Wu Zhen·imToken founder He Bin: A Bitcoin DeFi Tour

On the morning of November 9, at the “D-Future: Decentralized Finance Future” sub-forum “2019 World Blockchain Conference·Wuzhen” sponsored by Babbitt, He Bin, founder of imToken, published “One Bitcoin” The theme of the DeFi Tour.

He Bin said at the meeting that DeFi is based on the technology of blockchain as a security guarantee, and then uses encrypted digital currency as a carrier of value to create an open, programmable and combinable financial market through smart contracts. It is technology. Geeks and project practitioners bring a very good will to human expression.

In addition, He Bin said that DeFi has only been developed for more than a year. If you compare the traditional financial market of several trillions of dollars, the DeFi market with only a few hundred million dollars may be just a meteorite in the solar system, and it is still very small. Next, the bitcoin market has hundreds of billions of dollars, so imToken hopes to increase the volume of the DeFi ecosystem by bringing bitcoin to the Ethereum ecosystem. To this end, they released a bitcoin-mapped asset called imBTC, which acts as a shadow BTC, giving it programmability and combination with other DeFi applications.

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(Photo: He Bin, founder of imToken)

He Bin: Hello everyone, just on a round table, everyone knows more about DeFi. I followed the topic just now and introduced it to you in a more interesting way, letting everyone have a more perceptual understanding of "what is DeFi." Just a small experiment on the team side, how to bring a bitcoin to DeFi, today is to share with everyone in this form.

I will briefly summarize this for you. In my own way, I will introduce what DeFi is in one sentence.

It is actually based on blockchain technology as a security guarantee, and then uses encrypted digital currency as a carrier of value to create an open, programmable, and combinable financial market through smart contracts.

DeFi is the expression of human good will

Its characteristics have just been mentioned, it is a borderless, open mechanism. Because blockchain technology can fully guarantee its openness and transparency, it is not involved in the threshold.

This is not the case with traditional financial markets. It may not be clear to everyone that there are 1 billion people in the world who do not have a bank account and they have no way to enjoy modern financial services. In addition, if you look at the news, you know that the inflation rates in Argentina and Venezuela are very high, and recently their government has imposed very strict restrictions on citizens’ monthly withdrawals (such as a maximum of $200 per month). . Imagine what the local people are like when their national currency can depreciate by 30% a day.

DeFi relies on the blockchain, which is a mechanism that allows people to participate in financial markets and enjoy financial services in a way that has no international boundaries, no identity differences, or no amount differences.

I think that DeFi is a geek of these technologies, and the project practitioners bring a very good will to human beings. It is driven by the public interest to develop a new financial market. I am also honored to be this power. One molecule.

Since the beginning, imToken has attached great importance to supporting the development of DeFi. In 2017, we practiced decentralized exchanges inside the wallet.

Tokenlon's brand is based on the development of the time and the new currency exchange mechanism, and then built into the imToken wallet.

And a series of Ethereum projects like MakerDAO, we are also the first time to cooperate with them, we fully cooperate to optimize products in the entire wallet and interaction.

For example, Compound can do lending, and PoS chain can do Staking. There is also a series of DApps related to derivatives, a blue currency, and so on. DeFi is built on the Ethereum platform, and users need to interact spontaneously with smart contracts.

Users can install the wallet for free, let the wallet itself as a personal digital bank, and then complete the most basic financial activities such as deposits and loans, transaction investments, etc., so this is a very remarkable thing.

Comparing the multi-billion dollar traditional financial market, DeFi may be just a meteorite in the solar system.

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(Illustration) The DeFi ecosystem is still in the development stage. This is the service sector. In the Ethereum ecosystem, various project parties promote service modules in various fields. Most of them can be called at the blockchain smart contract level, interdependent, and combined into a service market, financial products, there should be more than hundreds of applications.

From the perspective of market size, we can see that DeFi Pulse locks in the market value. More than 50% is MakerDAO to issue DAI, users pledge Ethereum, and release DAI stable currency. At present, the locked assets exceed 350 million US dollars, and the issued DAI has just peaked, which should have exceeded 100 million US dollars.

