Goldman Sachs, Citadel and Google Alumni Collaborate on Blockchain Exchange for Real-World Assets
Goldman Sachs, Citadel Securities, Google, and Uber alumni are joining forces to revolutionize traditional financial markets with a blockchain-based exchange for real-world asset trading.
DeepSigma, a new platform, has launched a paper-trading demo covering 77 traditional financial markets, utilizing patented blockchain technology to bring crypto-style perpetual futures to stocks, commodities, and other real-world assets.
A Decentralized Approach
The platform aims to introduce a decentralized exchange, offering a popular crypto trading model to traditional markets. Powered by the Cypherium blockchain, DeepSigma enables traders to take long or short positions on assets without owning, tokenizing, or taking custody of the underlying instruments. Instead, its perpetual contracts track real-world markets using external price data.
Team and Leadership
The project boasts a diverse team with extensive experience in both traditional finance and blockchain development. Key leaders include:
- Albert Xu, a former Goldman Sachs FICC portfolio manager.
- Jenny Chen, a quantitative macro trader with a background at Citadel Securities.
- Chaoran Wang, a former Google and Uber engineer who founded quantitative trading firm UmiUmi.
- Sky Guo, CEO of DeepSigma and founder of Cypherium, the underlying blockchain.
Overcoming Technical Challenges
Perpetual futures have gained popularity in cryptocurrency trading, allowing for continuous market exposure. However, applying this model to traditional financial assets presents unique technical challenges. Unlike cryptocurrencies, stocks, and many other traditional assets operate within defined market hours, creating complexities for pricing, liquidity, and risk management in a continuous trading environment.
Guo emphasizes, "Crypto has already demonstrated the demand for perpetual markets, but you cannot simply take the same model and apply it to stocks or commodities. Real-world markets have distinct trading hours, liquidity conditions, pricing sources, and regulatory considerations. We designed DeepSigma with these differences in mind."
Demo and Future Plans
DeepSigma's demo currently covers a range of markets, including the S&P 500, Dow Jones Industrial Average, Nasdaq Composite, Russell 2000, VIX, gold, silver, crude oil, natural gas, and copper. The platform is developing a robust risk framework addressing multiple external pricing sources, position limits, circuit breakers, partial liquidations, and an insurance mechanism for stressful market conditions.
The exchange utilizes a central limit order book model, supported by a clearing layer responsible for managing positions, collateral, margin, and settlement.
Guo concludes, "The hardest part of bringing real-world assets on-chain isn't creating another market symbol. It's ensuring the market behaves sensibly when the underlying asset is closed, liquidity disappears, or an external price fluctuates sharply."
The team aims to navigate the complexities of traditional markets and blockchain technology, paving the way for a privacy-focused and innovative approach to regulatory compliance.