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wtf is katana?
Recorded: May 29, 2025 Duration: 1:03:02Space Recording
Short Summary
Katana has officially launched, introducing a purpose-built DeFi chain focused on delivering deep liquidity and high yields. Key partnerships with Polygon and GSR, along with innovative yield mechanisms like the Vault Bridge and Agora's AUSD, position Katana as a significant player in the crypto landscape.
Full Transcription
Thank you. Hello, hello, GMGM, everyone.
We will get started in just a few minutes to answer WTF
is Katana. We've got some people requesting here. Let's see. Sushi, you're on stage. Agora,
you're on stage. We're going to wait a little bit for some more of our contributors to join
so we'll get started about three minutes or so but until then just sit back relax and listen to this
music E aí so E aí so E aí E aí All right, everyone.
I think it's time to go ahead and get started.
Welcome, everyone.
Katana is live.
Well, predeposits are live with mainnet coming soon, but this is a very exciting time.
This is a chain that was purpose-built for DeFi users, designed to provide users with the two
things they want most, and engineered backwards from that, deep liquidity and high yields.
We're going to break that down. We're going to get into this. How do we execute on deep liquidity
and high yields, deeper than any other chain,
higher than any other chain?
And we're just going to introduce a lot of the core contributors and projects
that have helped make it possible so far and will be in the future.
So first, let's just do a quick round of introductions.
We've got a lot of people up here, so we're going to just focus on like uh mark and david and gsr turban urban which is an incredible username in
my opinion uh let's get those intros out the gate and then later on we'll we'll introduce uh more
people on like the core app and contributor side of things as well. So, Mark, if you wouldn't mind, let's do a quick mic check and just a little background on you and
your role as a co-contributor to Katana. Cool. Thanks. Yeah. So I'm Mark Boron. I'm
contributing to Katana. I'm also CEO at Polygon. Yeah, and for me, it really comes down to like been involved in DeFi for a long time
and really looking at like, is DeFi delivering what, you know, it should be in Web3?
And I think the answer is honestly like no.
Like it is fun.
There's a lot of good things, but it is not delivering nearly what people expect from being able to use financial applications in general.
So I'm going to fix that with Katana.
All right. Thank you.
And then, David, let's do a quick intro on you as well, please, sir.
GM, GM, everyone.
Hope you're keeping your sword sharp today.
I'm David.
I'm SVP of strategy over at Polygon Labs.
But for Katana, I'm an advisor on the Katana Consortium
representing Polygon and our work alongside the core apps
and other stakeholders as we try to build out
the best chain for DeFi and the best chain
for everyone to go earn some yields on.
Thank you for that intro, David.
And then Turban Urban over at GSR.
Can you give us a quick intro, please?
Certainly.
Howdy, howdy.
Turban Urban or Simran Singh as folks call me in my day-to-day.
I head of DeFi trading at GSR and have had the privilege and pleasure of working closely
with Mark and the rest of the team to help build something pretty cool into reality. So yeah, just excited to get this started.
Awesome. And I really, as a Texan, I appreciate the howdy howdy. Always, always appreciated.
Yeah, so let's go ahead and just get started. Let's start with the basics. I guess like the
first thing we kind of want to touch on, Mark, David,
Cimarron is, you know, what is Quintana and why now? I think here we can kind of talk about, you
know, why did GSR and Polygon decide to incubate a DeFi specific chain? And like, what gap does
this really fill in the current landscape? Mark, let's, let's start with you here.
Yeah, I'll try to, I'll try to not make it too long. But
from the Polygon side, it actually all started with the ag layer and this idea that everyone's
going to be tapping into, everyone's going to build chains that are specific to a certain purpose.
Simple reason is you can build a chain that is better for a specific purpose than a general
purpose chain will ever be. And if that's the case and you assume that that's how things are going to get built,
well, no chain is going to want to have to deal with building up liquidity
and an entire ecosystem on their own.
They'd rather just tap into one that actually already exists.
And so if you assume that that's going to happen,
then what you then ask yourself is, well, what ecosystem should they tap into?
Which one is like really good for this?
Which one is going to be able to handle, you know, hundreds of millions and billions of dollars on a daily basis in size?
And the answer is like none of them, like literally nothing in crypto right now.
And the question is like, why is that the case?
And the question is like, why is that the case?
And it all comes down to the approach that everyone's taken in Web3, including us at Polygon, which is like, hey, be unopinionated, be neutral, and let everyone come built.
And Katana is very much not that.
You can't actually achieve this goal of really having deep liquidity
if you're going to take that approach.
And so the whole idea behind Katana is to be very opinionated
and to say, let's pick the protocols
that have been around for a while, are very secure,
have very strong teams, will be around for a long time.
And let's build liquidity around them and on top of them and concentrate it all there.
And so that's really the idea of the core apps with Morpho, Sushi, and Vertex is instead of having what you have on your typical chain where you have like Morpho and Ave and Euler and you've got $100 million in Morpho and $100 million in Ave
and $100 million in Euler, that's $300 million in liquidity with the deepest liquidity possible in
any one of them is $100 million, which is terrible. Concentrate that all into Morpho,
bring $300 million into Morpho,
and you're going to be much, much better off. And if that number ends up being $250 million instead,
you're actually still significantly better off when it comes to what users are actually
experiencing. The same is true for assets, right? You look at assets and you're like,
hey, I've got WBTC and TBTC and CBBTC. And like you can literally name like 10 versions of BTC assets.
