Alkimiya

Alkimiya is a permissionless, open-source protocol for consensus capital markets. Every “consensus producer” (e.g., PoW miners, staking validators) requires continuously expending resources to participate in the mining or staking activities. These resources are either in certain forms of computation (e.g., hashpower) or opportunity costs of liquid assets (e.g., coins staked).

The primary motivation for most people to participate in consensus production is to capture the profit margin between block rewards (revenue) and the costs of resources (expense). On most networks, the costs tend to increase over time as competition heats up. Meanwhile, the revenue is extremely difficult to manage as it involves the fluctuations of coin price, difficulty (or equivalent metric), and network fees.

Similar to how traditional commodity producers use financial instruments to hedge against the uncertainties, consensus producers need a way to lock-in the return upfront. Alkimiya allows any consensus producers to create financial contracts backed by the underlying “consensus resources”.