ETHWarsaw x Sky & Spark (08.05.2025)

Hello. Okay, so we're starting. I don't think I need to introduce what we're doing here. I think you know all of the presenters. Um, today we're going to hear from Chris from Spark, from um um Pavo from Chronicle, and from Vartek from Stake Finance.

Is that it? Because it's new, right? Okay. No. Okay.

Sorry. Okay. So, we're going to talk about the um about the maker and then Sky and what happened. And I don't need to do a lot of more intros. You know what we're doing here.

Please make sure you get one of those. They grant you beers at the bar. So, just come find me. And Chris, you're up first. Okay.

Hi guys. Um, I'm Chris. Oh, do do I have a ticker or something like this? Okay. Uh, I'm going to watch out for this.

Okay. Okay. So, I'm Chris. Uh, I'm one of the co-founders at uh, Fenix Apps, which is the main contributor to Spark, which is a subd for the Sky ecosystem. I I promise in a second this these random names are going to make a little bit more sense to you.

Uh so um today I'm going to talk about stable coins. But before I do that, I want to start with a little bit of tangent and ask you what's the worst idea that you've seen build on blockchain. Like my favorite one is a dentacoin. It was a it was a blockchain for dentists. Uh yeah.

Why would blockchain why would dentists need a blockchain? Don't know. don't care. Apparently, they don't need it because the token is now like worth zero. But, you know, there were people building it.

There were people like, you know, speculating, investing, whatever. Uh, do you have some examples of other shitty things built on top of blockchain? No, not this one. Anyone? Yeah, we're going to talk about that.

But you know there are some crazy ideas being built on blockchain and um always building like financial related stuff resonated with me like you know it kind it's it's a thing that kind of makes sense to build on the top of the blockchain like after all you know bitcoin is a financial product right and it's like the original thing built on top of blockchain right and uh you know if you if you're following any news related to uh crypto or tech in general like every other day now there's a news about someone building a stable coin or someone using a stable coin to do something like even yesterday uh Stripe announced that uh they built some you know first class support for stable coins and this screams like you know strong product market feed to me uh so uh yes uh I wanted to to mention kind of that that you know there's a lot of things building being built on on top of blockchain but there are also things that are really really like you know uh having this escape velocity and stable coins are definitely one of them. So what are the stable coins uh exactly? So st stable coins, you can think about stable coin as a as a cryptocurrency that tracks a value of some other asset. Uh most likely it's US dollar, but it could be any other fiat currency like euro or gold or even like an abstract concept like um a a leverage uh need on the market. But the the basic idea is that they combine the advantages of cryptocurrencies like technical superiority with uh some um stability coming from fiat currencies like US dollar like you know stability if you believe in fiat money right um uh yes we're going to talk about how they work exactly how they you know maintain this this value in a second but before that let's talk a little more about use cases.

So um the main use cases are right now payments and u you can already companies use uh stable coins as uh as you know to avoid uh crossborder uh fiat uh transfers which are expensive and so uh even even this even today like on layer one layer one like uh ethium uh transfers are cheaper than doing like you know uh crossber transfers in the bank microp payment. So, paying with a stable coin for your cafe coffee cafe coffee, it's actually something that you can do right now. Uh you just order Gnosis Pay uh it's not built on like you know Ethereum decentralized blockchain. It's built on the side chain but you know the idea still holds. You can get Pay uh card and I I did that.

I went to Japka and I bought a beer with Gnosis pay card and what happened is that it triggered onchain transaction that moved some money from my chain from my Gnosi safe. There was an allowance first uh that I gave to to Visa card processor and it happened like on on the blockchain right with just a swipe of card like it's amazing it is already happening. Um if you're in crypto space probably you use stable coins for on and off ramps like instead of going to centralized exchange you just sell to USDC and apparently in Poland like even it's not a taxable event probably uh not a tax advice definitely not a tax advice uh and since stable coins are just programs they are like programmable you can you you can build like different uh financial primitives and this This is what decentralized finance defy is all about. And uh now let's get into the weeds how actually the stable coins maintain maintain their value. So there are couple of different types of stable coins.

The most popular ones are called fiat stable coin or stable coins or pec stable coins. And the idea here is very simple. Imagine that I have $1,000 in a bank and I decide to uh mint to create a $1,000 catalog coins on the blockchain and I also hire some kind of auditor to make an audit that yes I have $1,000 in the bank and I created only thousand tokens on the blockchain. Um, and I can also hire some market makers or basically open some arbitrage loops like for example, you send me money in the bank, I mint you stable coin and the other way around. So you send me stable coin, then I send you back the money in the bank.

And this way we create a very simple stable coin that basically it works like there is not a good reason why it shouldn't work, why it shouldn't maintain the value. The only problem is that it's not trust, right? You need to believe me that I'm not going to uh run away with the money in the bank, that there's a money in the bank in the first place. But also, you need to believe me that I'm not going to mint like, you know, billions of dollars of uh cryptocurrency of the stable coin in a single transaction and steal all the money in the you know, DeFi ecosystem in one go like it could happen in a single transaction, right? So there's like this inherent trust that you need to put into the issuer of this stable coin and the biggest stable coins these days like Tetar at 150 billion they work exactly in this way.