All that's doing is fragmenting liquidity so that nobody can actually trade in a BTC-based
asset in any real size.
So pick a BTC-based asset and focus all the liquidity on it.
So how do you focus all of this liquidity across all of this?
And the answer is just pull yield from every source possible,
which we'll get into, and I won't do that now.
But when you hear kind of like all of this,
and I'll kind of like leave this on to GSR,
what you really realize real quickly is like,
hey, this is all based on like liquidity,
creating a good environment for users
to actually be able to do
what they haven't done in other ecosystems because
chains haven't been built for it? And who's the best to actually facilitate that and actually
make that like the smoothest experience possible? And the answer is somebody who knows trading
and liquidity provisioning really, really well. And this is why we decided to like work with GSR.
It's really the ability to actually
create a good user experience. A lot of people think of liquidity providers as like extractive,
but when you actually have alignment, the value that they provide is enormous. And so I'll pass
that off to Sam to kind of like walk through how, you know, you've thought about things from the GSR side.
Yeah, I really appreciate it.
I would say liquidity is the lifeblood of any ecosystem.
And I think Mark hit the nail on the head where historically you've had general purpose setups where people are trying every iteration and every possible combination of things.
And you effectively and inevitably have liquidity fragmentation. But by actually
being
judicious about which protocols and teams you want to partner with and
you know forming a strong view and being able to take concentrated bets on that allows you to actually have concentrated liquidity, no pun intended. And I think Mark also touched on this earlier, but I think the name of the game is,
how do you monetize and give back yield to the actual users, right? It's not just to the
liquidity providers, but it's to the actual users of the ecosystem and be able to do that in a
concentrated way, whether it's leveraging viral- through the more full layer, whether it's putting on
algorithm, excuse me, whether it's putting
on yield bearing stable coins that are
backed by basis trades, whether it's
looking at staking services, the
combination of all of those different
facets should be used to reward the
actual users of the ecosystem as opposed
to service fragmented liquidity across the space.
And all of this goes to having partners that understand the ecosystem, understand how yield
is generated, understand how to redirect that yield back to the users that are actually
using those protocols.
Yeah, awesome.
Thank you all for that.
And David, I don't know if you have anything that you want to add to that as well, just
quickly.
bring in real retail via institutions, institutions and trading themselves. And also for them
to be a foundation upon all of the great distribution platforms that folks are building. And that's
really the thesis with these core apps is just a foundation upon folks to build on top
of and a foundation that everyone can get comfortable around.
Awesome. Yeah, perfect. Thank you for that, all three of you and uh i so you know what we talk about with katana you know when
we stand on on on two principles uh we talk about deep liquidity first and uh real like sustainably
high boosted yield as well so i want to talk on the the liquidity approach first and you know we've
kind of talked about this in general but let's dig in a little bit deeper on like how deep focused liquidity on in like these core protocols differ from like fragmented DeFi models.
And then also talk about like the resilience of having like chain owned liquidity as well
and the benefits of that.
Mark, I think we'll start with you on this.
Okay, cool.
Okay, cool. I touched on this a little bit,
I touched on this a little bit, but let me like draw a little more of a picture on this.
but let me draw a little more of a picture on this.
You right now go to Polygon POS,
go to Arbitrum, go to Solana, go to Ethereum,
and go look at what the ecosystem looks like on the DEX side,
the PERP DEX side, on the lending side, it doesn't matter.
You see many protocols doing substantially the same thing.
There's obviously differences, but they're doing meaningfully the same thing.
And you've got the liquidity that is broken up between those, as I was mentioning earlier.
When you end up in that environment, what happens?
Well, first of all, people say, okay, well, this isn't a problem
because I can just use an aggregator
and I can execute whatever trade I want across all of those protocols.
The answer is yes, that's true.
Except when you go look at the liquidity that actually exists in any of these protocols. If you go look at like what liquidity actually exists on the most traded pairs in all of
crypto like something like USDC, USDT or like ETH, USDC.
What you see is that like the pools with the deepest liquidity are literally tens of millions
of dollars.
It's like very small, not hundreds of billions, not billions.
It's like literally like tens of millions of dollars. It's very small, not hundreds of millions, not billions, it's literally tens of millions of dollars.
It's almost nothing.
The simple reason is because on Ethereum alone,
there's 50 of those pools in different DEXs and go to,
again, any ecosystem, the exact same thing exists.
If you can actually just bring all of that liquidity together,
still in a permissionless way, but bring it all together, you're going to result in a situation where two things happen that is very meaningful.
On the deck side, you're going to get substantially less slippage.
You're going to be able to execute bigger trades without actually moving the market in a more meaningful way.
This is like something that matters less for retail.
We'll talk about a part of Katana that matters a lot more for retail later
in terms of like where this like yield.
But for institutions and for anyone wanting to like start coming in in size,
you can't actually do that in crypto today.
The same is true on like the lending side lending side. Liquidity is not deep enough. So if
anybody wants to come in size, they're going to move the borrow and lend rates in a very meaningful
way. When you really deepen liquidity, you can create way more stability in the borrowing and
lending environment without fragmenting it. And so that's really the core reason why we have this,
like these core apps and these core assets
is so that we can deepen, deepen, deepen liquidity.
