An introduction to Jiritsu Network
Before we dive into the report, a little bit of background info is essential.
J.P. Morgan and Apollo recently collaborated on a new blockchain-based platform to bring alternative assets and over $5.5 trillion of illiquid capital into a new technological infrastructure that can revolutionize both traditional finance and crypto. The wealth management industry, centered around growing and managing trillions of dollars worth of discretionary portfolios for wealthy individuals - despite its obvious success - still faces limitations due to outdated technological infrastructure and the threats of an increasingly digital world.
Blackrock, Fidelity, Invesco and many other of the largest financial institutions in the world have been filing for spot Bitcoin ETFs in recent months, proving to the world that digital currencies are here to stay, and maybe even worth allocating a portion of funds towards, similar to equities, real estate and the many other traditional avenues of investment. Even further, the broader cryptocurrency market has recovered exceptionally on the back of this news and the increasingly positive sentiment around the economy as a whole. But what does this all mean for the blockchain industry in its current form, and how are teams working to accommodate for these stark changes and potential waves of new users primed to enter the space?
There’s been a recent trend of making blockchains increasingly modular, with developers pushing back against the previously standardized monolithic blockchain model. In crypto’s most recent bull market that began in 2020, Ethereum quickly became congested as a then-record number of users came flooding onto the network and transacting more than ever before. Average transaction cost ballooned to well over $100 for a period of time, with a sharp turn of events occurring when alternative L1 blockchains began popping up in an attempt to grab a portion of Ethereum’s market share with higher transaction speeds and lower transaction costs. While alternative L1s are still alive and doing well today, there has been relatively little to indicate Ethereum’s dominance will waver anytime soon.
This frenzy of alt L1s and heated discussions of monolithic blockchains also resulted in the creation of Ethereum L2s, separate networks that inherit Ethereum security while bundling transactions on a separate execution layer. At its core, this is the most basic example of a modular blockchain. Initial L2s were either zero-knowledge rollups or optimistic rollups, terms that describe the process of verifying transactions on respective L2s. Until very recently, the concept of using zero-knowledge technology in a blockchain context was unheard of.
But what about where we’re at today?
The landscape has shifted entirely, with zero-knowledge technology being developed at an extremely rapid pace, quickly dwarfing the market share of various other L2s using validity (or fraud) proofs for verification. Zero-knowledge proofs make it possible for two parties to exchange a verified proof of information without directly revealing said information, making them faster, more performant and often cheaper at scale than other proving methods utilized by L2s.
If the world is going to adopt crypto, the systems in place need to be scalable and superior to traditional financial systems. This report is centered around Jiritsu Network, a novel platform in the crypto space that has built a system of unlimited verified compute (UVC) to facilitate the security of additional crypto protocols and blockchains via zero-knowledge security promises. Jiritsu has the potential to scale throughout crypto and integrate with both new and existing players across numerous verticals. The content of this report will focus on Jiritsu’s push to accelerate the adoption of real-world assets (RWAs) on the blockchain, efforts to facilitate global trading infrastructure beyond just crypto and a detailed analysis of its capabilities and comparisons to similar players in the crypto industry.
Overview of Jiritsu Network’s tech stack and functionalities
The blockchain ecosystem is witnessing a significant transformation with the growing debate of RWAs making their way on-chain, marking a pivotal shift from purely digital assets to a more inclusive financial landscape.
This evolution taps into the vast potential of blockchain technology to enhance the liquidity, accessibility, and transparency of traditional asset classes. The ascendancy of blockchain technology has set the stage for transformative shifts across nearly every sector, and Jiritsu is at the helm, steering this change with its diverse toolkit.
As we delve deeper into the mechanics of this robust platform, it becomes clear that Jiritsu is not merely building towards an incremental update to existing systems, but rather a complete overhaul designed to address the many demands of the traditional financial ecosystem.
The convergence of Jiritsu's innovative attributes with the intricate requirements of commodities, forex, and stablecoin markets signals a pivotal moment; one that could redefine operational efficiencies, enhance transactional fluidity, and bolster the integrity of financial dealings worldwide.
How does it work?
Jiritsu Network seeks to leverage off-chain verifiable compute and zero-knowledge proofs with the additional help of multi-party computation (MPC). This approach enables Jiritsu to create a trustless environment for automation, distinguishing itself from other protocols that rely on reputation-based trust secured through economic incentives.