Uh the same with cir USDC uh at 60 billion. Uh the more interesting design is uh are crypto stable coins. So um here the idea is that you can collateralize your stable coin with a volatile asset like uh bitcoin, ether, some cryptocurrency as long as it's uh over collateralized position. So you can imagine that you have one bitcoin worth exactly $100,000 and this is the exactly the price that's that that bitcoin just reached again. um and you mint 50,000 uh stable coin uh let's say die against this debt your against this collateral your collateral gets locked in the system but you can do with your debt with the stable coin whatever you want right um so what happens if the bitcoin price uh increases twice let's say this means that you need to sell a much smaller portion of the bitcoin to cover your debt and unlock the stable coin right uh and unlock your collateral again.

So this way you just went long on the asset in a decentralized manner. Also with the stable coin you could buy even more Bitcoin and this way you get leverage on your Bitcoin. And this is basically the the main reason why you why anyone would do that, right? Um and um and of course there's this other situation when Bitcoin price goes down instead of up and then the system basically tracks the value of your position and automatically can sell your Bitcoin before the whole position gets uh under collateralized and this design basically works. Uh this is something that uh maker da the previous name for sky pioneered years ago and systems like this you know manage to survive collateral collapses like of 30% of value of the collateral in like you know one or two hours like this happened to um these days uh the these systems are mostly not only cryptocolateras but they are collaterized by some other collaterals as Well, like it's a mix of different catars.

They could be stable coins. There could be reward assets. Basically, anything that is like tokenized onchain. Um, and the main example here is USDS. So, Sky USDs or previously known as DI at sitting at 8 billion um market cap.

And then there's my f favorite algorithmic stable coins. So in these kind of systems there is no collateral like the collateral is replaced with some you know smart algorithm that keeps that tries to keep the value of the stable coin at $1. And spoiler alert this design doesn't work. Uh there were like multiple you know attempts to to to to create some algorithmic stable coins but after all they all collapse sooner or later. Uh the recent example was Terra Luna USD that was already mentioned.

Uh it got up to 20 billion dollars before collapsing to almost zero. And uh actually like Sky maker D folks were warning everybody about this design because we researched it years ago and we knew that it doesn't work but of course you know no one listened to us and I mentioned that the stable coins that work tend to have some kind of collateral right and this collateral uh can basically earn some revenue for the protocol. So in case of even fiat stable coins, you have uh cash in the bank, right? Instead of just having cash in the bank, you can hold a cash equivalent in the uh uh cash equivalents like uh treasuries or bonds and etc. So basically right now just with uh all the basically all the supply of your stable coin can earn you like 4 and a half% or something like that maybe more closer to four and uh spoiler alert that the company that I mentioned previously tetar the the minter of USDT is apparently the most profitable company that ever existed if you count the number of the the amount of revenue per person per employee.

So it's a pretty good business uh when you don't need to share the yield with anyone. But turns out that to make to build a bit better product you can actually share this yield uh with the users of the stable coin. And this is the idea of yieldbearing uh stable coins. And here the biggest stable coin um the the yield bearing stable coin is SUSDS um which is coming from Sky and it earns and it yields uh 4 and a half%. So I I I really like this product because it's just like you know the money in the bank that you would have but it constantly earns you uh some uh some uh revenue.

Uh there's also SUSD from it. Uh it does basically it tries to monetize the need for leverage on centralized exchanges. It's it's called basis trade. uh right now it yields around 4% and then there's USDI from it's basically tokenizing treasury yield and so it's like four and something%. Um yeah so now as we got through like basics of stable coins landscape let's talk about sky so instead of giving you raw facts I decided to give you some timeline so the sky project was born in 2014 as maker da in 2014 ethereum didn't exist uh there was no defi no one you know called it like this back And so basically the the initial thought was to build their own layer one.

It was supposed to be you know something like dodge or one of these color coins whatever. Uh but luckily one year later Ethereum was born and two years few years later uh D single collateral D uh was deployed as a set of smart contracts on top of uh Ethereum. So again in 2017 um just to give you some idea of how many things uh maker needed to create like there was no oracles uh so maker designed their oracle system. Pavo is going to talk about that a little bit later. Uh there was no even a tool chain to develop smart contracts in the first place.

So maker developed something called daptos which was later rewritten to rust and it's called foundry right now and it's like the way to develop smart contracts these days. Uh there was also no uh dexes so maker developed their own decks order uh order book based uh decks called as decks and I even had a chance to uh to work on it and single d you could only mint with ether. It was like the prototype of the of the system and it reached $100 million pretty uh soon. And then two years later the the the the final uh development of the uh maker system uh was deployed. It's called multi and it's actually the the the system that works till this day.

It's very modular, so you can replace some parts of the system, but basically the the the the main contract called VAT uh is still the same. Uh and it grew up to 10 $10 billion a few years later. Uh yeah, and one year ago, Maker got rebranded to Sky. That's why I'm like, you know, using two terms at the same time. But, uh, yeah, maker became Sky, the D became USDS, but since the contract is immutable, the D stable coin still exists.

It's and USDS is a separate contract, but there's like a redeemability one to one. You can upgrade and downgrade anytime you want. There are no fees. Basically, they are like exchangeable. Um, and Maker token got replaced with Sky as a governance token.

There was a token speed, so it's like one to 24,000, but again, you can go back and forth uh if you want. Um I think the main reason for the rebrand was that you know even though D and Maker D was are like very recognizable brands uh within like the the crypto uh ecosystem. The problem is that uh you know if you if you ask a norm to hold you their you know money in the currency called die it doesn't sound that good. it doesn't sound like it would supposed to, you know, keep the price. So, this was one of many reasons to to do the rebrand and it happened year ago.

