Connecting Decentralized Liquidity by Loi Luu (Devcon5)

right hello everyone my name is Lila and I'm a CEO and co-founder of Kaiba Network yes today I'm so excited to be here to you know give you an update about what Kaiba has been doing especially in connecting decentralized liquidity for decentralized finance before we go to the details let us oops let's just define you know what is liquidity right I think a lot of us have heard about liquidity but not many of us understand what exactly that term means so liquidity really like represent the degree in which an asset can be sold quickly in the market without impacting impacting the price right like for fiat currency like USD and Shep and agian they are super liquid for a set like Bitcoin and either they are so very very liquid right but for many of the g20 tokens they are not as liquid and when it comes to liquidity there are there are two main parties right the liquidity takers or people who buy and sell the asset and they're also the liquidity providers or people who actually you know make the offer further to buy and sell right and they work closely together every time so the main incentive for the market maker is that you know they're going to get the profit from the trading but they also have the reach of you know holding the inventory and you know sometimes the market move against the direction right but what is decentralized liquidy there's literally no definition of this term on the internet so this is really a first attempt right decentralized liquidity in our definition is the liquidy that is available in the decentralized ecosystem and there are two important properties decentralized liquidity first of all there has to be a choice less relationship between the ticker and the providers so that means when they do the trip there's no need for trust right there's no middleman that you know in sitting in the middle to settle the trip and all the parameters including rates the mouth and all this thing have to be transparent and verifiable so that you know people can detect everything and can verify everything before they enter the trade and most importantly it has to be utilizable by the centralized application or smart contract on public blockchains so this is the current state of all the decentralized liquid liquidity in aetherium ecosystem so we have like several players like uni swap Khyber Reserve oasis from maker banco and dash h from gnosis as well but the main problem is that all of them are working in silo right so if you know a def want to take liquidity from from all these players they you know they happen to have such different integrations and sometimes they you know it's going to take a lot of time right and sometimes they is it's even really hard to find enough liquidity because these don't have enough term and and gas right to talk to everyone so this is where copper comes in right we are building a decentralized liquidity protocol that basically connect all the on chain liquidity sources you know beer units were Khyber Reserve Bank Oasis and the main goal is to create one single create a pool for all the decentralized application and and wallets and website to you know to take the best rate available in the market so basically they just talk to Khyber and Khyber will justify the best rate available for them and return it you know to to the DAP so this is one example of how a unchained index fund can use Khyber for example here that users they want to send the ETA and they want to convert this ETA into a into an index of you know that has 30 percent by 30 percent of public BTC and say 40 percent link right the dissenter it hurt in origination to the index fund and the index fund with us for what the interruption and the fund to the khyber contract and with this but we defined the best rate according to H of the asset for the users and in one single generation we can return everything through the n users that will reduce all the friction because you know in a in a non khyber generation they may have like to do like three different generation in order to finish the trade so what are the good properties that we enable right first of all is you know this I will just combine all the available liquidity sources and make it single in one single make it available in one single interface for any application any gap to integrate so that that was just like make it easy for for all term and secondly we have a flexible liquidity models so that we can work with you know all of the liquidity sources that's why khyber is the only one that could talk to a voices that could talk to uni swap that could talk to gnosis and we could even work with professional market makers that market marking on chin so yeah so this really like allow other liquidity providers to use different strategy when it comes to market making on chain on the other hand if you you know on UNIX web there's only automatic market making model and if you subscribe to some some liquidity pool you have to follow that model right and it's the same for for always this latest for example and third but also like the most important property is that Kaiba runs everything on chain that will make it you know super transparent and verifiable that means there's no trusted third party and this is the main reason why we design khyber to be fully Unchained in the first place but later on when we started working with you know a few project we realize that running fully on chain make it very easy to you know connect with others as well that means there's a great composability with many