Jiritsu's framework introduces a "zero knowledge consensus," which is a mathematically secure consensus mechanism for verifiable computations, and a "zero knowledge signature" for automated keepers. This infrastructure aims to offer a more secure, reliable, and efficient means of automating blockchain transactions without the vulnerabilities present in current on-chain solutions.
The programmable and decentralized nature of the UVC framework allows Jiritsu to efficiently adapt to various computational workflows and blockchain layers, accommodating a wide range of asset types and middleware protocols. This adaptability is essential for institutions requiring a platform capable of handling various blockchain applications. This programmability cannot be overlooked, considering Jiritsu’s bundling of multiple utilities under one product makes it stand out in a sea of one-off protocols and infrastructure pieces, many of which are often incompatible.
Jiritsu’s focus towards a programmable architecture makes it suitable for any client’s needs, as blockchain systems often adapt and change far faster than technology stacks in any other industry. As evident through J.P. Morgan and Apollo’s push for an entirely standalone blockchain system, client needs will grow in direct correlation with the size of assets being moved on-chain. Even further, the ability to market to crypto teams building products within the RWA space, the vast decentralized finance (DeFi) industry and growing on-chain gaming ecosystem makes Jiritsu a candidate for immediate horizontal scaling, a go-to-market strategy that’s been vastly overlooked in crypto historically.
Additionally, Jiritsu’s zero-knowledge capabilities are used for attestation, confirming the accuracy of asset tokenization without revealing underlying data. This feature is particularly attractive for financial institutions prioritizing privacy while offering financial products to their numerous high net worth clients. By additionally automating the tokenization process and utilizing its verifiable compute to confirm valuations or even import accurate price data, Jiritsu potentially reduces the costs associated with asset management and tokenization, offering a cost-effective solution for financial institutions and crypto protocols of all varieties.
Key verticals for Jiritsu going forward
Now that we have a better understanding of how Jiritsu functions under the hood, we can explore the potential synergies available to Jiritsu amongst various promising crypto sectors. Let’s dig in.
Jiritsu’s approach to RWA tokenization is innovative, utilizing a Zero-Knowledge (ZK) attestation system that enhances transparency while preserving privacy. This system allows for the creation of programmable, secure tokens, unlocking alternative assets for investors and expanding market opportunities. The integration of institutional-grade security and regulatory compliance is seamless, ensuring a safe and compliant investment environment.
Jiritsu Network is at the forefront of this innovation, leveraging its unique technology to tokenize RWAs, thereby bridging the gap between physical and digital assets. This process enhances the liquidity, accessibility, and investment appeal of traditional asset classes while maintaining regulatory compliance and security.
The tokenization of RWAs introduces several advantages, such as improved liquidity of traditionally illiquid assets, global accessibility, and efficient market participation. By digitizing these assets, Jiritsu enables a seamless and more inclusive investment landscape. This democratization of investment opportunities, coupled with Jiritsu's robust security and compliance framework, positions it as a catalyst for significant growth in the RWA sector.
Global Trading Infrastructure:
With the promise of RWAs and the onboarding of traditional financial institutions comes the inevitable possibility of stock exchanges, commodities markets and various other global markets of trade being ported onto blockchain infrastructure. Luckily for Jiritsu, the combination of UVC, MPC and zero-knowledge technology not only make these integrations possible, but highly desirable. Here’s why.
Security and privacy are two of the most important aspects of a product that institutions look for. The larger the assets under management, the greater the responsibilities. Jiritsu Network’s expansion into global trading infrastructure is poised to revolutionize how traditional financial and commodity markets operate. The incorporation of blockchain technology in these sectors promises enhanced efficiency, security, and accessibility. Jiritsu's utilization of UVC, MPC, and zero-knowledge technology not only makes these integrations feasible but also highly advantageous.
With Jiritsu’s technology, traditional markets like stock exchanges and commodities can transition onto the blockchain infrastructure, fostering a more interconnected and fluid trading environment. This transition is crucial for institutions managing large assets, providing them with a secure and efficient platform for global trading operations.
