Bonds haven't played a big role in DeFi yet, but that's about to change

Major economies around the world are on the brink of recession and ongoing uncertainty means the outlook for the next 12 months is rather bleak.

Investment bank Nomura recently predicted that the US, euro zone, UK and Japan are all at risk of slipping into recession as inflation continues to spiral.

Stocks have been hammered, and the crypto market has not been spared. But in turbulent times, bonds tend to look more attractive.

Bonds are actually debt instruments - IOUs. They can be issued by governments and corporations and held by the public.

Interest is paid periodically, and the face value of the bond is then paid at maturity.

While bonds have been around for decades, a new crypto project argues that the asset class has yet to enter the world of decentralized finance. why? Because most DeFi projects rely on ERC-20 tokens, these tokens cannot define specific contractual terms — such as coupon rates and maturities — attributes that are critical for bonds.

D/Bond said it has created a new token standard, ERC-3475, to overcome these technical hurdles and ensure securities can be issued and traded on the blockchain.

D/Bond believes that in the future, this will open the door for anyone to create their own bonds — the platform will allow them to trade them through a custom decentralized exchange.

Users can then store ERC-3475 tokens in the D/Bond wallet.

Decentralized Bond Ecosystem

D/Bond CEO Yunan Liu told Cointelegraph: “ERC-3475 is a unique and significant improvement over what the traditional financial (TradFi) system currently offers. It helps us focus most of the potential of DeFi into the TradFi market , our platform offers fixed rates and guaranteed repayments, fund managers say the threat of recession is real, and there are signs that the trajectory of spreads is changing."

PeckShield is conducting a security audit of it, and the project also said it has a partnership with Blockpit so customers will be able to self-manage their finances more easily.

For more information on D/BOND click here

The name is called bond (bond), D/Bond

D/Bond believes that traditional bonds are in dire need of modernization, while everyday consumers often struggle to access these instruments because they do not meet the requirements to participate. This project aims to solve this problem by ensuring that it is open to all.

According to D/Bond, ERC-3475 tokens can be used to collateralize fungible and non-fungible tokens — and as interest grows, the standard could help facilitate interoperability between decentralized bond markets. Crucially, they can also be fragmented, meaning investors will be able to sell parts of the bonds in the secondary market.

The project believes: "The bond market is an area that DeFi missed. Soon, we will see how DeFi successfully disrupts and promotes its development."

D/Bond will launch in the fall and will shake up the bond world. While traditional U.S. bonds can currently only be traded between 8am and 5pm, the platform aims to ensure they trade around the clock — a truly international market.

Based in Paris, the startup has gained massive momentum over the past year.

The development of the ERC-3475 standard is now complete and a security audit of the D/Bond backend is in progress.

The project also said it had built a strong team and attracted financial support despite tough market and global economic conditions.

Learn more about D/Bond