#fomo3d

Think about the risk structure behind the rise of DeFi, stablecoins, lending agreements, decentralized exchanges and other fields. Original title: "5 Big Risks DeFi Got to know! 》 Published by: Ariah Klages-Mundt Translation: Jing Kai More individuals began to pay attention to the main topics DeFi governance. The memory of "Black Thursday" throughout the collapse of the crypto market in March in 2010 in addition has intensified people's concerns about DeFi. Folks are focused on the lack of understanding of the chance structure of DeFi. In this article, we're mainly centered on the stable currency field, but similar thinking could be applied to many broader fields of encrypted economic systems, including cross-chain protocols, home loans, and decentralized exchanges (DEX). We think that in certain DeFi systems fashioned with extensive governance power with no social recourse, the participation of rational subjects could be zero. It is because the price of adjusting incentives in these systems could be prohibitively high (this is similar to requiring banks to have a long-term P/E ratio of just one, 000 to ensure depositors' funds are not stolen). Our framework provides a solution to model these systems and generates some unanswered research questions which will be the main element to the development of DeFi. Certainly one of Compound's recent hot news in the DeFi field is the issuance of Compound's COMP token, which has develop into a leveraged risk circus. Driven by the reward mechanism, users have played a crazy game of leverage. As you can plainly see on the Ethereum network, all this is going on. Traders conduct COMP liquidity mining (Yield Farming) by maintaining complex multiple positions: for example , depositing ETH and USDC, lending a lot of BAT tokens; then, re-depositing BAT to a new Compound account to borrow ZRX tokens out, then deposit ZRX to the previous account, lend more BAT tokens, etc . (Translator's Note: Yield Farming, which means that token holders deposit funds on the platform, provide liquidity for the platform, and acquire the token incentives supplied by the platform, that is mining for liquidity) May very well not have looked at this type of operation before, but do not think about any of it due to this article: God operation, I will try it too! We have been obliged to emphasize that type of operation accumulates the risks of layers of leverage, especially in low-liquid markets such as for example BAT and ZRX. The risks involved are worthy of your personal analysis and analysis. Look at the multiple liquidations on Black Thursday! This low-liquid market is simple to govern and an easy task to attack. The others can use this to trigger the liquidation process and benefit from your losses.