So, now we we call call we call it sky uh yes and uh this day uh the balance sheet is of around 11 billion u dollars and uh let's talk a little bit about the assets that are part of the balance sheet. So as I mentioned these kind of stable coins tend to be mix uh of different collaterals. So the main one is still cryptocolateral. So things like ether, things like bitcoin, various staking derivatives of bit of uh of ether and so on. Um then there are stable coins.

So right now it's around 33% basically they are head in USDC. So this helps maintain the peg uh between dollar and um and USDS but also even the stable coins earn like three and a half% uh to the maker right now. uh the crypto collateral is more like four and six I think and then there's a reward assets part um which I guess earns depending you know on what we exactly invest in but back is going to talk a little bit more uh about the reward assets soon uh yes so um the sky governance token is a token that governance the the whole sky ecosystem and as I mentioned there's a revenue. So of course the token gets like the profit share. It's around 80 million uh per year right now.

There's also ability it gives you ability to farm subdo tokens. We're going to talk about subdos in a second. It gives you voting rights but also there's another uh there's a other end of the stick which is in case of the sky governance uh governing the protocol in the risky way which leads to some kind of bad dead event when there are under collateralized positions in the system when system wasn't able to sell the collateral quickly enough the sky token can be minted and already existing um holders can be you know uh diluted. Uh and now there's this thing called endgame plan which is uh like this huge uh plan to uh basically set up uh sky dow for years to come. It has many different you know areas but one of the areas that we're interested in right now is the idea of creation of subdows also called stars.

Yes. Very exciting. Yeah. So, so here um maker DA was well known to be one of these like you know huge slow to to change slow to to act uh dows and uh the idea is basically to create like this smaller more focused more uh startup like uh subdos uh and this is uh how we get to spark which is actually the very first uh Sky uh subdo it's a D5 focused one uh so we're doing like all all the different things related to to decentralized finance and one of the first thing that we did a few years ago was deployment of Sparkland so this is a v3 fork but it's focused on stable coin borrowing so this is the best place where you can borrow stable coins at like you know bigger scale like millions of dollars in one go and you have like the cheapest rates and you have like you know the biggest liquidity. Um and it's like sitting at 4 billion TVL these days.

Um another thing is that we spearheaded the the savings SUSDS uh efforts. So you can go into our app and very easy go from USDC or soon some other stable coins into this SUSDS product and start earning on your stable coins. Um and this like I think we have like around 100 more than 100,000 like you know act active wallets using that and there's a TB of like almost four billion. Um yes. Uh, and one of the things that excites me the most is the back end part of all of that.

So, it's called Spark liquidity layer and it's a system that injects the liquidity in the way that maximizes the the yield of the system. Of course, within some risk framework. So, it's not like you know random uh that that gets liquidity. it's rather like you know well-known protocols but uh you know with with not that much of a liquidity. So it's all constrained by the the risk framework and an example of that is that uh the spark liquidity layer can basically inject into most of the well-known protocols these days.

For example, when there's a spike in yields in ETNA, we can through itina capture this centralized exchange yields. Um and we actually do that um when there's there's actually a morpho deployment done by Coinbase on uh base network uh which is uh for uh which is prepared for Coinbase BTC users uh that can very easy take loans through through the Coinbase app and we're actually the biggest liquidity provider there at sitting at I think 70% of the of the pool. um and uh and you know uh and Sky and and Spark is capturing this yield and what happens with this yield later is this yield is being passed to the SUSDS holders. So for for the savings product. So basically you can think about SUSDS as like the best way to get like a yield on uh across all the DeFi um ecosystem in like a sane uh safe manner because we're not you know investing into random crap.

Uh yes and you can you can already see that you know spark is one of the subd dolls it's more focused on defy there's another subd doll doing solena stuff there's another subd doll doing real world asset stuff there's even one for bur chain and basically you can think that sky is acting a little bit as decentralized centralized bank which is not doing any commercial retail activities but rather have these like commercial banks not a bank uh like Sab does that they do have like a retail relationship u and this way the whole thing you know scales better and uh can reach the customers when they where they are and of course SPK our governance token is coming soon I can't tell anything more, but it's it's there. And yes, you can you can learn more on spark.fi. Uh, and I'm Chris Catcher. You can find me on Twitter.

Thank you. Questions? Hey everyone. Um, my biggest issue right now is off and on ramping. So, most protocols are taking a huge hefty fee.

Hopefully, there's no one here from Moon Pay, but they're like the biggest scammers here. So, you want to offramp $1,000. It's going to cost you like they take like $40, $50 in fees, right? And so, how do you perceive like the next on and next I guess next generation on and off ramping, right? Because right now that's my biggest issue, right?

people just taking my money and where the fees are going. Who's seeing that? I guess ramp is a better protocol to over your money. Would you like a professional answer like why this is so expensive? Okay.

So, I used to work at RAM for 5 years. I'm not working there anymore. So, like if anybody tells them that I'm saying that, please don't. Um the majority of the fee is the fact that you're buying a crypto asset which is priced very heavily by the card providers such as um World Pay or Stripe. So you need to pay like a risk premium on on boarding the crypto asset.

On top of that you need to pay the fee for KYB KYC checks which has like a v variable price and sometimes require human attention. So that's another bit. The other um part is that you're paying for sourcing liquidity which is stupidly expensive in crypto and it shouldn't be. But if you're asking me what is the best way to uh for new ways of unramping is through stable coins. So if you uh go directly to stable coins there is a technical way of actually making it um direct one to one.

