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Full Crypto Trading Suite with Seamless User Experience: Nibiru Chain
Recorded: April 6, 2023 Duration: 0:24:19Space Recording
Full Transcription
Hey, what's up, Joe?
You should be able to speak now.
Hey, girl.
Can you hear me okay?
Yeah.
Yeah, I can hear you good.
How can you hear me?
Yeah, you're coming in.
Okay, great.
Who else do we need to make a speaker here?
Unique Divine should join us from Nibiru team.
All right, we have Nibiru Chain as a speaker here.
Hey, hey.
Hello, hello.
How we doing?
How we doing?
Pretty good.
Karil, can you go ahead and make Brian a speaker as well?
Yeah, sure.
Nibiru Chain, are you allowed to dox yourself and share your name so that I don't have to call you Nibiru Chain?
Oh, this is Unique, yeah.
Oh, beautiful. Okay.
Awesome. Hello, Unique.
Hello.
Anybody else on your end coming?
We have Jonathan here, it looks like. I don't know if he wants to speak.
Okay.
We can give him – Karil, you want to give him the option?
Hey, guys. Thanks for having me.
All right, we're going to get in a minute to get started.
Joe, while we're kind of going through that, do you want to, like, do a little background on alpha growth?
And then I'll jump in after, like, the alpha growth talk and then talk about, you know, Unique and a little bit of Nibiru, and then we'll kind of jump into it.
How's that sound?
Sounds great.
Yeah.
Coolio.
So, we are – we're the alpha growth team.
We are helping the next thousand teams get grants in crypto and find the right ecosystems to launch with and go multi-chain, all that good stuff.
And we help different ecosystems with, you know, anything from infrastructure to tokenomics and sourcing cool developers and the next top narratives and a lot of alpha.
And, yeah, I think that's pretty much on our end if you guys want to chat a little bit, Unique, about who you guys are.
Sure.
So, Nibiru's team is comprised of backgrounds and, like, a mixture of Web2, Xtendermint, and, like, other projects in Cosmos or Ethereum.
Like, in my case, worked on Sommelier before this.
And my – I mean, personally, my background is more in ML, but, obviously, as of late, it's been a ton of blockchain for the past two years.
Jonathan, you want to give a little background on yourself, sir?
Yeah, happy to.
I joined the team recently, and I previously worked in – so, I worked in New York in equity research for Credit Suisse, and then I worked in TMT Investment Banking at JP Morgan.
And then I moved over to San Francisco and worked with GIC, the Singapore Sovereign Wealth Fund.
So, I did a mix of venture and growth equity investing where I covered crypto and fintech.
I actually met Unique at ETH Denver, I think, two years back.
I sat on a couch and just happened to get along with him.
And we did a hackathon together.
So, it's been an exciting journey since.
So, you're the guy that messed up all of Credit Suisse, and it's all your fault, right?
That's exactly me, but don't put me on record saying that.
Yeah, you know, my background working with Unique was like – was rad at Sommelier, that's where we met.
And then we have the infamous Desert Walk of – and I got to say, dude, like, you have a co-founder there and a partner there that, dude, I would launch a company with, man.
He was – dude, there was a couple people.
You can understand how much they're worth and their persistence and they're like – and Unique was one of those people that I would take on any adventure.
And I just want to throw that out there that it was a rad experience.
Cool, but let's get into your project.
Like, you know, generally, it's really good to say, like, okay, who needs another blockchain, all this other type of stuff people ask.
I was like, you know, why did you choose – I'm super curious why you chose Chain versus Dapp.
And then kind of what problem that you're solving that you guys got excited about that you wanted to tackle.
Sure.
So as for Chain versus Dapp, one aspect of it is I think kind of some of this goes into, like, why do you build an SDK module versus just launching, say, an Ethereum or Cosmosm smart contract?
And that really just goes to low-level, like, control of very specific parameters that are, like – like, you can't edit on Ethereum.
