Some thoughts on heavy collateralization: What are the opportunities and challenges?Thoughts on collateralization: Opportunities and challenges.
A 13-year-old intern who specializes in encryption research has outlined 11 ideas about collateralization, including the new developments that collateralization can bring, the dynamic distribution of the collateralization market and its use cases.
1) Heavy collateralization is inevitable: Heavy collateralization is truly beneficial for users, as it derives from real utility and value acquisition; 2) Heavy collateralization needs to align risk control with market efficiency: Similar to Flashbots’ impact on MEV, more transparency means more efficiency; 3) Heavy collateralization can promote decentralization: Heavy collateralization increases the value of protocol decentralization, which comes from community consensus and MEV; 4) Heavy collateralization will divide the previously cohesive Ethereum community into different camps, as different validators will have different priorities.
5) Ethereum validators will receive middleware token allocations to bribe them to participate in the network, further increasing the profits of network participants; 6) Due to the emergence of group consensus, most people will choose to join a few of the most trustworthy services, and only a small number of validators will choose riskier and newer services to optimize their profits; 7) The power dynamic distribution in the heavy collateralization market: the largest and safest middleware (with priority) > collateralizers (capital costs) > validators (operating costs) > newer and riskier middleware (requires bribing collateralizers).
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8) Middleware built on EigenLayer will be safer and cheaper to use than the native layer, such as Rollup built on EigenDA; 9) Regarding the debate on whether most protocols in the bear market need a decentralized network before achieving PMF, does this mean that the true use case of heavy collateralization is not to lead the traditional network of decentralized validators, but to make trusted commitments possible? 10) As part of Ethereum collateralization, the native token value of middleware may rise, with the goal of reducing reliance on heavy collateralization during growth; 11) How to detect Slash events, barnabe.eth proposes using Eigenlayer and PEPC within the protocol to ensure execution and reduce delegation agent issues.
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