In the Hashgard whitepaper, there is a description about decentralized fund.
Hashgard supports the creation of decentralized digital asset investment funds. Fund managers issue tokens as certificates for fund shares, and assets held by the funds can be traded through atomic swaps on chain. The Hashgard ecosystem can also provide the decentralized funds with a series of off-chain management tools based on the hService protocol such as net value calculation, accounting, transaction settlement, performance calculation, and management fee and carry provisioning. Based on Hashgard, fund managers can establish and manage funds at very low cost, while decreasing counterparty credit risk at the same time. The funds can be either open or closed, and active or passive.
Hashgard Digital Finance Blockchain White Paper
So what’s decentralized fund and what can it bring to us in the future?
In this article, we will talk about decentralized fund.
About decentralized fund
Decentralized fund refers to moving centralized fund on the chain and make the fund, its operation and revenue transparent, so that investors can participate the investment more rest assured.
In essence, the decentralized fund is a reform to the centralized fund. By the end of 2018, there were more than 200 quantitative funds invested in China alone, and more than 500 quantitative teams had been opened to the outside world to raise capital, while the asset of global decentralized fund had exceeded more than $8 billion .
So, why is the decentralized fund growing so fast?
It addresses four problems of centralized fund.
1. Security issues of funds trusteeship
Many centralized funds are not in trust. Even some trust funds may be lost due to unqualified trust organizations.
But decentralized funds, where funds are stored in smart contracts, can maximize security.
2. Fundraising issues:
For a fund, how to raise money has always been a problem. For investors, the specific price and selling status of the fund are also important issues. In decentralized funds, these statistics are not transparent, so investors don’t know who to trust, so the fundraising is faced with difficulties.
Decentralized fund solved this problem. Fundraising can be achieved through smart contract. investors can inquire the total amount of the fund-raising, the unit price of the fund-raising, and the current selling status through the contract on the chain. When investors complete the purchase, they will get a TOKEN-based share, and they can view the number of shares through a variety of tripartite wallet programs.
This makes fundraising costs fall sharply and investors can trust the fund more.
3. Equity issues:
The problem of centralized funds is that they are not transparent. High-risk projects are sold to investors. Supervisors of funds may use the investor’s money to invest in high-risk projects. Dividends may be not equal. Under the effect of bad money drives out good, more and more investors begin to have a natural sense of mistrust of the fund.
Decentralized funds can use smart contracts to achieve fund raising, investment, dividends and other procedures. Guaranteed by the contract code open source, all fund operation records will be recorded in the blockchain ledgers and be preserved permanently and publicly, so as to truly solve the problem of fairness.
4. Distribution of benefits
After the issuance of the centralized fund, when collecting the benefits and distributing the income to the investors, the proportion of the income and the income of different people are often not transparent, and many investors can not get the income they deserve in time and efficiently.
The decentralized fund can use open smart contract code to let any user check the distribution of fund income.
Why using Hashgard public chain to issue decentralized fund?
After reading the above, you must have a general knowledge of what is good about decentralized fund.
Then why do you want to choose to issue decentralized funds on the Hashgard public chain?
The answer can be summed up in four words: simple, easy to use
1. A safer public chain
As mentioned above, decentralized funds use smart contracts to ensure the security of funds, but what if there is something wrong with the smart contract itself.
With 24 groups of mnemonic collocation, the industry’s most advanced encryption algorithm to build smart contracts, slowmist technology, Hashgard public chain is safe and secure.
2. A better multi-signature system
In the system of Hashgard decentralized fund, we completely distinguish the investment decision-making power, management right and supervision power of funds.
(Multi-signature function of Hashgard public chain: More than two users as a whole
authorize the message with a digital signature. The multiple signature mechanism can reduce risks and improve security.)
3. More efficient and practical tools
As a public chain focused on digital finance, Hashgard will provide a large number of native functions for financial industry in the future, which can reflect the whole process of fund raising, investment, bidding and dividend in the chain. At the same time, the agreements such as forward payment and atomic swap will bring more for decentralized funds.
After reading this article, do you have a basic understanding of decentralized funds?
What products will be released on Hashgard public chain and when?
Stay tuned!
