People go in the currency circle, how can they not be covered?
Before being shackled by Algorand, Chen Jiaming was also caught by Iris' 21-day unlocking mechanism.
Comparing the two, Chen Jiaming is even more annoyed at the latter. "Algorand is wrong because he made a mistake. He mistakenly used scrap copper as gold. I recognized it. What is the disappointment of Iris? You want to be locked when you cut it."
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Since then, Chen Jiaming has equated Staking with his failure.
Some PoS projects with more than 20 days of long unlocking cycles, such as Cosmos and IrisNet, seem to be unfriendly to short-term investors and risk-averse.
Where there is a gold rush team, there are people who send water. Recently, the Odaily Planet Daily noticed that there were at least three projects in the market and wanted to provide liquidity for these Staking coins. They are the STAFI protocol for derivatives developers DeBank Pool, Definex and Wetez wallet promoters.
On the official website of the STAFI agreement, it is said that “the vision is to provide liquidity for 80% of Staking assets.” It can be seen that its ambition is great. “Staking's derivatives market will be the infrastructure of the POS ecosystem. Just like there will be REX on EOS,” believes Tang Hongbo, founder of DeBank Pool.
How big is the market for locked-to-deal tokens, and who will lead them?
Poor mobility into Staking
The loss of liquidity of the pledged currency means that the user has to bear the impact of fluctuations in the currency price. Although the user earns from the currency standard, from the gold standard, the user is likely to lose money. The PoS, which wanted to attract builders with interest, has a long-term solution to the pledge cycle, but it has discouraged interested people.
Chen Jiaming bought Iris in late April and early May, when Iris fell. When listening to Iris's private placement price is more than twice the current price, and the private equity firm's currency has not been unlocked, Chen Jiaming decisively opened the position. In the first two weeks, the price of the currency did rise, so Chen Jiaming, a short-term player, decided to try Staking. “Equivalent to double leverage, earning Staking revenue while optimistic about the rise in spot prices.” But I didn’t expect that Iris would start to fall after a few days after Staking. "When I fell to 4 hairs, I applied for solvency, but there was no way to wait for a long period of time. I could only look at the assets shrinking irritably," Chen Jiaming said.
According to Tang Hongbo, the 50% decline in Atom, Iris and other projects in the past three months has already had a significant impact on the community. “In these projects, the price signal in the secondary market has failed. It is impossible for you to stop the loss in time when the price falls. You need to wait for 21 days to pledge before you can throw it; in this process, you will pay attention to how the price changes. If the fall is awkward, the whole person's state will become more and more panic. The community will also have negative voices and even snoring, which will hurt the consensus."
This description is not excessive. An Iris Staking player once spoke in the group: "Look at this group, no one is talking. I can't help but complain when I pluck so many coins every day."
Tang Hongbo likened this problem to the lack of infrastructure. Just like before the REX on EOS came out, people had the need to rent a coin to buy a CPU, or directly rent a CPU. The pain point of the user is obvious, then the product is a matter of time.
This is not the case of Tang Hongbo. When Chen Jiaming heard the pattern of trading Staking tokens, he also felt why he didn’t come out early.
How is Staking derivatives done?
Staking node vendor Wetez is conceiving such products.
The product is called STAFI and the idea is to issue a stable currency called ABS Token to anchor with Staking. As a result, the assets of Staking's hostages on the chain cannot move, but ABS can trade. In addition, ABS not only represents the currency of the locked warehouse, but also represents the right to income of the locked warehouse token. Last month, STAFI released a white paper, the test network is expected to go online in November, the main online line will have to wait until next April.
DeBank Pool is probably one of the few available products on the market today. The idea is to develop a DEX on Cosmos to match the users who want to pledge in advance and the users who want to mortgage.
