Today's content includes:
1. Dragonfly Capital talks about DeFi's need to solve these three things next year;
2. Staking, loan interest and currency: What currency can make more money?
- 60% of Bitcoin has not been moved for nearly a year, investors prefer to store coins rather than trade
- Popular science | Privacy protection is worrying? Encrypted data warehouses show their talents (core use cases and requirements analysis)
- I left the project side and went to the exchange.
- Prophecy Machine Governance Attack in Maker: How to make Maker's mechanism more perfect?
- Behind the "per-billion dollar bitcoin permanent loss": Bitcoin almost died
- Canada launches regulated bitcoin fund, open to retail investors at the end of the year
3. Finance 2.0: a year-end summary letter from Pantera;
4. STO products (eventually) will skyrocket in 2020;
5. The dark side of the BRAVE browser (BAT).
Dragonfly Capital talks about DeFi need to solve these three things next year
Haseeb Qureshi, managing partner of Dragonfly Capital, gave Coindesk a retrospective interview about his views on Defi. And pointed out that in 2020, Defi needs to solve these three things. 1) Improve efficiency by reducing the margin of excess mortgages; 2) Increase the diversity of synthetic assets (not just DAI); 3) Establish a bridge with the real world to introduce a strong form of identity into the blockchain.
For DeFi, 2019 is an important year. The number of DeFi users has increased by 30 times. MakerDAO is the first and most important DeFi foundation and has captured a lot of market share. Platforms such as Compound, dYdX and Uniswap also have their own breakthroughs. Wallets like Coinbase and Argent are now providing The savings account against the US dollar, all of which are on the public blockchain.
A year ago, DeFi was just an obscure concept. No one now doubts that DeFi will become an integral part of the public blockchain.
This is a good start, but we still have a long way to go. DEFI introduces what is missing: a true form of Internet-native finance.
So what next? There are many areas where DeFi needs improvement, but these are the three major priorities of 2020.
The first is to improve efficiency by reducing the margin of excess mortgages. Most consumer mortgages operate at a down payment of 5-20%, bringing the total mortgage loan to 105-120% (because the house itself is already 100% mortgaged). 150% of excess mortgages will be unheard of in traditional finance.
There are two main reasons for excess pledges: volatility and transaction delays. If the freeze time in proof of stake can be reduced (or better yet, push the DeFi application to Tier 2) and a more professional market maker network is used, these systems will be able to clear collateral faster. In addition, with the acceleration of the liquidation speed and the increase in collateral, the excess mortgage rate may drop a lot.
After reducing the mortgage rate, DeFi's second priority is to increase the diversity of synthetic assets. Take a look at MakerDAO: MakerDAO produces dais, and there is no actual dollar anywhere in the system. All it takes is the price of Ethereum / USD. If we just swap the price supply for ETH / other assets, all of a sudden we can produce other anchored tokens synthesized through exactly the same mechanism. Maker and UMA are two agreements that pursue this goal, and I hope we will soon see a variety of synthetic financial assets. In the future, anyone with a mobile phone can buy any financial asset they want from anywhere in the world, all with cryptocurrencies.
Finally, DeFi will need to move towards iterative games. The agreement will not consider the gaps of each user, but will consider your long-standing on-chain cash flow and income-generating assets. If your address works well on other DeFi platforms, you should be eligible for lower rates and better credit.
Ultimately, we should be able to import a strong form of identity into the blockchain by building bridges with the real world.
Identity is a prerequisite here. After all, in terms of loans, blockchain is not very similar to the real world. If you default on your debt in real life, you must declare bankruptcy and waive your credit for at least 7 years. But on the blockchain, you can abandon any default address and start over with a new address.
So we need stable, expensive identities. However, if we wait for the government and other identity brokers to provide this service, then we may always wait. As Balaji Srinivasan advocates, we are more likely to build a bridge between one's blockchain and Web2 identity, and this can be done without any government involvement. If I can use my Twitter or Facebook reputation to support my credit history on the blockchain, then we can build a pure digital credit system. Although there are many unresolved issues regarding privacy and anonymity, they should work in principle.
The Internet has disrupted the monopoly of almost every industry, but to a certain extent it has left financials almost unaffected. DeFi introduces what is missing: a true form of Internet-native finance. Ultimately, it will fund the development of the Internet in other industries. However, it is too early, all of these products are experimental and will no doubt fail. However, the power of delicensing innovation makes DeFi inevitable.
Full text link https://www.coindesk.com/what-defi-needs-next-year-three-priorities
Staking, Defi & Cefi and Hodl: What currency can earn more?
The author uses the Binance platform as a standard, and compares three methods of operation, pledge (Staking), loan financing and TunCoin, which currencies can make more money. From December 9, 2018, a one-year comparison Of course, the comparison is still very rough, but the result is still in line with the impression. It concludes as follows:
A percentage value of the annual estimated average reported by Binance;
To understand the value of interest, we multiply the number of tokens collected by the current value of the cryptocurrency;
The number of investment tokens calculated by dividing $ 1000 by the value of the cryptocurrency as of December 9, 2018.
It turned out that the winning cryptocurrency was Tezos (XTZ), whose initial investment was multiplied by x4.
Loan Money Management:
Includes tasks performed on platforms such as Binance or systems created using the Compound protocol
Consider the following:
For Binance (USDT, BNB and BTC) loans, we will use the exchange rate on the platform;
For loans in other cryptocurrencies, we will use the interest rate published by Compound on December 9, 2019.
In this case, we found that due to a number of factors, the investment that brought x3 was Binance Coin (BNB).
The calculation is easier because it is necessary to consider that for the same investment, the highest return can be obtained by holding the cryptocurrency for one year, so the initial investment for 365 days is $ 1,000.
