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Kinto is the first blockchain network capable of supporting traditional financial services and DeFi. Combining over 100 interviews with leaders in traditional finance, and years of crypto experience, Kinto was created to allow for the seamless integration of capital, services, and assets from traditional finance and the crypto economy.
As a 100% KYC’ed Ethereum Layer 2 protocol with built-in insurance, Kinto vastly reduces regulatory and financial risks that are unavoidable on other chains and still maintains access to capital from the largest DeFi ecosystem in the world.
There is a chasm between regular finance and decentralized finance. The Kinto network allows both TradFi and DeFi to interact with each other. By bringing DeFi and traditional finance under one roof, Kinto creates a new interoperable and composable financial services ecosystem that will erase the barrier between the two.
By offering a safer, simpler, faster, and cheaper network built to DeFi and traditional finance requirements, Kinto provides the most attractive infrastructure for users, builders, and investors from both worlds.
The Problem: Crypto Capital is Isolated from the Financial System
There is an oil and water separation between DeFi and traditional finance. Institutional capital doesn’t want to deploy on a chain where anyone can dust their wallet with sanctioned funds, and no protocol is safe from exploits.
Traditional markets are cut off from the $1T of capital on-chain they could access and provide services to. Startups trying to offer real-world assets on-chain have their hands tied behind their back: existential compliance risk prevents them from allowing the assets to be transferable or usable on other protocols. Bluechip DeFi protocols have gone so far as to launch KYC’ed instances of their service where companies can interact. Still, those walled gardens operate in an isolated pool without access to the rest of the capital in DeFi.
And this separation is growing even starker as new regulatory regimes are already coming into place that requires KYC even for simple on-chain transfers–which would make it impossible to use other chains even for basic transactions.
The Solution: KYC’ed Layer 2
By offering KYC at the network level and sitting on top of Ethereum mainnet’s liquidity as an L2, Kinto is the only network where there doesn’t need to be a separation between the real-world financial system and DeFi. The network continuously verifies that all participants are OFAC compliant. Security tokens can have additional built-in checks that prevent them from being transferred to a non-accredited investor. Regulators can require KYC checks on any transactions, and Kinto is the only network that can easily provide that. But, beyond reducing regulatory risk,
Kinto does this in an environment where financial risk has been reduced thanks to the impossibility of anonymous exploits and network-wide insurance. Kinto offers all this with the cutting-edge blockchain infrastructure whose attractive speed and low transaction costs have already drawn most of the on-chain activity off of L1 Ethereum and onto L2s.
The Future: Kinto’s Unified Financial System
Kinto makes the kind of composability and rehypothecation between DeFi protocols possible between DeFi and traditional finance’s investment products and services. On Kinto, tokenized traditional ETFs can be provided as liquidity in an AMM. Your bank could be linked to your wallet and automatically approves and issues a mortgage using funds from an on-chain money market and the tokenized deed to your house as collateral. Corporate treasuries could be held in on-chain assets, and corporate debt issuance could happen through a Dapp. Any modern financial asset can be issued and traded on-chain, and any modern financial service can be provided on-chain. Kinto is a cost-efficient, 24-hour, automated, insured network infrastructure for every financial product and service.