Using high-risk assets for "Yield farming" is very dangerous and an easy task to hang. Don't add user funds to BAT liquidity mining with high leverage. Everybody, have a snack! If its goal is always to increase audience coverage, then a release of COMP is without a doubt successful. What's more obvious is that Compound has temporarily increased liquidity gains and solved the problem of "the chicken or the egg" when using the platform. Ironically, it sets up a platform for large-scale stress testing. In several reports, few people talked about Compond's initial goal: to foster "an increasingly large ecosystem [... ] could have the motivation to control the ongoing future of the agreement with good governance. " The distribution of COMP tokens is actually to achieve a wider distribution of governance rights among platform users, to ensure that users can manage their particular security. How to design a motivation mechanism to align the interests of participants is really a broader issue in the whole encrypted economy system. Using stablecoins as the background of analysis, we've created a framework to quantify the incentive problem. This framework could be widely applied to encrypted economic systems. We put forward a simple question of incentive security in the device: [Incentive security] After thinking about the attack situation, can all parties continue steadily to participate, can they nevertheless be mutually beneficial? If not, then a system won't work as the equilibrium participation is zero. Like if the incentive mechanism makes the attack profitable, then rational participants will price this risk when determining their education of participation. Only after answering this question can we comprehend the question of economic stability. [Economic stability] Can the incentive measures in the device produce stable results? May be the incentive mechanism sustainable? From the perspective of the model we've constructed, as the scale of the device expands, just how to provide continuous security incentives to combat governance attacks? This question is important. If the return on the attack is greater than the price of the attack, then it really is profitable to govern the attack. The reward is proportional to the worthiness of the assets locked in the device (AUM): if the governance power is strong, the collateral could be directly stolen (and the related liquidity pool on the DEX is cleared); even though the governance power is not so strong, the collateral assets can nevertheless be stolen indirectly, By manipulating parameters and preventing users from exiting, it may succeed even though there's a time delay in governance. The price of the attacker includes the worthiness of the governance token. For the "honest" governor, the fundamental value of the governance token value arises from the provision of future governance fees and institutional responsibilities (such as legal recourse). Stablecoins, synthetic assets and cross-chain assets For noncustodial stablecoins (as well as synthetic assets that use similar mechanisms and cross-chain assets of BTC), the worthiness of security governance has to exceed the worthiness of locked assets, which is a certain multiple of the latter Numerical value. When contemplating the long-term equilibrium with moderate growth expectations as time goes on, the problem of scale is going to be reflected. In cases like this, today's value of future expenses (even the unrealistically high proportion of AUM, that's, the worthiness of the assets locked in the system) can't Reach the level of AUM multiples. In cases like this, the security of the decentralized governance system depends on the device participants holding governance tokens holding numerous governance tokens in order to enhance its market value. This may feed back into the incentives of those other parties to participate, and there's absolutely no guarantee for the existence of balanced participation. Like in order to ensure their stable positions, stablecoin holders might need to hold numerous risk management assets, that might violate their intent behind holding stablecoins. This led us to an informal conjecture (and also an important direction for future research! ). [Conjecture] In several DeFi systems fashioned with extensive governance rights with no social recourse, the participation of rational people could be zero in equilibrium. The point is that the price of adjusting incentives for participants in these systems could be prohibitively high. Let's just take the bank's situation as an analogy: in case a secure incentive mechanism is implemented, the bank's currency markets value must certanly be a multiple of the total deposits, so it is maybe not worthwhile for depositors to participate. Put simply, the bank's long-term P/E ratio has to reach about 1000 (and supported by depositors) to ensure the bank does not steal depositors' funds. The clear answer currently implemented is simply centralized governance. This solution relies on a form of institutional responsibility, which is often described in our model. This example does not fundamentally cause problems. In fact , many conventional financial systems operate this way. This is the reason the worthiness of the bank doesn't need to be repeatedly the total deposit. Nevertheless , we have to publicly acknowledge that type of trust could be essential. Solving these problems in a totally decentralized manner continues to be a challenge to be solved. Decentralized exchange (DEX) incentive models will also be meaningful for some DEX. Like in case a DEX runs its own independent blockchain (this chain is jointly controlled by the DEX governor), when an attack does occur, the governor can restrict users who provide liquidity to the platform, making them struggling to withdraw, even in governance This is especially valid if you have an occasion delay. In DEX, fee accrual ("honest" governance profit) is proportional to a percentage of the total transaction volume over some time, which may be many times the instantaneous AUM value of the exchange, and the safety of incentives continues to be associated with AUM. For Uniswap, the annualized transaction volume could be about 100 times the deposit. In comparison, the accrual fees generated by the stablecoin system could be about 1/4 of the deposit supply. Weighed against stablecoins, the governance accrued fees of DEX could be much smaller, but this factor around 400 times makes the feasible area of ​​incentive security for governance attacks in DEX could be larger. This leads us to the following informal conjectures to compare the feasibility of different types of DeFi applications. [Conjecture] Weighed against stablecoins, DEX is easier in order to avoid governance attacks from an economic perspective. Considering these possibilities, when designing DeFi services and products, the research of common incentive mechanisms is a lot more essential. With your preliminary discussions on loan agreements, let us return to home loan agreements, such as for example Compound. These have the same structure to noncustodial stablecoins. Nevertheless , they truly are slightly simpler because borrowed assets are largely exogenous. As a result of this exogeneity, participants could be more likely to exit the device ahead of the governance attack is successful (that is, throughout the governance time delay). Like consider that the borrowed asset is USDC; in cases like this, the vault can deleverage and exit whenever you want through the issuer creating new stablecoins at face value (specifically, once they wish to withdraw, they don't depend on Dai holders to sell Dai back again to them). Essentially, governance delay in this environment is really a more powerful preventive tool, but if it involves an elaborate price feed mechanism and/or an attack where miners can extract value, there could be exceptions. This means that some small market capitalization assets in Compound can start to deviate from the exogenous situation. The BAT and ZRX markets are basically overutilized because they are currently conducive to liquid mining. Like the use rate of BAT is currently 91%, the nominal value of BAT deposited at present is 234 million, and the total market value of BAT is 377 million (although this section of BAT could have a certain net value because it arises from multiple borrowings, and then BAT is deposited repeatedly). Because of the structure, the large-scale liquidation of BAT could have a deleveraging effect just like that of a well balanced currency, that will be discussed further below. Data from Compound on June 23, 2020 One question remains: In the long run, does the distribution means of COMP tokens help motivate users to align their interests? Put simply, did it reduce user costs when resisting governance attacks? At first, this looks promising. Users get governance shares through participation, so they really need not consciously raise the governance market value in order to protect the security of the system-they just won't need to sell the COMP shares they get. But once users receive shares, which become section of their investment portfolio, they are going to choose whether to maintain this risky position. Although the distribution of COMP has undoubtedly attracted many new users to the Compound platform, it really is still as yet not known perhaps the distribution mechanism of COMP (or every other distribution mechanism) will help the device achieve a far more stable governance balance. Stablecoin: Design, Model and Risk Below we start from several typical forms of stablecoin and describe the risks and trade-off dimensions of different functional components. The big difference between custodial stablecoins and noncustodial stablecoins is obvious. The former relies on some sort of trust in an authorized, as the intent behind the latter is always to de-trust. The figure summarizes and analyzes the stablecoin design based on some of the most essential risk dimensions Custodian stablecoins In terms of custodial stablecoins, you can find three different types of stablecoins. They all are anchored through the task of arbitrageurs, who is able to create/redeem stablecoins for the topic matter. The reserve fund of stablecoins maintains a reserve ratio of 100%, just as the ETF of USD on the blockchain. These include TUSD, USDC, and later iterations of Libra. The second type, including Tether, resembles a bank or money market fund, with a partial reserve mechanism. This type of stable currency faces the chance of de-anchorage just like bank operations. In October 2018, this case occurred in the Tether stablecoin (USDT). When its partner exchange Bitfinex suspended the USDT exchange for legal currency, the crisis of Tether followed. As funds flowed from Tether to assets with less credit risk, the currency's anchor to the U. S. dollar was broken and arbitrage occurred. The writer was struggling to re-anchor Tether to the united states dollar. We've noticed that in contrast to conventional banks, these "banks" like Tether could be less regulated and audited, and may not need government guarantees and can't handle bank runs. In October 2018, Tether was off anchor from the U. S. dollar The third kind of stable currency is directly issued by the central bank. Currently, the central bank only provides reserve deposits to commercial banks, as the CBDC's goal is always to provide consumer-oriented deposits, possibly in the form of tokens. These custodial stablecoins face risks just like those of conventional financial systems. These risks mainly originate from counterparty risks, such as the danger of custodians breaching their contract to fulfill their linked value obligations. A related risk is the review risk, that's, the custodian selectively chooses which claims to honor. The characteristic of noncustodial stablecoins is that it no further depends on specific custodians like custodial stablecoins. What replaces these social institutions is the economic structure, which establishes an economic climate between participants through smart contracts. noncustodial stablecoins are similar in structure to dynamic versions of risk transfer tools, such as for example collateralized debt certificates (CDO). CDO is supported by way of a pool of mortgage assets and divided into different credit tranches. When there is a loss, the low-level credit tiers absorb losing first, and after every one of the low-level credit tiers are paid off, the high-level credit tiers absorb losing. Within our research paper, we provide a broad idea that can decompose the look of all noncustodial stablecoins to the following functional components. The following figure draws the look of several stablecoins and describes how they truly are associated with one another in the form of some components.

