What Is It

To get a better understanding of Altair, we must examine Centrifuge first.  As defined by Centrifuge, “Centrifuge bridges real-world assets into DeFi (“Decentralized Finance”) to bring down the cost of capital for SMEs and provide DeFi investors with a stable source of yield; uncorrelated from volatile crypto assets.” Centrifuge, built on Parity’s Substrate, simply acts as an intermediary that enables the connection between real companies/individuals and their real-world assets (RWA’s) to Decentralized Finance services.

There are two categories of users that can benefit from Altair.

Asset Originators
On the Centrifuge Chain, asset originators such as small and medium-sized enterprises (SME’s) can tokenize their RWA’s and use them as collateral for financing.

Lenders / Investors
Centrifuge enables Defi users (investors) to earn stable yield by investing in real-world companies. In addition, the money (stable coin) that is invested generates bankless liquidity for assets originators (AO’s).

Centrifuge and Altair

Altair, built on Parity’s Substrate and bridged to Ethereum, is an experimental network for users who want to test the bounds of asset financing.  As per Polkadot/Kusama’s design, tokenization of the most experimental assets and financing will happen on Altair before deployment on Centrifuge. Altair is close to identical in construction to Centrifuge Chain. However, Altair has special experimental features incorporated. Altair Chain has also secured a Kusama parachain slot. This now means that Altair can take advantage of what a Kusama parachain has to offer such as added security from the relay chain, cross-chain interoperability, on-chain governance decision making & implementation, also with extremely fast & cheap transactions! This is a massive milestone for Altair.

In addition, Centrifuge is also planning on securing a Polkadot parachain when the Poladota parachain auction process starts. There will be more details on Altair’s Crowdloan at the bottom of this review.

Note: The remainder of this review will be specific to Altair. However, please be aware that the same technology and principle applies to Centrifuge Chain.

Problems with Traditional Banking

➤ Only large businesses get direct access to liquid capital markets
➤ The value locked in traditional RWA’s is not accessible
➤ SME’s lack competitive interest rates
➤ Saving accounts offer extremely poor interest rates

Value Prop

➤ No need for conventional banking system’s
➤ Lowers the barrier of entry for originating and investing in assets
➤ Creates a bridge between the real world and DeFi
➤ Scales asset financing

How Does Altair Operate

Altair can benefit two main types of users: Asset Originators & Lenders.
Please see a real-life example below.

Asset Originators
Bob owns a lumber yard. He has business documents (invoices) showing that he is owed $10,000 from Alice, but she cannot settle for another 30 days. Unfortunately, Bob cannot wait 30 days because he has bills to pay. Bob can essentially tokenize his asset (invoice) into an NFT and use it as collateral to borrow against it at a specific interest rate. The loan will be issued in stable coin. This process is performed through Altair and the Tinlake DAPP. When Alice finally pays Bob the money owed, he can pay back the loan in full, partially, or whenever he desires as long as it complies with the terms and conditions of the loan agreements.

Lenders
Lenders provide liquidity for Bob’s assets. In exchange, lenders earn a stable yield (AIR rewards) on their investment. On the Tinlake DAPP, several companies are open for investment, all of which have various APRs.

Tokenized Assets

The list of potential assets that can be tokenized solely depends on how big your imagination is! For example, currently, assets such as invoices, mortgages, and royalties can be tokenized but this is only the starting point. Thinking out loud, it would be cool if real-estate, collectibles, entire businesses, vintage cars, helicopters, private jets, physical gold, silver, and maybe even Trust Funds could quality as asset classes eligible for tokenization. In addition, rare or high-value NFT’s such as CryptoPunks or Moonsama’s could very likely be used as collateral!

The beauty about Altair is that its use case can keep expanding to areas and sectors of traditional real-world markets. This will eventually have such a profound impact that financing through traditional banking systems will be a distant memory. Altair’s provision of accessibility, ease of use, and competitive interest rates through DeFi are major stepping stones towards mass adoption.

Features

There are two main features that fuel Altair:
➤ NFT’s & P2P Protocol/Node
➤ Tinlake DAPP

NFT’s & P2P Protocol/Node

As described earlier, when an asset originator wants to borrow against a RWA, the first stage of the process is tokenizing it as an NFT (non-fungible token). This is critical as it enables interaction with the Altair ecosystem. The asset originator’s loan details and assets attributes must be kept private. To achieve this, Altair uses privacy-enabled NFT’s, executed on a private P2P trusted (peer-to-peer) network. In addition, as per standard procedure, tracking public asset ownership is carried out on a decentralized public ledger. This combination of private and public ledgers is essential to Altair’s operation.