So if you mint the stables it's also on ramping. So if you mint your stable coin and then go to cryp go like explore crypto after that then it's better. Yeah, I can give you a concrete example like um if you hold um if you go into for example our savings product so you're not uh holding USDC you can go back holding USDC without any fees and and so on and with USDC you can actually I mean you need to be a business to do that but I know about people doing it on you know using y they just sign up with circle as a business and they can uh achieve onetoone swap like you know just uh send circle back the USDC and you get back uh like fiat money. So basically if you hold USDC the peg is very like uh they it holds the peg very well. So you can go to any centralized exchange and do that as well.

Basically you need a I think to you need a centralized exchange these days to do it at scale. Uh because like this like on ramps like ramp or something else it's like great for you know smaller amounts of money and no sorry this is what my presentation you go at least this is what I think it is but I'm sure that ramp is great and hi uh I check the spark land. So basically if I I put USDC there, I'm going to mint SUSDC to get this 4% interest rate. And so you're going to internally swap USDC to US no USDC to USDs and then from that to USD. So this four five% interest rate you charge you provide you giving less is for this fee because USDC is 4% USD is 4.

5%. So I think there is no way to easily get permissionless yield on top of USDC these days, right? Like you need to pass through KYC and you need to lock your stables uh your USDC in something like you know Coinbase uh um earn or something like this is all of them are the same interest rate is 4.5. It's 4.

5. Okay. And so this US this 4.5 where you get the interest rate? I know USDE and USDY where they get their interest rate from and where this USDS got interest rate.

Yeah. So uh this was uh this is more or less this previous one of the previous slides. Uh yeah this one. So basically there are multiple sources of the yield. It's not like we put everything into treasury bills uh the way on does or even itina even that itina used to tokenize mostly the the the centralize uh like this basis trade these days they actually inject liquidity into SUSDS because we provide the best yield and uh right now as I as it's like on the previous side most of the yield is coming from the uh crypto lending facilities, right?

So, basically we charge if you want to leverage on your crypto collateral using our system, we charge you more than four and a half%. Right? Depending on where you do it, it's like either five and something or it's like four and six, but it's always higher. So, this is the source of the uh most of the yield. And also, there's also this fact that the utilization of SUSDS, it's not 100%.

Not every holder of USDS is getting the yield. So we have like whole balance sheet providing the revenue for half of the uh users. So that's why it can be artificially even higher than what we would expect normally to what Yeah, the question is is SUSDS coming to none EVM chains? So yes actually it's available on Salana even right now and this is what Salana subdow is also uh you know spearheading last one uh your take on uh pectra update and you know how it can affect uh USDS and its usage and on top of so it's a great question because we have our front end team here and actually we already support update in our app So you already can uh you know do this complex uh multi-transaction uh transactions in a single transaction right now. So, I think it's great, you know, UX upgrade mostly.

Uh, you know, it also increased blobs, right? I I'm I'm honestly not that excited about that. But the UX part is like great. Of course, it's a little bit more complex like your wallets needs to support it as well. So, you need like a deploy like uh smart smart wallet first, but basically it works already and like a lot of apps already uh supports it.

Thank you. Thank you so much. Okay, so um a small shuffle. Uh there's some spaces in front. I have no idea what they're playing.

I think it's Call of Duty, but I don't play, so I have no idea. They yell, and I'm too afraid to knock. I I think that they might yell at me if I tell them to be quiet. Uh there's some spaces in the front. come over.

And if you still want to get a drink, just grab one of those from me or grab them after. H And uh now we have Bartk and Bartk I am sorry because I uh I'm it's stakehouse financial stakehouse financial and not stake finance. Why did you correct me? Sorry for that. Vortex coming up.

Um okay, since it's the setup's going to take a bit. Anybody wants these? one each. Anybody? Okay, those are the tokens for the bar.

You can exchange them for drinks and food. Okay, so Bart is gonna click for himself. Slideshow in progress. Resume slideshow. Hello everyone.

Okay, so uh my name is Bartk. Uh most of you probably know me already because I've been in this space and in this city for quite a few years. uh in the city for my life uh in the space for I think eight years. Um today I'm speaking to you as one of the chefs at Steakhouse Financial which actually is an established company in the crypto space because we've been doing work here uh for a couple of years already. Uh just a quick word about Stehouse Financial.

I added the slide just a moment ago. We are a team of cryptonative collaborators. So basically people that do know what they are doing. We are both technical people uh financial uh experts. So like banking professionals and also legal experts that do various things across different dows.

So similarly to Fenix Labs which works on Spark. Uh for Sky we do similar work for multiple protocols. Sky Lido or Morpho being the largest one with probably like the largest uh uh percentage of our time but also others many more. I encourage you to um to actually learn more about uh the company as it is uh quite influential in the space but operating rather in the shadows. Um so I'm going to talk to you not about sec financial but about RWAs.

Uh nice. So what are RWAs? Um, real world assets are basically uh, surprise surprise wrapped tokenized claims on offchain assets that usually are bonds, real estate, private credit, but also stocks or basically anything else that exists in the real world. But we want to bring this value or like it's its representation onchain into the decentralized economy that uh, takes place uh, mostly on Ethereum and and and surrounding layer 2. Usually RWA is on the form of uh ERC20 tokens which everyone knows but sometimes they can be something different.