* Main value objects. The economic structure of the stablecoin value basis mainly arises from market expectations under a certain system. Divided in to three types.

* Exogenous collateral: As well as the stable currency system, collateral has other uses, such as for example ETH in Maker. * Endogenous collateral: The goal of creating collateral is always to serve as the subject of collateral for stablecoins. * Implicit collateral: In cases like this, rather than using explicit collateral, market mechanisms are accustomed to dynamically adjust supply to stabilize prices. This really is just like endogenous collateral, but you can find essential differences in the obligation to absorb losses. * Risk absorbers: At a certain level, some speculators will absorb financial risks and seek profits (similar to the primary division of CDO). This is often the participation of individual entities with collateral, or it's really a separate similar equity position in the network, or the role of participants acting as miners (or verifiers) in the network. * Stablecoin holders: the main human body that constitutes the demand side of the stablecoin market (similar to the holders of the higher level credit tranches of CDO) * Issuance: The niche or algorithm that determines the issuance of stablecoins. It can be determined by multiple individuals in the device, or it may sort out algorithms. * Governance: The main human body or algorithm that manages the protocol parameters, similar to the stock position when managing CDO. * Data provider: Import the information of external assets in to some functions of the blockchain. * Miners: determine the individuals who verify and package transaction operations in the fundamental blockchain layer. The style of different noncustodial stablecoins shows how several components are interconnected. This sort of noncustodial stablecoin brings new risks, so existing financial models cannot be used "out of the box". Here we discuss three forms of new risks. The danger of deleveraging first is the danger of a unpredictable manner of deleveraging, that's, the debt level of maintaining stable currencies decreases too fast, that leads to the break of the anchor. This risk is substantial. Like in the 36 hours from March 12 to 13, 2020 ("Black Thursday"), industry turmoil associated with the coronavirus caused the crypto market to get rid of 50% of its market value. On the ETH network, this leads to network congestion and high gas handling fees, which often decelerates the transaction speed and leads to transaction failures. This caused serious problems for Maker's Dai. Vaults are trying to deleverage since they can't increase collateral or repay their Dai debts. The Keeper either can't quickly obtain Dai's liquidity or can't take part in all debt auctions. Some individuals even started bidding for ETH at a cost near 0 DAI, and almost got about 8 million US dollars in ETH for free. When Black Thursday does occur in March, the affect the price of Maker Dai Source: OnChainFx We've summarized several noteworthy noncustodial stablecoin de-leveraging events, as shown in the dining table. For the designers of stablecoin projects, these events are worthy as case studies.

The danger of oracle failure. Secondly, the oracle service that provides data from the surface to the blockchain may also fail. This can be a major accident, or it might be the result of an attack. Exactly the same risk includes a significant impact and contains occurred several times-we have summarized the notable events in the dining table below. Like in June 2019, FX's price feed error caused the KRW (South Korean Won) price on Synthetix to sky-rocket. At 3 am Sydney time, one of the price feed APIs began to fail intermittently, leading to the purchase price to be had that was 1000 times higher than the current exchange rate of the Korean won. Even though there's a defense mechanism to abandon the outliers, some unfortunate and coincidental results, in the particular calculation, the oracle machine still used the greatly increased expense. As a result, several transactions made a profit of just one, 000 times, causing a profit of more than $1 billion in less than an hour or so. A few incidents of invalidation Governance attacks and miner attacks We've already discussed protocol governance attacks above. In addition , miners also can participate, which is often understood as the second governance method, because miners can decide whether transactions are packaged in to blocks and determine the order of transactions. Smart contract risk As the stable currency adopts algorithmic execution method, without the specific agency supervision, errors in its specification or implementation could have a significant impact. From a modeling perspective, smart contract risk resembles counterparty risk (in this case, it identifies the chance of bugs in execution). The figure below shows what are the results when this type of bug is maliciously exploited. As a result of re-entrancy bug, the locked assets in the lending agreement dForce were stolen and changed from $25 million to $19, 000 within a few hours.