And one thing that comes out of that,
that people ask about a lot is this idea of like,
well, aren't you actually,
because this is effectively what we're
doing right like we're ensuring that there's three applications um of and only one of each type you
know one lending one perp decks one spot decks aren't you ensuring that they don't have competition
and isn't that bad um and i think that's a really legitimate question
that is like a real risk.
But the question that needs to be asked is,
what's more important at this point in time in DeFi?
Is it an incremental improvement in a protocol,
or is it deepening liquidity to the point where you can bring in much stickier, productive TDL in size through
kind of institutions and anyone who wants to do anything in a meaningful way.
And I think that's the more meaningful thing.
Like, I can give like an example.
Like, do you think that, you know, you go from like any like any decks like a v2 version of a dex to a v3
version of a dex and you're like okay that's like actually a really meaningful improvement to be
able to like have concentrated liquidity and like smaller ticks and things like that but then when
you start actually going be like okay what about when we move from like v3 to V4, you basically have like this choice. You can either say that was worth it
because we now have more flexibility with the DEX
than we had before and some incremental benefits.
Or you could say, actually what we just did
was we fragmented liquidity even further
because now we need to like move liquidity to another DEX.
And I would argue that we're at a point with lending,
spot DEX, perp DEX,
where the biggest improvements that are going to exist
have already been made,
and that anything else is incremental
and it is not worth hurting the depth of liquidity
that you can build for some incremental innovations.
So ultimately, that's kind of like the core idea
behind this fragmenting of liquidity
and how you actually just prevent that
within an ecosystem to create very deep liquidity.
I would just briefly compliment that
by saying effectively the name of the game is this, right?
Do you want multiple iterations of the same thing?
Or do you want to say, hey, if we're ever going to be competitive with the centralized landscape,
we should harvest as much liquidity as possible and minimize slippage,
which is how I would interpret what Mark is saying.
And he said it far more eloquently than I could.
The one brief thing I would add to that is the competitive landscape is more not how do we see more of the same thing
and it's like what programming language are you using or what paradigm are you using to have,
let's say, levered spot trading or perps. It's more what does the V2 to V3, V3 to V4 look like,
right? The innovation of V2 to V3 was okay i can now have concentrated liquidity
v3 to v4 is okay now i have all these hooks um so the the competition isn't more like okay should
should we have more protocols that are doing the same thing it's more what are the novel
structured products that we can build off the back of this um and i think you can only truly
do that when you have sufficiently liquid underlying markets which is which is my hope
and aspiration for world stream building.
You know what I realized though, Justin, is that I didn't check on chain-owned liquidity, and I think that David would be awesome to touch on the chain-owned
liquidity part, because I think that's actually very meaningful to achieving
very similar and aligned goals with this kind of deepening of liquidity.
Yeah, that's funny. I was just about to kick it over to David
to touch on chain-owned liquidity.
So David, would you mind?
Yeah.
I'd be excited to.
Chain-owned liquidity is this awesome mechanism
that a lot of people are much smarter
than I am working on for the past couple of months.
And the idea is for Katana, all of the sequencer fees,
as well as some of the other revenue generated, will go directly into a chain on liquidity program.
And this is different from most protocol-owned liquidity programs, you may have heard, where protocols own the LP of their token or invest back into the protocol.
This is slightly different in the sense of it acts as a junior capital across the entire chain.
taxes of junior capital across the entire chain, right? So the chain will be purchasing LP tokens
on Sushi, sometimes through products built on top of Sushi in order to support those as well,
but a lot of Sushi LPs on major pairs. It's going to be depositing into Morpho markets
to supply liquidity, but it's not just going to sit there and earn capital. It's going to do it
in an economically, as in the least economically extractive way possible for users. So in Sushi,
that means actually foregoing the trading fees that the protocol or the
chain's LP earns and re-emitting it to help deepen.
Within Morpho, it acts first off as first lost capital.
The chain will be slashed prior to a loss on a vault or a loss on a market.
And secondly, again, interest earned gets re-emitted back as incentives.
And it has this nice springboard effect, the shock absorber, where as if there's a downturn
in the market and people wish to pull out liquidity, as tends to happen, market makers
will tell you as soon as there's volatility, they start to pull out.
As the chain becomes a larger and larger percentage of any individual pool, the incentives for
other people to jump back in and join become higher and higher as the chain will forego
all economic benefit it gains as the junior capital.
And so, you know, Katana has this really great property of you get the benefit of being senior
capital, right?
Someone else is taking losses, someone else is taking higher risk than you without having
to pay for it as you would in a traditional financial product.
Awesome.
Thank you for that.
Next thing we want to do, since we've talked about deep liquidity and concentrating it in core apps and chain on liquidity and all the benefits of that,? We've got vault bridge yield,
yield generated from off-chain US treasuries
through Agora and AUSD,
sequencer fees,
yield that's generated from deployed chain-owned liquidity
can also go to boost yield,
among other fun little mechanics here and there.
So let's talk, Mark, we'll start with you again on this.
I kind of want to touch on, you know, how does Katana approach
or just what is Vault Bridge and, you know, why does it matter?
Maybe walk through how bridged assets earn yield on Ethereum
and how that gets routed back into Katana.
So focusing on Vault Bridge first when we're talking about it.
Justin, are you okay if I give like a broad overview
of like the different yield yields and how it actually
interacts?
Let's do it.
Cool.
I think one thing that's important is we talked about this deep liquidity.
That's the boring side.
