Benchmark Protocol: An Elastic Supply Stablecoin Alternative Bridging Traditional Finance and DeFi

What is Benchmark Protocol

Friends, imagine the money we use every day, like the Chinese yuan—its value is relatively stable; you won’t find that you can buy a bag today and only a piece of candy tomorrow. But in the world of cryptocurrencies, many digital assets have prices that swing like a roller coaster, with extreme volatility. This instability deters many people and limits their practical use in daily life.

Benchmark Protocol (project ticker: MARK) is like a “stabilizer” designer in the crypto world. It doesn’t aim to create a currency with a fixed value like the yuan, but rather a more flexible “elastic supply collateral” or “stablecoin alternative.” Its core goal is to help the decentralized finance (DeFi) sector reduce asset liquidation risk and provide a tool for hedging risk during periods of market turbulence. Simply put, it hopes to offer a relatively robust “safe haven” when the crypto market is in turmoil.

This project mainly targets users and investors seeking more reliable value measurement and performance indicators in DeFi, as well as developers looking to integrate precise benchmark tools into their own projects, and enterprises aiming to enhance financial strategies with data-driven insights.

Project Vision and Value Proposition

Benchmark Protocol’s vision is to provide a decentralized price stability solution for the cryptocurrency market and offer users a transparent and efficient way to create and manage stable assets.

The core problem it aims to solve is the widespread volatility and inconsistency in DeFi. Many DeFi projects fail due to technical flaws, sharp price swings, and general market skepticism. Traditional stablecoins attempt to peg to fiat currencies, but they themselves may also face risks.

Benchmark Protocol’s value proposition lies in offering a rule-based, supply-elastic collateral tool that is uncorrelated with the broader DeFi market and can inject liquidity during periods of high market volatility. Imagine when the market is in chaos, it acts like a smart water pump, automatically adjusting the “water flow” as needed to maintain overall balance. It achieves price stability through an innovative approach, using a decentralized oracle system to adjust token supply based on market conditions (especially volatility indicators).

Technical Features

The technical core of Benchmark Protocol lies in its unique “elastic supply” mechanism and intelligent use of external data:

• Elastic Supply Mechanism

  The supply of MARK tokens is not fixed, but dynamically adjusted according to a set of preset rules. When the market needs more liquidity, token supply may increase; when the market overheats, supply may decrease. This mechanism is called “rebase,” which adjusts the total supply of MARK in each token holder’s wallet based on algorithmically calculated deviations.

• Oracle System

  To make these smart adjustments, Benchmark Protocol relies on real-world external data. It mainly references two key indicators: CBOE Volatility Index (VIX) and Special Drawing Rights (SDR).

  • VIX (Volatility Index): Think of it as Wall Street’s “fear index,” reflecting the market’s expectations of future volatility. When VIX is high, it means market sentiment is tense and volatility is high.
  • SDR (Special Drawing Rights): This is an international reserve asset created by the International Monetary Fund (IMF), whose value is determined by a basket of five major currencies: the US dollar, euro, Chinese yuan, Japanese yen, and British pound, making it relatively stable. Benchmark Protocol uses one SDR unit as its target benchmark.

  To ensure the accuracy and decentralization of this external data, Benchmark Protocol integrates Chainlink oracles. Chainlink is an industry-standard oracle network that securely and reliably transmits off-chain data to the blockchain, ensuring the decentralization and data integrity of the protocol’s rebase function.

• Blockchain Foundation

  Benchmark Protocol is built on the Ethereum blockchain, and its MARK token is an ERC-20 standard token.

• Security Audit

  The protocol’s smart contracts have been audited by the well-known blockchain security company CertiK, which helps enhance its security.

Tokenomics

The core token of Benchmark Protocol is MARK.

• Token Symbol and Type

  Token symbol: MARK.
  Token type: ERC-20 standard utility token.

• Supply Mechanism

  MARK tokens use an elastic supply model, meaning the total supply is dynamically adjusted according to protocol rules, rather than being fixed. This “rebase” mechanism is designed to optimize value and stability based on market conditions such as VIX and SDR.

• Token Utility

  MARK tokens play multiple roles within the Benchmark Protocol ecosystem:

  • Collateral: As a supply-elastic collateral, used in DeFi applications to mitigate liquidation events and hedge risk.
  • Staking: Users can participate in the protocol by staking MARK tokens and have the opportunity to earn rewards.
  • Governance: MARK tokens grant holders the right to participate in protocol governance, meaning they can vote on the protocol’s future direction and major decisions.
  • Payment: In DeFi applications, MARK can also be used as a means of payment.

