【ethereum value calculator】

Stress testing: In the case of chain congesethereum value calculatortion or protocol and network level attacks, how will various bridge designs respond?

Expanding the liquidity of the liquidity network: The "liquidity network" can be said to be the fastest bridge for asset transfer, and there are some interesting design trade-offs between trust and liquidity. For example, the liquidity network may be able to use the mortgage verifier model to outsource capital supply, where routing may also be a threshold multi-signature with mortgage liquidity.ethereum etf tfsaBridge aggregation: Although the use of bridges may follow the law of exponential for a specific asset, an aggregator like Li Finance can improve the experience of developers and end users.

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Nowadays, many GameFi projects continue to emerge, and provide a variety of participation methods and play-to-earn and pledge functions. So, how to judge which projects can be held for a long time and can add value? How to find potential NFT agreements?The calculation of agreement income is the focus of value investment.First of all, let's take a look at what is the agreement income? What is the difference with income?Let me talk about the definition of revenue. Revenue measures the return of all participants, that is, the total cost paid to the contract supplier. For example, the fees paid to liquidity providers in AMM, the transaction fees of decentralized exchanges, and the amount of interest on the lending platform in DeFi. Revenue is obtained by charging a rate to the total flow of the agreement. Simply put, revenue refers to the total fees paid by end users of blockchain or decentralized applications. These revenues will eventually be distributed to token holders, liquidity holders and protocol libraries.GMV (Gross merchandise volume) refers to the total flow of the agreement, which represents the transaction volume of the blockchain or the transaction volume and borrowing volume of decentralized applications. For decentralized exchanges, GMV is the total transaction volume, and for lending agreements, GMV is the total borrowing volume.

The fee rate is the fee charged to GMV, which can be the transaction fee of the blockchain, the transaction fee of Dapp, or the interest rate of the loan.Income calculation formula:As of September 16, 2021, Defi's total TVL has hit a new high since May, reaching 180 billion U.S. dollars. Although the proportion of borrowed TVL has declined, it still occupies the bulk, with a TVL of approximately US$50 billion.

In terms of business volume, the established projects Aave, Compound and MakerDAO still firmly occupy the top three positions, and their TVL accounts for more than 70% of the entire lending market.However, the rise of emerging lending projects is also amazing. The top ten projects in TVL include Anchor ($3.12 billion) on Terra, Benqi ($1.23 billion) on the avalanche agreement, and Qubit ($400 million) on BSC. Unlike the big three lending giants that originated in Ethereum, these fast-growing lending forces all come from Ethereum’s competitors, which is the hottest narrative at the moment-the new public chain.What is even more surprising is that in addition to the earlier launch time of Anchor (in March this year), the official launch time of the other two projects is only less than one month.In terms of the type of lending business, whether it is the number of projects or the amount of funds, basic lending projects account for a higher proportion, followed by leveraged mining lending projects, and other relatively new ones such as risk-graded interest rate products. The business volume is currently relatively small.

Project StatusProduct launch time: August 24, 2021

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Qubit is a decentralized currency market that uses a mainstream borrowing capital pool model. Qubit's development and operation team is the team behind Pancakebunny-Mound, which was first deployed on BSC, and there are plans for multi-chain expansion in the future.Project FeaturesThe main features of Qubit compared to other basic lending projects are:Its token QBT can increase the rate of return of deposit users after lock-up, which is called "Boost" function

Qubit is part of Mound’s product matrix, and Mound’s products are highly combinableQubit does not support lightning loan functionBusiness conditionsBusiness data

Token value captureCore function: revenue acceleration

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Up to now, the main function of QBT is to obtain qScore after lock-up. Through qScore, deposit users can accelerate their deposit income (from the increase in QBT deposit subsidies).This mechanism is similar to Curve's Locker mechanism. Curve's Locker function and economic model consolidate its original competitive advantage and increase the switching cost of liquidity providers and investors. It is a very eye-catching design. However, when the mechanism is applied to a loan agreement, will it still have a good effect? The author remains skeptical about this.

