Contents
- Overview of Elixir
- Technological Infrastructure
- Economic Model and the ELX Token
- Synthetic Assets and deUSD
- Funding and Valuation
- Outlook and Roadmap
- Conclusion
1. Overview of Elixir
Elixir is a modular decentralized network designed to enhance liquidity in decentralized exchanges (DEXs) that utilize order book models. Unlike Automated Market Maker (AMM)-based DEXs, which rely on liquidity pools and mathematical formulas to facilitate trading, Elixir focuses on the order book model, enabling traders to interact directly with one another. This approach aims to provide deeper liquidity and reduce slippage, thereby improving the overall trading experience. The primary objective of the project is to serve as foundational infrastructure for Layer 1 and Layer 2 ecosystems, allowing exchanges and protocols to seamlessly scale liquidity. Elixir's cross-chain and composable nature enables native integration into the core infrastructure of leading DEXs, unlocking retail liquidity for various trading pairs and use cases. As of early 2024, Elixir has established over 30 native integrations with prominent DEXs, including Vertex, Bluefin, and RabbitX.2. Technological Infrastructure
Elixir’s technological foundation is built on a decentralized high-performance infrastructure that leverages Delegated Proof of Stake (DPoS) consensus for orders placed on integrated exchanges. The network architecture includes several key components:- Exchange Feeds: These are read-only credentials for each exchange, subscribing to a unified stream of updates and broadcasting data to data aggregators.
- Data Aggregator: Collects data from multiple exchange feeds, compiles it into a deterministic data frame, signs it, and broadcasts it to validators and auditors.
- Validator Network (DPoS): Operates based on a decentralized proof-of-stake system, requiring 66% consensus achieved on a relay node. End users delegate their stakes to validators who secure the network and earn emission rewards based on their delegated tokens.
- Relay Nodes: These nodes hold trading keys for individual exchanges and compute order proposals from validators. Once an order proposal expires, it is passed to the auditor for verification.
- Dispute Resolution Layer: Comprising an auditor and a controller, this layer ensures network integrity and resolves arising conflicts.
3. Economic Model and the ELX Token
At the core of the Elixir ecosystem lies the ELX token, which serves multiple functions within the network:
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Governance: ELX token holders participate in the decentralized governance of the Elixir ecosystem, influencing decisions related to network updates, parameter configurations, and other critical aspects.
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Staking and Rewards: Validators and node operators stake ELX tokens to secure the network and, in return, receive emission rewards. This incentivizes active participation and maintains the network's integrity.
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Liquidity Provision: Users can supply liquidity for various trading pairs on integrated DEXs, earning rewards in ELX tokens. This mechanism encourages liquidity provision and enhances the overall trading experience.
4. Synthetic Assets and deUSD
An essential component of the Elixir ecosystem is the issuance of synthetic assets, particularly deUSD—a decentralized synthetic dollar. deUSD is a fully collateralized stablecoin designed to ensure stability and liquidity across both decentralized and centralized exchanges.
Architecture of deUSD
deUSD is backed by a combination of wstETH (wrapped staked ETH) and sDAI. These assets are used to create a delta-neutral position by shorting an equivalent amount of ETH through perpetual futures contracts. This mechanism allows deUSD to maintain stability while minimizing exposure to market volatility.
Advantages of deUSD
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Decentralization: Unlike centralized stablecoins, deUSD operates independently of centralized issuers, ensuring greater transparency and resistance to censorship.
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Yield: Staked deUSD (sdeUSD) accrues yield from the underlying collateral, providing users with the opportunity for passive income.
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Integration: deUSD is integrated into the Elixir ecosystem and supported by various DeFi platforms, such as Pendle, expanding its utility and liquidity.
5. Funding and Valuation
Elixir has garnered significant investor attention, successfully completing multiple funding rounds:
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Series A: In October 2023, Elixir raised $7.5 million at a $100 million valuation. The round was led by Hack VC, with participation from NGC Ventures, AngelList Ventures, and others.
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Series B: In March 2024, the company secured an additional $8 million, elevating its valuation to $800 million. This round was co-led by Mysten Labs and Maelstrom, with contributions from Manifold, Arthur Hayes, Amber Group, and others.
These investments underscore confidence in Elixir's vision and its potential to transform liquidity on decentralized exchanges.
6. Future Prospects and Roadmap
Elixir is committed to expanding its ecosystem and enhancing its functionality through several strategic initiatives:
Expansion of Integrations
Elixir plans to increase the number of native integrations with decentralized exchanges (DEXs) to broaden its network's adoption and usage. By collaborating with a diverse range of DEXs, Elixir aims to provide users with access to deeper liquidity and more efficient trading experiences. This strategy not only enhances the platform's utility but also strengthens its position within the decentralized finance (DeFi) ecosystem.
Infrastructure Enhancements
Continuous improvement of the technological framework is a priority for Elixir. The project focuses on optimizing performance, scalability, and security to ensure a robust and reliable platform. By adopting advanced technologies and best practices, Elixir seeks to deliver a seamless user experience and maintain the integrity of its operations.
Diversification of Synthetic Assets
Beyond the issuance of deUSD, Elixir plans to introduce a variety of synthetic assets to meet the diverse needs of its users. These assets will enable users to gain exposure to different financial instruments within the DeFi space, offering more opportunities for investment and risk management. This diversification aligns with Elixir's goal of providing a comprehensive suite of financial products to its community.
By pursuing these initiatives, Elixir aims to solidify its role as a leading provider of liquidity solutions in the DeFi sector, offering users more efficient and decentralized trading platforms.
7. Conclusion
Elixir stands as an innovative solution aimed at enhancing liquidity on order book-based decentralized exchanges (DEXs). Its modular architecture facilitates seamless integration with various DEXs, providing deeper liquidity and reducing slippage for traders. The issuance of synthetic assets, such as deUSD, offers users stable and decentralized stablecoins applicable across diverse DeFi applications. Significant investor support, evidenced by successful funding rounds, underscores confidence in Elixir's vision and its potential to transform the DeFi ecosystem. With a focus on expanding integrations, improving infrastructure, and developing new synthetic assets, Elixir is poised to offer users more efficient and decentralized trading platforms, contributing to the continued evolution of decentralized finance.