According to Tang Hongbo, when users want to redeem quickly, DeBank Pool will not actually initiate a deflation operation on the main network. Instead, they will place orders on their DEX platform to allow people who want to pledge on the main website to pay for it. This provides liquidity for Staking's coins. At the same time, after the transfer of token ownership, the rights generated by the token, such as pledge income, community governance proposals and voting rights of the nodes, will be attributed to the real owner. ”
The development of DeBank Pool began in June, and the product went live in beta in July, supporting the pledge transaction service of Cosmos public chain Atom, which is currently connected to wheat wallet, TokenPocket and Ledger.
The idea of Definex is similar to that of DeBank Pool. According to an industry source, its products are still in the polishing stage.
Just like other transactions, buying and selling can be completed smoothly and the depth of trading. According to Tang Hongbo, in the natural state, because DeBank Pool currently has only a small number of seed users, there are often cases where pending orders and sell orders cannot be combined, or used for too long, especially for eating orders. Because this service is just needed for the pending party (seller).
In order to alleviate this problem in the short term, DeBank Pool uses its own market to solve the problem of transaction depth, and this has become the current profit model of this project.
In general, the seller is willing to pay a fee for the liquidity of the pledged assets. On the DeBank Pool, this rate is set by itself and the platform itself does not charge any transaction fees. Naturally, the higher the rate, the faster it will be sold. It depends on the seller's willingness to pay for this liquidity.
Will it become a standard for node vendors?
As a supporting service of Staking, the transaction lock warehouse token is essentially a convenient user, which effectively reduces the risk of users being quilted due to the downward price of the currency, thereby reducing the psychological threshold for users to participate in Staking.
From this logic, node vendors may want to do this. But is this really the case?
A node business told Odaily Planet Daily that the future may be needed, but it is estimated that it is not just needed. The (POS) project is still very early and the pool is small. Atom's current pledge assets are only $450 million, and thousands of users are pledged, like Iris is even smaller. In the end, there may be no one playing like the current DEX. This is actually the basic logic that entrepreneurs must follow – don't do business on a small track.
There are still many people who are similar to this node business, and they also take a wait-and-see attitude toward this "small plate."
Tang Hongbo does not deny this. “The upfront cost is indeed high, because the amount of users, the amount of funds, and the rate is relatively thin, DeBank Pool through the purchase of income, the income from the service fee is generally. Basically only support you to develop this application, verify yourself Model."
So, when will you wait for the user?
Tang Hongbo believes that the large-scale growth of users still needs to go to the blockchain industry and the PoS public chain to usher in a large-scale outbreak. This is a long cycle. But for a new thing, or from an industry development law, it is normal.
“I was hungry in 2012, and the job number is in the top 100. From 2009 to 2014, 5 years (hungry) can be said that not many people know. Until 2014, giants such as Alibaba and Tencent All stood up and said that this business is worth doing. So money and users are coming with the wind. I have concluded that Internet products are out of time to see if your business can resonate with a bigger wave, such as How can these businesses be quickly blown up? It is because of the need for mobile payment promotion in the 14th and 15th years. These scenes can help him promote payment. I believe that the blockchain is also like this. Which big waves resonate and need to be explored," Tang Hongbo said.
It can be said that DeBank Pool wants to use imagination to attract players. "We still need more market makers, so that we can truly decentralize and play the market mechanism. The first to join, may be some users who are more adept at arbitrage, professional programmers."
StaFi wants to expand the application scenario to become a big market. “Subsequent to the launch of Boca and ETH 2.0, the securitization and circulation of Staking assets will become very large. In addition, StaFi is targeting a larger mortgage asset market, not just Staking's assets. The issuance and trading of these bonds are Can be profitable."
Perhaps, as this market grows, Staking derivatives really have a day to become an infrastructure. But when will the project side get involved in a trading market?
Based on past experience, Tang Hongbo believes that this is very likely. Before REX went live, Tang Hongbo's team made a similar product in August last year. On the first month of the line, it received a mortgage of millions of EOS (to lease the CPU), but after the REX went online, the user plummeted.
The war on Staking derivatives has not yet ignited, which may be a good time for developers.
Text | Huang Xueyu
Produced | Odaily Planet Daily (ID: o-daily)
Original article; unauthorized reprinting is strictly prohibited, and violation of the law will be investigated.