In the past two decades, the game industry has only had two business models, the "try before buying" model that began in 2000 and the "free to play" model that emerged in 2010. "Try before you buy" was launched at the beginning of the 21st century. Big Fish Games releases a game every day that can be played for the first hour for free, allowing players to try it before choosing whether to buy the complete game. This model has brought a large number of female players to the gaming industry, especially older women. In the early 2010s, after free download + in-app purchase games dominated the Asian market, they began to enter the European and American regions. In this mode, the game is truly free, and more than 90% of players will not spend a penny. However, the real purpose of free games is to allow the most invested players to spend more money to improve or accelerate their gaming experience. Many top-up players will spend tens of thousands or even hundreds of thousands of dollars on their favorite games. After free games, what will be the next model that will disrupt the gaming industry? According to the development of other industries, subscription may become the next disruptive mode of the game industry. Developments in other industries have shown that subscriptions may become a disruptive force. Amazon, the world's largest retailer, uses its premium subscription service to lock in customers; Salesforce.com, one of the largest companies in the enterprise software field, uses a subscription model, which puts its established competitors into trouble; the world's second largest entertainment company Netflix uses subscriptions The model has gained current industry status; even Disney is betting its future on Disney Plus' subscription model. It is a change in people's attitudes that contributed to this change. Ten years ago, people would not pay for digital content. For example, ten years ago, people would not pay for music, but would buy a DVD or CD. But now, people's attitudes have changed. According to Reuters, in the United States, the proportion of people aged 18-24 who pay for digital news has jumped from 4% in 2016 to 18% in 2017. So, are subscriptions equally effective in the gaming industry? First, many gaming companies are already using subscription models. A blog post previously published by Google gave some data and functions about subscriptions. According to Google's blog post, the annual growth rate of global game subscriptions is 70%. Secondly, the subscription model has indeed played a role in the gaming industry. Google's blog post shows that game companies that use the subscription model have increased user retention by 20%. Finally, subscriptions offset the risk of developing and releasing new games. The game joins the subscription service "Operation Guide" Of course, the success of the subscription model depends on the implementation. Just as hundreds of game companies have failed to achieve success through free games, getting users to subscribe successfully is equally difficult. Adding subscription services to the game requires mastering the following 6 core concepts.

1. Subscription must be related to privileges The biggest challenge for game companies is to provide users with what kind of subscription content. Virtual currency? Do not. Successful subscription models provide a service that allows players to obtain privileges. In a game like "Legend of Bow and Arrow", it can gain a special level or power. The benefits of subscribing can also be special avatars or unique in-game activities. In short, the key is to allow players to obtain a privileged experience, not to allow players to obtain virtual currency or premium currency. 2. Keep it simple One of the core principles of creating a successful product is to ensure simplicity. If you provide customers with too many choices, you may be overwhelmed and unable to choose any of them.

World of Warcraft has a very simple subscription model that emphasizes the value of long-term contracts without causing a huge cognitive burden. If players have many different subscription options, including subscription terms, monthly fees, revenue levels, etc., they are likely not to choose. Therefore, the key to subscription is to make it easy for players to understand the value, choose between two or three plans, and decide whether to subscribe. 3. Be honest One of the reasons why subscriptions are difficult to be universally accepted is that some companies deceive customers to register for subscriptions, and then it is difficult to cancel. Preventing customers from leaving or deceiving them to subscribe is not only unethical, but also bad for business development.

One of the basic values ​​created by subscriptions for businesses is the connection with users. Top companies use subscriptions to improve their basic business, such as Amazon, Netflix, Spotify and other large companies benefit from user subscriptions. So when you add subscription content to the game, let value drive the product instead of deceiving customers not to cancel. 4. Build an ecological environment A successful subscription plan should be tied to the game itself. The longer you let customers play the game, the higher the value of the subscription.

Battle Pass is a good example, players can get a premium experience from subscription. It also creates a very powerful ecological ring, and subscribed players can get more rewards for continuous participation in the game. 5. The gradual upgrade of subscription value The evolution of revenue is another important factor in the success of subscription plans. According to Google, “As players invest more in the game, whether it's time, skills, or other IAPs, the benefits of subscription will increase accordingly.”

Although AFK Arena is not an example of a game that uses subscriptions as a monetization model, its mechanism allows players to increase their income in the game as their VIP level increases. 6. Subscription as an affirmation for big R players VIP is at the core of almost any game's success. 60% to 90% of most free game revenue comes from the top 1% or 2% of players. Therefore, encouraging players to become VIPs and retaining them should be the focus of the game team.

Many product managers will avoid subscription plans because they are worried that if players can subscribe to VIP plans for a fixed amount, this will limit VIP spending in the game. This concern leads to the first point of subscription design, which is privileges, not replacing existing purchases. If someone spends a lot of money on your game, don't try to get them to spend another $5 or $10 subscription fee each month. Instead, turn the subscription into an affirmation of their VIP status. Give them a free subscription, and the goodwill value will far exceed the short-term income generated by forcing VIPs to purchase subscriptions. case study: Subscription service for "Legendary: Game of Heroes" "Legendary: Game of Heroes" is a card elimination game published by N3TWORK Inc. in the United States. Players can cultivate their own monsters and allow them to evolve continuously, thereby increasing the probability of winning the battle. The iOS version of the game has a total global revenue of US$2 million in October 2019, and the most popular country is the United States. In terms of subscription services, "Legendary: Game of Heroes" has done a great job.

The fragmentation problem in the DEX industry will probably continue for some time, and also this trend is precisely the opportunity for 1inch. exchange. Published by: Liam Kelly, Ashwath Balakrishnan Translation: Lu Jiangfei Crypto Briefing authorizes blockchain news translation and publishes Chinese version One of the most significant explanations why 1inch. exchange can flourish in the DeFi field is that they "concentrate" decentralized liquidity in one place. Particularly following the rise of Yield Farming, the 1inch. exchange platform is promoting somewhat.