It's a very foundational side, but it's a very boring side of the equation.
The much more fun side of the equation is the yield. But that yield is also very important
for actually achieving this deep liquidity,
because everything we just talked about is like, cool,
like you're going to have these core apps and these assets,
and you're going to focus liquidity in them.
But we are talking about a permissionless ecosystem.
So the question is like, how do you actually achieve that?
That's like the really important question.
And it all comes down to this yield.
And if this yield isn't significant enough, you can't actually achieve that goal.
Kind of like walkthrough, right?
So there's kind of at the core, like five pieces of yield that are relevant in Katana.
And Justin, as you said, like, I think we can dig into like each of these if you want,
or any one of them, like Vault Bridge, for example.
But maybe just starting on like what these sources of yield are.
The first one is Vault Bridge.
Vault Bridge is effectively a protocol that allows for
depositing assets on L1 into Morpho Vaults,
and the assets being USDC, USDT, ETH, and BTC.
Those assets are lent out, they earn yields.
If you take a blended rate based off of what we're targeting,
on a billion dollars of TVL,
you're probably looking at 40 to $50 million in yield.
What you do with that yield is very,
very important because what most ecosystems do with that yield is they spread it out
everywhere across multiple DEXs,
across multiple lending protocols,
they fragment the liquidity in all of them.
Important thing here is it all goes into,
through these core applications.
Now, what I'd expect is that you're going to have
hundreds, thousands of applications built on top of
these core applications and that's all yield that's going
through to those applications that they can then pass on to their users.
In addition, obviously, to users that are directly using Morpho, Sushi, or Vertex.
And so that's all incentivizing liquidity coming into those protocols and nowhere else.
And it's a very meaningful amount of money.
amount of money, but then you add to that the fact that there's
But then you add to that the fact that there's a second source, which is a sequencer fees.
a second source which is a sequencer fees.
Most chains, they take sequencer fees
and they retain them for themselves,
or they pass them off to a DAO that doesn't really do anything with them.
In this case, it all goes to users,
right back through those core applications.
Again, incentivizing only those applications,
those core ones and deepening the liquidity in them.
Again, allowing all the applications built on top of
them to benefit from that yield that goes in there
and benefit from the deeper liquidity that will exist there.
Third part is that when you think of
Vault Bridge, there's risk associated with it.
We shouldn't deny the fact that that risk exists.
It's risk that I it. We shouldn't deny the fact that that risk exists. It's risk
that I think most DeFi users want because it's going to create greater yield than what they
would otherwise receive. But it has risk. And some people are going to say, I don't want to
take that risk. And the nice thing is that we have on the chain a stablecoin that shares revenue with the chain.
It's a significant portion of the stablecoin revenue.
For anyone who says, I don't want to take bridge risk,
but I still want to participate in the ecosystem,
well, there's going to be Agora,
AUSD is going to play that role.
All of that yield that is generated,
again, goes right back to the users through these core applications, deepening liquidity, giving users even more yield.
All of the core applications and same thing with core assets have yield that, like token emissions
that will be offered as well. And then lastly, this new cap token will offer emissions as well.
And so you've got these five sources of yield
all piling into these core applications,
flowing through them to the hundreds of thousands
of applications that will build on top of them
and to their users, allowing for very significant,
hundreds of million dollars of incentives
in the first few years already.
And that will deepen the liquidity. very significant hundreds of million dollars of incentives in the first few years already.
That will deepen the liquidity. When you take all those sources of yield, it's a shitload of yields going to users.
It's all going to the users continuously again and again and again.
The simple reason for this is because when you think about what Katana is,
if there's one thing you walk away from, it's Katana's like literally built every part of it so that users win as much
as possible. And it's like legitimate, like it started from why does this chain exist? It's
because users have been saying, I want deep liquidity and I want high yields and we need
it to be sustainable. And the best way to do that is find every source of yield you can find,
pull it together in the safest, highest way possible,
and then pass it all on to users.
So that's kind of like the yield big picture.
Obviously, let's dig into the smaller portions too,
or the details.
Yeah, thanks for that mark and uh simran i don't know if you if you have something that you want to touch on uh related
to like all the multiple yield sources coming in and like how like how does gsr think about that
and david if you want to chime in too uh please do yeah i would say I mean it's it's like creating a knock-on effect right effectively
the more you are able to pass through yield back to the actual users which is the point I was
mentioning earlier the more you're able to I think incentivize the right behaviors for the ecosystem
and facilitation by a vault bridge facilitation via proper governance facilitation via Vault Bridge, facilitation via proper governance, facilitation via actually,
again, it all goes back to having sufficient and saturated liquidity, which is inherently
passed back to users at the end of the day. That can come in many forms. I think Mark touched on
a few of them. For me, looking at it as a trading individual, I would say the primary
drivers become things like AUSD, things like the basis trade, things like the actual fees
generated from deploying liquidity into Sushi. And all of that is pulled back together and
rewarded back to users and serves as a virtuous flywheel effect.
Yeah, David, any thoughts on your end? And then we'll start talking to some of the core
apps who are here today as well.
I think we lost David. He jumped off. So long, Samurai. Okay, we've talked about Channel
Liquidity, Vault Bridge, Yield. Let's talk the the core apps here. I kind of want to get their sense. I think we've got Jared on the sushi handle. We've got Mark here from Morpho. We've got Agora here. So Jared, let's let's talk to you on the sushi side. Like sushi is the decentralized exchange for Katana. It is a core app.