It is important to note that there are certain aspects of Altair that are centralized. There will be some form of entity that needs to approve/disapprove assets during the tokenization process. There will be legal structures required to onboard real-world assets. However, as per Altair team, this process may become more decentralized over time.

Tinlake

The core of the magic lies within Tinlake, Altair’s smart contract DAPP Marketplace. Tinlake unites both asset originators and Investors for the ultimate Defi experience. Tinlake, is currently built on Ethereum, however going forward, it plans to fully migrate to Altair Chain and a secure p2p protocol.

There are two different tokens that the investor can invest with, TIN & DROP

➤ TIN (risk token) – high risk / high reward (Risk token takes the risks of defaults)
➤ DROP (yield token) – low risk / low stable rewards (Yield token is protected against defaults by Risk token)

Revolving Pools

Revolving pools allow users or investors to withdraw their funds at any time. This is achieved by a decentralized mechanism that ensures Asset Originators have a constant source of liquidity while investors can flexibly invest and redeem. Please see the below image for more detail.

ChainSafe Bridge

This ChainSafe bridge (a substrate pallet implementation) simply allows the safe transfer of assets between Altair Chain and Ethereum.

Token Utility

AIR, is the native token that powers Altair. With basic functionality delegated to Kusama, the AIR token has no limits — it can become more than a traditional network token. Please see the current AIR token utilities below.

➤ Govern the development of Altair
➤ Pay for transaction fees
➤ Secure the chain
➤ Reward adoption

Incentives

➤ Staking / Security rewards
➤ Validator rewards
➤ On-chain governance
➤ Adoption Rewards

Tokenomics

There is more information to come on Altair’s tokenomics. Once available, they will be updated here. For now, please see the below chart showing distribution after lauch.

Team

Altair has a solid team with lots of experience. The team consists of alumni of many of the world’s leading organizations, including Consensys, Electric Coin Company, Parity, Goldman Sachs, Credit Suisse, SAP, Microsoft, Deloitte, United Nations, Federal Reserve, and more.

➤ Total team members – 35
➤ Software Developers – 8
➤ Advisors – 3

Lucas Vogelsang (CEO & Co-Founder) – https://www.linkedin.com/in/lucasvo/
Martin Quensel (Co-Founder) – https://www.linkedin.com/in/martinquensel/

Roadmap

Partnerships

Altair has a large number of partnerships, including, MakerDAO, Aave, and Paperchain. All partnerships add value to Altair in their own unique way. Please see the image below for further detail.

Investors

Mosaic, BlueYard, and Fintech Collective were the main contributors to the seed round with a total contribution of $8m. The second round of investments were made by investors such as Fenbushi, Galaxy Digital, IOSG, and Moonwhale. Please see below for a complete list of investors.

Verdict

Altair’s unique use case will provide so much value to SME’s and individuals that require bankless liquidity of their assets with ease of use. Altair incorporates Defi, NFT’s, RWA’s, and a Kusama Parachain. An all-in-one crypto mind-blowing package.

Altair’s DAPP Tinlake is very easy to use with good UI/UX. The fact that an investor can earn a stable yield is very admirable. RWA’s are not correlated with the cryptocurrency markets, so high volatility is less likely. This will also benefit Altair with respect to TVL, as it won’t be subjected to the same impact of sudden dips in cryptocurrency markets. This provides peace of mind when investing in real-world companies. I have no direct feedback from an Asset Originator point of view, but I can only assume that there are no major issues as there are many companies on Tinlake already running smoothly.

Altair’s successful securing of a Kusama Parachain slot complements Altair’s functionality, efficiency and adds significant value to the project. It is my opinion that Altair will do exceptionally well. There is a lot of value locked in current RWA’s that could be put to use. The benefits associated with borrowing against these assets on-chain, in a bankless way will escalate the world of decentralized finance to all-time highs. It has the potential to bring trillions of dollars into Defi. I can’t even begin to imagine where Altair will be in two years from now. Exciting times.

Altair is a unique opportunity and use case. Altair has all the right ingredients, such as a solid team, use case, backing, marketing, and the technical ability to establish themselves as the number one connection between RWA’s and decentralized finance. This multi-trillion-dollar market will hugely benefit from an innovative use case such as Altair.

Resources

https://developer.centrifuge.io/
https://medium.com/centrifuge/your-wildest-assets-competition-f2a4c9f3bf69
https://medium.com/centrifuge