Millicent One: A New Era of Onchain Finance

For over a decade, crypto enthusiasts have speculated that the future of finance would be blockchain-based.

In 2024, the convergence of TradFi and DeFi is rapidly moving from fantasy to imminent reality. As Citigroup says:

‍“We are approaching an inflection point, where the promised potential of blockchain will be realized and be measured in billions of users and trillions of dollars in value."

That’s why we’re building Millicent One — the vertically-integrated chain for RWAs and compliant onchain finance. With core features including protocol-owned financial applications, privacy-preserving ID at the chain level, and a sybil-resistant Proof-of-Participation reward mechanism, Millicent One is set to play a leading role in this impending shift.

TradFi’s Size is Size

The scale of what’s coming is staggering.

Boston Consulting Group predicts an asset tokenization sector reaching $16 trillion by the end of the decade.

One of the world’s largest banks, Standard Chartered, forecasts that over the next decade, more than $30 trillion of tokenized assets and currencies will come onchain — that’s more about 35% of all the money in the world.

But, before we get to the promised land, there are still significant challenges that need to be addressed.

PvP Games

Today, most people view blockchain design as binary: either public or private.

Crypto-natives are firmly in the public-permissionless camp, while TradFi leans much more strongly towards private permissioned (with the occasional peek over the fence).

Public-permissionless blockchains are the biggest thing to happen to money since Kublai Khan invented fiat currency in the 13th century. Coming out of nowhere in 2009 they have created more novel, accessible, and democratic financial systems, rapidly growing to grab the world’s attention.

Yet despite all their successes, public-permissionless chains still struggle with regulatory uncertainties, as well as the ever-present risks of hacks, bad actors, and scams.

Private-permissioned blockchains emerged around 2013, as financial institutions and enterprises began to recognize the potential of blockchain technology but wanted solutions that offered more control and privacy, and scalability than public blockchains offered.  The primary motivation was to leverage blockchain's benefits of immutability, security, and efficiency, while maintaining control over who could participate in the network and access data.

In a way, Private chains succeed in achieving these goals but the success rate of private blockchain developments has been notably low.  By stripping out the core values of community ownership, user freedoms, and product composability they also removed the very things that make blockchains and crypto so compelling.

But what if it turns out that permissioning is better viewed as a full design spectrum, rather than a binary choice?

Millicent One: The Best of Both Worlds

As Coindesk’s Michael Casey put it in an International Monetary Fund OpEd titled ‘DeFi and TradFi must Work Together’:

“If they are to attain mainstream adoption, DeFi and crypto must integrate some of the regulatory and self-regulatory practices that have brought functional stability to TradFi. But there's also an urgent need for the stewards of the global economy to explore DeFi and crypto solutions to its many problems."

Enter Millicent One: a public-permissioned blockchain for onchain financial services, developed by a team from JP Morgan, Morgan Stanley, Goldman Sachs, Bank of America, PwC, Citadel, and Tendermint, with direct input from some of the world’s largest public and private financial institutions.

Millicent One isn’t yet another general-purpose Ethereum rollup; it's a carefully crafted bridge between TradFi and DeFi, designed to merge regulatory compliance and access to institutional capital with the benefits of open development, meaningful community participation, interoperability, and composability.

Core Features

• Vertical Integration: Millicent One's core applications for RWA-based DeFi — including a next-gen DEX, a lending market, and perpetual futures exchange — are native to, and owned by, the protocol itself. These applications offer non-custodial access to products not traditionally found onchain, and are designed to benefit the entire ecosystem and reward all stakeholders, rather than being created by third parties with potentially conflicting agendas.
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• Privacy-Preserving Identity Credentials: Participants on Millicent One can selectively prove relevant attributes to chosen counterparties without disclosing personally identifiable information (PII). This feature delivers the compliance and operational safety regulators and institutions require, alongside the freedoms and privacy users deserve.
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• Composable RWAs: Millicent One’s native apps and compliance framework unlock the full potential of RWAs in onchain finance, far beyond simply buying and holding, enabling diverse investment and trading strategies that combine both digitally native and traditional financial assets.
  
  For example, on Millicent One, a trader could use a corporate bond yielding 12% APY as collateral for a margin trade rather than using a stablecoin with no native yield; a real-estate investor could unlock liquidity in their holdings though a collateralized debt position on the network’s native lending market.

• Proof-of-Participation: A cryptoeconomic system that rewards participants that improve the quality of the overall ecosystem, positively incentivizing skin-in-the-game and long-term protocol alignment with real yields generated by the network and its services.  Native identity credentials and bonding mechanisms reduce both sybil farmers and mercentary capital, enabling truly democratic user governance and sustainable ecosystem growth.

The Road Ahead

These innovative features distinguish Millicent One from current market offerings and position it to attract a diverse user base, from retail users to large institutions, many of whom have yet to participate in the blockchain space.

Over the coming weeks, we'll dive deeper into the details of Millicent One, providing an insider's look at what's to come.

To be the first to know, visit millicent.io or join us on Twitter/X.

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