A primary concern for these institutions is the security and confidentiality of their transactions. Jiritsu addresses these concerns by offering robust privacy features and a secure environment for trading activities. This assurance of privacy and security is pivotal in attracting large financial institutions to adopt blockchain technology for their trading needs.
Jiritsu Network stands out for its highly programmable and adaptable technology stack. The platform’s architecture is designed to accommodate the dynamic nature of blockchain systems, ensuring compatibility with various blockchain layers and asset types. This flexibility is particularly appealing to clients in the rapidly evolving blockchain industry.
The platform’s programmable nature allows it to cater to a wide range of client needs, from traditional financial institutions to innovative crypto projects. Jiritsu’s ability to offer customized solutions for tokenizing assets, managing digital financial products, and automating complex blockchain operations positions it as a versatile player in the industry.
In asset management and tokenization, Jiritsu's programmable features, combined with zero-knowledge attestation, enable efficient and cost-effective solutions. These capabilities allow for the accurate representation and valuation of tokenized assets, reducing operational costs and enhancing the overall asset management process.
Comparative analysis of Jiritsu and its competitors
Jiritsu is designed with a high degree of programmability, allowing financial institutions and crypto-native projects to compose and manage a diverse range of tokenized assets. Beyond this, Jiritsu guarantees security and offers its zero-knowledge capabilities to further build trust around its product base and partnerships. This flexibility is essential for creating complex, customized financial products, particularly for institutions exploring innovative tokenization strategies and various other potential use cases for RWAs.
While there are a number of teams building throughout the zero-knowledge and RWA verticals, Jiritsu is positioned to target both while also marketing itself as a hub for these new and existing teams to build upon. This section will compare Jiritsu to three competitors: Securitize, FortunaFi and Dinari. Additionally, Jiritsu’s architecture, product offerings and target audience(s) will be contrasted to these three projects, with the intent laying out a clear and concise explanation of where Jiritsu fits into the crypto puzzle.
It’s important for any crypto project to understand its target audience while also building towards potential expansionary routes of gaining additional market share in key verticals.
Securitize aims to democratize access to alternative assets, simplifying investment in tokenized securities for a broader audience. It provides a vital platform for both primary offerings and secondary market trading, but does not inherently offer the tools for institutions to create bespoke tokenized products.
The target audiences of Jiritsu and FortunaFi differ significantly. Jiritsu is tailored for both established financial institutions and crypto projects seeking to leverage advanced tokenization technologies for new business models and products. Its advanced programmability and security features make it an ideal candidate for sophisticated asset management and innovation in financial products.
FortunaFi, on the other hand, is more accessible to a more loosely defined range of investors, including those outside the institutional sphere. Its straightforward, user-friendly platform is designed to make investment in RWAs easy and transparent for individual investors, but not necessarily larger clients with more personal needs for their respective platforms.
When looking at Jiritsu and Dinari directly, it's evident that both platforms have unique approaches and offerings in the blockchain and tokenization space, but they cater to different aspects of the market and user needs. Jiritsu is a comprehensive platform primarily designed for established financial institutions, focusing on enabling them to tokenize a wide array of assets and create unique financial products.
On the other hand, Dinari caters to a broader range of users, including individual investors, by providing an infrastructure for trading traditional securities, like stocks and bonds, as tokens on the blockchain. Dinari uses smart contracts to represent these securities, focusing on accessibility and convenience for the average user. This approach democratizes the trading of tokenized securities, making it possible for a wider audience to gain exposure to assets like Google and Apple shares.
Architecture Differences and Product Differentiation:
With the growing number of blockchain applications has come a variety of different methodologies for constructing platform architectures.
Jiritsu’s approach to automating the tokenization process and offering a programmable consensus mechanism could significantly reduce costs associated with asset management and tokenization. Its scalable infrastructure is adaptable to the needs of financial institutions, irrespective of the asset's complexity. Securitize might offer cost efficiencies in capital access and liquidity by minimizing traditional intermediaries. However, it does not directly address the cost implications for issuers in managing and scaling tokenized assets, along with the numerous challenges associated with programming customizable products for different users.