Breakdown of key content

* 1inch. exchange targets serving the retail (retail) user market eager to explore decentralized exchanges. * By integrating numerous decentralized exchanges (DEX) and tokens, users can exchange just about all types of ECR-20 tokens. * Nevertheless , since DEX is mostly built on Ethereum, it could cause gas fees to be too much. 1inch. exchange has now become a significant the main booming Decentralized Finance (DeFi) industry. Initially, it played the role of a one-stop liquidity aggregation "gathering place", nonetheless it has gradually evolved in to an exceptionally practical " "Swiss Army Knife", its sustained effectiveness is closely related to the ever-changing DeFi world. Yes, many users have noticed the powerful function of 1inch. exchange. Recently, DeFi supporter and crypto venture investor Qiao Wang launched an informal survey on Twitter. He hopes to learn in regards to the usefulness of different DeFi platforms from his 17, 000 followers, and lists including Balancer, Uniswap, Compound Many well-known projects including. In the long run, Qiao Wang concluded that in terms of product/market fit, the most notable three DeFi projects are Uniswap, Curve and 1inch. exchange.

Since the saying goes, when there is no investigation, there is absolutely no to speak. Qiao Wang's survey answers are more thought-provoking than anything. By better determining the product/market fit, understanding the liquidity of different DeFi platforms, and determining whether there is "business overlap" involving the platforms, is it possible to more accurately judge the differences between these DeFi platforms. In this specific article, we shall deeply analyze the essence of 1inch. exchange, explain platform functions, explore its operating principles, and explain why this DeFi tool is essential for just about any user. What is 1inch. exchange? 1inch. exchange is really a DEX aggregator which will help route just about all DeFi transactions. By integrating with various DEX providers, 1inch users can get probably the most affordable transaction, the lowest transaction delay, and may use various ERC-20 tokens for transactions. The aforementioned picture is from Dune Analytics: various digital assets exchanged on 1inch. exchange every month Platforms include: Uniswap, Kyber Protocol, Aave, Curve. fi, Airswap, mStable, Balancer, dForce Swap, 0x API, 0x Relayers (Bamboo, Radar Relay), Bancor, and Oasis, in addition to a number of other resources of liquidity (including private Market maker). The aforementioned picture is from Dune Analytics: monthly cross-DEX transaction distribution on 1inch. exchange Frequently, 1inch. exchange routing is going to be exchanged through one or more platform. This multi-routing procedure is named split trade. For example , between aDAI (Aave's interest-bearing DAI token) and DAI This simple exchange mode is adopted. The picture above is from 1inch. exchange Many of these transactions occur on Uniswap, and just a small portion are conducted on Balancer. The specific transaction ratio will fluctuate in line with the changing exchange rates on both platforms. Before performing such specific transactions, Uniswap also provides users with two "unlocking" processes, one is "unlimited unlocking" and one other is "single unlocking" one at a time. Most DApps require users to enable them to connect to the user's digital wallet, but 1inch is really a non-custodial decentralized application, so it won't ever hold user funds, but at the same time it may continue to connect to various encrypted wallets. Once "unlocked", transaction activities will occur, and every time the application form calls and verifies the unlocking, it may save yourself gas. For users who usually connect to the DeFi protocol, this feature can save yourself them lots of money. 1inch refers to this sort of unlocking as "infinity unlock" because it is different from the one-time unlock transaction-because the user needs to pay gas fees every time the unlock is named, so "unlock the transaction one by one" This kind of unlocking is higher priced. Nevertheless , "unlocking transactions one at a time" is relatively safer, because once threatened, users are not always linked to the protocol. In the DeFi platforms listed in the aforementioned figure, users may also hide some DEXs that they do not desire to connect to. The operation is simple, follow on the switch button. If the selected DEX is closed, the transaction will not be Will pass these platforms. In essence, 1inch is more like an efficient DeFi routing platform. It does not search various exchanges to get the best transaction price. It just sorts out all of the data for users, and means that users can get it no matter how "exchange" Probably the most affordable price. Even though operating platform can be a bit daunting initially, even if you really are a novice, you will get a really intuitive user experience in just a couple of minutes. Next, let them discuss 1inch's "growth mode" in the Yield Farming boom and analyze the specific circumstances behind these "exchanges. " What role does 1inch. exchange play in Yield Farming? The so-called Yield Farming essentially transfers users' idle cryptocurrency to various lending platforms, and they can earn interest from these assets. Although Yield Farming may have more complex definitions in some different forms, the aforementioned explanation is at least in this essay. If you wish to learn more about Yield Farming, I would suggest the next two articles:

* Just how to Yield Farm on Uniswap and Not Get Rekt * Yield Farming on DeFi: Beginner's Guide to Earning Interest in your Crypto Next, let's take a look at what sort of so-called "Yield Farmer" user can use 1inch. exchange to maximize his income-the so-called "Yield" (Yield) Right. First, by opening a tab (tab) on 1inch. exchange, you are able to connect with websites such as for example LoanScan, DeFi Rate, DeFi Prime, and so forth Currently, users pays awareness of the lending rates on different platforms whenever you want. For now, the cost and exchange rate of the stable currency DAI on Aave is extremely good. If users hold DAI, the operation of "Yield Farming" is relatively simple: they can get on Aave directly and exchange their DAI in to aDAI, which really is a stable currency DAI's interest-bearing token on Aave. As the operation is too simple, users barely require a transaction routing service provider like 1inch. Nevertheless the problem is that when the user holds other assets, such as for example Chainlink's LINK token, the process of manual exchange in to aDAI token is going to be very troublesome:

