Horizon Protocol, a Synthetix fork, aims to enable people to trade synthetic assets derived from real-world products on the blockchain. In contrast to Synthetic that runs on Ethereum, Horizon Protocol leverages Binance Smart Chain (BSC) which provides speed, dependability, and gas prices at a fraction of the cost when compared to Ethereum. Horizon Protocol plans to leverage this to allow for scalability without the problems of congestion, cross-chain interoperability through the use of blockchain bridges, and a larger range of synthetic assets through Oracles such as Chainlink, BAND, and Phoenix Oracles.
Horizon Protocol allows users to gain exposure to synthetic assets (zAssets) representing the real economy backed by a community collateral pool and the ability to trade seamlessly between any synthetic assets (e.g. synthetic Amazon stock, synthetic Oil derivatives, synthetic ETH) with infinite liquidity (limited by the amount of collateral in the system) and no slippage.
Horizon Exchange will not only be offering cross-chain derivative trading (long and short positions) of synthetic cryptocurrency assets, but it also ventures into synthetic assets based on traditional financial markets, including commodities, indices, equities & corporate, physical, and equity assets.
Horizon Exchange intends to add more features to facilitate the optimum user experience for traders besides what the common decentralized exchanges (DEXs) offer. It intends to include limit orders, stop losses and fully functional charts like those on Forex trading platforms for technical analysis.
Leverage and margin trading
In the future, Horizon Exchange seeks to expand into offering margin, leverage, and options trading.
A trader shall trade a zAsset pair using leverage and thus open larger trades than their account balance could otherwise allow. That will make trading on the platform enjoyable and increase the returns for the traders though it also increases the risk involved.
Horizon Exchange will also be adding functionality to allow users to trade futures of the synthetic assets (zAssets).
Horizon Exchange will most likely use a mechanism similar to Uniswap’s self-balancing algorithm that ensures that the sum of the interest of every open position is capped. It would also ensure the borrow rates are adjusted according to the open interest to ensure the risk to the HZN stake.
Traders are offered the advantages of scalability, transaction speeds, low costs, and stability due to Horizon Protocol utilizing the Binance Smart Chain (BSC) as opposed to Ethereum with current congestion problems. These are critical edges that allow traders who demand speed, low transaction costs, and no slippage. It also allows a far lower capital entry with the low gas fees. Horizon Protocol seeks to provide a higher trading experience where traders can have exposure to crypto-assets, traditional financial assets, and innovative assets such as fractionalized NFTs, real estate indices, and artwork. All in one system on the blockchain.
Horizon Protocol has already begun delivering one of the most valuable DeFi protocols deployed on the Binance Smart Chain (BSC) mainnet by tapping into on-chain synthetic assets. The launch of Horizon Staker in April marked the initial 100% community-given distribution of HZN alongside their PancakeSwap IFO. Horizon Genesis will start the process of facilitating the foundation of collateral needed for Horizon Protocol to unlock the full potential of the largely untapped synthetic assets market in crypto. The functionalities Horizon Protocol have lined up in the future will unlock more platform applications and provide users with the options they deserve.