The $100bn DEX - THORChain's Next Growth Arc | ETHSofia

[Music] hey guys I'm uh JP so I started in 20123 uh buying Bitcoin on Mt gox and BTC um back in those days it's funny how the cycle goes around because we were just buying mean coins on BTC which were actually all just Forks of Bitcoin you had pcoin feathercoin Litecoin grosser coin they're all just fors of Bitcoin um so it's funny watching mad's talk two months ago in Singapore about the meme rotation but over the last three four Cycles it's always been about memes in fact Bitcoin is a meme but anyway that's something to think about but when I got rugged on Mount MTG and BTC I uh thought I'd devote all my attention to building a decent exchange and uh it was very ambitious at the time 2017 18 we started it and the whole time I thought we were going to fail because it was very technically complex we had to take initially it was multisig but we realized multisig wasn't work it was too opinionated you had the signing keys on chain it wasn't chain agnostic um but in 2018 I discovered the paper um that jera and goldfeder wrote gg20 was actually gd18 and it was the first threshold MPC protocol so we took the threshold NPC protocol took Cosmos SDK in in 2018 which is still beat a software and jammed the two together um we failed a few times but we kept going and this is the dream was always could we get liquidity on chain to where it mattered the most and could we get liquidity into the exchanges because uh it was pretty clear that everyone wanted to decentralize liquidity and everything all the entire infrastructure was still building around centralization mtgs even binance um here today well on binance but binance is still today largely centralized and there's there's a road map of strangulation from regul regulatory point of view and and what not around centralized liquidity and bance are doing this by trying to move more liquidity into the web 3 wallet which is launching soon uh you should check it out but what I've noticed is we still are not there yet and even though we've been building this thing for six years I would say we're still another six years away another two cycles away from really realizing this dream and this wasn't apparent to me back in 2018 but we can actually see this kind of layer appear we we've got the user layer which is everyone's trying to get 100 million users on chain binance have 200 million users very jealous of that everyone should be very jealous of that um but how do we get those users on chain users are going to use wallets and they that's the that's the philosophy there is the users should have full self custody of their assets whether it be uh Ledger metamask uh the new Unis swap wallet Etc voltis which I'll present today users must own their own Assets in a wallet layout those wallets allow them to connect to interfaces interfaces are an opinioned way of accessing uh and like interfaces don't need need to be decentralized I've seen many mistakes over the years where like shape shift or tornado cache or even Unis swap they either do try and decentralize and they're not because they're all sered through centralized front ends or centralized app stores so there's no point needing to centralized uh decentralized interface at all the interfaces are actually just very thin clients that wrap aggregators this wasn't apparent to me back in 2018 but seeing 1 in lefi swap kit and a bunch of other aggregators emerge you can definitely see that these aggregators are solving a key point where they they're able to solve and look for liquidity from different sources and rout them to to the users but these aggregators still don't own the liquidity the liquidity lives on Jane it could be Justin Time liquidity it could be intent based liquidity it could be passive liquidity uh uniso V1 I think was such a beautiful elegant design I was there in 2018 when Hayden was presenting it uh a check uh in Devcon 4 and as a very beautiful design an F with tokens on consum product liquidity over the years we've complicated it with constate liquidity and and various other things and we've chased out retail LPS so we need to think about can we make liquidity passive again and can we stop trying to size up sophisticated LP with unsophisticated LP and that's the challenge for liquidity protocols and finally you have the protocol itself uh which is like thorchain or Unis swap or chain flip and these protocols should be as decentralized as possible they should be as as faceless as possible they shouldn't own the user they shouldn't even own the liquidity the liquidity should come and go as needed they shouldn't own the aggregator and they shouldn't know an interface however today in 2024 we are still nowhere near yet solving all these problems and with all the l2s coming online I mean I was chatting last night with C it's just going to get more and more fragmented and complex and how do you think users are going to tolerate all that so looking or zooming out how do we build this1 billion deck uh and the reason I like frame on that valuation is in 2021 two centz exchanges hit $1 billion valuation coinbase and binance did so we we should we should look to that the whole decentralized exchange infrastructure should be worth 100b maybe not this cycle but definitely next cycle um and we know the crypto is going to T all Central exchanges moving on chain you got okx binance coinbase Kraken or moving on chain to the l2s the future is multichain I cannot stand here until tell you that ethereum will win or salana will win or telegram will win or some new protocol that we haven't seen yet what if Apple releasing chain or Google released chain we don't yet know uh which infrastructure is it monolithic is it modular is it rollups is it ZK we don't know yet so I'm of the opinion that you should just be chain agnostic you should move like water um and you should at all times realize that you can't really well we have Bitcoin eth salana and ton ton is actually the the sleep giant here has almost a billion users that pel Duro will lead silently on chain slowly ton it will be one of the biggest up chains in the next the next cycle uh one huge app chain C uh opportunity is actually only fans only fans has been debanked a few times um you know they make five six billion a year in Revenue they should just try and build an L2 who's who's building the infrastructure