Katana is opinionated.
Chain on liquidity,
Valbridge rewards will flow through Sushi.
Just kind of want to talk like,
you know,
from a Sushi standpoint,
like what was it about Katana that really like made it stand out and made
you want to join as a core app specifically?
Hey, Justin, you mean besides the name
i know like katana and sushi just go hand in hand so well it's so true yeah yeah i love the branding too um so mark uh spoke quite a lot about like the fragmented liquidity experience across defy and
...equmented liquidity experience across DeFi.
And, you know, I've been at Sushi now almost three years,
and a good portion, if not the majority of my time here,
is focused on, you know, addressing the competitive landscape
of liquidity within the context of a DAX, right?
And as far as I know, I'm pretty sure,
I'm sure someone could correct me if I'm wrong.
Sushi was, you know, kind of the first multi-chain Dex, at least the one that explored that narrative with any like velocity.
Yeah, actually, I can attest to that because when I was working at the index coop way back when in DeFi summer, I wrote a whole thread about Sushi being on literally any, every single EVM chain possible, basically.
So, yes, I would say that you were, Sushi was the pioneer there.
Yeah, and so that's interesting.
Interesting, I have to read that.
I have to read that.
And so I guess like one of the experiences
that kind of was first, like front and center
when I first came on as head chef back in 22,
was, you know, Sushi was kind of getting towards
the end of its distribution cycle for its token.
And so the Onsen program,
which was how it was bootstrapping via token
emissions and the feedback loop there that the Sushi Bar and the RevShare kind of complements
liquidity providers with was coming to kind of its bootstrapping conclusion. And so a lot of time
had been spent within the DAO, a lot of big brain energy to try and figure out what would be the next step
in trying to keep the DEX competitive and the token model relevant. And so
a lot of the experiments that we've tried to implement, and we've not put out a model,
like a macro model upgrade to the Sushi token, because a lot of the experiments
that we went to try and execute, we saw in other protocols, I don't want to say fail,
but not kind of prove to the level that we had hoped to see that would cause us to shift
the entire model.
And then we start to look at you know the differences of the capital efficiency
of different amms right when sushi first came out it was v2 then v3 came out now you have v4
um and so you know how do you reconcile those with the token model as you're trying to iterate
both in parallel you know and so i think there were some really unique challenges.
So as we expanded in this multi-chain world with the AM side, we were seeing the L2 scaling
network for the ecosystem come into play with other providers.
And those networks wanting to focus less on kind of the established brands
have more like a native DEX experience where they had a new token with that DEX
to try and bootstrap network activity and bring over liquidity miners
and kind of get that flywheel going for themselves.
And so a lot of what we were curating for originally
and what DeFi Summer was kind of curating for kind of one or two networks got really fragmented in and of itself.
So there were a lot of challenges, I think, to solve for Sushi.
And we ultimately ended up building just like a really distributed and performant aggregator into the decks.
And so most of our focus, and this was part of the tweet that I put out yesterday to compliment
the Katana launch, was that a lot of what drew us to what you guys are doing was the
thesis of the ag layer and bringing all of these things together because it aligns with what
we kind of naturally migrated to as a DEX, which was aggregation. And so now, you know,
we have one of the most distributed aggregators across networks. It's one of the most performant.
I would challenge anyone to like go to any other aggregator and then go to sushi.com and plug in the same thing, the same swapper out and see, you know, what you get.
And so, yeah, there's a lot of alignment between like the thesis of the foundational offering of Katana through the ag layer.
But Katana itself, you know, we had explored, we had even talked to the conduit, which I think is here in the audience today, about launching a sushi chain where we were going to focus on like protocol and liquidity.
And we're going to try and, you know, reinstitute this flywheel.
But I think it makes the most sense doing it with a, and a network partner like Polygon,
who has the experience of launching and maintaining a chain,
and the capital partners that specialize in these fields,
you know, like GSR.
And so, I don't know, for us,
it just aligns perfectly with what we see in the market.
I mean, Sushi's now five years old, right?
I'm the fourth or I think I'm the fourth head chef, right?
So there's been quite a lot of experiments undertaken
and I think this is just a natural progression
of like all of those lessons from those experiments.
And yeah, I'm really interested to see how this plays out.
Yeah, it's going to be very exciting.
And yeah, you mentioned about alignment
and that's really like the whole thesis here, right?
You know, taking all of these mechanisms
that can be value extractive to users in DeFi ecosystems
and just recycling them and aligning apps, users, and the network
together in one. And I'm glad you touched on that, Jared. Thank you for sharing. And let's kick it
over to Morpho. Mark, I'm trying to get Darius from Vertex up here as well, but I'm having trouble
finding him in the crowd. We're going to try to troubleshoot that and get you up here, Darius.
But Mark, just kind of want to take it from your side too. Like, you know, what, you know, Morpho is a core app. It is the lending
and borrowing protocol of Katana. What made Morpho kind of want to step in this direction
as well and become a core app? Yeah. No, first of all, thank you for having me on the spaces today.
Super excited about this launch.
We've been waiting so long for this launch,
and there's been so much work that's gone into it.
So it feels almost surreal that we're talking about it on a Spaces today and gearing up to our main launch as well.
Just super, super exciting.
But yeah, what about Katana made it really appealing to Morpho, right?