First of all, the reason why some people are willing to lock up the position of Curve's token CRV for a long time after buying it is caused by Curve's strong position in the stable asset business chain and the competition for the governance power of Curve by multiple participants. Because governance power on the Curve platform means two core resources: the baton of liquidity and the accelerator of revenue.Since the issuer of stable consideration assets (stable currency, stETH and other pledge certificates and renBTC and other BTC cross-chain assets are stable consideration assets), they have great requirements on the stability and transaction depth of their operating assets, so they choose Curve to list. Assets and attracting market-making liquidity are very rigid requirements, which creates a strong position of Curve relative to asset operators, which is determined by the business positioning of its Top1 stable asset exchange platform.In terms of the expansion of asset lending scenarios, the demand from asset operators is far less strong, which results in a large number of less demanders for Qubit governance rights, and the overall lock-up willingness is difficult to reach the level of Curve.In addition to the revenue acceleration function, QBT currently has no other functional scenarios, and there is no QBT repurchase or dividend mechanism for the borrowing spread income of the Qubit platform.On the whole, QBT tokens are currently weak in capturing the overall economic value of the platform.risk control

Qubit does not have a special design for risk control. It basically adopts a method similar to the mainstream lending agreement Aave. Each mortgageable asset has two types: LTV (Loan-to-Value, borrowing ratio) and liquidation threshold (Liquidation Threshold). The main parameters, the former determines the upper limit ratio of funds that can be lent for a fixed-value collateral, and the latter determines when the debt/collateral comes to the ratio, the liquidation window will be opened.However, the current borrowing ratio of all Qubit assets is consistent with the liquidation line, instead of Aave's method of using the liquidation line to be higher than the borrowing ratio.

Qubit's LTV and clearing line parameters (data not updated), source: Qubit documentAt present, the borrowing rate of most assets on Qubit is 60%, which is slightly higher than the initial 50%. While this reduces the risk, it also reduces the pledger's capital utilization efficiency to some extent, especially the mortgage rate of all stablecoin assets is only 60%. There is still a lot of room for optimization of the overall parameters.

In terms of contract security, Qubit only received an audit report from the Peckshield family before it went live in August, which was slightly thin, and the oracle used Chainlink.The total deposits and TVL growth rate of Qubit was very fast since the launch of Qubit. The product's data board function is complete, the product interaction is smooth, and the interface is more beautiful, but overall there are not many innovations. With the continued decline of currency prices and the dilution of subsidies by funds, the current decline in the TVL of the project is also very obvious. It is worth noting that, compared with other lending project tokens that capture the cash flow of the agreement as the core source of value, Qubit's tokens are not currently linked to the project’s profit. The only function is to increase the deposit’s tokens through lock-up. Subsidies, which also caused the intrinsic value of project tokens to weaken, and the high inflation of tokens further aggravated the selling pressure of tokens.

Euler is a license-free lending agreement developed on Ethereum founded by Michael Bentley, a researcher at Oxford University. The development company is Euler XYZ. Euler XYZ won the Encode Club’s “Spark” college hackathon in 2020, and subsequently won a $800,000 seed round led by Lemniscap. Other participating funds include LAUNCHub Ventures, CMT Digital, Difference Ventures, Block0 and Cluster. And Luke Youngblood, an influential Coinbase angel investor. On August 25, 2021, the project announced that it has received a new round of investment of 8 million US dollars led by Paradigm. Other investors include Lemniscap and individual investor Anthony Sassano (The Daily Gwei), and Bankless founder Ryan Sean Adams With David Hoffman, Synthetix founders Kain Warwick, Hasu (Uncommon Core podcast).Project FeaturesIn response to the many shortcomings of existing lending projects, Euler has carried out quite a wealth of product mechanism innovations. Due to space limitations, only the key parts are introduced:License-free listing mechanism: Provide a lending platform for long-tail assets

Compared with the current licensing system adopted by mainstream lending platforms, the introduction of assets on the Euler platform does not require a license, as long as the asset has a WETH trading pair on Uniswap V3. Of course, in order to protect users from low liquidity and the risk of violent fluctuations in long-tail assets, Euler divides assets into three categories based on the risk of assets:Isolation layer assets: Users can deposit or lend assets, but they cannot use the isolation layer assets as collateral. In addition, if you want to borrow different isolation layer assets, users need to use different accounts on Euler to isolate different assets Between the risks.

Cross-layer assets: It can be used for ordinary lending and cannot be used as collateral, but it is possible to borrow multiple cross-layer assets with one account.Mortgage layer assets: The assets of this layer are similar to those of most mainstream lending platforms. They can be used for ordinary lending, cross-borrowing, or as collateral. Cross-borrowing means that users mortgage assets in one account to borrow multiple mortgage-level assets.