for only fans right now so that that's the opportunity there so we need to consolidate the user experience there's F coming on here with like chain obstruction gas obstruction gas tanks and and wallets and whatnot um you know we've got ethereum so Unis swap with a uni chain attempting a new cross chain standard so that will solve it um but we'll have Consolidated UPS so users will see uh basically they'll have a wallet that does everything will connect to all these chains and I've just thrown a few chains up there you got eth salana ton tons of big one uh Bitcoin these are all completely different architecture I was sitting down with a team last week cuz we're trying to connect ton to Thor chain right now ton is extremely difficult functional C is a very low level language they've got wallet states that can be on or off and there's a whole bunch of permutations that are just really hard to gra wrap your head around different to salana um different to El I mean even salana has this notion that transactions can time out which you don't really see on ethereum and so who's actually got all that corporate knowledge to understand all of these chain of the different infrastructure it's it's pretty mindboggling uh all the nuances to do with these these apps now this is my view of the of the world this you don't have to agree with me here but this is what I'm building right now this is what I've been building last six years and what I'm going to devote the next six years of my life to do in it we need a multi-chain multiactor wallet standard and you can see me on Twitter quote tweeting so many people losing money through private Keys just use a multiactor wallet BL chain runs on multi-party computation and I think the future of the wallets has to be multiactor you can't run around you can't give a bot a private key and by the way there's going to be Bots everywhere so and actually here's a side note you should be building infrastructure for the Bots and not really for you for the next 100 million users we're going to get 100 million Bots or a billion Bots before we'll get a billion users on chain so build infrastructure for the Bots is a good way to to frame yourself so multiactor multi-chain wallet standards is actually perfectly suited for the bot because it can be supervised it can be managed it can you know think about all the zero days out there that if you send a sophisticated architecture to hunt down all these like esoteric code B code pass you don't even know about how many of these Bots are just going to be devoted to attacking other bots so it's in if you give a bot a private key expected get zeroed out pretty quickly so it has to be multiactor um there has to be a a discrete app layer and the app layer should separate the user from these different protocols and these protocols should be chain agnostic and we're building Thor chain in a way that that is chain agnostic that can tolerate t or Salan or evm or IBC and like I said I want to frame this is my view of the world you may disag age with me in which case get out there in the arena and build what you think the users on the next building bot should have now Vol Zig is so we sponsored the coffee machine outside go get yourself a swapo capuccino or a rune shot volage is live and last night we release the voltis uh Vol connect voltis takes a multi-party computation protocol thresh ecdsa and edza open source of course audited of course and it puts it in your iPhone it's basically an open source file blocks with no fees five blocks if you're a fund you're going to pay 100 Grand a year to access five blocks we basically took the same technology and put it in an iOS up uh so your device your full device just becomes a cosigner running an NPC then we took the Vault share which doesn't store funds and we can stick it into a Chrome extension and when you jump on Unis swap or curve. Finance or whatever and you spull up a transaction it will broker a NPC session between your desktop app and your phone check it out um it's live it's progress I started building this in January when I launched a crypto fund and I realized that the multisig standard for salana ethereum and Bitcoin just sucked and it can be solved with multiparty uh NPC um this happened in like I said this is my view of the world and how we I'm going to build over the next six years to build that future uh so kajira was the estrange community from Terror that obviously blew up and a lot of us probably hear PTSD from Terror but Tera blew up uh and Terra was a flagship CM wasm chain with IBC and for those of you who were around in 2020 2021 the user experience between mirror Anor and on The Suite of teror products was Second To None it really was a flagship chain and my actually segue my opinion is the cosmos SDK IBC kmom stack is the gold standard up chain and uh mainly for the reason that it is live it's a state machine it wakes up every second and pokes itself which is not what you can get on like a roll up or an L2 uh like an evm machine which is basically dead and you have to poke it to wake up every second so if you are considering rolling out an up chain for users to do things to to accumulate fees to pay your stakeholders token holders consider using the the cosm stack uh shared security is an interesting and I'll talk about shared security is a fascinating Direction and I think uh we should build upon shared security allows you to roll out an app chain very quickly and rent security instead of buying it and as long as you pay yield natively instead of esoteric tokens the security cost is actually really low far lower than if you're printing your own token that's all possible with with an app chain anyway getting back to kajira the Tera Community moved to kajira but kajira themselves blew up through financial mismanagement so we essentially underwrote their debt in February sorry July and we're moving them to thorchain uh so thorchain has this base liquidity it's got about 250 million in tvl Bitcoin Ethan very stables and whatnot and we're going to expose all that liquidity on a km wasm layer powered by rira uh and also hook it up at IBC and I was chatting with a bunch of teams over the last few weeks about what they're going to do once we have IBC connected onto Thor Jam after for so many years and I told Chris go this back in 2019 the regional version IBC wasn't expressive