ITSA DeFi Insight — Avalanche and TraderJoe

What is the Avalanche Chain?

Launched in September 2020, Avalanche has risen to one of the leading DeFi blockchains offering a diverse range of dApps ranging from decentralized exchanges like TraderJoe to play-to-earn titles like Cradaba. Avalanche has been proclaimed as a viable alternative to Ethereum due to its low transaction fees and support for the Ethereum virtual machine (EVM). In fact, Avalanche offers high transaction throughput while being relatively decentralized. Utilizing Proof-of-Stake and being EVM-compatible, users can deploy their own subnet on Avalanche, which is essentially another blockchain with its own consensus mechanism, permission rules, etc. In such a way Avalanche lets users deploy their own customizable network on top of it while utilizing its network security and decentralization.

  • The X-Chain is designed to exchange digital assets on the Avalanche blockchain. Moreover, one can specify rules for those assets (e.g., can be only traded within the EU)
  • The C-Chain allows users to deploy and use their smart contracts. Its EVM-compatibility allows for the deployment of Ethereum based smart contracts on the Avalanche network and vice versa
  • The P-Chain is designed to manage the deployed subnets. It also coordinates validators which secure the network
Figure 1: Avalanche platform overview (source: https://docs.avax.network/learn/platform-overview/)

DEX overview and JOE tokenomics

JOE is the largest DEX by total value locked (TVL) on the Avalanche Blockchain with more than 1 billion dollars locked at the time of writing. JOE attracted this amount of capital by having the first mover advantage and being the first DEX on Avalanche. For now, they have maintained their incumbent position by offering attractive rewards for providing liquidity. These rewards are paid out in TraderJoe’s native token JOE.

Figure 2: Staking of JOE for xJOE (source: traderjoexyz.com)

JOE tokenomics revamp

JOE has now recently shifted towards a more modular staking mechanism that allows for various options, namely:

The classification of JOE according to the ITC

JOE is the primary token of TraderJoe’s decentralized exchange providing an on-chain governance functionality to its holders so that they can participate in the decision-making process on how the platform is managed.

Figure 3: The JOE Tokenbase entry (Source: https://itin.itsa.global/CB9Q8QVY1)
Figure 4: List of TraderJoe tokens (source: https://api.itsa.global/view-list?list_id=23)

The International Token Standardization Association (ITSA) e.V.

The International Token Standardization Association (ITSA) e.V. is a not-for-profit association of German law that aims at promoting the development and implementation of comprehensive market standards for the identification, classification, and analysis of DLT- and blockchain-based cryptographic tokens. As an independent industry membership body, ITSA unites over 100 international associated founding members from various interest groups. In order to increase transparency and safety on global token markets, ITSA currently develops and implements the International Token Identification Number (ITIN) as a market standard for the identification of cryptographic tokens, the International Token Classification (ITC) as a standard framework for the classification of cryptographic tokens according to their inherent characteristics. ITSA then adds the identified and classified token to the world’s largest register for tokens in our Tokenbase.

  • The International Token Identification Number (ITIN) is a 9-digit alphanumeric technical identifier for both fungible and non-fungible DLT-based tokens. Thanks to its underlying Uniform Token Locator (UTL), ITIN presents a unique and fork-resilient identification of tokens. The ITIN also allows for the connecting and matching of other media and data to the token, such as legal contracts or price data, and increases safety and operational transparency when handling these tokens.
  • The International Token Classification (ITC) is a multi-dimensional, expandable framework for the classification of tokens. Current dimensions include technological, economic, legal, and regulatory dimensions with multiple sub-dimensions. By mid-2021, there will be at least two new dimensions added, including a tax dimension. So far, our classification framework has been applied to 99% of the token market according to market capitalization of classified tokens.
  • ITSA’s Tokenbase currently holds data on over 4000 tokens. Tokenbase is a holistic database for the analysis of tokens and combines our identification and classification data with market and blockchain data from external providers. Third-party data of several partners is already integrated, and API access is also in development.

Remarks

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International Token Standardization Association

International Token Standardization Association

The International Token Standardization Association (ITSA) is a not for profit organization working on holistic market standards for the global token economy.