By isolating assets with different risk levels, Euler tries to increase the supported asset classes on the one hand, and on the other hand to ensure that high-risk assets do not affect the security of mainstream assets.Adopt dynamic interest rate model: improve the sensitivity and accuracy of interest rate pricing

This model is similar to the "dynamic interest rate model" designed by Delphi Digital for the Mars Protocol, the lending agreement of the Terra ecology. On the one hand, it improves the sensitivity and accuracy of interest rate pricing, and at the same time, it can obtain higher interest income for depositors and the agreement itself.The simulation of the mutual influence between the capital utilization rate and the borrowing rate in the Euler agreement, source: euler blogTo put it simply, the interest rate model is adjusted on the basis of mainstream lending agreements such as Aave. By adjusting the fund utilization formula, the interest rate can be more sensitively adapted to the real capital supply and demand situation of the market in real time, instead of the existing mainstream interest rate. The linear method of the model increases the interest rate. This can prevent the occurrence of a loan agreement that can only watch users use low-cost loans on their own platforms and then deposit them on other platforms to obtain high mining revenues for arbitrage. This will cause borrowers to have no incentive to provide loans, and lenders are unwilling The condition of repaying the loan as soon as possible eventually led to the exhaustion of the liquidity of the loan agreement. The dynamic interest rate model is dedicated to solving such problems.For details of the Euler interest rate dynamic model, please refer to "Introducing Euler" in the reference material.

A large number of improvements in the liquidation mechanism: optimization of the liquidation threshold, anti-MEV, internal multi-collateral pool1. Combine mortgage rate and borrowing rate to customize the threshold of asset liquidation

Like mainstream lending agreements, Euler requires users to ensure over-collateralization, that is, the value of assets is greater than the value of liabilities. When the value of liabilities exceeds a certain ratio of the collateral, it will allow the liquidator to liquidate the mortgagor's assets and repay the debt. But in the calculation of debt value, Euler also introduced the concept of borrowing factor. The liquidation threshold of each borrower is tailored to the specific risk profile associated with the assets they borrow and use as collateral. In other words, when the value of the borrower's risk-adjusted liabilities exceeds the value of the collateral, it may be liquidated. Specifically, compared to the original lending mechanism, Euler's mechanism also adds a multi-dimensional risk assessment of liabilities, which further improves the safety margin of liquidation.At present, the main liquidation incentive model adopted by mainstream lending agreements such as Compound is: the liquidator can purchase the mortgagor's assets with a fixed percentage discount. Under this mechanism, all liquidators face the same liquidation opportunity, and their potential profit percentages are the same, so they can only compete for liquidation opportunities by increasing Gas, where the high MEV value (Gas cost) becomes the liquidator’s The additional cost also increases the risk of the system. On the other hand, for mortgagors, the fixed asset discount auction rate also allows them to lose the opportunity to lose a lower liquidation penalty.

In response to this problem, Euler’s plan is to use Dutch auctions in liquidation, which can ease the joint bid of liquidators and may also obtain lower asset liquidation losses for mortgagors. At the same time, Euler also provides a discount acceleration mechanism for the collateral provider, so that he is eligible to conduct self-liquidation before the liquidator conducts the Dutch auction and reduce the mortgagor's loss. The above two measures are to restrict miners from grabbing excessive MEV fees in the liquidation, so as to improve the overall security of the system in the liquidation storm.In order to further reduce the transaction cost of liquidators in liquidation, Euler also borrowed the stable pool model pioneered by the Liquity protocol and expanded it into a multi-collateral stable pool form, allowing lenders to provide liquidity to the stable pool of each loan market. Support liquidation.

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Perspectives of a 2x entrepreneur turned VC at @UpfrontVC#

Mark Suster

Written by

2x entrepreneur. Sold both companies (last to salesforce.com). Turned VC looking to invest in passionate entrepreneurs 〞 I*m on Twitter at @msuster

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Perspectives of a 2x entrepreneur turned VC at @UpfrontVC, the largest and most active early-stage fund in Southern California. Snapchat: msuster

Mark Suster

Written by

2x entrepreneur. Sold both companies (last to salesforce.com). Turned VC looking to invest in passionate entrepreneurs 〞 I*m on Twitter at @msuster

Both Sides of the Table

Perspectives of a 2x entrepreneur turned VC at @UpfrontVC, the largest and most active early-stage fund in Southern California. Snapchat: msuster