We are Bananas for Synthetic Assets
Why we chose bananas and how decentralized synthetic asset creation can help emerging markets
Bananas are a world wide commodity and a key asset in many markets, supporting communities in many developing countries and consumed globally. By creating a Synth which can hedge inflation, peg to a universal value and be stable, bananas offer a unique value proposition to many users.
We chose bananas at the start because it’s a fun ape meme, cause apes like bananas so why hold USDT or USDc when can hold bananas as your stablecoin. But then we thought about what this actually means. Bananas are not just a fun fruit full of potassium, but are a key market that many are exposed to, from food supply chains, rural and developing communities and your local fridge. Many rely on bananas and this creates relatively stable value as the market has optimized around supply to meet demand.
Why Banana vs USD
Bananas have provided a stable net gain vs the USD over the last decades, and even account for inflation, making it an attractive inflation hedged stablecoin. This makes the asset more robust than the USD simply by not inflating the value away, cause you can’t eat dollars (*shouldn’t). This allows people to hold stable relative value, cause you can always just sell 1 Synthetic Banana for 1 real banana.
Opening up emerging markets
Agriculture futures are a key component in the economy, allowing producers to hedge risk, selling future yield today, for commitments to production many months away, removing exposure to markets while crops produce yield. This tool however requires access to complicated financial tools and services, a luxury not all have. Conjure can open these markets and allow everyone access to the tools to protect their future.
To do this consider the following
- Bob has a small business in South America for growing bananas, he has expenses to cultivate 100kg in bananas that costs $90. Bananas are worth $1/kg today but they’ll take 12w to grow. — Bob mints 100 Banana Synth xNANA for 1 USD per, and sells 100 for $100. Now they have a short on bananas — 12w later Bob can now sell 100kg in bananas, but they have dropped to $0.9 /kg so they sell their 100kg for $90. They then use the $90 to buy back 100 xNANA, and close their loan.
- Bob has protected the $10 loss from volatility and been profitable, allowing their production to continue
Hedge risk on actual yields for agriculture for developing markets and open access to tools with Conjure. Open source agriculture futures. Also because asset creations permissionless, anyone can bootstrap markets for any asset, allowing for everyone to access the tools they need.
So check it out