uh it's they had some problem that problems with uh relaying the IBC packets it didn't support memos but the modern IBC V2 that just came out like a month ago two weeks ago is world class and it's what every team should consider using so this is all coming to thought chain um some just numbers uh very proud of this because this is this is blood certain and tears uh you know we were hacked three times from various permutations in 2021 on the theory and Frost with Upstream Downstream attacks so these numbers are hard one um that number is actually out of date for two weeks all time volume is now 100 billion um and the annual revenue is about 100 million and I'm just throwing these numbers up there to really like Focus you that if you grind for six plus years and and not just build an ephemeral product that's going to you know pump and dump or whatever you actually build over a cycle or two cycles these numbers are all within reach just requires focus and if just to get back up when when when the world throws adversity at you and like we've all lived through hacks um we've all woken up at 2 a.m. getting a call from your CTO that we're being hacked again that still gives me PTSD but it's just the stuff that we have to work through which is why some of the learnings that we've carried from this with the auditing how we how we like manage security it's all one in blood it's the these the lines of code of thought chain were written in blood uh and it's it's I'm very proud of those lines of code uh because we we've earned those numbers but these numbers should inspire you to actually get out there have a long-term focus and build something like that and even these numbers are are nothing compared to where're going these numbers should be 100x in the next in the next two cycles and that's where we want to go um integration and this is another point I want to make is don't build for your own users build for everyone so from day one we never shipped an interface we actually just ship the protocol but we built an affiliate phase so we let anyone wrap thorchain and earn fees basically give away fee revenue and today we're about to have very large wallets announc support for thorchain because uh I mean as an example trust wallet make a million dollars a month in integrating th chain from those affiliate fees and as a result th chain has never had an interface problem it's never had those phone calls well we have had those phone calls but we sold those phone calls um and we haven't added any censorship or address screening on the Bas layer which would be very difficult anyway to do for for protocol like thought chain but integration is power thought chain so anyone building like a decentralized protocol or a liquidity lier should think about no one one 100% fee switch from start so share all your fee Revenue with your users your nodes LPS and and build an ecosystem around you that can share in the growth of the network and and through affiliate fees so I really want to stress that point home so the next the next two or three Cycles launching the Apper over the next quarter and and next year launching the multi-chain wallet standards uh as the flagship wallet standard in not just the ecosystem that we're building in but also in other wallets uh like every day I log into Twitter and someone else has got the private Keys zeroed out from downloading a malicious PDF and you think about how you going to bring a next 100 million users are a billion Bots online it's not through private Keys private Keys just don't if you're running a wall right now right now think about getting rid of those private keys and moving to multi party that's why we built V's open source we're about to upgrade the library open source again you know I have this really strong philosopy set the memes free th chain is a good meme set it free it's always been open source so V you can fork and you should integrate into your own wallet as a multi-chain wallet standard uh more Integrations and more chain connections thorchain is a beast it's it's very big very decentralized very slow but next year we're going to really try and solve chain connections and add them very quickly uh we will have to recede a bit on our security posture when it comes to these l2s but face that all these l2s are centralized anyway so we can take a more centralized posture to these l2s salana is coming tons coming uh and I'll be very curious of if you have any other inputs what chains we should focus on in next year we're going to see an explosion in these chains so like there's a future of a thousand l2s so yeah if you're building abstraction technology like for wallet abstraction gas abstraction or user abstraction double down on that because you're about to see an explosion in Jones um ethereum BAS will suffer because all that fee revenue is going to go to l2s and not even in the E asset I mean Bas just announced that they're going to start taking base fees in USC so there's a there's a reckoning coming for everyone on don't hold anything sacred it like theorem could be replaced salana could be tripped up any like anything could be just don't hold anything sacret just be just be willing to to handle anything um is my uh my point now just uh just an a uh we're putting in 50 million of our Capital to what we recognize is so the inflation rate on 14 is 2% but it makes uh another 8% in liquidity fee yield so the the API on the nodes is about 10% there only 2% of that being block rewards so we're actually uh announcing a fund to double down on this um and go for it so that's it that's my view of the world and you may not disagree with me but if you're if you're building app chains abstraction or solving the user a problem or if you just want to focus on getting the bots on on chain uh then double down it's the right time to do it and I think someone else was saying before in the panel before that if you just build and you grind and you have like a multic A multi-year or even a multicycle Outlook you will win this is the right industry to be in uh it is intense yeah it really like tackles your adversity or your ability to tolerate chaos but just figure it out stay in it keep a sharp mind and keep an internal loky of control but also so make sure you have a vision a five or 10 year Vision if you're still around here in 10 years you'll have done it right thank [Music] a