other on chain applications and moving forward I think this is one of our key concern when it Orion switch to eat pie to pie oh when you know there are different shop and you know running on chain doesn't mean that you can doesn't mean that you could talk to a different smart contract easily this is the stops in the last few months okay so we have more the more than 5,000 monthly unique addresses that have been using khyber the number of liquidity providers that have been working actively on khyber is around 30 so value locking this is the metric that a lot of people are talking on Twitter but I don't think is that important because for kaiba the value locking is actually much less than others but we are processing in terms of the trade volume much more than others at the moment and in the last six months we are processing more than you know it and rip thousand eater that is corresponding to around 150 million USD the number of tokens that we were supporting is around 70 and we are adding more every month so in terms of application integrated I want to show this figure right so we have more than 65 different applications wallets that have been integrating with khyber to utilize the liquidity pool that we have and many of them are here today like Toto and BC rights and and and we can also see a lot of other defi players like set protocol and new oh and instead up in terms of wallets I think we are connected to most of the major bullets in the space already including you know my toe wallet I'm talkin penguins here and em gene and code base bullet and it's you know totally open and permissionless to integrate with khyber you just go to you know developer keyboard our network to see their api and you can just like integrate with khyber I guess in a couple of hours I just want to share a cup of like you know spotlight integration there have been using Khyber so that you can understand you know what they use Kaiba for right the first one is the in-house n users decentralized chains we call it Kaiba swap and the main the main advantage subscriber swap is a you know it it it optimized for the you know user friendliness right we have many features that make it super easy for the end users to start you know doing decentralized shredding some of them are like you know non-custodial limit orders that allow them to create limit orders even you know even when there's no custodial involve right they also like price alert and we also help like iOS and Android mobile apps so that the users they can just do it on the phone and this is the growth of khyber up Cabaye swap in terms of shape volume this is just like part of the khyber volume because we have many other partners that introduced volume to Kaiba as well but we could see that you know from February to June to July when the market was you know go was booming we saw a lot of you know generation and volume from car swap but in the last couple of months when is when is crudo we see a doubt trend but in the last six months we uncover swap we have around like ten thousand new users and a lot of them coming from other users marketing that caboose were targeted at conference at events and one of the activities that cap that cover swap team did is that this is you know distributor the end user gift card with pre-loaded eater so that the users they can just start using the turian blockchain without you know the concern of like acquiring eater or you know what we understanding was gas and things like that another one is set protocol and basically what they do is they allow people to manage the asset in a different strategy and one simple strategies that they can just buy in some index right like you know there's a setup basket of a set and the users can do send either and services help them buy a basket of asset including you know it could be like you know eat die or wEDC and you name it right and set use khyber in background when the users and you do that conversion and everything is fully on chin the users can also see all the generation on either scan or any Explorer right another one that is super interesting is Newell they allow people to you know borrow and lend crypto transversely so they basically you know if you have eater and you want to borrow die right uses collateralized your eat and when the price of it you know goes down which is unfortunate Newell was just liquidate and users position on Khyber and everything is done we are the smart contract and the users can also verify the the activities so in case there's dispute they can verify it they can check it and it can be it can be used as a proof right so that is on the technical side let's see how how we are doing on the reserve side or on the liquidity provider side right so here here's the list of like top ten liquidity providers on khyber so so Kaiba we have our own reserve as well but at the same time we also like work with many other reserve including Oasis unit swap there are a few professional market makers like there guys in the third position they they don't want to share their identity yeah and and we have like different models for people to contribute their liquidity including like you know fat price Reserve this is mainly used by the professional market maker we also have something similar to Jimmy swab that we call automated price Reserve and of course there's the bridge to uni swap and our C's as well and the torture that tokens are you know stable coins of course you know died us DC and eater and W BTC and USD T as well there are few other liquid esc 20 tokens like micro ohms ago and and