I would have to say that, you know, everything that we've already touched on in this space
is already is what we focus on at Morpho, right?
So like deep liquidity and high yields.
That's exactly what our users ask from us every day.
I'm on the growth team at Morpho, and I have really close connections to a lot of our suppliers and a lot of our borrowers.
And that is a constant tension that I need to kind of like manage on top of Morpho, right?
I need to make sure that our lenders are getting high and attractive rates for them to want to supply.
But I also need to make sure that there's deep enough liquidity for our borrowers to be able to execute
in size. So when Katana came to us, it just kind of felt like the most natural fit where a chain
is focusing specifically on those two things, right? It's actually quite rare that you have a
chain that openly is so focused on not just DeFi, but those two specific things.
And I've constructed an entire ecosystem
that is built around that.
So for us, it was just like music to our ears.
And I would have to say also,
there's like a social element
to why it's been amazing to work with Katana, right?
So I've worked with a lot of the folks at Polygon who's contributing to Katana,
and there's just so much experience on that team that has seen so many things in DeFi
that they know the right decisions to make in order for this thing to work.
Many, many teams have created an L2,
and many times they actually don't have the background in DeFi
that's needed to actually make it scale.
And I think for us, what made it really exciting
is that the team behind Katana is,
they're just a bunch of ballers.
They have seen it all.
They know how to make the d5 flywheel kind of spin
and for us it was just like you know both from the mechanism design to the people behind it
just uh extremely bullish mark thanks thanks for that intro i really appreciate it and uh yeah we're
i i just love morpho in general too like that. That's my preferred lending and borrowing protocol.
So obviously very excited to have Morpho as the core app on Katana.
And now we've got Darius from Vertex.
Another core app, the perps decks of Katana.
But before we give it over to Darius, I just want to say,
if anyone here has questions, if you're listening and you have questions,
just comment on the post.
And then I'll be sure to get those questions answered for you. We want to be as transparent as possible
here. We want to get all the questions answered. So ask in there and I'll be sure to get, float
them up to the speaker who needs to answer them. So Darius, just let's talk about, you know, the
alignment of Vertex and Katana.
How do y'all see this?
And maybe just intro yourself in your project a little bit too.
Yeah, thanks, man.
Yeah, we're super excited about it.
I think there's, you know, Mark alluded to it.
to it there's a little bit of a um i think team teams have selected a bit about supporting apps
and going deep with projects and really aligning with the teams that they're working with
but i think when you've seen big success it's because the chain and the team has been deeply
aligned so doing this from the ground up makes a lot of sense and building that because the chain and the team has been deeply aligned. So doing this from the ground up makes a lot of sense
and building that into the chain design makes a lot of sense.
I think from the Vertex standpoint,
my background's in trading
and we operate across a bunch of different chains.
I think what's really exciting here is
there's a prospect to make Katana
our real hub for liquidity
and broadcasting that out
into other evm so similar to the thesis that sushi are working on where they can be a
aggregation slash um liquidity center for a number of different chains
via katana i think we can do that for perps. And so I think what's going to be great
is bringing all those like native DeFi traders on Katana, having them trade, but then being able
to connect to other communities as well. So I think it's going to be cool. I'm really excited
to get it fired up and we'll see where we go. Actually, Darius, you touched on something here
that's like, I think actually super important, which is this idea of other communities and stuff.
I think that when most chains start, they want to go align with a community somewhere.
And I think that one of the things that's actually really unique about Katana is that it doesn't actually need to do that.
It's intended to welcome people in who want to be in, who just say,
Hey, I need a better place for DeFi, or I need a place that's actually going to become an area where I earn higher yields.
I have higher yields. I have like deeper liquidity. Um, I,
as an app, I can make more money on Katana simply because people are incentivized to use it based
off of, of the, the yields. And I think this idea of like, um, oh, Katana needs to be viewed as, because it's an EVM chain as an Ethereum this or that,
or doesn't actually want to connect with others.
Like, completely not the vision that you should have,
or the idea that you should have for Katana.
I think, and Justin,
you're going to kill me for taking away this question and Gautier, sorry.
But one of the things that really important reasons why we're working with Universal really closely here is because of this. So I'm not going to take the thunder away to explain what Universal is in detail.
find a way to explain what Universal is in detail.
But at the core, our vision is like every blue chip
asset of any ecosystem should be on
Katana with very deep liquidity
and higher yields than people can get elsewhere.
This isn't to say that I want
Hull to be bigger here than on Polygon or
Sol to be bigger here than on Solana.
But what users shouldn't need to do is they shouldn't need to
leave Katana just to go access those assets.
Users should be able to get whatever they want on
Katana and access anything from any ecosystem.
Vertex as an example is great in the sense that,
you know what, if people can be placing orders
from basically from other chains onto their order book,
and that can create deeper liquidity for Katana,
then that's fantastic because the Katana users end up winning from that.
It's actually like a good thing.
Now, my view is that users will actually want to come to Katana
because whether it's posting margin and earning yield on it,
like they'll just be better off,
but it doesn't actually matter.
It's the same thing when it comes to sushi.
If you can leverage other ecosystems to make
the user experience better, it's good.
Last thing that I'll say on this because I was not
invited to talk right now and I've talked a lot already,
is that there's this general idea that people want to build apps.
You go to some ecosystem and you get these apps that are named after this ecosystem.
Stablecoin sometimes named after ecosystems.