* Currently, the user needs to find a decentralized exchange or even a liquidity pool, and also this liquidity pool needs to give a competitive price for the exchange between LINK and DAI. * Then, the user needs to transfer the DAI exchanged from the decentralized exchange or liquidity pool with the leverage to Aave and exchange it in to aDAI. This method is extremely awkward, since the user may not be able to secure the most effective price when performing each step-at now, 1inch should be able to work. On 1inch, users can complete the complete process with only one click, making certain traders' orders won't have low slippage dilemmas. (Blockchain news note: There is a gap involving the price of the slippage market value order and the cost point of the final transaction) Nevertheless , with the popularity of DeFi, Ethereum gas fees will also be rising, which means that simple transactions may be relatively cheaper. If users start interacting with multiple smart contracts, the gas fee charged will increase rapidly. This might be one of the most obvious dilemmas undergone when using 1inch, but from yet another perspective, this issue is really a problem with the underlying blockchain (Ethereum), not a problem with 1inch itself. Exploring the Ethereum gas cost problem on 1inch Now, let us give yet another example, that we possibly may comprehend yet another problem solved by 1inch: If a user holds aDAI tokens, but currently he or she finds that Aave is stable on Synthetix The interest-bearing token aSUSD of SUSD includes a better exchange rate, and this user really wants to switch to aSUSD. What should I do currently? On 1inch, users can route through any number of liquidity pools and DEX, convert their aDAI tokens in to DAI, then convert DAI in to SUSD, last but not least exchange SUSD in to aSUSD tokens-most importantly, each one of these operations can be completed with one click. Unfortuitously, even though the operation is extremely convenient, it will bring high gas costs to users.

The aforementioned picture is from 1inch. exchange: If you wish to convert 50 aDAI to about 50 aSUSD, the user needs to pay more than $30 to execute this transaction. Consequently , most users might not accept this operation. One of the most significant explanations why such specific transaction costs are so costly on 1inch is that the gas cost on the Ethereum network is too much. Since most DEXs are made on the Ethereum blockchain, gas fees are a problem that cannot be circumvented. However in order to resolve this issue, 1inch has integrated an original feature: CHI GasToken token. Before explaining the CHI GasToken token, we should first discuss GasToken. GasToken allows users to take a position the gas price. When the price is low, users can buy and store gas for future use. The developers behind 1inch took this concept one step further and created the CHI GasToken token. For active DeFi users, by using this token or equivalent GasToken is definitely a good habit. The aforementioned picture is from Dune Analytics: When users use GasToken denominated in USD, they can save yourself gas on 1inch. exchange The team behind 1inch In June 2019, Sergej Kunz and Anton Bukov announced the creation of 1inch. exchange at the ETH Ny Hackathon. Both of these have become experienced software engineers with not exactly 30 years of experience. Sergej Kunz spent some time working as a software engineer in many German organizations, probably the most well-known that is Porsche. Anton Bukov worked being an iOS and macOS developer and entered the cryptocurrency industry in August 2017. Since that time, he's been cooperating with the NEAR agreement to simply help build an interoperable bridge between NEAR and Ethereum until June 2020. 1inch is fabled for publishing reports on DeFi vulnerabilities. Currently, many such reports have been published. The DeFi platforms involved include Balancer and Bancor. With regards to hackathons, the 1inch team often uses hackathons to require help, such as for example product building and expanding more intuitive user interfaces. Before founding 1inch, Sergej Kunz and Anton Bukov also participated in a hackathon, during which additionally they developed an arbitrage robot for the DeFi project. The 1inch platform indicator 1inch's liquidity summary function provides DeFi users with great practicability and may help DeFi users obtain the best price from all aspects. This kind of aggregation service can greatly improve the user connection with DEX, however for simple users who don't desire to complicate CHI tokens and keep transaction costs low, Uniswap might be a better choice. After all, Uniswap provides a cheaper Methods of obtaining liquidity. Nearly all of 1inch's user group are frequent users who often use the product. By the writing with this article, 1inch has approximately 300 unique users each day, and also this indicator peaked on June 24, 2020 (730 users). The aforementioned image is from Dune Analytics: Daily user volume on 1inch. exchange since its inception The 1inch user group is mainly made up of retail accounts, and the transaction volume is between $500 and $8, 000 to fully prove this. So far, there are no more than 100 large-scale transactions with a value greater than USD 1 million on the 1inch platform. The aforementioned picture is from Dune Analytics: the distribution of transaction volume by transaction amount on the 1inch platform Exactly why there are numerous small transactions on the 1inch platform may also be caused by whale split transactions, because DeFi liquidity cannot promote large transactions with no significant decline. Conclusion At this stage, DeFi liquidity is really mainly "concentrated" in many pools, such as for example Uniswap, Kyber, Balancer, Bancor, 0x, and Curve. They are also the primary players in most DEX liquidity. Each DEX's token liquidity pool has different depths, such as for example:

The DeFi loan agreement Aave is developing rapidly. CEO Stani Kulechov mentioned the big difference between your project along with other loan agreements, usage scenarios and development plans. Original title: "The old tree blossoms, 3 minutes to understand the most recent progress of DeFi loan agreement Aave" Interviewed: Stani Kulechov, CEO of Aave Aave is just a decentralized money market protocol that users can use to earn interest on deposits or borrow assets. Aave is definitely an open source protocol, anybody can freely obtain code and build about it. Recently, Aave's market size exceeded $70 million. Currently, Aave supports 17 different crypto assets, of which 6 are stable currencies.

