What can NEST Protocol do?

This network offers a large number of application possibilities, we briefly list some below.

Decentralized exchange

We all know that derivatives exchanges need to solve technical support, asset custody (risk management), liquidity support and marketing. If you use the NEST protocol, you only need to do a front-end page to develop a decentralized exchange, so it saves the first three costs, you only need to focus on marketing. Schematic diagram:

Financial derivatives supermarket

Based on the NESTcraft, a large number of new financial derivatives can be designed, such as barrier options, Asian options, two-way options, and a type of interesting income such as square-root return, squared return, and exponential return can also be easily designed.

On-chain and off-chain risk hedging

Since there is no supply side for off-chain hedging in many cases, NEST can provide a large number of hedging transactions for many off-chain tradings without being af- fected by market makers. And the transaction on the chain can also realize one-click hedging based on NEST. The most typical one is the LP one-click hedging of UNISWAP. One-click hedging.

The economic framework of Metaverse and GameFi

Since the NEST provides a series of martingale functions, such fair games around de- terministic mathematical relations, probability relations, and random processes can be developed by calling the NEST functions, so as to re- alize the unified value measurement of different games. Even if a game developer stop developing, its core value is still preserved in NEST, and can be integrated and exchanged across other NEST-based games.

Lottery, prop synthesis, etc

Some basic designs based on randomness can be realized with only some distribution functions.

Other unique applications

An open network will always bring more possibilities. Many valuable applications will be proposed more cre- atively when the basic functions exist. We expect that there will be many new applications and new things beyond the description in this article.

NEST's application space is extended on top of the ETH: ETH can handle general deterministic functions, while NEST's mechanism handles random functions. Because the ETH's token issuance adopts a deterministic algorithm and is independent of on-chain applications, its feedback on application side information is insufficient. On the other hand the NEST's token issuance (increased issuance) follows the scenario, which is closer to guarantee market-clearing currency target at any time.