Jiritsu is primarily designed for financial institutions, offering a highly programmable platform that enables the creation of complex, customized financial products. It stands out for its advanced features like Zero-Knowledge (ZK) Attestation and Multi-Party Computation (MPC), which enhance security and privacy. This focus positions Jiritsu as a tool for institutions to innovate and manage the entire lifecycle of tokenized assets. In contrast, FortunaFi caters more to individual investors, providing an all-in-one RWA app that simplifies the process of investing in a range of assets, from US Treasury bills to revenue-based financing. This user-centric approach makes FortunaFi accessible and convenient, especially for those new to RWAs.
Dinari, however, focuses on providing direct exposure to traditional securities through its Securities Backed Tokens (dShares). These tokens represent a 1-to-1 backing by Dinari's reserves, offering a transparent and programmable way of accruing value in well-known assets. Dinari’s approach allows users to purchase US stock-based tokens, requiring compliance with KYC (Know Your Customer) processes, ensuring adherence to regulatory standards. This makes Dinari more aligned with individual investors looking for exposure to traditional securities in a tokenized form.
Looking beyond the blockchain
So, what comes next for Jiritsu? The true power of Jiritsu lies in its ability to enable financial institutions to craft unique financial products with enhanced customization. The platform allows for the development of programmable financial products tailored to the specific needs of clients. Whether it’s tokenizing real estate, art, or debt instruments, the platform can handle the intricacies involved, offering an unprecedented level of customization. Additionally, Jiritsu opens new markets by making previously illiquid assets tradable, thus democratizing investment and broadening the range of potential investors. Through its partnership with Republic’s marketplace, Jiritsu exemplifies this democratization, providing access to a vast pool of potential investors.
In summary, Jiritsu represents a significant advancement in the field of financial technology, especially in asset tokenization. Its emphasis on security, privacy, scalability, and flexibility, coupled with its specialized focus on RWAs and integrated asset management, positions it as a key player in empowering financial institutions to explore new business models and offer diverse, innovative financial products. The platform's alignment with regulatory compliance and its ability to democratize investment further underscores its strategic importance in the evolving financial landscape.
Jiritsu’s capability to tokenize a wide range of assets, from real estate and art to debt instruments, is crucial in broadening the scope of assets available for investment. This expansion is not just about adding more asset types; it’s about transforming previously illiquid assets into tradable securities. This shift has the potential to unlock immense value, as it opens investment opportunities in markets and asset classes that were previously inaccessible to most investors.
By enabling the trading of these tokenized assets, Jiritsu is not just participating in the market – it's actively expanding it. The partnership between Jiritsu and Republic’s marketplace is a strategic move that exemplifies the democratization of investment. Republic’s vast user base provides a ready market for the innovative financial products created through Jiritsu. This collaboration signifies a trend in the financial world where investment opportunities are no longer confined to a select group of high-net-worth individuals or institutional investors. The ability to invest in tokenized RWAs can attract a broader demographic, including retail investors and smaller institutions, thereby democratizing access to investment opportunities.
A significant advantage that Jiritsu offers is its alignment with regulatory compliance. As the financial world grapples with the integration of blockchain technology, regulatory frameworks are evolving. Jiritsu’s focus on compliance positions it well to navigate these changing regulatory waters. This adherence not only adds legitimacy to the platform but also instills confidence among institutions and investors who are cautious about regulatory risks associated with blockchain investments.Jiritsu’s use of cutting-edge technologies like Zero-Knowledge cryptography and MPC sets a high bar for security and privacy in the tokenization process.
In an era where data breaches and cyber threats are a significant concern, the emphasis on advanced security measures is a substantial asset. These technological advancements ensure that Jiritsu remains at the forefront of the tokenization space, capable of meeting the sophisticated needs of modern financial institutions. We hope this report was informative in establishing not only a deeper understanding of Jiritsu, but of the numerous opportunities present within crypto and the growing positive sentiment from respected institutions of traditional finance.
Disclaimer: This report was commissioned by Jiritsu. This research report is exactly that — a research report. It is not intended to serve as financial advice, nor should you blindly assume that any of the information is accurate without confirming through your own research. Bitcoin, cryptocurrencies, and other digital assets are incredibly risky and nothing in this report should be considered an endorsement to buy or sell any asset. Never invest more than you are willing to lose and understand the risk that you are taking. Do your own research. All information in this report is for educational purposes only and should not be the basis for any investment decisions that you make.