Panel: DeFi across different chain15th Oct 2023 | Sunway University | ETHKL 2023

all right good morning everyone welcome to this panel discussion on uh def5 cross uh multiple chains um we have a a very distinguished panel of uh three speakers who actually represent a very different perspectives you will find out soon so uh let's kick uh let's kick off by having our speakers introduce themselves and um share what exciting things that building in the D5 space can hey guys uh Calvin from imp possible here uh impossible is a decentralize incubator and accelerator we work with a lot of early stage projects and spend a lot of time trying to think about what happens in this space so uh very lucky as well to be able to be alongside two folks that are uh from multiple chain ecosystems so I think we'll get some interesting perspectives today hi everyone I'm Ken I'm the CTO of AO so AO is a decentralized derivatives exchange uh we allow you to trade perpetuals options and strategies so we started out first as ribbon finance and we've expanded our scope to building out AA and excited to discuss cross chain def5 with you all hi I'm s from Jupiter Jupiter is a DEX aggregator on salana on a monthly basis we do about half a billion to a billion volume um I mean it's very different from everyone here IFK but we are from Solana and it's very excited to know share everything about Solana with you guys all right that we we'll start with our first question so how would you categorize um defi compared to other sectors in the space or narratives or like what do you think defi sets defi apart start anyone can take okay so I mean I think defi is always there right like if you look at if you look at what that's happening recently the trend that's happening um people have been talking about social fi you know FR Tech and everything if you look at FR Tech alone that's a part of defi as well it's basically social plus a price curve right and that that's what make it more interesting comparing to you know like lens or whatever out there it's like you know you post a tweet hopefully you will get some kind of tokens but now it's different like you can actually play with you know the valuation of someone like social profile and that's part of defy as well I would say right because without the pricing curve no one will buy and sell like all this social profile and I I think one major part about defi is that people feel like there's some kind of alpha there and people just jump in just so that they can you know get the kind of alpha that's why it's always interesting to think about you know other than social what are the things that you can you know do it together with like somehow like you know a pricing curve or different perspective that like from from D5 before yeah I think to Me Def has always been like this big brain crowd almost where whereas you have like on a corner it's nfts the other corner is defi defi is always been a big brain crowd we've developed stuff like amm so I think that's what distinguishes all of D5 from everything else it's really just um development of really interesting ideas combining finance and like math so uh yeah that's why I'm excited about it uh in some way defi never left right because it's part of what uh both of them are uh mentioning right I think especially when I think we've been lucky enough I think all of us to be around in crypto for quite a while uh we remember when we opened like those def Llama Or def pulse pages is where DL was in the you know tens of millions and even today in bare Market we're still sitting at you know tens of billions I think it is uh you know a different scale of magnitude of the progress that we've seen in the space um and that even when maybe headlines get taken over by other products like the social F side of things or uh maybe before metaverses who remembers metaverses right you know you always have uh you know new thesises or new threads that get people's attention but uh obviously a lot of people come to crypto or defi for the permissionless access uh to use any of these products and I think that's something that's always going to be useful yeah D everywhere actually so you guys uh all come from you know different chains or like uh parts of um defi space just next question will be wanted to learn more from your own perspective what do you think are the pro pros and cons um like building um non evm chains or evm chains or a row up oh yeah okay so ASM uh I'm gonna have a contrarian take on this one so maybe I'll let sh start um Solana is very different because uh you know you look at ethereum there's always like a new narrative that bring it like you know um do something more and fresh fresh for a lot of people like before there was like ethereum now you have like all the like L2 with optimism abits and all these things that carry ethereum narrative forward Solana is only one chain like you know there's only one L1 there's no L2 or whatever and um a lot of baggages you know like FTX SBF and now now like the downtime and whatever right people like to like you know throw a lot of hits on it but at the same time you like you know I'm biased obviously but if you look at the technology like Improvement that has been going on like last year I think there a few like like a couple down times like this year so far has been quite amazing on the up time the team are learning a lot you know the foundation is learning a lot like working with the people uh in the ecosystem defy on the defy activities like U obviously after the whole FDX uh you know um crashing the a lot of volume went away but uh so far we have seen uh the up tip in the last like over the year since the last you know FDX crash it has been going up like quite steadily not like you know um like very insane but at least it's like going up like 10 20% and but like linear growth over the year yeah yeah I think the general trend is that that in Bull markets people look for all L ones for new opportunities but somehow in bare markets ethereum alignment becomes an actual thing I'm not sure why so during the last bare Market people were like oh Bitcoin is not crypto ethereum is not crypto I think we're seeing the same here with ethereum as well so people are trying to lean into this ethereum alignment angle with arbitrum optimism shared sequences so but I I do think like salana and avales time would come back in the bull market for sure yeah I think um I think both of you guys mentioned a bit of like the rotation of usages of these different