Like, you don't get the begin and end block hooks.
And so essentially there are advantages we get on – more specifically for, like, the perps exchange and Oracle module that would be kind of impossible to build on Ethereum.
So it's, like, we needed that level of control of the stack.
Then as for, like, the problems we're solving, so it's a few things.
One would be the removal of complexity from having too many tokens.
So, for example, we're developing custom duration bonded liquidity gauges for the spot AMM, where users can essentially just lock longer to increase their external token rewards on top of an LP position.
So since Nibi's already the governance and staking token, it already acts as a sort of V or voter escrow token.
In effect, this means you don't need to use convex, V-curve, and ETH.
You crunch them down into one thing as Nibi.
A second point would be aligning –
Well, can we – well, that's a lot, dude.
There's, like, two things that are giant mouthfuls.
All right.
So let me try to speak it back.
You couldn't – with the current stack and the current tech available within ETH or within the SDK, there wasn't enough fine-tuning parameterization to get the juice out of the chain that you needed to build the DAP you wanted to build.
Exactly.
Yeah.
Okay.
All right.
And now you just combine four different concepts in this token.
Well, it's a gas token.
It's a governance token.
It acts like a VES grow.
Can we break that down more?
Because there's a lot embedded in there.
Yeah.
So if you – kind of just think of it this way.
When you lock – so you LP on curve, and then you can lock the LP position to gain additional CRV.
And you do so by using your voter escrow curve.
On osmosis, the analogous thing is you lock into the gauges, and there's three different fixed durations you can choose.
So it's essentially like if you found a middle ground between those two things where you can continuous lock up to some max duration, except – so you can scale your rewards like you do by locking longer on curve, except it's just a normal reward of needy like it is on osmosis.
So there's like – so it's a little bit more choice there.
So why I bring up the voter escrow aspect is just you get that for free with cosmos.
So if you're using your staking token as the reward emission, then you already can use it to vote.
That's kind of what I was getting at.
Are you voting on a particular gauge?
Are you voting on a perp position?
I know you're voting on governance.
Are you doing the gauge and the emissions all through governance?
Oh, that was just – I mean, that's kind of generic.
I don't know.
Like, I don't know if we would have gauges like curve.
It's just that you do get more of a voting token for locking longer.
That's kind of the point I was getting at.
Yeah.
All right.
So like normal staking has like a certain bond rate, and are you guys doing like multiple bond rates?
There's nothing like that in the roadmap right now.
Okay.
All right.
So more fine-tuned control on the perpetuals.
And when we talked in East Denver this past year, what you were describing is a new type of DeFi primitive that you're launching with your chain, the perpetual.
And you try to explain it.
It was loud.
There was lots of music.
And I'm like, dude, I've never heard anything like this.
So I want to dive into your perps positioning and what you're working on because it has massive potential.
But I want to hear it again without some crappy techno music behind us.
Sure.
So I guess the crunchdown simple version of it, of the perpetual of Nibi perps is it's a perpetuals exchange with AMM-based price discovery, which would be similar to like perpetual or perpetual protocol or drift, right?
But, you know, you can support any Cosmos native pairs in addition to external ones like ETH, Bitcoin, or, you know, even Doge or something.
And eventually, like all of it would have these improvements of like automatic market operations for repegging, swatting the liquidity, and even for performing liquidations that are like fully automatic, right?
So there's actually a lot to unpack there, right?
So I guess I'll kind of focus on, say, the liquidation aspect, right?
So this is an example of one of the ways you can, like, improve the economic efficiency and safety.
So the idea with that feature rollout is that you basically make the liquidation fidelity perfect because you remove the external agents that normally call liquidations.
So what you, so we'll have a white paper coming out on that, but, and, and, you know, because it's kind of its own little, well, well, not little, but it's its own product suite on top of the perps that essentially the chain itself tracks and executes to liquidations.
So to my knowledge, it doesn't exist anywhere in the DeFi derivative space.