• Circulation Information

  According to current data, the circulating supply of MARK is about 429,643 tokens. Its market capitalization is approximately $456,400. The tokenomics are designed to incentivize long-term holding and community participation.

Team, Governance, and Funding

• Team

  Benchmark Protocol was launched in 2020 by a team focused on providing decentralized price stability solutions in the cryptocurrency market. The founder is David Mass. Team members include investors, blockchain engineers, and financial experts dedicated to enhancing the security and efficiency of on-chain loan collateral.

• Governance

  The project adopts a decentralized governance model, with MARK token holders able to influence protocol decisions by participating in the governance process.

• Funding

  Although there is no detailed funding report, the project has gained early attention and development through its innovative price stability approach and community engagement.

Roadmap

Since its launch in 2020, Benchmark Protocol has been continuously evolving:

• Historical Milestones

  • 2020: Project launched, aiming to provide a decentralized price stability solution.
  • May 2021: Integrated Chainlink oracles to decentralize its rebase function and used VXX (a volatility index) to calculate supply adjustments.

• Future Plans

  Benchmark Protocol’s future development focuses include:

  • Liquidity Pools and Yield Farms: Plans to integrate new liquidity pools and enhanced yield farming features to increase user engagement and optimize returns.
  • Education and Outreach: Community goals include expanding educational programs to help users understand DeFi strategies and the protocol’s unique value proposition.
  • Cross-chain P2P Lending Market: A cross-chain peer-to-peer (P2P) lending market featuring the MARK token is set to launch, aiming to further drive MARK adoption on DeFi platforms.

Common Risk Reminders

Investing in any cryptocurrency project comes with risks, and Benchmark Protocol is no exception. Here are some common risks to be aware of:

• Technical and Security Risks

  Although the smart contracts have been audited, blockchain technology and the DeFi sector may still have unknown vulnerabilities or security incidents. No technical system can guarantee 100% absolute security.

• Economic Risks

  Although Benchmark Protocol aims to provide price stability, it still faces the inherent volatility of the cryptocurrency market. Critics argue that its tokenomics design may have potential risks of market manipulation. Additionally, the crypto market is influenced by many factors, such as US dollar policy, government regulations, technological advances, and market sentiment, all of which may cause sharp fluctuations in the price of MARK tokens.

• Compliance and Operational Risks

  The regulatory environment in the cryptocurrency sector is rapidly evolving, and Benchmark Protocol must address ever-changing compliance issues. Any new regulations could impact its operations and development.

• Market Acceptance Risk

  The project’s success largely depends on its widespread acceptance and use in the DeFi sector. If its unique stability mechanism fails to gain sufficient market recognition, it may affect its long-term development.

Please note: The above information is for reference only and does not constitute any investment advice. Be sure to conduct your own independent research before making any investment decisions.

Verification Checklist

To learn more about Benchmark Protocol, you can consult the following official and community resources:

• Official Website: benchmarkprotocol.finance
• Block Explorers (Ethereum):
  • etherscan.io
  • blockchair.com
• GitHub: You can find the GitHub repository link via the official website or related crypto information platforms to check project code activity.
• Whitepaper: Although there is no direct PDF link, many crypto information sites provide summaries of the whitepaper’s core concepts. You can look for more detailed documentation via the official website.
• Audit Report: CertiK has audited the protocol’s smart contracts, and the report is usually available through official channels.

Project Summary

Benchmark Protocol is an innovative project aimed at bringing price stability and risk hedging to the decentralized finance (DeFi) sector. Through its unique elastic supply mechanism, combined with external benchmarks like the CBOE Volatility Index (VIX) and the International Monetary Fund’s Special Drawing Rights (SDR), and utilizing Chainlink oracles to dynamically adjust the supply of its MARK token, it is designed as a “stablecoin alternative” to mitigate liquidation risk and provide liquidity during periods of high market volatility. The MARK token is not only the protocol’s collateral but also grants holders the rights to stake and participate in governance. The project team consists of experienced financial and blockchain experts, and plans to launch more features in the future, such as new liquidity pools, yield farms, and cross-chain lending markets.

However, like all cryptocurrency projects, Benchmark Protocol faces challenges such as market volatility, potential economic risks, and an ever-changing regulatory environment. For those interested in learning about or participating in the project, it is recommended to carefully study its official materials and fully understand the risks involved. Remember, this is not investment advice; any investment decision should be based on your own independent judgment and risk tolerance.