chains I think it's boiled down to something much simpler um in bull market money is everywhere I think it's pretty obvious and I think it's always hard not to get distracted in these types of environments and then you compare that to in bare markets right when money is scarce the momentum the sentiment around the space is definitely dampened across the board uh the question is where can you aggregate some semblance of community right um a shout out to Heth and the team here that has done a lot of stuff in building a community here I think to your point about like why everything kind of seems to come back H in some way liquidity is what scarce in this space right um I mean you guys see this on on the trading side of things for all of us that have some more trading background here we understand how important uh liquidity is and that there's only two ways to Source liquidity for the space one is to bring new liquidity into the space and maybe that's why you also hear in bare Market rwas start becoming popular again right because that's one way to bring liquidity into this space even in bare Market uh and then of course uh in bull market you have enough liquidity to be able to support new l1s new l2s whatever it might be um so yeah I think it's something that is going to be natural to keep on seeing this type of uh cyclical action um but it's up to us to figure out which ways we can actually sizeably make a difference and building a better liquidity for any of the products that we work on you I I might like um have a full of a question for Ken um just like when you were selecting like row up Solutions like um with like the thinking process and then any tips for maybe other D5 projects are looking to uh throw up Solutions yeah so actually the full answer I'll cover within my talk later an hour later but um so the approach that AO has gone with is to host our own rollup and then actually have our own almost like app chain that we're running on top of so uh that's the solution that we've gone to and I think it's important for us to inherit ethereum security and so that's what we're stuck to so op stack ethereum and we're built on top of that go um yeah um so addressing security and scalability will be a like I think a challenge for all three of you just wanted to learn more on like whether there's any insights you want to share I I for us it's very different because like so far we uh we're just doing Bas basic routing like uh most most of the security is falling on the partners that we are working with so most of the time we can get pretty relx on it I mean but obviously not losing uh user money um a lot of our problems usually happen on the UI it's like you know the price that we are quoting is not what the user expect so those are usually the the things that we have to handle but most of the time because we don't have to store any tvl we have to we don't have to store any user assets on our protocol which is one thing that's great for us that we don't have to worry too much about you know holding user assets yeah yeah so security is a huge point for us right so for our exchange how users actually deposit into our exchange is they deposit into our Bridge contract and then they actually Bridge funds over to EV L2 so it's Paramount to actually have like security to be airtight uh we monitor transactions that come in and out yeah I think um I'm curious I'll throw it back to Ken sorry to grow you U but I'm curious uh if there's been a significant difference in the amount of security that you guys need to consider with the new purpose product versus before when you guys had the vaults and uh the option side of things yeah I think it's quite different in terms of security we actually have to care if you know our users are solvent and things like that like do they heav enough margin is a liquidation engine running well whereas with vaults a lot of these things are like fully collateralized so it really does not matter as much we just have to ensure that our vault contracts are secure they're audited so yeah it's a different ball game for sure how do you do liquidation cross chain oh no um so liquidation actually only happens on L2 and yeah it it's happening within the rollup itself yeah there is no like cross chain liquidation or anything like that yeah you cannot find enough liquidity to liquidate on a chain like I guess you have Market maker that will come in yeah it's mostly driven by market makers um so if for example you deposit Eve you um open a Perpetual position and you get liquidated we actually need to liquidate your Eve into usdc right so how we would do that is we would actually uh do almost like an RFQ we would RFQ e to usdc convert that and then re have your usdc so that you are fully mergin uh maybe as a Launchpad I guess the product side of things is maybe less technically rigorous and so some of what we have to consider as well as on the Financial Risk side of things so I think since October of 2021 impossible has had a buyback Protection Program as part of the sales that we do um so we've actually returned a total of 1.3 mil USD um to our users in the cases where launches don't go as well as planned and users unfortunately are faced with some loss that we have effectively a stop loss or some sort of buyback mechanism to allow the users to sell back the token to the project teams in the cases that the project dips significantly below the the launch price so I think in each of the kind of cases that when we're working on different problems like the the funed side of aggregation or on the more heavy derivative side um you know everything that we have to do we have to be able to own up to our users and show them that the work that we're doing has the intentions to really protect them um and I think that's the most important thing I'm myself a impossible launch pad user and bipat program like user as well um your next question um will be more on the regular and compliance side like it's becoming a more severe like important issue for like project Founders or everyone in the space just want to know how your team is like navigating or like um tackling these maybe I'll start on this one uh I guess uh impossible has two in-house lawyers on the team I think one of them is saying the back CM if you want to raise your hand so if someone has some questions on whatever you guys are building during this hackathon please feel free to ask us um yeah I would say it's quite difficult uh especially when a lot of uh countries or