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Provenance AMA Recap

Provenance is a Cosmos-based blockchain whose mission is to develop a vibrant ecosystem of decentralized financial services for a variety of financial institutions and individuals. Provenance supports the financial service industry by providing a ledger, registry, and exchange across multiple financial assets and markets. On August 12th, the Provenance team joined us in our Staking Hub community for an AMA. 

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Quick Takes: 

  • Provenance is a Cosmos-based blockchain 
  • Figure was granted an alternative trading system (ATS) license earlier this year
  • Provenance is helping bring banking solutions to the underbanked
  • Recent Partnership with Apollo 
  • The native HASH token is used for staking, and governance 
  • Provenance is improving transparency in the financial industry and driving out middlemen to reduce costs
  • Over time, governance on Provenance will be turned over to the community 

Who will use Provenance? 

A wide range of customers will use Provenance, spanning from financial institutions like large investment banks all the way to small community banks. These banks, regardless of size, will see efficiency gains in originating, funding, and trading loans. 

On top of lending, Figure was granted an alternative trading system (ATS) license from the SEC earlier in the year, as they are now actively engaged to provide an ATS for digital assets on Provenance. This ATS license will allow anything from private stock to shares in loan funds to be traded 24×7.

In addition to the items above, there is a payments platform called “Figure Pay” that includes a mobile app which settles and operates on the Provenance blockchain. 

“Provenance is positioned to provide ledgering, registry, and exchange of financial assets.” – Matt Conroy 

Provenance’s additions to the Cosmos Ecosystem 

Since Provenance is a Cosmos-based blockchain, as the Cosmos ecosystem continues to evolve, the Provenance team believes that this will bring more liquidity to Provenance as well as interaction among other Cosmos chains. Along with this, Provenance is looking to run or build IBC relayers. 

“For the larger cosmos ecosystem Provenance brings a unique set of capabilities targeting institutional and accredited investors” – Ira Miller

Regulatory Considerations 

From a regulatory perspective, Provenance is working through the regulatory and compliance landscape. As with many crypto-related projects, this will be a major effort for Provenance that will evolve over time. Currently, Provenance is geared towards customers in the US. Their team is interested in global reach, and will be looking to add support for more regions in the future. 

Partnership with Apollo

On July 14, the global alternative asset manager Apollo entered into an agreement with Figure to work on several initiatives developed on Provenance. Since that agreement, The Figure team has engaged with several large financial institutions, new small startups, and seasoned blockchain heavyweights on potential projects. 

At the core, this agreement will allow the team to scale Provenance at an accelerated rate. On top of this, the agreement shows the financial industry’s commitment to the platform for a wide variety of financial services use cases.

“Apollo is an incredible partner that will bring additional use cases to Provenance quickly.” – Matt Conroy 

The HASH Token: Staking & Governance 

On Provenance, the HASH token is used as a spam-prevention mechanism, as well as a staking and governance token. Stakers of HASH can use their voting power to participate in on-chain governance. Over time, the Figure team will be divesting its majority stake in the Provenance network with the goal of empowering the community governance processes. 

“The direction for the protocol will be set through community interaction and the governance process. Figure has a stated intention to divest its majority stake in the network as the community grows further.” – Ira Miller 

More on the Provenance token in our “Provenance: First Look” article here

The value of HASH intrinsically increases as the use of the blockchain increases. Along with this, various strategic partnerships will boost value to delegators. As the number of HASH delegated to validators increases, so does the overall security. 

Provenance: Progress so far

The value of assets held and transacted on Provenance is already in the billions, and the chain just launched publicly in May. To continue this powerful momentum, the developments moving forward on Provenance will be fueled by adoption of additional large scale loan originators, large capital investors, as well as bringing banking solutions to the underbanked.

“Provenance is improving transparency in the financial industry and driving out middlemen to reduce costs.” – Ira Miller 

Provenance: Next Steps 

Moving forward, Provenance will continue to focus on building the community around Provenance so developers continue to feel supported in the ecosystem. In the coming months, Provenance will be Introducing a digital marker on chain that will be minted and burned by a consortium of FDIC insured banks.

Along with this, the Provenance team will continue the development of the core protocol and tracking with the Cosmos/Tendermint teams to help see the vision of a world of blockchains come to life. 

Special Thanks

Special thanks to Ira, Matt, and Arnab from Provenance for spending an hour with Staking Hub to answer all of our questions! 

Thank you to Emerick, our Protocol Analyst, for co-hosting. Feel free to join our Staking Hub Telegram group if you haven’t already.

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