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Understand and Leverage Injective Protocol to Trade Unlimited DeFi Markets While Harnessing Derivatives Trading [Explained]

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Unknown Speaker  0:01  

Welcome to the New To Crypto podcast designed to guide you through the crypto landscape with pinpoint accuracy created for the new and intermediate crypto investor. Join your host Crypto Travels Michael as he takes you through the different facets of getting started and succeeding in your crypto journey. New to crypto podcast brings you new episodes daily Monday through Friday with surprise bonus episodes sometimes on the weekend. Let me ask you, are you new to crypto don’t know where to start? Are you more experienced but have questions? Then you’re in the right place. This podcast is designed for you, coming at you from the training center in the lifestyle design studio. Here’s your host Crypto Travels Michael.

 

Michael  0:52  

I’ll tell you, you are awesome. All the listeners 86 countries around the world this show has been heard. I’m excited about our journey together. Definitely share the episode with your friends that are new in crypto, want to know more maybe they’ve been in crypto for a while, or maybe they just wanted to know about a specific project. So without further to do, let’s jump into today’s episode. It’s all about Injective Protocol. So, what is Injective Protocol? Injective Protocol is a universal decentralized finance or DeFi protocol for cross chain derivative trading across many different financial products, like perpetual swaps, futures and spot trading. Injective aims to build a network that is trustless, censorship resistant, publicly verifiable, and front running resistant. The Injective chain is implemented as a Cosmos SDK module built with EVM on Tender Mint. It utilizes a Tender Mint based proof of stake to facilitate cross chain derivatives trading across Cosmos, Ethereum and other layer one protocols. 

 

The Injective platform enables users to take part in decentralized cross chain derivatives trading with zero gas fees, access cross chain yield generation, create and trade on any derivative market with only a price feed, thereby opening up more opportunities for trading on markets not found on other exchanges. So let’s break down what Injective mission is. It’s to create a truly free and decentralized financial network for everyone. They strive to create a more free and inclusive financial system through decentralization by providing the unrestricted and unprecedented ability to express views in the decentralized financial markets. Some of Injective Protocol’s key things would be layer two decentralized derivative trading, so Injective is able to achieve fast trading speeds, while charging zero gas fees. Can also trade on any market, Injective allows anyone to create and trade on any derivative market using only a price feed, thereby opening up many opportunities for Trading and Markets where you wouldn’t actually find with other exchanges. 

 

There’s also cross chain trading and yield generation. There’s community driven network governance and there’s liquidity mining incentives. So let’s break down and unpacked the Injective chain. I like how Binance research words it: the Injective chain is a fully decentralized side chain relay or network which serves as a layer two derivatives platform, a trade execution coordinator, also known as it TEC, and a decentralized order book. Injective chain utilizes the Tender Mint consensus mechanism, and the core protocol logic is implemented through Cosmos SDK modules. Layer two derivatives platform, the Injective chain supports building generalized derivatives applications through two avenues, the Injective futures protocol and general Smart Contracts. The Injective futures protocols deployed on the Injective chain as the cosmos SDK based application. This protocol enables traders to create enter in and execute decentralized perpetual swap contracts NSFDs on any arbitrary market. 

 

The Injective chain provides a two way Ethereum pegs zone or Ethereum and ERC tokens to be transferred to the Injective chain as well as EVM compatible execution environment for DeFi applications. So the peg zone is based on Peggy and the EVM execution is based on Ether Mint, INJ is the native asset of Injective Protocol. So that’s their token INJ. And it’s used across a diverse range of functions, such as protocol governance, exchange fee value capture, derivative, collateralization, liquidity mining, and staking to name a few. The following is taken from Coinmarketcap about the INJ token. INJ is the native token of Injective Protocol, and is a scarce asset that is used for governance, exchange value capture, liquidity, mining, and staking. 60% of all exchange fees are used to buy back and burn INJ every two weeks, which allows the supply of INJ to dramatically decrease over time. 

 

In addition to this transactions on Injective Protocol, brought by new Injective ecosystem projects also helped to burn more INJ. So the amount of total supply of INJ is decreasing over time. The current circulating supply of INJ is just over 32.6 million tokens. And the max supply was 100 million. INJ is currently trading at just over $9.27 there abouts, and the current market cap is just over $303 million. The founders of Injective Protocol are Eric Chen and Albert Chung, Eric he worked as a cryptographic researcher and trader at a major crypto fund where he led an innovative market, neutral trading efforts in the blockchain space, as well as investments into prominent companies like Chainlink and Cosmos. Albert graduated with computer science degrees from Stanford University, and was a software development engineer at Amazon. So, what makes Injective Protocol unique? 

 

Injective enables anyone to access create and trade unlimited DeFi markets. This means crypto futures, perpetuals and sophisticated financial derivatives can all be traded on Injective in an entirely decentralized manner. And trades are super fast. And it’s almost instant finality and the cost is absolutely zero gas fees. So users on Injective can seamlessly trade across distinct blockchain networks such as Ethereum, Cosmos and Binance Smart Chain. Injective is also able to facilitate trades across Cosmos based projects, such as Terra. Injective is the first custom in operable protocol built for decentralized finance applications. Anyone can create new cross chain dapps using Ethereum based tooling, fast transaction times and instant finality while receiving unparalleled developer incentives. So let me ask you, how is Injective Protocol’s network secured? The Injective Protocol blockchain operates on a Tender Mint based proof of stake or PoS consensus mechanism. Prominent validators helped to secure the network by making it more decentralized. 

