TradFi entering Web3: Hedge AI

Xillion by ProjectX
5 min readApr 29, 2023

Greetings Learn2Earn community!

Today we will be taking a further look into the entry of TradFi (Traditional Finance) into Web3, alongside one of Xillion.One’s projects Hedge AI, our AI-empowered asset management platform that is designed to provide its customers with a 60%-80% passive ROI per year.

However, before we get into the details of Hedge AI, let’s take a look into the key components between traditional finance and Web 3 - along with where they intersect!

TradFi & Web3:

  1. Decentralized Finance (DeFi): Traditional finance has entered the Web 3.0 space through DeFi, which is the next-generation financial ecosystem built on blockchain technology. DeFi offers users decentralized, permissionless financial services such as lending, borrowing, trading, and investment without intermediaries.
  2. Digital Assets: Traditional finance has also entered the Web 3.0 space through digital assets such as cryptocurrencies, digital securities, and stablecoins. These assets are built on blockchain technology and enable peer-to-peer transactions, global accessibility, and programmable features.
  3. Central Bank Digital Currencies (CBDCs): CBDCs are digital versions of fiat currencies issued by central banks. These currencies are built on blockchain technology and aim to enhance the efficiency and transparency of financial transactions. Traditional finance has entered the Web 3.0 space by exploring the use of CBDCs as a new form of digital currency.
  4. NFTs: Non-Fungible Tokens (NFTs) are unique digital assets that represent ownership of a particular item or asset. Traditional finance has entered the Web 3.0 space by exploring the use of NFTs as a new form of digital asset class, allowing ownership of unique assets like art, music, or collectibles.
  5. Tokenization: Tokenization refers to the process of converting a traditional asset into a digital token on a blockchain. Traditional finance has entered the Web 3.0 space by exploring the use of tokenization to provide liquidity, fractional ownership, and accessibility to traditional assets such as real estate, art, or stocks.
  6. Smart Contracts: Smart contracts are self-executing contracts with the terms of the agreement between buyer and seller being directly written into lines of code. Traditional finance has entered the Web 3.0 space by exploring the use of smart contracts to automate financial transactions, reduce costs, and eliminate intermediaries.
  7. Decentralized Autonomous Organizations (DAOs): DAOs are organizations run by code and operate on a decentralized blockchain network. Traditional finance has entered the Web 3.0 space by exploring the use of DAOs as a new form of decentralized governance, decision-making, and investment vehicles.
  8. Open Finance: Open Finance refers to the integration of traditional financial services with decentralized finance (DeFi). Traditional finance has entered the Web 3.0 space by exploring the use of open finance to provide users with more options, transparency, and flexibility in their financial transactions.

Hedge Funds & Web 3.0 : What Does This Mean for You?

Hedge is incubated by Xillion, and is based on proprietary AI algorithms that work with a large set of data - scanning the market in real-time and managing capital using its own models.

It offers a unique and affordable insurance option that provides all users with full coverage (for just 1% of their deposit amount). This option guarantees that the clients will receive the full amount they deposited no matter what. Currently, 89% of the customers are using this feature.

Below are some of the technical capabilities which the platform unlocks with the power of AI and Web3.

  1. Transparency and Security: Blockchain technology provides transparency and security in hedge fund operations. By using a distributed ledger, hedge funds can record and track transactions in real-time, providing increased transparency and reducing the risk of fraud and error.
  2. Smart Contracts: Smart contracts can be used to automate the execution of investment strategies, reducing operational costs and increasing efficiency. By using smart contracts, hedge funds can also ensure compliance with regulatory requirements.
  3. Reduced Counterparty Risk: Blockchain technology can reduce counterparty risk by enabling the direct transfer of assets between investors and fund managers without the need for intermediaries.
  4. Increased Liquidity: Hedge funds can use blockchain technology to tokenize assets, making them more accessible and transferable to a broader range of investors. This increased liquidity can help to attract new investors and increase returns.
  5. Improved Settlement Times: Blockchain technology can improve settlement times for hedge fund transactions. By using a distributed ledger, transactions can be settled in real-time or near-real-time, reducing settlement times and the associated costs.
  6. Decentralized Governance: Hedge funds can use blockchain technology to create decentralized governance structures that allow investors to participate in decision-making. This can increase transparency and accountability and help to align investor interests with those of the fund.
  7. Data Management: Hedge funds can use blockchain technology to manage and secure their data. By using a distributed ledger, hedge funds can record and track data in real-time, reducing the risk of data breaches and improving data management practices.
  8. Enhanced Due Diligence: Blockchain technology can enhance due diligence practices by providing increased transparency and accountability. By using a distributed ledger, hedge funds can provide investors with access to real-time transaction data, improving due diligence practices and increasing investor confidence.

All Hedge AI users can track their investments via a perfectly-looking and informative personal live dashboard, which allows them to check all of the key indicators such as ROI, or the profit they’ve made so far from anywhere in just 2 clicks.

Artificial Intelligence (AI) is being increasingly used in the hedge fund industry to enhance investment decision-making and generate higher returns. AI algorithms can analyze large amounts of financial data, including market trends, news, and social media sentiment, and provide insights that can inform investment decisions. Machine learning algorithms can also identify patterns and make predictions based on historical data, helping hedge funds to optimize their investment strategies.

Additionally, AI-powered tools can automate and streamline processes such as risk management, portfolio optimization, and trading, improving efficiency and reducing costs. However, the use of AI in hedge funds also presents challenges, including the need for data accuracy, bias mitigation, and regulatory compliance.

Hedge AI executes on an impartial and conservative risk model to make sure our customers will make twice as much as traditional hedge funds offer (and incredibly flexible conditions such as monthly plans). Additionally, Hedge AI operates on the fundamental aspects of traditional Hedge Funds while overriding the major faults seen in its TradFi counterpart with the help of its proprietary AI and Web3 suite of solutions.

Thank you for tuning in to another segment of Learn2Earn!

About us

Xillion.one - a Web3 Tokenized Incubator that provides every XIL token holder with free tokens of every project it incubates.

We build projects from scratch and create synergy between them. We combine the VC and PE approach to building companies by growing their value and managing investor capital. We simultaneously operate as investors and founders to amplify the results.

| Website | Hedge AI | L2E DAO | Twitter | Discord | Telegram |

--

--

Xillion by ProjectX

Xillion.one is a Web3 Tokenized Incubator that provides every XIL token holder with free tokens of every project it incubates.