Canza Finance Launches Baki Stablecoin Platform on Avalanche, Revolutionizing African Forex Trading
In a groundbreaking move aimed at reshaping the landscape of foreign exchange (forex) trading in African markets, Canza Finance, a crypto startup, has introduced Baki, a stablecoin platform natively built on the Avalanche blockchain. Baki represents the first step towards enabling forex trading in emerging markets, leveraging Avalanche’s low transaction costs and lightning-speed finality to offer an innovative solution to both institutional and retail users.
Baki: A Gateway to African Stablecoins
Baki is described as an “infinite-liquidity forex protocol” that facilitates slippage-free swaps between various African fiat currencies. The platform allows users to deposit stablecoins and mint overcollateralized synthetic assets called zTokens, which are pegged to African currencies. This groundbreaking development represents the first-ever on-chain implementation of African stablecoins.
One of the key features of Baki is its ability to enable the conversion of zTokens from one African currency to another seamlessly. Presently, Baki supports the minting of zTokens for US Dollars (zUSD), Nigerian Naira (zNGN), West African CFA (zCFA), and South African Rand (zZAR). Importantly, all foreign exchange conversions between these currencies are executed at central bank rates, ensuring that users have access to dollar markets at the most competitive rates available.
Victor Teixeira, Chief Crypto Economist at Canza Finance, expressed the platform’s mission, stating, “Baki aims to reshape the fundamentals of FX transactions on the continent by creating a robust and accessible market that offers all participants the best, fairest price available. By creating a synthetic marketplace for African currencies, we are able to overcome the key challenge on the continent, FX scarcity.”
USDC-Backed African Stablecoins
In its initial version, Baki will enable on-chain trading of tokenized Nigerian Naira, South African Rand, and West African CFA. Notably, these stablecoins differ from traditional fiat-backed stablecoins as they are backed by USDC (USD Coin) rather than the underlying African currencies. These zTokens, supported by USDC with a market cap exceeding $25 billion, provide a significant advantage in terms of liquidity, reduced fees, and a user-friendly experience for DeFi enthusiasts.
Baki’s entry into the market represents a significant milestone, as it becomes the first synthetic DeFi market for African stablecoins. This innovative approach to forex trading is poised to address the unique challenges facing the Sub-Saharan FX market, such as high inflation, illiquid and fragmented currencies, and a preference for over-the-counter (OTC) and peer-to-peer (P2P) markets over centralized exchanges (CEXs).
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