While we are convinced of the success of pure crypto exchanges, we see a predominant and unsolved problem in this sector: For interested parties who are not educated enough about the requirements of digital currencies (e.g. Bitcoin) in a differentiated way; there are very limited possibilities to invest in smaller projects e.g. ERC20 tokens.

This is due to the still unavoidable measure of first having to acquire Bitcoin on an exchange in order to transfer it in a second step to another exchange — all this just to acquire a desired asset there.

Since an overwhelming majority of assets can only be exchanged for Bitcoin, they are directly dependent on the situational Bitcoin price — and that, even though these should not be related at all.

In the future, transparency and the connection to the alternative market should remain decisive factors. We are therefore committed to creating an interface in the investment sector that is an attractive trading platform for both conventional investment firms and private investors.

In order to make this possible, we are focusing on the establishment of an internationally usable exchange, which enables a direct investment in assets.

The majority of Blockchain projects and alternative digital currencies are in a one-sided dependency relationship with Bitcoin. Especially smaller currencies or starting projects are exposed to the partly enormous effects of Bitcoin performance. This can be attributed to the direct trade between Bitcoin and these currencies.

BACE strives to weaken this dependency by providing new assets with the possibility of a fiat market. As soon as a currency on BACE has more volume in the fiat pair than in the Bitcoin pair, the dependence on Bitcoin is minimized. Due to the volatility of Bitcoin, the dependent assets are at a disadvantage. As a result, an expansion of the market is very beneficial.

At times, it was interesting for investors to sell their Altcoins before a Bitcoin hard fork to make a profit. For investors whose focus was on the diversification of Altcoins, this meant an inevitable loss. Some assets lost over 60% of its value. BACE Exchange wants to counteract this scenario so that blockchain projects such as Walton, Modum or Chainlink can be exchanged directly for USD.

Why do we mention a digital asset like Chainlink in our article? If you dig deeper into detail, the answer is clear. The payoff for node-operators securing smart contracts in this example takes place through a payment in a digital asset called Chainlink. According to Chainlink’s white paper; If a person/company wants to hire nodes, they have to pay for them in the form of Chainlink. The process itself for inexperienced persons/companies is time-consuming and needs knowledge (registration on an exchange, acquiring Bitcoin/Ether, the transfer to a next Exchange, buying the asset there). This example makes it clear that in the future, smaller assets will necessarily need the USD (also other Fiat currencies) market to make it easier for non-process-experienced people/companies to navigate and to get started. The demand for such solutions is enormous and will be important in the future.

The Management of Bace Exchange

Sources

/BACE Whitepaper v1.1

/Chainlink Whitepaper v1.0

/ Security and Privacy (SP), 2016 IEEE Symposium, Smart Contracts

/ Peters G.W., Panayi E. (2016) Understanding Modern Banking Ledgers Through Blockchain Technologies: Future of Transaction Processing and Smart Contracts on the Internet of Money.

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