By the way, I'm literally not putting in any ecosystems.
It's okay, it's cool, it's actually fun.
But we've actually specifically told
applications don't build something just for Katana.
Don't name it something Katana related.
Now, Sushi just happens to be way before us and
named it a long time ago and so it works out perfectly.
But for anyone else,
the reason we don't want that is because it
actually decreases distribution.
If you name some application like Samurai Warriors Katana,
and it's an app that only exists here,
that app is going to be significantly
smaller than if it has distribution across many ecosystems.
I think the better approach is actually for Katana to say,
why don't I create the best environment here?
It's going to have the deepest liquidity,
it's going to have the highest yields,
and apps, tokens, everyone, go distribute that everywhere.
And if Katana actually is the best product,
then people are going to come use it.
And that's going to create the deeper liquidity that me,
as CEO of Polygon Labs, loves,
because people can tap into that for the Ag layer.
Poll holders can earn more fees from the Ag layer as a result of that.
But ultimately for Katana, this is how users end up winning.
The apps end up winning.
The core apps end up winning.
And it's just the best.
So love this idea of like, no, you don't need to be like aligned with an ecosystem. And that's the
one that wins. No, it's go increase distribution as broadly as possible. And like, I think all the
core apps do like a really good job of this, which I lost. Yeah, thanks. Thanks for all of that. Yeah,
a lot of great perspective and clarity there as well.
And the next, you know, I want to try to get all the core apps and assets and launch partners that are here right now some time to speak.
I think we have Nick on the Agora handle.
We are trying to get him on the Agora handle.
I'm not sure if that's the case.
Is that the case?
You got me.
I'm Drake, the other co-founder. Oh, Drake.
Perfect.
I'm happy to chat i was about to
say even better but don't tell nick that i said that great yeah let's talk about you know we've
got ausd as like the native stable coin for katana and there's a lot of things that are very unique
about agora and ausd and how the mechanisms of yield work, especially compared to other centralized stable
coins like USDC and USDT. So I was wondering if you could touch on that a little bit, please.
Yeah. Yeah. For those who don't know, AUSD is a T-bill and treasury backed stable coin,
similar in structure maybe to USDC, but our treasuries are managed by VanEck and a short-dated treasury fund held at State
Street.
But when Nick and I started Agora, we always believed that stablecoins should be a public
good.
And what that really means to us is paying out as much of the revenue as we can to the
people who build the ecosystem.
And so when we linked up with Katana,
obviously we were super aligned.
And so, yeah, I mean, we're just super excited
to send as much of that revenue back
to the people who drive value as possible.
And the mechanism design within Katana
kind of does that in a really elegant way.
Awesome, perfect.
And I know that Mark and Cimarron, in a really elegant way. Awesome. Perfect.
And I know that Mark and Simran,
I don't know if y'all want to touch on the Agora partnership here
and kind of what y'all think about it
and how it really helps to set Katana aside
as well as a differentiator.
Yeah, I just, I, okay.
I'm like very passionate about Agorah
because A, I love the team.
They're like total hustlers,
work their ass off,
and I think are gonna like continue
to do phenomenally well.
B, the model that they have for a USD
is very good in that it's not a rebasing token
that causes problems for DeFi.
It's like very intentional about passing revenue to
whoever makes sense in the context.
In our case, it's going to be Katana Foundation.
The nice thing is that gives us
flexibility to give it back to the users,
but specifically and very importantly to
the users who are value additive in the ecosystem.
So you don't sit there and have a USD on Katana and do nothing and earn yield.
No, you go use applications on Katana and you earn yield.
That makes more money for applications on Katana.
Hence applications, if you're here, come to Katana because you will earn more money.
But that alone wouldn't be enough for, I think, a stablecoin that is not as established as others.
They've done an awesome job of getting the right backing.
When you've got folks like the State Street and VanEck on
the custody investment side,
that's very important because when you go talk to
an institution about holding a USD,
they don't need to worry about it.
They can have a conversation,
they can go dig into it and very quickly reach the conclusion,
this is a stablecoin I can hold.
You get this world in which you get a stablecoin that I think is
going to flourish incredibly well on Katana,
that is going to drive more growth and yield for users and is going to be safe.
And so that's why I'm super excited about Agora and just a really good team to work with as well.
Awesome. And I see one question from Twitter.
So I'm just going to go ahead and answer this one real quick.
The question is, like, why the name Katana?
And I'll just touch on this very quickly because I want to try to get to Lombard and Yurn who are here as well.
So, yeah, so sharing a little bit of the lore.
So, you know, back in the inspiration for the name i should say uh so
back in feudal japan warriors they used more straight general purpose swords like the like
the tachi and a couple others uh they were they were reliable but they were unspecialized uh much
like today's general purpose blockchains um and then like as combat evolved, like mounted samurais on, on horseback, uh, demanded
something different. They needed more speed and precision, uh, straight blades slowed them down
and, uh, they needed a, uh, a weapon built for purpose. And that's when the Katana was forged,
you know, a single blade, a single edged blade that allowed for, you know, a little bit more seamless and fluid draws. It was, you know, designed, the design was optimized for precision and speed, you know,
giving the samurais like a little bit more of a decisive edge in combat, right? So it was purpose
built, specialized for the challenges of newly developing mounted warfare. And so that's kind of our inspiration for the name Katana
is that this is a chain that's specialized
for the needs of the DeFi users specifically.
