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Here we dive into the exciting world of tokenized bankruptcy claims, which involves converting them into digital tokens on the blockchain.
We call our tokenized bankruptcy claims Smart Claims. Each Smart Claim represents ownership of the bankruptcy claim and can be traded, sold, or used as collateral in decentralized finance protocols. Revolutionary Smart Claim features include (click to expand):
Let's explore the advantages of tokenized bankruptcy claims compared to traditional centralized marketplaces. Found's Smart Claims provide a clear advantage by leveraging the full potential of blockchain and decentralized finance (DeFi) technology. Some key differences include:
- Enhanced security & transparency with decentralized, tamper-proof ledgers
- Better liquidity and global accessibility through NFT marketplaces
- Ability to tap into DeFi loan products using tokenized claims as collateral
- Improved price discovery through transparent fee structure
Greater Access. Smart Claims are non-fungible tokens (NFTs) that grant access to NFT marketplaces where they can be bought, sold, or traded. This expands the reach of claim holders to a wider market, enabling better price discovery and potential appreciation in value. Smart Claims can also be used as collateral to access various DeFi loan products. This offers an alternative to traditional financing options, with key advantages such as:
- Faster loan processing times
- Lower interest rates
- Reduced reliance on intermediaries
Transparent Fee Structures. We charge a flat 10% fee for our services, while our competitors take 10% plus and additional 1-3% of the face value of the bankruptcy claim (15-20% transaction fees). This makes Found a more cost-effective option for claim holders.
Our competition charges the buyer fees, which results in less transparency and less efficient price discovery. This structure incentives centralized marketplaces to devote efforts to finding cheap bankruptcy claims on behalf of their buyers instead of innovating technology that unlocks additional value for users.
By having a transparent flat fee, Found creates a simpler and more predictable cost structure that allows claim holders to focus on finding the best deals, without being concerned about potential hidden costs or variable fees that artificially reduce market value.
Found.xyz simplifies the process of tokenizing bankruptcy claims by guiding users through a step-by-step process that creates a digital tokenized claim using the ERC-721A standard. This streamlined process eliminates the need for users to hire engineers, brokers, or attorneys and allows immediate access to DeFi loan products and trading on major marketplaces.
Onboarding and Claim Submission. To begin the tokenization process, users will need to register on Found.xyz and provide the necessary information about their bankruptcy claim. The platform will guide users through a simple questionnaire that gathers details about the claim, such as the case number, court jurisdiction, debtor, claim amount, and relevant supporting documents.
Automatic Claim Valuation. Found.xyz's advanced algorithms will automatically calculate the value of the user's bankruptcy claim based on the provided information. The platform considers factors such as the debtor's financial position, the priority of the claim, and market conditions on the date and time of bankruptcy to determine an accurate valuation.
Standardized Legal Agreements. Instead of hiring attorneys or brokers, Found.xyz streamlines the process by generating standardized legal agreements based on the claim's details. These agreements ensure that users remain compliant with regulations and industry best practices while also reducing costs and expediting the tokenization process.
Tokenization and ERC-721A Integration. Once the user has reviewed and agreed to the legal documents, Found.xyz will create a digital tokenized claim using the ERC-721A standard. The ERC-721A standard ensures that each tokenized bankruptcy claim is unique, traceable, and compatible with major marketplaces and DeFi loan products.
Accessing DeFi Loan Products and Marketplaces. After successfully tokenizing their bankruptcy claim, users can access various DeFi loan products and marketplaces immediately. The tokenized claims can be used as collateral, traded on secondary markets, or employed in other financial services, offering users increased liquidity and financial flexibility.
By utilizing Found.xyz's user-friendly platform and streamlined tokenization process, users can efficiently convert their bankruptcy claims into digital assets, unlocking the full potential of tokenized claims in the world of decentralized finance.
Smart Claims unlock greater liquidity, accurate price discovery, and access to a broader range of investors. By leveraging blockchain technology, claim holders can transform the bankruptcy claims market, potentially achieving more competitive prices and new opportunities for their assets.
