Understanding Synthethic assets with Comdex

3 min readNov 7, 2021

The Cosmos ecosystem is blossoming and many projects are coming out. An ecosystem that is building an open, scalable and interconnected economy for the future. With Cosmos, interoperability is key and moves have been made to ensure that it is indeed an internet of blockchains. One project that is making waves within the Cosmos ecosystem is Persistence.

Persistence has been doing a lot, lately and they are placing themselves as the leader and major project looking to help improve decentralized finance (DeFi) all round. As witnessed today, there is quick growth and expansion going on within the ecosystem. Being the pioneer for a series of next-gen financial products, you can easily decipher why there is so much hype around this top DeFi project.

In this article, we would be looking at Persistence’s flagship dApp, COMDEX and how it is democratizing commodities via interchain synthetic assets. Let’s see what these synthetic assets are and how Comdex is changing the way we see them.

Synthetic assets

When you talk about Synthetic assets, you’re referring to a group of assets that have the same effect as the ownership of another asset. This simply shows that synthetic assets get their value from other assets like minerals, currency, precious metals, stocks, bonds, and other commodities. With them, you can track and create new opportunities for these aforesaid asset classes and the beauty of it all is that investors wouldn’t have to hold these real-world assets. Comdex is helping to open up the narrative for commodity synthetics within the Cosmos ecosystem. This new commodity synthetics of Comdex, built on Cosmos, is set to open up various opportunities outside what is normally experienced in the crypto space and decentralized finance, DeFi. The result of this is greater access. A wide array of commodities would be made accessible to cryptocurrency and blockchain enthusiasts through the Comdex trading platform.

The Role of Comdex

You might say this is all talk and of what significance is this to us? Well, it is easy. Human civilization has always thrived but we can’t rule out the importance of commodities to this success and it is fair to say that commodities have served as a backbone for this growth. Over time it has been seen that the commodity industry usually grows in strength during periods where there is a reduced belief in the regular fiat currency. What Comdex is doing is really great by granting access (permissionless) to global assets and liquidity for the first time ever. With this, speculating the price of various commodities would be made possible. Certain commodities would play the role of safe spots during periods of economic uncertainty with the possibility of appreciating when looked at, long-term. Comdex’s synthetics protocol would look to unlock access to a large array of commodity debt assets and liquidity, making the flow of capital from DeFi to CeFi smooth and frictionless.

What Synthetic Assets Bring

Synthetic assets would help to bring diversification. You might wonder how. It’s easy. Because of the fact that there is a lack of correlation between commodities and stocks (and bonds), there’d be a greater degree of spread inside the portfolio of a user. Also, synthetic assets would also protect users from the high degree of volatility that commodities usually have. Let’s also talk about inflation. It is a killer of many economies but with synthetic assets, users are protected from the effects of inflation.

Let’s take this walk with Comdex as we explore the great opportunities that abound in the world of commodities trading and synthetic assets.