 

Injective’s consensus mechanism achieves instant transaction finality, while leading to a 99% lower carbon footprint. Here’s an interesting note about Injective: one to two second block times with instant finality, as mentioned previously, but that’s just lightning fast. So let’s talk about injectors ecosystem for a minute. They have a large ecosystem of projects which are working with objectives chain and an NF T space super farm is wallets such as Ledger and Math Wallet, stable coins, such as Terra in the DeFi space projects like Kardia Chain, DAO Maker, Mirror and Moonbeam. Under the Oracles category, Chainlink and Band Protocol are a couple, and under blockchains, we have Avalanche, Binance Smart Chain or Binance Chain, Cosmos, LRon Ethereum, Fantom Harmony, Polkadot, Polygon and Huobi Chain, are some of them. You can also use the dex for Injective. It’s at Injective.exchange. That’s the URL Injective data exchange where you can access create and trade unlimited decentralized financial markets. You can connect your Metamask or Ledger Wallets and just start swapping if you choose. Injective Protocol is definitely one of those projects to keep an eye on. I hope that this has been helpful for you. If you like today’s episode, definitely like and subscribe to the podcast. Show your support. And remember to chime in here tomorrow for another special episode. Until then I’m out.

 

Unknown Speaker  10:01  

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By: cryptotravelsmichael
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Table of Contents

What Is The Injective Protocol? 

Injective Protocol is a decentralized derivatives exchange based on Ethereum that is backed by a layer-2 solution, which was founded by Eric Chen and Albert Chon in 2018. 

Investors may swiftly and securely access DeFi marketplaces using this Injective Protocol system with layer-2 solution backup. In April 2020, Injective Labs announced its initial offering, DeFi’s first fully decentralized trading system. 

The programming team’s primary goal was to get beyond the limitations of the DEXs at the time, which limited users by requiring order book trading, having excessive latency, having insufficient liquidity, and other centralized designs.

Injective Protocol intends to provide DeFi investors with decentralized futures, margin, spot trading, and everlasting swaps. 

As said by Injective Labs, every component that supports the DEX is built in a way that is censorship-resistant, public, and completely trustworthy. 

The project’s three major elements are Injective Chain, Injective Exchange, and the Injective Futures platform.

What Does The Injective Protocol Entail? 

The Injective Chain allows Ethereum (ETH) and ERC-20 compatible tokens to employ a two-way peg. It also has a decentralized application execution framework that is Ethereum Virtual Machine (EVM) compatible (dApps). 

The EVM execution framework is based on Tendermint’s Ethermint EVM implementation. In contrast, Injective’s peg-zone design is built on the Cosmos Gravity Bridge, which allows for the movement of value between the Cosmos Hub and Ethereum. 

This allows for a high level of cross-chain compatibility and liquidity.

The order book solution from Injective is a completely decentralized order book that matches orders on the Injective sidechain and settles transactions in batches on-chain.

The Injective Chain is a completely decentralized sidechain relayer service that works as a layer-2 derivatives platform, trade execution coordinator (TEC), and decentralized order book, and is based on the Cosmos Tendermint standard. 

So what makes injective protocol unique? Injective enables anyone to access, create and trade unlimited DeFi markets.

- Crypto Travels Michael

Here's What We Discussed in Detail in This Interview

[00:01 – 02:29] Opening Segment

  • Let’s learn a bit more about Injective Protocol
    • Universal DeFi for cross-chain derivative trading
    • An aim to be censorship and running resistant 
    • Using Tendermint based proof of stake 
  • What this enables you to do 
    • Cross-chain trading with zero gas fees
    • Access cross-chain yield generation
    • Create and trade on any market

 

[02:30 – 07:03] Understand Injective Protocol

  • I break down the mission of Injective 
    • Create a truly decentralized network 
    • Free and inclusive financial system 
    • Unprecedented ability to express views in DeFI markets
  • Key elements of what Injective can achieve 
    • Layer 2 decentralized derivative trading
    • Fast trading while charging zero gas fees
    • Community driven governance 
    • Liquidity mining incentives 
  • I breakdown and unpack the Injectiv Chain 
  • INJ: the native asset to Injective Protocol 
    • The functions its used across
    • CoinMarketCap on INJ
    • 32.6M tokens w/ max supply of 100M
    • Trading at ~$9.27 at time of recording
    • Market cap at $303M 
  • A bit of the background and history of Injective 

 

[07:04 – 10:16] Leveraging Injective Protocol 

  • I talk about what makes Injective unique 
    • Trade unlimited markets
    • Super fast trading 
    • Zero gas fees
    • Trade across Cosmos based projects
  • How they make their network secure and safer
    • Tendermint proof of stake
    • 99% lower carbon footprint
  • A look at the ecosystem of Injective
    • Working with Injective chain
    • NFT space super farm 
    • Breakdown of the wallets
  • Use the DeFi Dex for Injective 

https://injective.exchange/

Killer Resources

HOW TO REACH TO CRYPTO TRAVELS MICHAEL

Final Thoughts

The Injective Protocol enables traders to enter into and construct on a Blockchain by executing everlasting decentralized swap contracts based on any market.

The Injective Protocol’s design is based on an account balance model that records all publicly available information about the accounts.

The Injective Protocol’s basic logic is applied to on-chain smart contracts, while the Injective Chain is used to match orders.

On Cosmos, Ethereum, and several other layer-1 blockchain networks, Injective Protocol enables cross-chain derivatives trading.

Injective’s decentralized exchange employs a number of innovative technological breakthroughs to provide a high level of network speed, security, and decentralization.

Injective Protocol is creating an exchange paradigm that has the ability to disrupt the industry as we know it by utilizing technology breakthroughs that boost settlement and trade execution speed in a genuinely decentralized, permissionless, and censorship-resistant manner.

The New to Crypto Podcast is designed to guide you through the crypto landscape with pinpoint accuracy. New episodes are added daily. Be sure to subscribe to the podcast and listen to all of the episodes to help you in your cryptocurrency journey.

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