In my previous article “Interest Rate Swaps meet DeFi” I focused on explaining how “competitors” of Voltz operate and how Voltz is a true Interest Rate Swap (IRS) protocol. Given that the size of the IRS's market is estimated at $1 quadrillion in TradFi it seems like the IRS instrument being introduced to DeFi is not being noticed and talked about enough. Thus I decided that given that the IRS are not a common concept, I would like to take this opportunity to explain about them in detail as well as elaborate on how they are extremely bullish for Decentralised Finance.

​​In the following article we will delve into Interest Rate Swaps (IRS, not the best abbreviation lol). Generally speaking, IRS is huge in TradFi  -  the size of the interest rate derivatives market is estimated at over $1 quadrillion. IRS in TradFi is where users can swap their derivatives to match their risk preference. Given the fact that each user has a unique risk preference, the IRS product allows for the user to swap their current position to the one that matches  their risk preference better. It could be that the user is risk averse and thus wants Fixed rates, or instead the user wants a speculative position and is seeking risk taking which may push them towards Variable rates.

Voltz is an Automated Market Maker (AMM) for Interest Rate Swaps.