This week's most noticeable DeFi world is a technical research paper published by Gauntlet CEO Tarun Chitra, which concluded that on-chain lending and other (DeFi) activities can affect the security of PoS networks.
Dragonsee's partner Haseeb Qureshi simplified and refined the paper, which sparked widespread discussion.
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How does DeFi cannibalize PoS security?
The original paper is here: https://docsend.com/view/697feid
On this topic, the cryptocurrency community has engaged in heated discussions with participants including Ethereum co-founder Vitalik and original paper author Tarun Chitra.
"Deflationary monetary policy means that the assumption that R is close to zero is wrong, which ignores transaction costs."
"I agree that this part of the model is indeed different from the actual situation, but we have simulated this with a non-zero cost (modeling cost based on historical data / jump process), and you still have pledged supply and drainage. In the plot of borrowing, there is more oscillating behavior. The phase transition of “all staked” occurs at different points in time (for example, different threshold interest rates), but there is still a change from “almost full pledge” to the opposite Face jumping.
"Do you model the return of staking as a constant or inversely proportional to the total pledge amount (or inversely proportional to the inverse sqrt in eth2)? If it is any of the latter, such as stake -> 0, reward-> infinity, then 0 staking seems to be unstable. "
"Reverse sqrt! You will not have a zero pledge situation, and you are at a distance from the 50% pledge rate, and the cost model …"
"I am very willing to believe that in various cases, the proportion of pledges will be much lower than 50%, but why is it bad?"
"More importantly, the volatility of pledged assets is also high (if the participants are rational), which means that attackers can wait for a period of low pledged tokens before performing their favorite attack. And confidence comes from For stability, a deviation from the 50% limit will produce a range of fluctuations (see the theorem section in the paper). In other words, the next inequality is very useful. "
Comment: Tarun Chitra thinks that his research methods and results have no big mistakes, Vitalik thinks that this does not seem to be a big hidden problem and then refutes his thoughts. As the people who eat melon, we just want to see a conclusion: DeFi What is the security impact on the PoS system?
Will Tether break into the world of DeFi?
Another hot topic this week about DeFi is the relationship between Tether and DeFi:
We know that Tether is the largest stablecoin in the current cryptocurrency world. Its USDT market value on Ethereum has already exceeded 2 billion U.S. dollars, but it has not been applied in the DeFi world. If we go to make a package The operation is like cDAI. Does that mean that Tether can also perform DeFi?
In this regard, Hayden Adams, the founder of the Uniswap protocol, mentioned:
"We are building custom support for it in Uniswap V2:"
(The implication is: we will soon support this feature.)
Will the DeFi ecosystem usher in a large wave of growth as a result? This remains to be seen further.
Best DeFi Articles of the Week
1. How to get a fixed interest rate for your DAI assets? 》
Author: Andrey Belyakov, translation & proofreading: ViolaH & Min Min (Ethernet Square enthusiasts)
Recommended reason: This article introduces the operating principle, technical details and operating steps of the SWAP.RATE platform. Through this platform, you can deposit your "previous insurance" on your DAI.
2. " Decentralized Mobility: How to Make DeFi Mature? 》
Author: Steven McKie and Matthew Prewitt
Reason for recommendation: This article introduces some decentralized liquidity pool solutions, including Uniswap, Bancor, Balancer, Convexity Protocol, Unipig, and StarkDEX.
3. How does DeFi cannibalize PoS security? 》
Author: Haseeb Qureshi, translator: Coi (Blue Fox notes)
Reason: Do you still need a reason …
DeFi News of the Week
1. DeFi company Zerion received USD 2 million in seed funding, and Placeholder and others participated in the investment: https://www.8btc.com/article/524992;
2. Sai stabilization fee, Dai stabilization fee, DSR adjustment, and debt ceiling adjustment: https://blog.makerdao.com/governance-poll-stability-fee-dsr-adjustment-december-2/
3. 0x protocol v3 is deployed to the Ethereum mainnet: https://twitter.com/0xProject/status/1201533886565502977
4. Synthetix reached cooperation with THORchain, a cross-chain liquidity pool: https://blog.synthetix.io/synthetix-thorchain/
5. Bancor announced the airdrop of new liquidity tokens on January 1, 2020: https://decrypt.co/12553/bancor-cryptocurrency-airdrop-set-for-new-years-eve
6. Biyuan Chain will try on the Defi field based on the Bystack architecture, and a related white paper will be released soon: https://www.8btc.com/article/526589