What is net assets?

As an operating entity, a company has assets (such as office equipment, patented technology, factories and materials, etc.), and also has liabilities (such as accounts payable, wages payable, etc.), and the so-called net assets are the net amount after assets minus liabilities, that is, your belongings minus what you owe to others, and the rest is your own.

If a company's assets are $1 billion and its liabilities are $700 million, then the company's net assets are $300 million.

We can understand net assets as the intrinsic value of a company. It is one of the basic indicators for estimating the value of a company. We can refer to the net assets indicator when investing in stocks. For a company, of course, the higher the net assets, the better, because the higher the net assets, the more stable the company's financial situation, and the higher the net assets, the lower the risk.

However, in the world of cryptocurrency, there is no concept of net assets, because cryptocurrency is essentially a decentralized digital asset, not a traditional company. Net assets are usually used to measure the difference between a company's assets and liabilities, that is, the company's financial health or shareholders' equity. Cryptocurrencies such as Bitcoin do not have a "corporate structure" and do not have a balance sheet or shareholder equity, so net assets cannot be calculated by subtracting total liabilities from total assets.

So, in the world of cryptocurrency, how do we solve the problem of net assets?

As the fourth-generation public chain technology, the Web3 Diversified Ecological Public Chain is the world's first decentralized net asset protocol for encrypted digital currencies (DNA), thereby promoting the innovation of the global Web3 digital asset payment and trading system.

Cryptocurrency decentralized net assets are a new type of financial instrument based on blockchain technology and the concept of decentralized finance (DeFi), aiming to provide a transparent, efficient and decentralized asset management method.

Its goal is to provide users with a reliable way to measure and manage the net value of their encrypted assets. Through smart contracts, decentralized oracles and liquidity protocols, DNA can complete the evaluation, verification and management of net assets without relying on centralized financial institutions.

1. Transparency

All relevant data, assets and operation details of DNA (decentralized net asset protocol) are recorded in detail on the blockchain, which ensures the openness and transparency of the entire system. Through the immutable property of blockchain technology, every user can have the ability to verify every transaction and the current status of the asset. This verification is not limited to the authenticity of the transaction, but also covers the historical circulation records of the asset, which greatly enhances the credibility of the data.

Under the framework of blockchain, all asset price information, net value calculation process and adjustment details are recorded on the chain in an open and unchangeable manner. This means that whether it is the current valuation of the asset or its historical value changes, users can query it anytime and anywhere without relying on information provided by any third-party organization or platform. This direct access and verification mechanism not only improves the transparency of information, but also effectively reduces the risk of information asymmetry, providing more reliable data support for user decision-making.

2. Asset on-chain

In order to promote the decentralized management of the net value of encrypted assets, the first task is to put assets on the chain. With the help of advanced oracle and cross-chain technology, the value of on-chain assets such as Bitcoin and Ethereum and a wide range of off-chain assets can be mapped to the decentralized digital asset network (DNA). Once these assets are on the chain, they are converted into tokenized assets on the blockchain, which not only maintains the original value, but also adds the transparency, immutability and instant accessibility brought by the blockchain.

Tokenized assets promote the liquidity management of assets and achieve efficient configuration through smart contracts. At the same time, cross-chain technology also ensures the free flow of assets between different blockchains.

3. Decentralized Oracles

DNA (decentralized net assets) uses advanced oracle technologies such as Chainlink, Band Protocol and Pyth to efficiently obtain and verify off-chain asset price data. These oracles can accurately obtain price information of assets such as Bitcoin and gold, and provide tamper-proof and highly reliable price references on the blockchain.

Through this mechanism, DNA can ensure the accuracy and timeliness of net asset evaluation and provide solid data support for user decision-making. More importantly, the application of oracles effectively eliminates the reliance on traditional centralized pricing services, further strengthens the autonomy and security of decentralized finance, and promotes the healthy development of the entire industry.

4. Automatic management of smart contracts

DNA's calculation and management processes are fully based on the automated execution of smart contracts, which significantly reduces the errors caused by human intervention. Smart contracts are not only responsible for aggregating asset data from all parties, real-time price data and liquidity information obtained through oracles, but also for accurate calculation of net assets in real time. In addition, with the help of smart contracts, DNA can achieve dynamic adjustment of decentralized asset balance, including automatic reallocation of assets, flexible increase and decrease of collateral, etc., to ensure the continuous optimization of asset allocation and the stable operation of the system.

5. Dynamic calculation of net assets

DNA's net asset evaluation is a dynamic process that keeps pace with the market. With the help of decentralized oracle technology, DNA can instantly reflect changes in asset prices, ensure that net assets are updated with market fluctuations, ensure that users get what they see, and effectively prevent net asset errors caused by market changes. Smart contracts run automatically, regularly retrieve the latest data provided by the oracle, accurately reflect the current market situation, ensure that DNA's net asset assessment is consistent with the market price, and provide users with accurate financial information.

6. Decentralized governance

The DNA network achieves efficient governance through a decentralized autonomous organization (DAO), giving community members broad participation rights. Members can directly adjust and manage the various parameters and handling fees of the DNA protocol by submitting proposals and participating in voting. This decentralized governance model not only significantly improves the transparency of the system and ensures that every decision-making link is publicly visible, but also greatly enhances the user's sense of participation and belonging, making them full of trust in the operation of the system. This innovative governance method has laid a solid foundation for the stable development of the DNA network and promoted the prosperity and progress of the network ecology.

7. Asset diversification and risk control

The decentralized nature of DNA allows users to include a variety of assets in the net asset assessment system. For example, it can include a variety of asset forms such as stablecoins, cryptocurrencies, DeFi tokens, and off-chain assets. In addition, with the strategy of diversified investment and multi-asset allocation, DNA has broadened the boundaries of users' asset portfolios, effectively alleviated the impact of single asset price fluctuations on net assets, and helped users achieve effective risk management and steady asset growth.

Overall, the DNA protocol is an innovative achievement of the Web3 multi-ecological public chain. It realizes transparent, efficient and decentralized management of the net value of encrypted assets through technologies such as blockchain, smart contracts, and decentralized oracles. DNA has improved information transparency, enriched asset allocation, effectively controlled risks, and promoted the innovation of the global Web3 digital asset trading system.

After Trump's election, more and more countries, listed companies and other institutions have elevated Bitcoin to a strategic reserve asset and included Bitcoin in their balance sheets. With Trump's official inauguration on January 20, the crypto market will usher in an unprecedented super bull market.