jurisdictions are not particularly clear in their regulations um the stupid answer is always just do what you think is best for the users if you are a user yourself um there's not really I think enough guidance in a lot of places um for ourselves a lot of the things that we do is just try to keep up with what's happening in the space as well as um imposs info chain does have to do kyc uh on our product as well and I think I'm not sure about uh aonl um but generally speaking uh I do see a lot of teams moving down that direction um I know it's not the most popular one in the more decentralized ethereum communities and also not the more popular one when we have so many Anonymous uh anime characters in Twitter and stuff right uh but it's something that I think when you have too many bad actors in a space a lot of the prevention in trying to uh reduce the amount of anonymous folks that maybe do things in the wrong ways I think they've kind of ruined it for a lot of the folks that were honest good builders that um you know were unhonest for different reasons um I'll tell a small quick story of a lot of us at binance uh were Anonymous in def5 mainly because we weren't allowed to work with non-competes so I think that's one you know very obvious reason why some folks whether it's for regulation or for um you know work rules that they're not able to announce that they're working on some side project um so it's not to say that Anonymous Builders are all doing things for the wrong reasons but rather um a lot of it comes from necessity H and so I do think that working within the bounds of you know whatever jurisdictions you guys have and um mde is a sponsor right so we don't want to screw over any people's applications for VAs or anything um so I think generally speaking we do want to make sure that uh you know if you're doing by the users and you feel proud of you being a user of your own prod product I think you're in the right direction yeah I Echo what Kelvin mentioned um I think broad Strokes as a defi protocol block Americans uh block Russians unfortunately that's how it is but um I mean you guys have to actually protect yourself as a project and track IPS unfortunately that too but as long as that does not fully inhibit like the user experience like that seems to be the way to go unfortunately I'm I'm not sure what I can add um yeah yeah don't want don't want to be you know like being add as a clip on Twitter like saying anything stupid so if a Decks that you guys aggregate doesn't serve a certain country but you do are you allowed to aggregate them I don't know okay we we'll find out yeah um so we then let's jump to the next question um yeah def is are rapidly growing space um like how do you guys uh stay on top of the Innovations in the defi space and how would you recommend like our other defi Builders here um to like stay on top you uh I guess there's a lot of free resources out there there I think a lot of group chats um dashboards I I really like doing um dashboards to see like what's happening know maybe uh seeing only 400 users go over to scroll in the first three days you know you get these like quick like tidbits that you see just I'm simply opening the homepage obviously on on Twitter I think a lot of us have already used Twitter but I do think Twitter is one of the most powerful resources and you can also see exactly what other people are following too right so I can find out what Ken's like oh that's a new Dex or that's a new thing or you guys aggregate something new I can just go see what other people's follower lists are right um and I would say maybe the other one is uh uh generally speaking uh I do think you learn a lot in small group chats um and I think uh when you have a lot of friends as well that are in the space and are trying to teach each other uh to keep up to date I think that's the fastest way to reinforce each other in uh the learning that you can do yeah I think crypto I don't think we call it to or now this crypto X is like the best place to actually learn anything so um follow the right accounts and if you're starting out in di5 for example I would highly recommend you to go through every single blog post VC has posted read all of them imprinted in your brain and that's how you become an expert in DIY um I I mean it's also very easy to chase Trends as well like sometimes you know like like meta wor like people Tred to do that but like you know nothing has been happening now with social f i once like you like what are the new things you can build and on on EV evm is very easy to close the contract then deploy something but most of the time you have to care about like the UI and a lot of stuff as well I I feel like there are a lot of things that are there but still not exact ly proven yet like for for example mm like you know we talk about couple billion of trading volume but if you look at the total number of users are still not there I mean people have been saying about that as well like you know how do we do more Improvement on the UI and stuff like that sometimes maybe it's not about the the idea it's more about the UI but good thing is that things has been improving like AOL you know like it's not possible two three years ago now it's possible with new row up and stuff like that you can easily do stuff that you don't actually have to sign but the assets are pretty secure in some way same thing for you know friend Tech and all these things as well yeah yeah I think the other thing on the learning point is just try more stuff right use use their products you know try everything I think um I would say brute force is one of the easiest ways for you to catch up with this space um in in Def summer uh sadly binance didn't reimburse me when I was using this uh but I spent almost 415 e in gas fees in the calendar year of 2020 uh but my job was to know about every single thing that existed in this space you'll always feel fomo you'll always feel like there's stuff that you're going to miss out but you know honestly the learnings that you get from just trying all the products and seeing the new stuff and also going back and trying stuff that you haven't tried in a while right maybe you have tried the ribbon vaults in the past but you haven't tried the the roll up maybe before Jupiter had a lot of features and then they rolled out a simple UI where uh there's a less uh a more streamlined approach of of trading where there's only fewer buttons but a very quick uh Snappy interface you know everything