Uh and just one word of what RWAs are not they're not crypto loans. So um Chris mentioned basis trade. So and we can also add uh some loans to um crypto market makers. Basically anything that still is facilitated offchain but is sort of crypto business related we do not consider it RWA all that much because it's still very uh tightly coupled to the to the whole crypto market and the actual uh RWAs grew a lot in past couple of years. So you know back then when you know I thought that that RWA space is already pretty big uh which was like the times like 2021 2022 and already I had the chance to work on RWA related projects.

I thought they were big, but I wasn't ready for what is happening today. And this this past couple years, we are experiencing a true boom in the RWA space mostly uh in the form of the tokenized um tokenized treasury debt uh which is the most popular use case. But when it comes to the TVL, as RWA.xyz shows us, the private credit is leading. And uh today uh because this is the screen from today we can say that we have uh $22 billion worth of RWAs on ch on chain which I think is quite an impressive number.

In the past year uh the growth was 60% just in a single year and this year already the growth I think surpassed it and we still have plenty of the year to go. So um so I think we can expect even more vertical chart um as we go uh in the most uh upcoming months. So why RWAS matter? Okay, so like they exist um they are growing but like why would we even care and why we as crypto professionals or like people interested in blockchain technology would like to care about them? Well, actually they're very important step in the development of the whole decentralized finance industry because first of all they provide the uncorrelated source of yield.

Most of the yield that can be earned on chain is somehow correlated with the broader crypto market. If the crypto market is booming, prices of crypto assets like Bitcoin, Ethereum and others are going up. There is more demand for leverage, there is more capacity for leverage because the assets are worth more and the yields go up and as people get greedy, they want to borrow more at higher rates and that drives the whole crypto economy. But then if we uh happen to enter the bare market then uh the yields of of course plummet. Of course uh of course not only the rates plummet but the size of the whole market because then if the assets are worth less then there is less capacity for leverage there is less ability to borrow less borrowing power in the space and then the whole economy shrinks.

So basically without RWA, the whole DeFi is just like a crypto casino that represents like kind of like a sentiment towards Bitcoin and Ethereum which is not a sustainable um thing to have. Then also RWA gives access to new markets and can in the future can help build completely new use cases which we don't have today but we might see with the RWA growth and also helps onboard new users because not everyone that wants to use financial products on chain maybe is after the crypto casino but also is after stable products like Chris mentioned uh SUSDS in the sky provided by the sky ecosystem is a savings product that just gives a stable yield on top of USD on top of USDS or USDC. And this is something completely different from just the leverage trade and um and the and the kind of uh gambling situation that is happening um in crypto normally. And then also RWAS bring compliance and mainstream integration which is very important because RWAS and the investment banking professionals, legal experts and these people that are coming into the space with integrations of RWAs also bring their expertise and make can make help also this kind of more DGEN side of crypto slightly look slightly more serious and slightly more appealing to everyone that uh would not enter the space without this kind of certificate of or like check mark um of these like professionals being in that uh market already. But uh RWAS uh matter not only for DeFi, they do matter for the traditional finance as well because this is the next step for them into the digitalization and and automation like every industry needs to grow, needs to modernize, needs to uh needs to change and I firmly believe and I think you believe also that blockchain technology is far superior to any other technology that we have and that that is underlying the financial systems today.

So it is just better technical rails for the financial system to operate even outside of the whole decentralization discussion. Then this is also a 24/7 open market. Unlike the traditional markets which work only in the office hours which work only on the working days. Um this is far more reactive and far more fast-paced environment which also is just uh far more efficient and because being more efficient can give in result access to far larger liquidity and over time will just uh will just grow to a bigger size than the financial markets that we have today. So if it all sounds that good um who is building this?

So like we need RWAS on chain. We do have RWAS on chain because we we saw the growth. So what are some of the projects that are doing this already? Some notable mentions uh here. uh first of all Sky which is a pioneer on uh in the RWA space and one of the most uh important actors but also other protocols that help make that happen or used to make that happen in the past and played some role in the in the whole RWA system growth.

So uh centrifuge uh on the super state uh mostly these days working on collateralizing the actual real world assets which are uh in the largest TVLs today um uh treasury bills so uh bonds but not only uh centrifuge is doing some very interesting work uh with some uh traditional institutions that I think will help in the future bring far more interesting assets on chain. Maple and Trufi were also uh kind of uh pioneers uh but these days uh what they do is not strictly RWA related according to uh the definition that I set but I I had to uh mention them uh kind of as the as as an or honorable mentions and what's interesting on the other side where we do not have strictly the gen crypto startups we can put some very serious ious names that are doing some serious work within the within the RWA space. So for example, Black Black Rockck and its uh Bele fund uh which tokenizes uh treasury bills um I think recently surpassed over three billion in TVL across all chain. So, $3 billion worth of assets on public blockchains uh introduced by Black Rockck, one of the largest asset managers uh in the world or if not the single largest uh asset manager in the world. I think that people heavily underestimate uh the weight uh of uh of that and uh and need to need to pay more attention so to speak.

Visa and Mastercard launching um launching some pilot programs on public blockchains as well. PayPal launching uh PIUSD. Um so uh again a stable coin that helps them play around and kind of wet their feet in the in the in the ecosystem. and Jennus Henderson, which is very traditional, very legacy asset managing corporation, but these days works with Centrifuge and actually manages over 300 million onchain in JTRSY um in JTRSY tokenized Treasury bills fund, which I think is super interesting and and I'm really excited to see names like that do stuff on public blockchain of Ethereum. So what Sky does in in LWA space?

