A Protocol for Building Synthetic Assets

Write self-enforcing smart contracts with economic guarantees.
Read our Whitepaper and chat with us on Discord.

We are a platform for your financial innovation.

UMA is designed to power the financial innovations made possible by permissionless, public blockchains, like Ethereum. Using concepts borrowed from fiat financial derivatives, UMA defines an open-source protocol that allows any two counterparties to design and create their own financial contracts. But unlike traditional derivatives, UMA contracts are secured with economic incentives alone, making them self-enforcing and universally accessible.

How It Works: A Financial Derivative (For Apples)

1: Custom, 2-Party Agreement

Alice thinks the price of apples will go down over the next six months. Bob thinks apples are cheap and wants to go long. Bob and Alice formalize their trade using an UMA smart contract. Both sides deposit a margin requirement of 10% that will be lost if they misbehave.

2: Automatic Enforcement

Over the next six months the price of apples shifts up and down (but mostly down). As the price shifts down (as verified by UMA’s oracle), Bob automatically contributes money to cover his margin requirement. The more it shifts down the more he contributes.

3: Instant Settlement

After six months, the price of apples has fallen by 30%. Alice's bet was right. Because Bob was consistently contributing funds to re-margin his position and not risk losing his 10% margin requirement, the contract can be instantly settled.

What will you build with UMA?

Synthetic Tokens to Track Anything?

Use the UMA Synthetic Token Builder to design ERC20 tokens that can track the price of anything—you are only limited by your creativity.

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Decentralized Crypto Futures?

Write contracts representing levered crypto exposure—or anything else that can be expressed with decentralized futures, CfDs, or total return swap contracts.

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Yield Curves on Ethereum?

Create your own interest paying synthetic tokens and construct a yield curve on the blockchain.

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Something Else?

Do you have another idea? We want to help make it happen.

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Regulating Decentralized Finance

We believe deeply that financial markets should be universally accessible and open, a vision we know is shared by financial regulators globally. The potential of decentralized finance is truly exciting—provided that regional laws and regulations protecting consumers are respected. UMA is an open-source, permissionless, and censorship-resistant protocol built to power safe and responsible financial innovation.