Enhanced Liquidity. Tokenization can increase liquidity, as Smart Claims can be traded on various decentralized platforms and NFT marketplaces. This allows for higher demand and more competitive pricing compared to traditional sales to specific buyers, such as hedge funds or individual investors.
Global Investor Base. Smart Claims can tap into a global investor base, including both retail and institutional investors. This increased investor base could lead to higher demand and potentially higher prices for tokenized claims.
New Financial Products. Smart Claims can leverage smart contracts and other blockchain functionalities, enabling automated processes and more sophisticated investment strategies. These programmable features attract a wider range of buyers interested in utilizing advanced capabilities.
Lower Transaction Costs. Smart Claims reduce transaction costs and other barriers associated with traditional asset transfers. This cost efficiency makes the tokenized claim more attractive to potential buyers, influencing the price they offer.
Smart Claims facilitate transparent price discovery, as the blockchain can display the tokenized claim's value and transaction history. This transparency allows the market to assess the claim's true value, leading to more accurate pricing.
Smart Claims provide increased flexibility and new investment strategies by leveraging programmability offered by blockchain technology and smart contracts. Here are some sophisticated investment strategies and features that can be implemented with tokenized bankruptcy claims:
Automated Asset Management. Smart Claims can be managed through decentralized finance (DeFi) platforms, which use smart contracts to automate various asset management tasks, such as portfolio rebalancing, profit-taking, and interest accrual.
Fractional Ownership. Smart Claims allow for the easy division of a bankruptcy claim into smaller portions, enabling investors to purchase and trade fractional shares. This can increase the claim's liquidity, allowing a broader range of investors to participate in the market and reducing the barriers to entry.
Derivative Products. Smart Claims can be used as the underlying assets for various derivative products, such as options, futures, and swaps. This allows investors to hedge their exposure, speculate on price movements, or gain leveraged exposure to the performance of the claim.
Bundling and Index Funds. Investors can bundle multiple Smart Claims together to create diversified portfolios or index funds that track the performance of a specific sector or market segment. This can help investors manage risk and achieve more stable returns.
Yield Farming and Staking. Smart Claims can be utilized in DeFi protocols as collateral to earn interest or other rewards through yield farming and staking. Investors can lend their tokens to others or provide liquidity to decentralized exchanges to earn fees or other incentives.
Automated Trading Strategies. Smart contracts can be programmed around Smart Claims to execute advanced trading strategies, such as algorithmic trading, arbitrage, and market-making, which can help investors capitalize on price discrepancies and market inefficiencies.
Governance and Voting. Smart Claims can incorporate governance and voting mechanisms, allowing token holders to participate in decision-making processes related to the management of the underlying assets, such as approving proposed restructuring plans or asset sales.
Custom Risk Management. Smart contracts enable investors to create customized risk management strategies for their tokenized bankruptcy claims, such as setting stop-loss orders, automated liquidation thresholds, and collateral requirements.
These sophisticated investment strategies, facilitated by the programmability of Smart Claims, offer investors more control and flexibility, enabling them to tailor their investments according to their risk appetite, goals, and market outlook.
Fraud and identity theft are significant concerns on centralized marketplaces. Found addresses these challenges by combining the anonymity protections of decentralized trading with a secure and safe environment for buyers and sellers to communicate and conduct due diligence.
Fraud Prevention. Our user account verification and biometric authentication prevents fraudulent activities, such as identity theft, unauthorized account access, and falsified bankruptcy claims. This robust security layer helps ensure that only legitimate users and assets are allowed on the platform.
Confidentiality. Found provides gated access to Smart Claim data rooms to ensure user information remains protected and confidential, preventing unauthorized access or misuse of information.
By addressing concerns related to fraud and identity theft, Found.xyz ensures a safer, more reliable environment for trading tokenized bankruptcy claims, fostering trust and compliance in this rapidly evolving market.