Um first of all it pioneered with uh RWA usage as collateral as Chris mentioned. Uh back in the days uh the crypto the only collateral um in the formerly maker but these days sky ecosystem was crypto. But in order to grow the monetary base of USDS now uh and die earlier we had to like the ecosystem had to expand. So RWA was used as a collateral for for its stable coin and back then there were some tokenized bills in some more primitive form used uh which happened quite a few years ago already and also uh Sky led pilots with some banks. So banks uh Huntington Valley Bank and uh one of the French banks which I'm not going to attempt to read that correctly were allowed to borrow from Sky from Maker using their uh banking their investment portfolio as collateral.

Um, so that was also uh something pretty interesting and um these days Sky is a heavy user of Coinbase Prime Custody which is also another wrapper around the um treasury bills. Then uh where Sky is heading these days is a great uh tokenization grand prix that Sky announced recently and that resulted in uh some uh pretty interesting protocols signing up for the cooperation with Sky and initially so these numbers are going to grow and are growing but initially 1 billion of dollars of USDS from Sky were assigned to these three protocols to allocate hate. Um, so I think these are pretty serious numbers and uh and um pretty exciting to see that happen and see this number grow even further uh in the future. And what's for Sky in all this? Again, as I said uh before the same rules apply uh Sky gains growth outside of crypto uh gains diversified source of yield.

So uh no need to always follow the sentiment of the crypto market diversified collateral and probably more stable base monetary base that the sky will have and also legitimacy because with on boardings of RWA there's a lot of legal work happening that makes Sky more of a big boy adult business rather than just like a funny crypto thingy that is just somewhere there in the in the fairy tale of the of the Dunan Um to investigate more I invite you to um to check out info.sky.money or app.rwa.xyz which are two very interesting information sources.

Info.sky.m money of course about the sky ecosystem. You can learn there about the exact composition of the collateral in sky about the exact allocations of assets and about the revenue uh that is being uh sourced from u all the assets that are underlying uh USDS. I think this could be a pretty interesting thing to research and lwa.

xyz XYZ just for the RWA stuff and at the at the end of uh my presentation uh one small mention so uh me as a member of steakhouse financial uh I'm uh very happy to uh sort of pre-announce uh a new star that is going to be rising in the in the sky ecosystem. Um so we have spark uh which is already a pretty renowned and one of the largest allocators uh in the in the sky system but there is going to be a next one and uh it's going to be mainly RWA focused these like on this on this presentation mainly when I was uh mentioning RWA it might have sound a little um a little monotonous that there is there is there are so many different RWAs and then what kind of RWAs yeah Treasury bills and what are these guys using? Uh different things. Treasury bills. So it's not going to be only treasury bills.

Uh this is the time when the real uh and uh actually diversified RWA is going to shine and Sky again is going to uh to be uh to be a pioneer that's going to lead that and I'm uh very happy to be a part uh of that. And if you also want to be a part of that and want to help bring billions of dollars literal of real world assets onchain into the sky ecosystem, let's talk u we have uh some needs. Of course, I'm not speaking on behalf of the of the of the of the DAO itself because everyone can can contribute to the DAO. But uh but yeah uh we will be helping to uh foster the the new subdow and u we can help you help the subdo grow. Thank you again and uh if you have any questions uh just ask in this new subd will you be be bringing in like precious metals, oils and those kind of real world assets into the blockchain space potentially but I cannot really answer that question just yet.

I hope I didn't disappoint you with that with that with that answer. I this is a very early pre-announcement. So so uh no uh no details uh to be shared just yet unfortunately. Okay. Another applause for another sky.

The potential for memes with the sky rebrand is that you have a spark in the sky. have you're going to have new stars and all that. Who came up with that name? Okay. Uh thank you so much and um we're going to have one more presentation and then we're going to have a short round of lightning talks.

Um and now we have Pavo from Chronicle also from E4. So you know Pavo, do you want me to you want my help or you can Let's see how that works. I just connected right number one number two. That's great. Does this does this work?

Yeah. Nice. So, hi. I'm Pavo. I'm part of uh Chronicle and I'm also part of it Warso and I've started even in Maker a few years ago.

So, I'm an engineer and uh that's what I do and there's not going to be much financial talks here. So, Chronicle builds oracles. What are oracles you might ask? So this is the most important part of DeFi. The oracles actually at least for now uh oracles turn gossip into fact.

So what is unreliable information we turn into reliable information that is verified and that is also important. I'm going to speak more about it later uh about that verification. But this is the most important part like we turn stuff that is uh unverified into actual facts and we are making it offline uh available online on chain. Uh and this is also one of the important aspects of uh doing an oracle. Any pool oracle that you might hear that has some prices is actually So don't believe anyone that says oracles cannot be don't have to be on chain.

