NAOS Finance:Connecting DeFi with TradFi

7 min readJul 2, 2021

499Block Our ama is about to start, first of all let us warmly welcome the guests @tsengkevin!So now our ama will officially start. Before that, we ask the guests to make a short self-introduction.

Kevin: Hey guys! it’s great to be here, I came from traditional finance and startup world.prior to NAO Finance I led strategic investment at The Walt Disney Company and Alibaba Group. focused on M&A; and international investments. I was also the founder of 3 tech startups, founded Foodpanda (acquired by Delivery Hero), Zalora (acquired by Central Group) and Lazada (acquired by Alibaba Group).

** 499Block ** Impressive experience, great, then let’s start today’s theme, first of all, the first question is about the project itself.

Q1. What is the vision and mission of NAOS? What are your goals?

Kevin: NAOS envisions connecting DeFi and CeFi, We do that in a way by building a DeFi infrastructure based on Real World Assets. right now we’re a layer two Dapp, but with the scaling of real world assets on chain, we’re positioned to be a layer one protocol allowing all DeFi ecosystem to innovate on top of us.ultimately, we see a world where DeFi technology and CeFi application being interchangeable seamlessly.

** 499Block ** For many new users of the blockchain, Real World Assets has always been an important reason why they dare not participate in it, because most digital assets are bubbles. For users who are aware of NAOS for the first time, they want to know more about NAOS products in order to be able to participate directly,then the second question.

Q2. What are the products of NAOS and how is the current development progress? How can users participate in?

Kevin: haha, digital assets are definitely harder to price, the perception of a digital asset bubble has to do with the intangible nature of the asset without any underlying hard assets, with real world assets, things are a bit different.

NAOS Finance has two sub-protocols

1. Formation: the liquidity protocol

2. Galaxy: the lending protocol

Formation allows us to take the liquidity from DeFi and channel it to fund real world assets, Galaxy essentially emulates the entire banking process, for a borrower to submit loan applications, getting evaluated and get funded. We’ve already completed audit for Formation and getting ready to launch the mainnet. Galaxy is under the final touches before submitting for audit, we expect to launch Galaxy shortly after. users will be able to participate in 5 different type of liquidity mining pools in Formation, I think it will be an very interesting experience.

** 499Block ** Great, you said very clearly, but in order to avoid users having other questions, is there a tutorial or link that can help users understand the entire project more intuitively, or users can go to the official website to learn everything they want to know?

Kevin: absolutely!you will find a clear step-by-step guide on how Formation works here:

and more general information on team, investor and social media here:

** 499Block ** Awesome, after knowing how to participate, let us return to the question users are most concerned about, which is how Naos maps real assets to the project.

Q3. NAOS initiated the proposal of adding new supply chain financial assets as collateral in MakerDAO. What is the progress? What role will NAOS play in the process of supply chain financial assets as collateral?

Kevin: All great questions, We think the current DeFi lending model is semi-broken, such that if you want to borrow $100, you must use $200 or $300 as collateral. not only that, the entire lending process is based on cryptos only, which is only applicable to 1% of the population. NAOS bring RWA into the picture to solve two problems:

1. reduces the over-collateralization requirement by introducing an asset type that is stable and has recurring income streams

2. bridge the global credit gap issue and allow RWA to get funded by all lenders with various risk-reward profile

Our partnership with MakerDao is the first of many cases that will follow,we’ve been working closely with Maker for the last 5 months, and we’re part of Maker’s Real World Asset Committee. we’ve passed Maker’s community governance vote, and now focusing on creating the legal entities and operational details, fully expect a successful funding of the supply chain finance asset in Q4.

In this partnership, NAOS is like a merchant bank, and Maker is the Central bank, we will be tapping into Maker’s treasury for virtually unlimited funding capital.

** 499Block ** In the process, I saw the efforts made by Naos and the future development trend of the blockchain, and I know that some people in the digital asset world are also trying to open the gap between reality and the blockchain. What is the difference between Naos and them?

Q4.What methods will NAOS Finance use to help real-world assets participate in DeFi lending? How is this different from the current mortgage lending of encrypted assets? What are the meanings for DeFi, the encrypted world, and the real world?

Kevin: So for the first question, I think this is how NAOS stands out, we’ve seen projects attempting to tokenize real estates, solar farms and other type of illiquid assets, with the goal of transfer of ownership and fractional ownership. we see real world assets differently,we see real world assets from the lens of banking, in which those assets with value could be used as collateral to free up future cashflow.hence, in the case of our partnership with Maker, we will tokenize RWA and deposit into Maker’s vault as collateral, and in return get the equivalent amount of DAI. as for Q4, i think that’s a huge question lol,but i will try to tackle it.

the key for real world assets into crypto is to minimize the need to understand crypto. for example, at NAOS, we’ve created a seamless process for traditional borrowers, they will go through the entire borrowing process as if they would at a bank.but faster, easier. most importantly, we ensure that they will never have to deal with cryptos, if they are borrowing fiat, they will get fiat and payback in fiat. i know this may be counter-intuitive.but we believe DeFi is a wonderful technology, but for mass adoption, we dont need everyone to be an engineer to enjoy the technology. ultimately, there should be no tangible difference between DeFi and traditional finance.

** 499Block ** Thank you for your answers, as I said, in addition to NAOS, there are other projects that map real assets, including real estate, stocks, games, art, etc.

Q5. Compared with these projects, what differentiated advantages does Naos Finance have?

Kevin: I’d say that we have unique and unfair advantage over other similar projects. first of all, we have financing licenses in multiple countries, which allows us to interface with real world lenders in a compliant manner. this will also allows us to scale the onboard of real world assets much faster. in additional, we already have a large network of corporate borrowers, with over $300M worth of assets ready to be deployed. we believe those are the two most critical aspects in this business.

** 499Block ** Great, to be honest, I can’t wait to learn more about the mechanics of Naos. Finally, I ask a question about the industry on my own behalf. Compared with traditional finance, DeFi has obvious advantages in terms of efficiency and cost, but when will mainstream society begin to use DeFi? What conditions are needed?

Kevin: we’re still super early in the game,DeFi is not user friendly for 99.9% of the world, let’s be honest lol. we’re so used to do banking in the traditional world, and for users in China, Alipay is so simple you rarely need to go to the bank. i dont foresee an user behavior migration, no one will stop using traditional banking completely by switching to Metamask.

however, i believe many of the existing DeFi technology will be applied in traditional banking to make it more efficient. for example, the stock markets like NASDAQ and NYSE are implementing the DeFi AMM technology in their book building process. im sure we will see more of that in the near future.International wire transfers are adopting Ripple’s technology for faster remittance. VISA is working Circle to accept cryptocurrencies, the list goes on.

** 499Block ** Thanks to Kevin for sharing, I will turn off the mute function. If you have any questions, you can directly ask in the group, and Kevin will always be in the group. If you have questions about the project, you can ask him in the future.

Kevin: or join our official TG group to meet other like minded people :):

** 499Block ** thanks for having me here today!

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