So thanks for asking that question.
Yeah, and I want to kick it over to Goat really quick.
Mark touched on the benefits of having Universal.
And so GOAT, just kind of want to get it from your side as well.
Talk about the partnership between Katana and Universal and how users benefit here.
And before you go do that, GOAT, we are running up on time a little bit.
And I know some of you might have some hard stops here.
And if you do, that's fine.
We're going to continue a little bit. And I know some of you might have some hard stops here. And if you do, that's fine. We're going to continue a little bit further onto this. And then we'll close on the spaces just to
make sure we get everyone a chance to speak at least briefly. So Goat, kick it over to you.
Awesome. Yeah, I'll keep it super quick. Yeah, one of the things we're trying to do
is make sure that there's fundamentally all of the assets available for this kind of new DeFi layer with Katana to be created.
And I think for us, we're still in the very early innings
of kind of defining how U assets can be used at a spot level,
like a spot exposure level, but also within that DeFi ecosystem.
And for those that don't know as much about Universal,
we're doing one-to-one backed wrapped assets
that will be natively issued on Katana
and then composable within DeFi
and within some of these mechanisms
we've been talking about.
Short and sweet.
And we will have dedicated spaces
to all of the core apps uh core assets
and launch partners as well as well as dedicated spaces for the specific mechanisms that make the
katana flywheel spin like ball bridge chain on liquidity vb tokens sequencer fees etc etc etc
so stay tuned for those as well um who's still on here who do we have okay turtle club dropped off uh matt from lombard
and i gotta say like the i i think it's the kaido leaderboard but the lombard uh community is going
out in full force and really helping to amplify the katana message so just like a props to your
community matt and uh b let's uh let's dig into lombard and the benefits that uh you know for
users on katana to benefit from lombard absolutely thanks for having me yeah definitely i think um
obviously twitter's pretty hot right now um and i mean after the origin story as well for katana i
don't think that can be beat.
So thank you for that and sharing that with everyone here.
So as the Aglayer for Deep Unified Liquidity, I think there's few chains which are promising upcoming that I've been interested in.
and Katana's approach and backing and the team that's building it from first principles of
liquidity with all of the experience that we have in DeFi over the years, I'm very bullish. I think
this is going to be not just a product which has a successful launch, but it's going to have a
sustainable future and that's even more important.
So with Liquid Bitcoin, LBTC as the category leader for Bitcoin staking, backed by a proven
security model with some of the largest names in crypto securing the protocol, we're excited to
bring LBTC to Katana on day one and utilize the security model that we've built up so that users can bridge Bitcoin directly to Katana with the sprinkling of yield that we have on top as well.
So that's incredibly exciting.
I think aggregation is the answer.
We want to have LBTC everywhere as securely, as cheap and as fast as possible.
And we know this isn't easy between the myriad of bridging solutions available today and all
of the different security setups that exist. So having LBTC minted directly to Katana, I think
it's going to be a big win on the demand side. And obviously Katana with
aggregation is also the answer to a lot of this longer term. So incredibly excited for the future
here and I'll keep it short and sweet, but thank you for hosting me. Yeah, absolutely. And like I
said, we'll have dedicated spaces for all of the core apps, assets, and launch partners as well. And without further ado, last but not least, let's talk to Korn from Yearn, a integral partner in the predeposit launch,
and will also be deploying on Katana day one. So Korn, a little background on Yearn and Katana,
and then we'll try to wrap things up on the spaces. Yeah, thanks for having me. Can you hear me?
We can hear you loud and clear, sir.
Nice, good. So I'm Corin from Yarn, and I've been doing BD and all the ecosystem partnerships
for a long time, for coming up on four years now. And Yarn, when I first heard about getting
involved in Katana, in a chain that makes revenue from its AUM and directs it to the best places to reward users and builders, like we had to be involved.
And we're going to be doing all of the pre-deposit vaults, which are live right now, and then the transition from pre-deposit to being live on Katana.
to being live on Katana.
We're going to do that smoothly,
and we're going to have all these vaults and strategies
on Katana on day one too,
along with a new product that is a new way to earn yield
called Yield Splitter,
as well as doing some select vault bridge strategies too.
So very excited to be here
and really happy that Katana is finally launching.
It's been a long road, but it's been fun.
Absolutely. And we had some guests that couldn't make it, you know, that were involved at, you
know, the core app and launch partner side of things. But, you know, we will have dedicated
spaces to them as well. Some of those include Jito, which is very exciting.
Bitvault is another one, as long as like Etherfy.
So many like stacked, stacked DeFi infrastructure teams are very, very bullish on Katana for all the things that we've talked about here.
So the social proof is there.
One last thing I'm going to do, I'm going to leak some alpha here because that's something that we also like to
do if you're here and you're participating you get the benefit um go pre-deposit why well that's
because uh there have been more mladies added to the pot we haven't really made this public yet
but it's there and they're ready to be won.
And if you're on the spaces, you're hearing about it first.
So pre-deposit, get the yield engine running, the flywheel spinning.
It starts today.
So we'll go ahead and close things out.
Oh, yeah, perfect.
Yeah, we'll go ahead and close things out.
But thanks for everyone for joining. We will have a lot more spaces talking about the protocols and the assets and the mechanisms that make the entire flywheel spin in the coming weeks leading up to mainnet. So stay tuned, everyone. Notifications on and we'll talk to you next time. Thanks, everybody.