Yes, they do and they do have to be on the same chain that your project is on because otherwise uh you are risking quite a lot with data availability problems. So external data available to smart contracts exactly during the execution that's that's the important part. Why are oracles? So there is no defi without oracles. That's that's the main the main part.

and uh how the oracles are built that's the exciting part because uh like being an engineer and doing being having done that for for more than 5 years run now uh like it's still quite exciting so this is the longest I've been in a single project uh so this maybe says something so Oracle system systems collect data from uh different sources uh usually offchain but also onchain they uh sign and verify that this data is correct and put and and store it on chain. And uh the first iteration of uh chronicle oracles which was then actually maker dao like a part of maker da and it was uh it was even like in in 2017 like the first oracle was built was we had uh multiple multiple validators as we call them and they were storing their their price on chain and the uh the price was uh then calculated a median Price was then calculated onchain. Which of course you might see that it is expensive because you would need for like in our case you would need 13 13 distinct signatures that needed to be verified and 13 distinct um transactions. So everyone would have have to pay and it would have to happen quite often. So it's like unsustainable when you when it comes to gas cost.

And then the Oracles V2 was born the where all of the signing happened offchain and it was sent to a to a peer-to-peer network where the median was calculated and sent onchain. But of course still it can always and be verified onchain. But you don't need to do multiple transactions to to store this value because you just can store the payload in one transaction. And that was some somewhat of a gas savior. Uh and Oracle's v3 is something that we have developed.

Uh it's called chronicles scribe and it uses schnore signature aggregation. This is some magic bitcoin math and crypto stuff that is uh like smarter people than than me do that like implement the the contracts for that. But uh the uh this allows us to to have the payload be even smaller. So we optimize call data size and for optimistic updates that we do I'll talk about them a little bit later. Uh we optimize compute cycles.

So uh on Ethereum it gets like super super cheap because instead of verifying 13 signatures so 13 easy recovers which is the most expensive in this in this transaction we just verify one and there's a uh challenge period and challenge bounty that means that for the 10 minutes the price is not finalized anyone can challenge and every oracle in Chronicle has a bounty of one ether uh per challenge. So if you manage to catch a transaction that is uh sent optimistically like optimistic rollups like there's a period. So if the transaction sent optimistically doesn't compute when you calculate the actual verification uh then you just you can spot it. You can send uh a challenge and win one ETH. Uh so where are the oracles?

Of course, this is our dashboard if you want to scan the QR code. And of course, I I am showing QR codes, but actually it's interesting because QR codes are not quite safe for people because if you scan them, you it gets you to a scammy site and then yeah, that's a problem. But I do hope no one hugged it and it is the correct uh address. So uh it is quite important to remember that the your oracles can only be as strong as the weakest link. Uh I'm not going to comment on the colors, but you get the gist.

We use we use 13 signatures. other other oracle providers use four or three and even then you don't know who that actually is. So strong is the best the better choice. Uh know your oracles that's super important you need to know your oracles or be another article on wctck. uh if you are implementing a protocol that requires oracles and you don't know all of the assumptions that come with with the particular Oracle provider or Oracle model then you are actually endangering your protocol and your clients and everything uh in between actually.

So the properties of Oracles accuracy you always need to ask yourself and you before using a a specific uh Oracle provider where does this data come from? How many independent uh sources are there and how were was everything calculated? And another question is can one source actually affect the whole price because for example median is a nice has a nice property that it actually cuts out outliers. If you have a number like a set of numbers and you just pick the one in the middle do not do the average but you just pick the one in the middle. Then if someone says that the price is five when it's 10 then it's actually it's getting ignored.

Uh and how is this integrity preserved? Usually cryptographic security is uh is needed for that. So if someone vouches and signs for it uh then that this is secure but you if you are just uh your if your protocol just assumes okay this must be fine. It it no it's not going to be fine. uh consensus how is the truth determined.

So I mentioned before that we are using 13 validators. So we need 13 validators out of 25 to agree on a specific price to even consider it uh being eligible to to send onchain. So if you have two, if you have three and you don't know who they are because in chronicle the validators are actually reputable projects like uh Gitcoin, like at etherscan and some some other big projects. Of course maker is also one of the validators in chronicle. Uh so if you know who those projects are, they are actually staking their reputation.

Uh and if they do something bad the like send a bad price and they caught get caught with with their pants down then uh the project is actually at risk of uh of a lot of damage. uh the the reputation in crypto is even though it is a permissionless and trustless system and trustless uh like area uh it actually the the reputation is quite important. So availability also I said that pool oracles is something where you don't send the price on chain until you need it. But the question is will it be available when you need it. So if the prices are not sent onchain uh constantly for any contract to be able to read it without any intermediaries without bridging without I don't know like whatever else one could could think of then if it's not just a read function on a contract with a current state it's actually like it of course you can say oh this blockchain that holds this data and that is cheap has never gone down.

That's when the that's what the black swan events are and they do happen and some blockchain can go down and then uh what no one can do anything because it's all locked. Of course, if it's not locked then there's another thing that you need to worry about is like why is it not locked? Why can someone manipulate the price without an oracle? So these are the all of the things you need to look out for and check before actually implementing uh an Oracle provider cost. What's the price for the users?

Again, pool oracles are tax for the users. We are not in this space to because we like taxes. It's the opposite actually. like taxes for the users is the worst thing a protocol can do because how does how that works is when a user wants to do a transaction like I don't know get some collateral or stake something or do whatever and needs an oracle price and if it's a pool oracle then they also need to do uh oracle update so the protocol the Oracle provider says okay we don't pay for that it's very cheap because we don't pay it's zero No, it's not zero. It's the users who are paying.

So adding attacks to your users is not a good thing, especially in crypto. Uh also, how does everything scale, you might ask? So we with the optimistic updates, we can go from 13 to 256 or 1,024 or other uh round digital numbers. Uh digital numbers, that's not a word. Anyway, uh other round numbers for IT people.

