The Disrupt Weekend

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“Stablecoins are a real-world use case with product-market fit. And there’s a battle brewing between them. An epic battle for market share.

Stablecoins are deeply rooted in every single DeFi protocol, explicitly or implicitly. This means there’s a strong demand for deep stablecoin liquidity – the ability to regularly move millions with no slippage. Enter Curve. The Curve 3pool is a vital DeFi building block. It’s a stablecoin liquidity pool made of DAI, USDC, and UDST with over 3 billion in TVL.

Designed to compete with the 3pool, the 4pool is comprised of USDT, USDC, UST, and FRAX. By pooling CVX holdings, an alliance of Terra, Frax Finance, and [REDACTED] Cartel intend to drive CRV emissions to the 4pool and effectively starve the 3pool and drive LPs to deposit into the 4pool if they want to earn returns. Notably absent in the pool is of course DAI.

While many are skeptical of the long-term safety and decentralization prospects of UST, recently Terra has been making big moves to protect UST’s peg. Backing UST with BTC and AVAX creates alliances between Terra and the Bitcoin and Avalanche communities.

Meanwhile, MakerDAO isn’t resting on its laurels. MakerDAO has consistently pursued a strategy to diversify its collateral reserves into real-world assets and imbue further utility into DAI with the off-chain world. This week saw Tesla close a $7.8 million financing deal with MakerDAO, with the latter extending a line of credit to fund Tesla’s repair facilities.

Who will win? It’s too early to tell. Acquiring market share is one major test of a stablecoin’s prowess. But the harder tests involve resistance to market shocks, centralization, and regulatory capture.”

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To some in the crypto world, the Ronin attack was evidence that the future of crypto, even if it is to be “multichain,” is unlikely to be “cross-chain.” With teams fleeing Ethereum for more centralized blockchains that are faster and cheaper, the Ronin attack also served as a reminder of decentralization’s importance.

Some members of the Ethereum community have pointed to the words of Ethereum founder Vitalik Buterin, who described his feelings on the limits of cross-chain bridges in a January Reddit post. Sending assets across cross-chain bridges will never carry the same security guarantees as transacting within individual blockchain ecosystems, he explained.

The fundamental security limits of bridges are actually a key reason why, while I am optimistic about a multi-chain blockchain ecosystem … I am pessimistic about cross-chain applications.

If there are 100 chains, then there will end up being dapps with many interdependencies between those chains, and 51% attacking even one chain would create a systemic contagion that threatens the economy of that entire ecosystem.

Sky Mavis tried to scale up its ability to operate on Ethereum by building out a sidechain (Ronin). But scaling a layer 1 blockchain via a sidechain – which will always require a bridge – will arguably never be as safe as scaling via solutions like rollups, which inherit their security guarantees from a layer 1 chain.

In addition to highlighting the shortcomings of cross-chain bridges, the Ronin attack validated another core thesis among Ethereum devotees – one which is shared by bitcoiners and crypto-idealists in general – which is that true decentralization is vitally important to the success of any crypto ecosystem.

More and more crypto projects are emerging that throw decentralization to the wind, believing (perhaps rightfully) that today’s users don’t care about decentralization so long as they can transact quickly and cheaply. The Ronin attack reminds us that decentralization, regardless of what users might think, is of practical security importance for big-money applications.

Ethereum’s slow pace migrating to Ethereum 2.0 has left room for more centralized chains like Ronin to emerge out of sheer necessity. Nevertheless, as “the Merge” inches closer, last month’s Ronin attack showed why the hard work of decentralization at scale remains important.”

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Many of the collective action problems that pervade politics and real-world markets are fast being solved in Web3. Public blockchains like Ethereum are immutable, publicly accessible, and programmable substrate that excels at facilitating human coordination on a global scale.

Here are 3 examples that are in production, today.

  1. Informational asymmetries – Extensive financial regulations today try to eliminate information asymmetries by binding banks to transparent and fixed reporting standards so it offers investors certainty about the underlying security of assets. On the blockchain, the backings are transparent and publicly accessible. Analysts, journalists, and concerned citizens can verify for themselves the financial backings and overcollaterization ratios and determine the risk independently, instead of waiting for quarterly reports which when released are akin to lighting dynamite fuses to stock prices.
  2. Decentralized identities and occupational licensing – Decentralized identity systems make reliable information available and therefore render occupational licensing laws redundant. A person’s reputation and their job experience can be verified by anyone on the ledger, obviating the need for a state bureaucracy to issue a licensing regime that is vulnerable to regulatory capture by corporate lobbies.
  3. Public goods funding – Gitcoin employs a quadratic funding formula that scales funding in a democratically efficient way. They do this by matching every single donor’s contribution with the deep pockets of large foundations. The idea is that if a wide group of people signal the value of a public good through their willingness to pay, then it makes sense to prop them up with institutional funding. In effect, Gitcoin offers the best of both worlds: it effectively aggregates preferences in public goods while at the same time incentivizing the rich to pay a fairer share. [Further], blockchain-based protocols like Gitcoin not only raise money more efficiently but also provide a credibly neutral way for individuals to fund and build public goods.

Blockchain technology offers a credible solution to the many societal problems that our existing outdated and entrenched institutions have struggled to solve.”


The presented study examines the use of concepts and models of the Baseline Protocol in the context of the introduction of an EU-wide Intermediated Financing Platform at the European Investment Fund. The individual basic concepts of the Baseline Protocol are presented and evaluated for their applicability to the given application.

The authors of the study recommend the introduction of the Baseline Patterns and concepts in the design phase of the EIF Intermediated Financing Platform. The baseline patterns supports automation, scaling potential and inclusion of 3rd parties, without putting any of the applicant’s information at risk of being exposed to an unintended use.

We are pleased that Unibright have chosen to undertake this study. At EIF, it can be expected to feed into our thinking as we consider design and technology aspects of the digital transformation of our business that we are embarking on.”