km c and link and bad as well so one of the initiative that Khyber has been actively working on is you know coaching right like I'll go is like to bring more and more asset from different blockchain like bit coy and and gos and other blockchain to eat or iam so that the users on interim can trade them can use them in at restless and freely manner so the first initiative that we launched together with many other partners I think six or seven months ago was W BTC and the idea was very simple right with this you know allow people to create a representative a bit coy auditorium which is in a form of ESC 20 tokens and the main question is you know who will Kasturi the bitcoin for the users for simplicity which is not ideal but you know it's very simple and very easy to understand we just use bit go as a custody so the users deposit bitcoin they will get you know the corresponding amount of ESC 20 W BTC auditorium and if they want to redeem it they just burn the token and they will get back to Bitcoin Bitcoin blockchain this is very widely supported initiative by order project in the ecosystem and you know feel free to integrate WTC in your project in your defi project now it's just like you know adding any other ESC 20 token another one that we started not too long ago was the bridge between Yas and ytterbium basically this is just no having and this is gonna be a transverse bridge and the idea here is that like we could we essentially let build a like client or of Yas auditorium and the like client of idiom on yours and we just allow people to you know verify the generation of one blockchain on another in a trust west manner the detailed this you can you can do search a Waterloo Bridge you know Stewie theorem and you will find the blog post that our developer release a couple of months ago and you'll find all the technical details yeah so final thought I hope that I have convinced you that decentralized equity is important for defy and and you know they are still scatter and we are doing your best in connecting other liquidy sources on ethereum there's still a lot to do especially in the cross chain space we need to have a better mechanism to you know to bring W BTC on auditorium but you know WBC and T BTC as well and what Lou a good start we can improve from there and yeah we look forward to work with everyone on this and thank you is there any Q&A oh okay sure have two minutes yeah thank you so much for a talk I have two questions how specific do you our first one is a barrier index fun I thought like rink chain-link talking is 40% consists of the next one I was wondering why it was chosen I think like dye and WTC kinda makes sense but there is the link talking was not and then the other question is I often hear from the defy community that Khyber's exchange rate is it's a little bit expensive their exchange rate is not you know really good compared to tech central exchange it's probably due to you know on chain transaction of everything however are you guys going to solve this issue in the future or what are you walking home thank you so I think for the first question it was just like you know out of nowhere it's just like for example it's just for example okay right and for the second one I think in the last in the last few months we have been working with a lot of professional market makers to work with them to improve the rate and the liquidity on Kaiba I think one of the one of the challenge is that updating the price on chain would cost you some gas right and and a lot of them don't update the price like instantly because they just cannot once you send a generation to update the price you have to wait for like you know 15 or 20 seconds so they have like to to have that in the pricing model to - yeah but I think currently the rate for stable quois are quite good and they are quite competitive I think this is as competitive as central changes I think one thing that is different in cable prices that does the final price that the user will get there's no fees after that so it's the post fee price right but the price on central changes for example they are like previous price so that's the price you get and then you know that's the amount you get before the fees so after the central changes they deduct the fees you may get you know less yeah okay thanks hey thanks we'll talk so Khyber and Eunice Bob are becoming the de facto price feeds in an edifice pace one thing I'm concerned about and would like to understand what you're doing is things like flash brushes so if I want to lend some amount I'm concerned that you know due to thin order books my you know position might get liquidated what are your thoughts on that and what you want to do to prevent these things thank you I think for example on I think that's that's a good question I think for example on khyber if if you wanted to trade a very large amount you won't be able to because we just revert the generation but on unit swap because the model they allowed you to scale to I think infinitely right so if you wanted to sell like one thousand eight or they could also allow you to do that but there but the price is right bad because there's no that's not enough liquid inventory there so on Tiber will just be serially to revert the generation if there's not enough liquidity and and I think the only way to address that is to work with more professional market makers to bring them on chain and to to help them you know provide more liquidity for the defi ecosystem okay if not if there's no other question I'm gonna be around so feel free to us you