Fleetingly introduce the team behind Aave. The Aave team currently has 17 people and is headquartered in London, with offices in Switzerland and Europe to work remotely. Aave happens to be devoted to expanding the Asian market and is recruiting community managers in Korea and Vietnam. Aave was originally the P2P lending type of ETHLend. Why did you decide to switch to a pool-based model? In the P2P loan model, borrowers and lenders can set their own rate of interest, duration, collateral along with other parameters to generate loan requests and loan offers. In ETHLend, if their conditions match, the machine will automatically match the loan offer and request. In the Aave loan pool, the liquidity deposited in the agreement is automatically allotted to the borrower, and the borrower can quickly have the loan through mortgage. This provides more selections for the borrower's loan term-as long since the collateral remains above the threshold, they are able to repay whenever you want. The lending pool causes it to be easier for users to take part in lending. We understand that Aave will allow anyone to take part in the lending pool with parameters set on their own. Is it possible to elaborate? Yes, starting your own pool is part of our multi-pool strategy. Initially, Aave will start several pools to open the multi-pool ecosystem. Our first pool is just a loan pool secured by Uniswap liquidity provider tokens (Unitokens). Which means that Uniswap liquidity providers can acquire liquidity leverage through the use of their Unitokens as collateral for Aave. In essence, Aave will generate a fresh currency market. Every currency market was created to release value from DeFi and bring depositors a profit in accordance with risk appetite. Like Aave can create pools with different risk levels, every one of which attracts different types of liquidity. LEND will soon be used for governance and voting to find out which pools can access LEND-based insurance. Liquidity providers can use their aTokens to vote and manage their fund pools. Weighed against the present governance system, users may have a larger say in dealing with their liquidity. Is it possible to tell us more about LEND tokens? LEND token would be the governance token of the Aave protocol. After the governance function is launched, LEND token holders should be able to vote on protocol updates and take part in the governance of the Aave protocol ecosystem. We're exploring the use of LEND tokens as a governance vote for new lending pools to select insurance. Anybody can use their own assets and parameters to generate their own loan pool, of course, if the pool features a good sense of risk get a handle on, they are able to decide to access the LEND token-based insurance system. LEND holders ensure the security of the protocol by staking LEND in a pool. In case of danger, governance will vote to cut back the pledge of LEND. If the pledged LEND cannot make up for losing, the LEND will soon be cast centered on governance voting to make up. The protocol features a integral backstop module, and Aave community members can deposit stablecoins in this module. When notably reducing or casting a fresh LEND, the backstop module can act as a buyer to ensure the selling price of LEND. Once purchased, LEND will soon be locked for a period of time. In this way, any auctioned LEND won't flood the marketplace in large quantities, and the protection of the LEND price gives the Aave agreement more stability.

What's the largest big difference between Aave along with other lending agreements? A significant function of Aave is "Aave interest-bearing tokens" (also known as "aTokens"). Whenever you deposit in the Aave agreement, you may be given a corresponding quantity of "aToken", that is 1: 1 from the underlying asset. aTokens generates interest directly in your wallet, to help you see the growth of your balance every 2nd. In order to decide to receive this interest at any Ethereum address. Another cool feature is rate of interest conversion when borrowing. This allows you to select between stable and floating interest levels whenever you want, so you always obtain the most readily useful rate of interest. Like in the event that you initially opt for floating rate of interest, however the rate of interest rises sharply, you can switch to a stable rate of interest. We also adjusted the rate of interest model to fill the gap between your floating rate of interest model and the stable rate of interest model, thereby making the brand new stable rate of interest more competitive. The absolute most concerned feature is flash loan, which allows developers to borrow money without any collateral. Fundamentally, they offer any developer with the exact same opportunities since the richest person, and the transaction will simply reverse if the loan is not repaid, so the risk is quite low. Flash loans can be utilized for various basic tools in DeFi, not only to make money through arbitrage. What have flash loans been used for up to now? Flash loans are mainly used for arbitrage. Another use case is to use flash loans to pay off debts to prevent liquidation penalties. The best example is DeFiSaver, which uses flash loans often a day. DeFi Saver enables you to manage all DeFi activities in a single place. It also enables you to put up a computerized self-liquidation procedure, use flash loans to settle debts, release collateral and sell the main collateral to settle the Aave agreement, thereby avoiding liquidation penalties.

Decentralized exchanges and oracles are basic application modules that explain to you just about all DeFi projects. Decentralized exchanges provide token exchanges, and oracles provide price-feeding mechanisms for various DeFi protocols. Compiled by: IOSG Ventures Token value flow of DeFi ecology @IOSG VC: From the vertical standpoint, users' rights and interests are tokenized layer by layer from the proper execution of the underlying assets, and the rights and interests are displayed by means of different tokens, and finally flow into the top-user aggregation layer to meet up various economic activities and requirements of users. For example , Ether can be mortgaged in the Maker Vault mortgage pool to lend out the stable currency Dai, and Dai can enter the Compound or Aave protocol for re-mortgage, expressing equity in cDai or aDai, and the top-level get back maximization tool such as RAY can automatically Allocate user rights and interests to different lending agreements to have maximum benefits. This shows a complete vertical flow case. From the horizontal perspective, decentralized exchanges and oracles are basic application modules that explain to you all projects. Decentralized exchanges provide token exchange, and oracles provide price-feeding mechanisms for various DeFi protocols. They serve as DeFi infrastructure Through the entire flow of DeFi value. Security Audit Technology of Smart Contract @IOSG VC: Security audits in a wide sense frequently utilize the combination of technologies shown above to find known or suspicious vulnerabilities in smart contracts that could allow attackers to steal funds. Security audits have greatly increased the threshold for attacking smart contracts, so every public project must be audited. It's like every door lock can be opened by the proper person with the proper skills, but we must still put in a lock to your door. Nevertheless , most security audit techniques are inefficient in detecting unsuspected issues, and they are definately not claiming that any audited smart contract is 100% "secure" or won't be attacked as time goes on. In addition , due to budget constraints, you can find sometimes trade-offs in exactly how many security audits to conduct. The aforementioned might sound a bit sad, but this is the reality we have to face. As a user of smart contracts, what does this mean to us? Listed here are the points you want to make:

