Review on UMA by Japheth Ayuba
UMA has been created for Financial Innovations but it goes beyond that.
UMA which stands for Universal Market Access is an Open-source permissionless Decentralized Finance Protocol that has been specially created to power financial innovations. This financial innovation of UMA is primarily for financial derivatives connecting two individuals to create self-enforcing smart contracts. After making their trades or prediction, it's Oracles DVM (Data Verification Mechanism) keeps updating the smart contract and financing the party whose prediction was
Another use case of UMA is for the creation of Synthetic Tokens which can be used to track anything. This was the area of UMA I found quite interesting and engaging as the synthetic tokens created can be used to track anything from Forex fiat pairs to cryptocurrencies price and even social media followers. This Synthetic Token building feature is available on the Rinkeby Testnet and can be accessed using an Ethereum wallet that supports DApps. To create this Synthetic Token, I had to access the Rinkeby Testnet and went to it's faucet which is located on the top corner of the Dapp to claim some Testnet Ethereum and Dai in order to build my Synthetic Token. The process of building was simpler than I even imagined but without boring you with all the technical details, I will move to the other use cases of UMA which you might be interested in
Other use case of UMA includes Decentralized Crypto Futures which functions more like a futures trading platform but in a Decentralized way. And another use case is the Yield Curves which allows Developers to create synthetic tokens that pays out interest based on what they are created for for example, Company Stocks.
Universal Market Access UMA is a Crypto project that in my view is majorly targeted at Developers and liquidity providers for the sale of the created synthetic tokens,but all the same, it's one project that has brought to life, innovations one hasn't seen
Pros
- UMA is a Decentralized Finance Project created to power financial innovations and has kept to that fact by implementing it's smart contracts useful in derivatives trading
- UMA allows users create synthetic tokens which can be used to track anything like price of cryptocurrencies or number of followers one had on his/her social media account
- Developers can build synthetic tokens that will yield interests . An impressive implemention in building this token is that, it can be configured so that as price rises, interest rate falls and as price falls, interest rate rises
Cons
- It's not a popular project despite having huge investors and partners
