Market creators can choose between two distinct market types, each serving different financial objectives:

• Capital Market
• Money Market

Market creators must select one type or the other when setting up their marketplace.

Finance Market

A Finance Market facilitates direct sales from issuers to investors. This market type is characterized by the following process:

• Issuance: The issuer creates and issues one or multiple assets.
• Wrapping and Distribution: These assets are wrapped into a sale.
• Investment: Investors purchase these assets directly.

In a Finance Market, the primary goal is to distribute assets to investors, allowing them to invest directly in various asset classes.

Capital Market

The Capital Market is part of the Finance Market and focuses on trading long-term financial assets. It includes the following:

• Stock Market: Facilitates the buying and selling of shares of companies.
• Bond Market: Involves the issuance and trading of debt securities, where investors lend money to issuers in exchange for periodic interest payments and the return of principal at maturity.
• Foreign Exchange (Forex) Market: Enables the trading of currencies.

In the Capital Market, the primary aim is to provide a platform for raising long-term funds for various entities, including corporations and governments, while offering investment opportunities to individuals and institutions.

Money Market

The Money Market meets the short-term liquidity needs of borrowers and lenders. It helps manage the cash needs of businesses and governments and ensures that they have access to funds for their short-term operational requirements. It includes treasury bills, commercial paper, certificates of deposit, and repurchase agreements. These assets are highly liquid and considered safe investments. Major participants include banks, financial institutions, corporations, and the government.

The Money Market follows a similar concept to the Finance Market but extends its functionality to include financing based on collateral. The wrapped assets act as collateral, and the asset issuer leverages these to secure financing from investors. Investors purchase these collateral-backed financial instruments, effectively lending money to the issuer. In return, investors receive fractions of the collateral or rights to future cash flows generated by the collateralized assets. This process allows issuers to raise funds without selling the assets outright.

This market type operates as follows:

• Collateralization: The issuer wraps assets, which now serve as collateral.
• Offering Financing: The issuer offers financing to investors, using the collateral to secure the investment.
• Investment: Investors buy into the financing against a fraction of the collateral.
• Funding: The issuer collects the money from the financing.
• Buyback: The issuer is obligated to buy back the fractions from investors at a higher price or repay the principal amount plus interest. This buyback often occurs at the end of the financing period or upon reaching specific milestones. Once repurchased, these fractions are burned.
• Fraction Burning: Upon buyback, the fractions held by investors are effectively "burned," meaning they are retired or canceled. This reduces the asset supply, ensuring that the issuer regains full ownership of the collateral.