updates over time and so even if you've touched something once I don't think you can uh say you know that's done you never need to go back to it right I think that's the challenge of this game where because there's always new stuff coming out from each of the project teams that are in the space um there's a lot of incentive for you to keep on learning and trying the products directly I think here come to our uh last question due to time limit um for the aspiring or upcoming D5 Founders uh what will be your suggestion on like for them to uh during like product design and uh or any other like suggestion you want to offer yeah I think think for yourself it's very easy to C be caught up with whatever's happening on crypto X and and um follow Trends so you don't want to be like the 10th friend tech for for example you want to do the original FR Tech so you need to have an original idea there so read all the resources out there think for yourself and then decide on the project that you want to embark on I mean yeah exactly what like Ken say right or you can find an age on what you're really good at like I mean I think in Malaysia there are not many Traders or like whatever people with very good like Finance background you can obviously immerse yourself by reading a ton online but at the same times you can also think about what are the age that you have over other people right the most interesting things are things like friend I mean things like FR Tech is interesting because when you blend something that you are good at with something that uh has been interesting then you get something can be interesting or can can be you know not interesting as well for example Tech you you basically blend social with like somehow like a defi it becomes something very interesting so things uh this are the things that you have to think for yourself like what are the things out there or things that you're good at can be adopted and blend with something that existing and make it a lot more interesting yeah and I think um this is I think quite common also coming out of hackathons but I think the important question that you should always ask is would you feel proud of if you had to work on this thing for 5 years I think that's a question that takes a lot of commitment but I think if you can get across that mental barrier or you can find ways to add more to the story like you can see how ribbon plus AO and adding new features to the the story of what you guys want to build and this is something where if you can see that kind of reason I think the the project teams that you respect in the space or the products that we use a lot of them aren't around for just a year or two who they're the ones that have been around for for many many years right um and so to I think make that type of lasting impact I think you actually have to start with thinking is the problem that you're trying to start with is that worth spending a significant chunk of your life on so I think if you can find a good answer for that for yourself I think you guys will all be in very good shape right as we wrap up I'd like to thank our panelists for the insightful panel and hopefully for our audience you have some good takeaways and I guess that's it and thank you [Applause] everyone all right thank you very much to all of our speakers let's give them another round of applause we really appreciate it we have about two or three minutes you want to take question from the audience is that all right with you guys okay if anybody has a question you can raise your hand we can take one or two short questions raise your hand and let us know if you want to ask any questions about dii across different chains okay I'll wait a few okay we got one over there okay I'll come and pass hi guys um thank you for a very good talk um just a question um because uh Kelvin mentioned a little bit about it uh regarding the real world asset tokenization um I think this been a big Trend uh especially in Southeast Asia with the recent conclusion um by uh Mas Singapore uh for project guardian so they brought in like JP Morgan HSBC and all these big Banks to work on this project what are your take on rwa as one of the product in a new product in Defi and are you optimistic about it you know um how can the community get more involved in it what's your take on that than yeah I think uh like I said it's a great way to bring in liquidity into the space so I think you've got some very interesting research that you brought up uh in terms of some of the adoption that we're starting to see um for all of us maybe we've heard of this phrase defi Legos um I think that anytime you can build up more sources of yield then you have more components to play with you know maybe you're Tre creating like a delta neutral strategy on Avo and then you want to be able to augment some of that yield you could imagine where some of these assets eventually someday if they have enough liquidity to be added on a per or more derivatives they can be I think quite composable um we've already started to see this with like the treasury bills like the uh Ono Finance backed uh Matrix ports or Matrix docs uh us stbt so on and so forth so I do think that we'll see more and more products come uh as uh I think in trafi you just need one guide to set the predent and I think everyone gets the fomo to follow or at least maybe the regulatory clearance to start following um so I do think that it is a very interesting um sector to look at um we have a few research teammates from impossible that have been spending even more time on rwa so maybe you guys can raave uh wave your hands and then more folks can come chat to you guys on rwas thanks I have nothing to add but um so we have what we call in ribbon ribbon earn which is actually helping you uh stick your usdc and we give you yield from t- bill so I think that direction is quite exciting uh just bringing more financial products to People based on real world yield and trade with this usdc is not coming from having to issue more tokens from his side but rather from the yield that the T Bill provides so I think it's a very smart way to be able to Source value from outside of the space to incentivize your users great answer thank you for the question as well we're a bit short on time so if you don't mind maybe you can just check out with the speakers after this is that okay with you thank you so much let's give them another big round of applause and we welcome you back down from the stage thank you so much everybody