What is crypt coinage?

 

The use of financial terms in the cryptographic world is becoming more and more common, the various platforms offer more and more services to attract more users, as the growth in the use of cryptomoney has been unique in the last decade.

This is how new ways of using crypto-currencies began, which started in 2008 as the utopia of a new system that would allow the dismantling of the traditional financial system that has allowed the accumulation of great wealth in such a disproportionate way, while at the same time has become almost inaccessible for the common person to the basic services it offers, such as access to credit or loans.

But it has not all been bad, both the failures of the traditional financial system and its successes have allowed the cryptographic world to emerge with greater strength and momentum. Thus, today we have a new financial system, based on the use of cryptomoney but taking the best of the dying traditional system.

In this context, the coinage with Iq Option comes to represent a practical case of a financial instrument called loan with guarantee. In the legal jargon, these are called loans with rights in rem, in which, in order to obtain a loan, you put up your movable or immovable property as collateral and receive an amount of money that will temporarily allow you to be an atypical owner, because even though you may have the property in your possession, you will not be able to sell it without paying for the loan obtained.

The Ethereum blockchain is the most used due to the stablecoins

However, in the world of crypto-currencies the coinage goes further, in platforms like Synthetix for example, you are allowed not only the possibility of having a loan based on your crypto-currencies, but also to obtain a profit by ‚betting‘ on the growth of the platform, which represents a quite attractive option, because although the percentage of collateralization is quite high and leaves little margin of profit, the novelty is that we leave the obsolete mortgage financial system to obtain liquidity.

How it works
The functionality is simple, to obtain the coinage you must first purchase the token from the platform where you want to run it, through an exchange or within it.

In the case of Synthetix, you can purchase SNX tokens within Uniswap for example.

Then you must log in to the Synthetix platform – in this case – and in the ‚Mintr‘ section, start the coinage.

In this case what Synthetix does is to generate a stablecoin sUSD through an underlying such as your native SNX token. All this is done through a Smart contract that is signed with the authorization of the wallet you use.

The interesting thing about this type of instrument is that the investment you make is taken as debt, because when you supply your token, it generates a collateralization index that fluctuates according to the market gains or losses.

Zero Knowledge Testing (ZKP), the state of art of cryptography

However, care must be taken when minting the crypts, because if the objectives of the minting are not met, your debt may reach 100% of the limit, and your collateral will be liquidated, as the platform understands that it has lost the ability to hold the capital and therefore forecloses the collateral.