And it offers several advantages.
Like, you, you know, it's, the protocol's more stable in volatile price regimes because it's less stress and risk on the insurance fund.
If, because if there's not a human agent involved, it's not going to miss a position.
So it's less likely to create bad debt in the first place, but also it's a little bit easier on the users because if your partial liquidations de-leverage you faster, it's harder to get fully liquidated.
So you'll lose less money.
But, so, but how, like, normally in these kind of liquidation, liquidation kind of cascading mechanisms, you kind of want a person in the loop that will be there.
So you don't kind of like pull the ripcord and you have this like, like falling, falling knife, falling crater event where the liquidations start to put cell pressure onto the, onto the, now, how do you guys prevent that if it's all automated?
I think in some way that happens from like, you have cascading liquidations if you catch some of them late.
Because a lot of times what, what you're kind of describing, I think, is when there's one large juicy position that people are watching for that they think will get liquidated soon.
But then because you need to pay a lot of attention to that like whale position, there's not as robust tracking on all the other ones.
So, like, a good way to put this is like, how one of our other engineers, Kevin, describes it, is like, it's as if you had a, it's a morbid example.
But it's as if you had a room of people and the price at which they would get liquidated is like their height.
And if you just track the water level, you know when somebody would drop without paying specific attention to anybody, as long as you store them in order of height in the, in the key value store.
Okay, so, so what you're saying is, is that because you're, you're liquidating less or often, based upon the perpetuals and the way that you guys, because it's not just kind of like one giant liquidation.
And you can, you can kind of, it's not like a water dam breaking that creates a cascading effect.
You're, you're, you're letting off the pressure of the dam based upon, in your example, height.
The people that are lower height would obviously drown first.
And so they're getting liquidated first and it's not adding this cascading effect.
But, you know, some of these.
I should have said it like that.
Yeah, instead of, and so, so part of the problem that we see in stuff like, you know, Tara and Kajera and these types of things is that, and kind of tracking what they had, if the liquidity, externalized liquidity where they're liquidating this then, then it can create that cascading effect too.
Like, how are you guys managing that?
I think you said before that there aren't kind of like external parties on this.
So how does, how is that managed?
Or external pools to, to, to, to liquidate into?
Yeah.
So it's basically part of, if you think about that is normally why you don't do this is let's say there's 10,000 or a hundred thousand or however many positions on your exchange.
And if you need to know when they would get liquidated, you have to look at, you know, their, uh, their maintenance or, well, their margin ratio.
Like how essentially how much debt do they owe relative to the amount of margin they put into the position.
And so every time someone trades and basically every block, uh, and, and also funding payments factor to this, everybody's margin ratio changes.
So if you were, you can't just query all the positions, every block, uh, because that's really, it's too much network trap.
Like it'd be ridiculous.
So usually you store a ton of information, like the external liquidators store a ton of information in an off chain DB.
And then kind of have some like foresight of which positions are close to the border and then pay more attention to those so that they're not missing.
Like, you know, they have to come up with their own algorithms basically to do this, but you can just keep the positions in the store in order of who gets liquidated first and actually use the price as the key.
I know that this was kind of like a technical explanation of it, but if you do that, you can effectively grab all the people like with exact fidelity every time as like your beginner end block hook.
And then obviously you can like sort rank based on who's next and then do that comparison.
So you don't have to scroll the whole entire index.
You have it indexed and, you know, optimized for who's next on the chopping block.
Exactly.
Interesting.
And so you're taking stuff that, you know, maybe Kajira or some of these other liquidators may have done off chain.
And because you have enough access and availability to manage it on the chain at a lower level, you can kind of sort order and sort rank these things and then do it on your own chain.
Yeah.
So that's like, you know, as transparent as it gets.
Also, you don't have to compete for your transaction.
Like if they're, let's say the block is only has a certain number of transactions that'll go through in some huge crisis scenario.
