SatoshiPay Receives R&D Grant from Stellar for Pendulum Blockchain

We are excited to announce that we have received a research and development grant from Stellar Development Foundation to start development of the Pendulum network — a new second-layer blockchain that connects Stellar to the wider DeFi ecosystem by adding smart contract support and bridges to Ethereum and Polkadot.

Connecting Stellar to Decentralized Finance Ecosystem

Decentralized Finance (DeFi) has emerged in the past year and is positioned to profoundly disrupt traditional financial services like trading, credit/lending and yield-generating accounts. The industry has grown over twentyfold in 2020 alone, and reached more than USD 60 billion in Total Value Locked in smart contracts as of May 2021.

From decentralized exchanges and crypto lending to yield farming and insurance platforms, the DeFi economy unlocks a new financial system that is setting new standards for access, resilience, and transparency.

With its unique focus on fiat token payments, Stellar is perfectly suited to serve as the missing link between traditional finance and the flourishing DeFi industry. To achieve this, the Stellar network needs to support custom smart contract capabilities — a premise for advanced DeFi applications — and to establish bridges that connect it to other relevant blockchains in the ecosystem. This is precisely what SatoshiPay’s new project Pendulum aims to accomplish.

Stellar Development Foundation Grant for Pendulum

Justin Rice, VP of Ecosystem at Stellar Development Foundation says:

“SatoshiPay has a proven track record as a key Stellar network and ecosystem participant, and we couldn’t be more excited that they are exploring an opportunity to connect Stellar to the thriving DeFi ecosystem. With its unique tools for compliant connections to traditional banking networks, the Stellar network is well positioned to connect traditional finance with the innovative DeFi space. Pendulum has the potential to build bridges that increase Stellar’s interoperability with other networks, which could enable new use cases and help unlock the world’s economic potential by making money more fluid, markets more open, and people more empowered.”

Stellar Development Foundation has granted SatoshiPay initial funding to kickstart the project and develop a proof of concept implementation of Pendulum. After completing the initial proof of concept, Pendulum will be further developed into a full-fledged decentralized layer 2 blockchain that will be accessible for everyone.

Meinhard Benn, CEO at SatoshiPay comments:

“With Pendulum, SatoshiPay is entering the protocol space, which is an exciting opportunity for us to drive forward permissionless innovation and to increase our impact on the blockchain ecosystem. We’ve been discussing options to execute arbitrary smart contracts with the Stellar team for quite some time and we are delighted to receive their technical input and financial support for this. We aim to bring together the best of two worlds — DeFi applications as we know them from Ethereum with Stellar’s compliant fiat tokens. It will be exciting to see liquidity enclosed in Stellar’s $9 billion market cap and the $7 trillion foreign exchange market interact with the booming DeFi economy via Pendulum.”

Unlimited Opportunities for Stellar Users

Leveraging Pendulum, Stellar-based services will be able to utilize all the different types of DeFi protocols with a focus on fiat tokens, including automated market makers (AMMs) that enable foreign exchange without middlemen, or lending protocols for instant on-demand liquidity in different currencies. All of these services can be connected to the traditional banking system via regulated, and in many cases instant, local onramps and offramps on Stellar in a large and growing number of countries.

Fiat token holders on Stellar, such as individuals, institutions as well as services, will be able to put their funds to work, for example by depositing them into lending pools or by providing liquidity to AMMs.

Pendulum Layer Model

The proposed bridges to the Ethereum and Polkadot ecosystems will further foster the integration of traditional financial services with the booming DeFi ecosystem on these blockchain networks, allowing fiat tokens and liquidity to freely circulate between Stellar, Pendulum and the wider DeFi economy.

Pendulum and DTransfer

The arrival of fully automated market-making via decentralized smart contracts solves this issue and Pendulum is being developed with services like DTransfer in mind. Once Pendulum is up and running, and AMM smart contracts deployed on Pendulum can exchange fiat tokens, DTransfer will benefit from instant currency exchange at optimal rates — enabling efficient money transfer between businesses from every corner of the world.

Stay tuned!

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Telegram: t.me/pendulum_chain
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Connecting the world through instant payments

Connecting the world through instant payments