* As always, only put the funds that you could afford in the worst case into the smart contract; * Only deposit funds for safety audited projects; * The potential rewards or advantages of DeFi applications should compensate for the extra security risks. The pulse of a Algorand Foundation and Circle have reached a cooperation to issue USDC on the Algorand chain The Algorand Foundation announced that it has already reached a cooperation with Circle to issue USDC on the Algorand chain. USDC is founded on an open standard and governance framework manufactured by the Centre Consortium (a joint investment and operation company of Coinbase and Circle) to understand a completely mortgaged stable currency for USD. FIT, Binance, Coinbase officially launched COMP, and Coinbase Earn added support for COMP FTX recently launched the COMP contract and DeFi index contract, and Binance in addition has launched the Compound governance token COMP, and opened the COMP/BTC, COMP/BNB, COMP/BUSD, COMP/USDT trading markets, and the COMP deposit channel has become open. And the cryptocurrency exchange Coinbase in addition has officially launched the Compound governance token COMP, and users can trade, send, receive or store COMP. ConsenSys Diligence launches blockchain project security audit database ConsenSys Diligence launched a blockchain project security audit database, which can be open source and displays relevant security audit information on the basis of the project, including audits, bounty, and contract warehouse lists. All project data is stored in JSON files. The goal of this database would be to aggregate blockchain security data for users, to not guarantee the security of any particular project. @IOSG VC: OpenZeppelin performed the Timelock Audit, Governance System Audit, Tether Integration Audit, MCD & DSR Integration Audit & COMP Distribution System Audit. However, Trail of Bits has been around charge of Compound Protocol Security Assessment, Compound V2 Security Assessment & Compound Governance Security Assessment. Certora and Gauntlet also participated in the security analysis, performing Formal Verification of Compound Protocol and Market Risk Assessment, respectively. In terms of the amount of projects covered Trail of Bits, OpenZeppelin and Consensys Diligence seem to be the absolute most reliable auditors. They've been followed by Chain Security (now element of PwC), SmartDec and QuantStamp. The DeFi Money Market Agreement DMM Telegram Group was attacked through the public offering, and users have already been compensated with USD 40, 000 DeFi Money Market Protocol DMM's official Twitter stated that its telegram group was maliciously hijacked through the public offering, and the attacker imposted the DMM Foundation in order to steal funds. The corresponding DMG amount was compensated for people who were deceived in the token sale. Startup Notabene is launching a compliance platform for crypto exchanges Start-up Notabene wrote a write-up about Notabene, its compliance platform for cryptocurrency exchanges. The platform is made to help worldwide virtual asset service providers (VASP) comply with the travel rules proposed by the Financial Action Task Force (FATF), allowing exchanges to begin integrating travel rules within their compliance workflows. @IOSG VC:

Notabene is the first professional KYC platform set up for compliance transactions. Its team began operations in February 2020 and won its first customer Concordium, which can be the very first public chain infrastructure established for compliance. Notabene focuses on the overall process of users' digital asset transactions as opposed to just identity verification. Including connecting the customer's identity with the digital encrypted currency account, real-time monitoring and evaluation, and providing continuous SAAS services. Cryptocurrency trading KYC is dramatically distinctive from KYC in conventional finance. The KYC business process of cryptocurrency transactions requires the following aspects. StarkWare launches STARK-based verifiable delay function service "VeeDo" StarkWare, a zero-knowledge proof research and development organization, launched a STARK-based Verifiable Delay Function (VDF) service "VeeDo" on the Ethereum mainnet. VDF is just a function that delivers delay and time lag through calculations. The first application that StarkWare intends to resolve with VeeDo is the trustless and uncontrollable random proof concept (PoC) on Ethereum. @IOSG VC: At the conclusion of May possibly this season, StarkWare also announced on twitter that it might soon complete the development of the ethSTARK code and open source it. ethSTARK is founded on the Ethereum Foundation funding StarkWare in July 2018 to develop a STARK-friendly hash function and offer open source ZKP code because of its ecology. Once ethSTARK is completed, the code will run 20 times faster than any existing ZKP code.. StarkWare raised $30 million in October 2018. Investors include Consensys, Coinbase Ventures, Intel Capital, Pantera and Sequoia.

Fomo3D Team Launches New DApp ‘Just.game’

Fomo3D is back with an eagerly anticipated new DApp, Just.game, which has been dubbed “a showcase of how blockchain technology can be used to create an autonomous company that constantly generates revenue and distributes it to anyone crazy enough to play with it.”

https://twitter.com/Joojjoojojo/status/1208499170086211584

It has been reported that Just.gameis not just another blockchain…