Like let's say it's the, the, the UST collapse or something.
If your liquidators are competing against other people to put the transactions, I see that as an attack vector.
But if the chain just does them as part of the binary, like they're, they're not, they're not competing against other people to submit the liquidations.
They just see.
Yeah.
Yeah.
So you, you, you limit front run risk and MEV type of objections, right?
Or, or, or attack vector.
Yeah.
And this is uniquely done, I think, because we run our own layer one blockchain, whereas like other perps products aren't vertically, vertically integrated.
So they can't do the same feature.
Right.
Which brings up MEV risk and front run risk.
On the, on the liquidations aspect, right?
Yeah.
So that's, this was like a super long winded answer to your, why do it on Cosmos question.
Because it doesn't work otherwise.
Right.
Or it'd work less efficient.
It would be less capital efficient.
Yeah.
Or specifically, like I couldn't do this on Ethereum.
There's just not the same flexibility.
Or you'd have to build your kind of like prioritization of your liquidations module in an off chain manner.
It would all, all, all this logic thing would need to be stored off chain.
Exactly.
Which is the standard way of doing it.
Right.
And you could get front run and, and have MEV and then all these other potential issues.
All right.
That's rad.
Cool.
I get it, dude.
This is, this is super cool.
You're, you're, you're building an on chain primitive.
And the reason why you built the chain is because the current, like the current chains wouldn't allow you to be more concentrated on the user and more fair.
And people could kind of have consensus slippage.
That's what I call MEV is like, it's like the slippage in the way.
So they could front run some of these things.
And by doing it, your own chain, you remove all of that risk.
And so that people are going to have a better experience versus, you know, somebody playing inside baseball, moving blocks around.
Yep.
So I think, uh, another like key aspects of this is, um, combining different primitives to feel like one application, even if they're separate.
So in the case of, you know, large centralized exchanges, like finance and well, formerly FTX, there's often like a varied and robust product suite, like where you have access to an all one UI future spot leverage OTC margin trading, lending, et cetera.
And cross margin, right.
Like all in one place.
So the, obviously we can't launch with all of that at the same time, or even like, that's a, that's a longterm vision.
But we're aiming for something that feels like trading on a centralized exchange while remaining like super, like truly decentralized and transparent.
That's like the, the core idea, I think.
I have a question.
Uh, I think Brian's going to really appreciate this, uh, the, to hear your opinions on this, but curious, uh, what you think about ICS and Neutron.
Um, sure.
So just to like recap for people listening.
So ICS, like your internet chain security is, uh, the method for one blockchain to inherit economic security from another blockchain.
Um, so in the context of, uh, Cosmos, where you, we kind of use security to refer to the stake and slash risk at the same time.
Um, so my take on this, I guess, so, uh, one thing ICS will likely do is help grant Adam, like the Adam token and the Adam staker, like Adam more utility and scale the Cosmos hub.
Um, so it also helps the, like, uh, the Cosmos stick to one of its core value propositions, which is horizontal scalability.
Um, so in, in one model, uh, the same validator set can produce all of the blocks for two different chains.
So it sounds like this is the approach that is happening with Neutron, uh, which will support permissionless Cosmos, um, like Juno and Nibiru, except secured by the hub directly.
So I've wanted to see smart contracts on the hub for a while.
And I, I think Neutron is an awesome approximate solution to accomplishing that.
Um, the bonus effect is, of this is additional value accrual to the Adam stakers because the consumer chain is basically renting security, uh, from its provider.
Usually the hub is what people talk about as a provider.
So that would mean part of the transaction fees on Neutron, for example, would go to Adam stakers directly.
Uh, then of course there's one caveat that like you have increased slash risk if you have more blocks that you're like, if you have more chains.
But I think that the pros outweigh the cons pretty substantially.
Uh, I particularly like that this, uh, that ICS in general supports the infinite scalability narrative that was in the, uh, Cosmos.
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