Uh we could go up and up and up and still the price of sending an update is only one easy recover. Of course the verification is more expensive but still like we are infinitely scalable at Chronicle and this is a cool property [Music] uh transparency. Who are who are the validators and the reputation? I talked about that but that's super important. And that's why it's here again permissions.

Uh who can change parameters? Usually it's best that it's a DAO or like uh something that is very transparent to update the the parameters of an oracle. And uh the other question is who can update in Chronicle. It's permissionless as long as you get your hands on the signature and it's public because in the it's in a peer-to-peer network. So it's public and everyone can read it.

So, as long as you get your hands on the signature, you can do an update. Of course, you have to pay for the gas. Sure. But, uh, we are not blocking anyone from doing a transaction. You don't have to be allowed to update the transaction provided that you have uh the signatures.

And whenever you are verifying a protocol or a Oracle provider, you always need to look at the probability and impact. So how probable is this problem or like this issue that how probable it is it that it's going to happen and what's the impact? So it's if it's something very probable but the impact is minuscule then maybe it's not that bad. Of course, every time uh you need to calculate this risk for uh on your own and yeah, it's just a risk calculation at this point. So, do not trust, verify.

That's the uh phrase I would like to leave you with because uh this is the the the main reason people get scammed. They trust that okay, it should be fine. should be fine. Hasn't worked good for many people. Uh so I am Pavo from Chronicle and I am also from it Warso.

Uh and this is chroniclelabs.org and I welcome you to visit the site. Thank you. Questions. Just a short question about like I talked with some of your team members maybe half of year ago and asked about you know real random values.

Do you have a plan to provide it maybe later once? Maybe someday but right now no like we are we are we are we are focused on uh on two things right now. Defi is something we know very well and we do very well and there's actually very few competitors and if you of course you could count the TVL but actually there's few compet competitors when you could they could compare the security and verifiability and reliability of Chronicle but of course real world assets is something that we are uh also doing and testing and going with in the future. So random values as I said not necessarily sometimes sometimes or the or the signatures or the signatures but like that's that's another story any more questions no thank you so that was very nice uh one more talk and then we get pizza. Uh some uh while they set up a few things ifo is happening this year again it's from 4th to 7 September.

Uh speaker applications are open if you want to volunteer or join the team. This is open as well. Ticket sales will go out soonish. I don't know exactly when but soonish. That's one bit.

Uh we also have a pop-up available for the meet up for the meetup and Monica can help you men it. Yeah. Basically, you need a POP home app and then you scan the location and you can mint your POP. There's a POP. We have a POP.

Um, and uh, I'm not supposed to say this, but if Warso was probably going to be doing a co-working space. So, if you're looking for a crypto focused space to work in Warso, message me somewhere on like Telegram, whatever, just let me know and I will add you to the group that is doing the test run and I can tell you the details. Uh, you ready? Cool. So, we have a a very annoying lightning talk right now.

Yes. Very sorry about that. Hi, I'm P. So, in 5 minutes, you're going to be eating pizza and drink beer. So, don't worry, that's going to be super quick.

Um, I'm co-founder of Stable Watch and the handsome guy in the uh glasses is is my co-founder. It's Yatk. Uh, just today we launched our new dashboard. So, um, what you can see here is new metric YPO, yield paid out, which is specific to yield bearing assets. So at the beginning of all of this of this meetup, uh Chris told you a little bit about yield bearing assets, right?

So you got those stable coins which acts uh a little bit like a saving account in your bank. Um at the moment any dashboards you see out there, so AWA XYZ, which you could see in here, Defy Lama or whatever are not looking in this segment. So this is the first dashboard you can actually check any data around u those specific coins. So Yelp paid out is providing you the value which been distributed to the holders of those coins and as you can see in all time of those coins there is more than half a billion dollars distributed to the holders and this value is is growing. If you're going to go down uh on our website, there's much much more analytics and much more is coming soon because uh we believe there are two types of stable coins.

The payment ones like USDC, USDT and the yieldbearing ones. We can't look at them as the same category. We can't put them in the same bracket. uh the regulators already looking at them in a different ways both in EU and in the US. Uh what is lacking beside this basic analytics is also categorization for those because actually even if we call those yield bearing stable coins most of those assets are not stable coins they call themselves like that to do regulatory arbitrage because they are structure products like hedge fund for example Ethena as such um or private treasury funds which are providing you exposure to T bills etc.

So we need this categorization and we are working on that. The second thing which you as a user got no idea about is a risk assessment or like risk framework you could look at. So you don't know in a lot of examples what is happening within treasury uh of those assets besides sky and and and and few others. Um so you can't take informed decisions when it comes to allocating your portfolio and all of that is coming soon to stable watch. We launched just today.

So much much more stuff um going to be announced soon. The next verbic announcement going to be at stable gun in New York end of this month. So stay tuned. And uh in a month we grew from two people to 10. We still hiring.

So if you're a researcher, marketer, developer, you can hit me up after that. Um and that's it. Please go to our website, check around, and we would love to welcome any of your feedback. Thank you. Thank you very much.

Uh that's it. That's all for today. Uh I still have some and the pizzas in there and it's going to come in here in a second. Thank you very much for coming to another E4O meetup. We're going to see you in um I think three weeks.

Oh, and we have lots of Spark swag. So Kishu, if you want to and Sky Swag, so if you want to grab something or Kishu can you can stand here and throw things at people. It's like concert style. Oh, that's it. See you next time.

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