Fragment Inc, the team responsible for developing the Ampleforth Protocol, has announced that the protocol will be integrated with the popular Avalanche blockchain to facilitate the adoption of the AMPL unit of account model.
AMPL is an algorithmic computer programming language that promises to be a decentralized way of defining stable contracts for core functions in the DeFi space such as lending, borrowing and providing derivatives on the internet.
Ampleforth’s recovery mechanism to a daily adjusted quote makes it possible to measure price value in order to collect user tokens, as opposed to the traditional method of tracking price volatility. These system rules are then encrypted by smart contracts on Ethereum.
For example, if a user participates in a speculative prediction that Bitcoin will reach $ 100,000 by the end of the year and it comes true, they will receive 5 AMPL tokens. However, if the top asset fails to meet the specified goal, five tokens will be withdrawn. With this in mind, as the AMPL ecosystem grows, users will get more tokens and vice versa.
The creation of reliable price consistency and flexibility in the supply mechanism and the fact that it is an unregulated decentralized model implies that the AMPL can present an alternative challenge to the existing model.
Related: Cointelegraph Consulting: How Avalanche Reinvents DeFi
Evan Kuo, CEO of Fragment Inc, spoke about the importance of real decentralization across DeFi’s growing ecosystem:
“It is ironic that the DeFi ecosystem is currently so reliant on centralized stablecoins for liquidity and collateral lending. Given the changing regulatory landscape and the uncertainty about what the verdict on stablecoins will be, it is important for DeFi to have a decentralized financial building block that is immutable and has multiple aspects of predictability or price stability. “
In late December 2018, the Fragment Protocol renamed their identity to what we know today as Ampleforth. The title was inspired by a poetic character who works at the Ministry of Truth in the classic novel by George Orwell 1984.
Analytical data from Cointelegraph Markets Pro and TradingView show that Avalanche’s native AVAX token has gained 28% to $ 71.30 in momentum over the past seven days.
According to specs from DeFi Llama, the blockchain network, which hosts 52 decentralized protocols totaling $ 8.62 billion in lockdown (TVL), has a 30% market share.
Avalanche’s TVL number has risen significantly since early August, when it consolidated around the $ 200 million mark.