Cerebral: The Decentralized Approach to Crypto Derivatives

Precog Finance
3 min readAug 26, 2022


Cerebral: The Decentralized Approach to Crypto Derivatives | PRECOG FINANCE

If you hear “Precog Finance” you’d probably associate it with a sophisticated, automated, AI-assisted DeFi trading algorithm — and for good reason. Although Sentient is our top priority at the moment, it isn’t exactly our only product, and there’s more to the Precog ecosystem than what meets the eye.

Indeed, what is close to completion takes priority over works in their early stages, and such is the case with Sentient. We routinely write about it, share our development process, and even show off a demo every once in a while. So if your main topic of interest is Sentient, check out our YouTube channel where we cover updates, tutorials, and more!

But here’s why you might want to stick around for Cerebral.

If you want to indulge yourself in the thrilling world of crypto derivatives such as futures and options, your best bet is centralized exchanges. They are, after all, where most of the liquidity is concentrated, and it helps that there are various tools and resources at traders’ disposal.

But that’s not truly DeFi, is it? What if you wanted to open a position on a new token that just launched on a particular network? It would require that these exchanges list them first, and most of them have different listing requirements for their derivatives market. What if you wanted to use various other tokens as collateral? You would need these exchanges to recognize your collateral as valid.

The market, therefore, needs a decentralized — a truly decentralized — on-chain, DeFi derivatives marketplace, overwhelmingly lead and influenced by the community of traders and users of the platform. This is what Cerebral aims to do, to establish a central pillar not only in the Precog Finance ecosystem but in DeFi as a whole.

We recently released various articles surrounding the topic of derivatives that might help you get up to speed if you don’t know what they are. We compared spot trading, futures, and Sentient, futures and options, as well as a brief guide on margin calls and liquidations.

So what makes Cerebral unique?

As alluded to earlier, we want Cerebral to be a platform run and driven by traders. This means having a decentralized order book, one to which users can also contribute by pooling their assets and creating order book depth. Like the DEXes you are accustomed to, trades and other actions will be carried out using smart contracts to ensure the security, permissionlessness, and trustlessness of all processes.

Users can also define, create, and deploy synthetic assets on Cerebral. These assets can have various functions and purposes, which can be freely traded and utilized in the marketplace. Synthetic assets, of course, are an integral part of the whole process, as you can’t have an on-chain derivatives marketplace without them — we just go the extra mile and give everyone the ability to create them.

Finally, there’s the matter of the blockchain network itself. One of the main selling points of CEXes (centralized exchanges) is how cross-network asset trading works seamlessly without the need to use any bridges. This is because as a custodial service, the exchange is in full control of your assets, and doesn’t actually make on-chain trades. It doesn’t need to. Cerebral will not be limited to a single chain like many decentralized marketplaces, but will instead support multiple blockchain networks; starting with Ethereum, and then moving onto other major ecosystems.

DeFi has a long journey ahead of it.

It has been over a decade since the creation of cryptocurrencies and we still don’t have a decentralized crypto derivatives marketplace. It may sound like a bad thing at first, but it actually is a testament to the slow but meticulous work being done by developers to ensure they’re building a solid foundation for the future of finance and Web3. If we were to draw parallels with the internet, it too took decades to reach where it is at today. Good work takes time, and we hope that with Cerebral, we mark a new chapter in DeFi, one where traders look back and ask themselves how they were able to manage before its inception.

While it’s a long way ahead, if you don’t want to miss any updates on Cerebral, check out our pages and community channels below!




Precog Finance

Decentralized Derivatives trading ecosystem powered by AI, governed by community.