Unsurprisingly, Bitcoin (BTC) has proven itself to be the leader of asset holders and therefore a store of value. Close behind is Bitcoin Cash (BCH), which proved to be twice the initial investment, and Ripple (XRP) recorded a net loss, proving to be a very bad investment.
Full text link https://read.cash/@AlanOne/staking-vs-lending-vs-holding-what-crypto-assets-allow-to-earn-more-the-cryptonomist-9649aab4
Finance 2.0: a blockchain letter from Pantera
A Defi article written by Pantera. They wrote a great Open finance article at the beginning of the year. Maybe they plan to conclude another article at the end of the year? Some research data summarized at the end of the article is not bad. Some highlights:
Since 2010, any Bitcoin investor who has held Bitcoin for three and a half years has achieved positive returns.
Jeremy Allaire, founder and CEO of Circle: "When the iPhone came out, no one could think of Uber-maybe only a few entrepreneurs. When you connect the dots between the infrastructure, what you can do may not even be People think of them. This is actually where I'm most excited. "
Xapo founder and CEO Wences Casares, "I don't think it's far away that Bitcoin will become the most widely held asset in the history of civilization. I can see this happening in the next three or even five years."
We mentioned earlier this year that the three major obstacles facing cryptocurrencies and Defi: scalability; fiat currency entry; nascent infrastructure
0x has partnered with StarkWare to enable hundreds of transactions per second. Similarly, Uniswap conducted a trial at Plasma Group, which allowed 100 transactions per second.
BloXroute was recently put into use on Ethereum, which will increase the throughput of the network. Ethereum has increased throughput by about 25%, and using bloXroute, it may grow 10 times faster than the current speed next year. We have made great strides in Plasma research, and in particular the Matic Network has launched an experiment on the main Ethereum network using the technology. A new technology called Rollup has emerged that can increase performance by 10 to 50 times (without latency), which is the way Uniswap uses for its scalability experiments. In the first six months of 2020 we will see a lot of interesting launches.
Fiat entrance The ramp has developed very smoothly over the past year. Bakkt launched their futures contract in September and its trading volume is rapidly increasing. On the consumer side, Wyre (and many competitors) have launched products that enable users to bring US dollars (Ethereum, Bitcoin or Dai) into their crypto wallets in less than 30 seconds.
Unlike scalability and fiat entrances that have made tremendous progress over the past year and achieved more anticipated improvements in 2020, improvements in infrastructure may evolve at a slower pace. Our expectation is that change will take about 5 years to materialize.
Full text link https://medium.com/@PanteraCapital/finance-2-0-pantera-blockchain-letter-december-2019-d279aa310ac6
STO products (finally) will skyrocket in 2020
The author is Emma Channing, the CEO of Satis Group and a representative of Consensys Securities, a retrospective interview with Coindesk. I mainly talk about her views on STO. She believes that STO will skyrocket in 2020.
At the beginning of 2018, only three STOs were put on the market. In contrast, infrastructure technology has improved significantly in 2019, while costs have fallen sharply. At the same time, the platform has begun to be thoughtfully designed around end-to-end functionality and compliance, including the features needed by broker-dealers.
Relative liquidity is a benefit, but it is not a panacea for STOs (except for funds, especially those that have active, co-invested LPs and want to trade with each other). For individuals, registered investment advisors, and broker-dealers, custody and control solutions are important, but they are still new and complex from a practical and legal perspective. Another problem is the poor quality, unqualified or enthusiastic lawyers providing consulting services to STOs and their failure to deliver. In particular, due to insufficient confidence in Regulation A + applications.
The biggest difficulty in 2019 is finding such issuers in things we don't think will succeed. But this is the growth curve of classic emerging technologies and capital markets, and by 2020 everything will be a good sign. We believe that what investors want to see is traditionally the kind of high-growth, high-profit, technology-driven investment that private equity has attracted, especially considering the technology learning curve involved in securities token ownership.
To further develop the STO industry in 2020, it needs to provide reasons other than greater liquidity (that is, STO will transfer investment to previous non-current assets). The STO needs to be designed by a suitably qualified FINRA registered representative to provide a better trap. Financially, this is not only financially attractive, but it also adds functionality or enhanced execution or similar functions. Performance exceeds traditional capital markets. To achieve these goals, issuers need to leverage the full suite of DLT technologies.
Full text link https://www.coindesk.com/security-token-offerings-are-finally-set-for-takeoff-in-2020
The dark side of the BRAVE browser
This is an article criticizing BAT (Brave Browser), especially the attack against founder Brendan Eich. There are some attacks on individuals as well as criticisms of Brave and BAT's economic ecology.
In 1998, while still a Netscape employee, he helped launch the Mozilla project. The core part of Mozilla identity has always been a good ethics around open source and web citizenship. This is a remarkable legacy for any software engineer. However, Brendan Eich underwent some late career transition and became a representative of the dark side.
By layering ads on my ad-free website, while assuring web users that they are part of a benign new economy. Users may find that all Brave has done is replace one set of ads with another set of ads, so Brave introduces some popular misleading: cryptocurrencies. Invented a so-called "Basic Attention Coin" to pay users for watching ads provided by the Brave browser.
This is what I found about Brave:
Zero innovation. Brave did not provide new ideas. Just replace one set of ads with another set of ads.
dishonest. For users, Brave will still collect data about you.
The economic model doesn't work. One of the most sneaky aspects is the implicit connection between generating a cryptocurrency while browsing and paying for that currency later. It's easy to foresee that systems where users control the distribution of cryptocurrencies will suffer from a system-wide form of cheating that has nothing to do with content creation. Brave's creator economy could plunge into anarchy corruption in about five seconds.
Full text link https://practicaltypography.com/the-cowardice-of-brave.html