It is because there is an excess mortgage rate, so its entire issuance scale is still limited to a single Ethereum asset. Behind the more mainstream Compound, it has a scale of about 100 million US dollars.

DeFi has been in development for more than a year, and it is still less than two years. It is still in a process of gradual growth. If you compare traditional financial markets, DeFi may be a rock in the solar system, and it is still very small. The traditional financial market has a multi-billion dollar scale. The entire encrypted digital currency has a market capitalization of $250 billion. Bitcoin is relatively large ($170 billion), more than 60%, and Ethereum is $20 billion.

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imBTC design ideas

Under this mechanism, we hope to bring Bitcoin to the Ethereum ecosystem, so that DeFi's volume can be improved when the entire asset size is very small.

WBTC and BTC are the same ideas. How to bring BTC as a mapping asset to DeFi is not introduced here. Each project will fulfill such a goal in different ways.

However, whether it is the mapping of BTC or the originator of DeFi itself, it will face a dilemma.

Under the mechanism of decentralization, how to guarantee or support the user experience is good enough, how to make the threshold low enough, to promote liquidity, and to increase the scale of the market, these three are actually very difficult to achieve.

From our point of view, we hope to verify this market with a way of thinking about Internet products. Starting from the user experience, we will lower the threshold very low, and promote the growth of liquidity scale with user growth, and further able to honor or stick to it. Centralization mechanism, this is a very good innovative experimental process.

Here the Token team released the bitcoin mapping assets of imBTC in this way of thinking.

As the name implies, imBTC is an asset that is released on the Ethereum platform in a BTC 1:1 manner, as a shadow BTC, with its programmability and combination with other DeFi applications.

Its distribution mechanism is also very simple, there is a Relayer in the middle, and the Ethereum and Bitcoin two chains interact. From the user's point of view, the coin has three steps, the user hits the bitcoin to the escrow account, and Relayer transfers the transfer. To make a confirmation, the ETC will issue the equivalent BTC to the user, and the lock is issued in two atomic steps. Redemption is a reverse process, also initiated by the user. This process destroys imBTC. Relayer transfers the equivalent BTC back to the user's bitcoin wallet. Currently, Relayer is still a centralized system. BTC hosting is still dependent on centralized hosting. Account, in the future we will replace the middle Relayer with a more decentralized way.

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In addition, we set a new mode for imBTC, and hold the currency. For example, let's go to Staking, or go to borrow, lock the coin into the contract, or borrow it through the contract market to generate interest. How is this achieved?

It is the contract fee that imBTC will generate on the Tokenlon trading platform in the future, and it will be reversely flowed back into the contract to make the distribution. This distribution allows all imBTC holders to allocate interest according to the proportion of the currency. Through such economic incentives, imBTC itself allows everyone to have more desire to hold it. When users go to buy the handling fee generated by imBTC, they will stimulate more people to hold it, thus expanding the scale of imBTC issuance.

From the core process, coinage, redemption, purchase, and trading to the currency, we have achieved a very low threshold through deep understanding of these core links, so that everyone has more economic incentives, let imBTC Widely popularized, let everyone want to hold, and drive to the entire DeFi ecosystem.

We hope to gradually improve our products and continue to expand the size of the imBTC market to drive the DeFi ecosystem, including lending, pledge assets for stable currency issuance, as well as DEXes, and other synthetic assets.

DeFi is a wonderful, beautiful vision. So how do we let it happen and how can we promote its development?

Can be summarized as three points:

First, more efforts are needed to introduce more abundant and liquid assets to expand the mobility of the DeFi ecosystem. Second, continuous optimization and product experience will continue to lower the threshold and attract a wider range of users. From the user's point of view, the more participants, the bigger the market, the wider the user scale can be reached in the whole promotion of users; the third is to adhere to the open and transparent mechanism of the blockchain, so that the DeFi application can be very Good synergy, resulting in network effects;

If DeFi and CeFi end up with a battle, where do you choose to stand?

I am here to encourage everyone to experience and participate in this movement, because this is our right.

thank you all!