Ringier. Following this, he embarked on another startup journey with KaufDA. Eventually, Vogelsang moved to Silicon Valley, taking on a role as a technical manager at Taulia, before co-founding Centrifuge in October 2017.
Martin Quensel, co-founder and current COO of Centrifuge, originally co-founded Taulia. His career began at SAP, where he worked as a software developer and architect.
What Makes Centrifuge (CFG) Unique?
Centrifuge stands out by transforming real-world assets into non-fungible tokens (NFTs), which are then financed via Tinlake. As the inaugural DApp on the Centrifuge blockchain, Tinlake was designed to utilize Ethereum’s liquidity, while CFG features its own Ethereum bridge.
One of Centrifuge’s key features is its integration with various DeFi protocols, allowing users to access liquidity seamlessly and shielding DeFi platforms from destabilizing situations with diverse collateral. This reduces overall risk and replaces traditional lending and banks with smart contracts.
As of June 2021, Centrifuge boasts the highest total value locked (TVL) within the Polkadot ecosystem and claims to be among the pioneers in launching a parachain on Polkadot. The Centrifuge chain was designed with a focus on high speed and low costs.
How Many Centrifuge (CFG) Coins Are There in Circulation?
CFG serves as the native token for Centrifuge, fueling the entire network. It has three main functions: staking, covering transaction fees, and participating in governance. Additionally, CFG is used to reward those providing liquidity on Tinlake. As of June 2021, the total supply is 425 million CFG, with an annual growth rate of 3%.
The allocation of these tokens is as follows: 27% goes to core contributors, 17.1% to total backers, 7.3% to rewards and grants, 9.5% to community sales, 11.8% to foundation endowments, 7.1% to community grants, 10.8% to development grants, and 8.3% to the early ecosystem.
The CFG token sale occurred on May 26, 2021, via Coinlist. The event was split into two stages, each with a token supply cap of 17 million.
How Is the Centrifuge Network Secured?
Users pay transaction fees using CFG tokens, and transaction aggregators on Polkadot receive a portion of these fees for handling and storing data. The Nominated Proof-of-Stake (NPoS) mechanism, along with CFG rewards, incentivizes fair user behavior and the selection of data collators that ensure censorship resistance.
The majority of Centrifuge’s security is derived from the Polkadot relay chain. Thanks to Polkadot's security features, Centrifuge achieves a high level of protection at an economical rate.
Where Can You Buy Centrifuge (CFG)?
As of June 2021, CFG tokens are available for trading on the BitZ exchange.
For more information on purchasing cryptocurrency, be sure to check out our in-depth guide.
