Thread by @aliatiia_

1/12

Too many blockchain projects to keep up with.

But one trick is to focus _only_ on the "weakest link" in a project, its most experimental/unproven-yet feature. Other "10x" improvements over the status quo won't matter if that weakest link breaks.

Examples projects 👇

2/12

Project: @avalabsofficial
Weakest link: no slashing for malicious behaviour.

Safe and robust? IMO no. @drakefjustin also addressed it in the last ETH2 AMA: gist.github.com/aliatiia/34dd8…

Previous thread with @kevinsekniqi on this:

3/12

Project: @cosmos
Weakest link: fragmented security

Cosmos is an ecosystem of sidechains. The "layer-1" chain in Cosmos is the "Hub" which launched last year. There are sidechains to this Hub, referred to as "Zones". Each Zone is "sovereign", they have control over every..

..aspect of their chain, but it also means they must roll their own security. From a user PoV, if a Zone asks you to, say, lock up ATOMs on the Hub in exchange for minting you ZoneTokens on their chain to play with, then on your way back (redemption) your ATOMs are as secure as..

..the Zone's validators are honest. The Hub cannot help you if the Zone's validators redeem your ATOMs to an address they control or simply refuse to redeem.

Will this be proven to be a feature (sovereignty) or a bug? TBD.

4/12

Project: @polkadotnetwork
Weakest link: On-chain governance and hot-swapping

Playing with fire? Maybe. If sth goes wrong the network could become a snake with a 1000 heads (forks).

note: "parathreads" (think Cron-able Eth contracts) untested, but not really a weak link

5/12

Project: @SkaleNetwork
Weakest link: sidechain

SKALE is an Eth sidechain b/c its validators are not accountable to Eth mainnet like rollup validators are. Is there a market for Eth sidechains? More TPS yes but why not app-specific L1-secured rollups with _sufficient_ TPS?

6/12

Project: @MakerDAO
Weakest link: Oracle is a brand-sensitive service

Governance is at best an automatable component and at worst a liability. Parameters tweaked by MKR governance can be made algorithmic (compound has already proven that algorithmic interest rates can be..

.. robust). Business logic ruling the asset-backed credit facilities are quite simple .. ERP companies have a lot of experience here and can provide libraries of such logic in the future, so nothing new/particularly valuable here..

..The only valuable non-forkable aspect is the reputation/brand/reliability of the Oracle feed. The recent events on Black Thursday showed that @MakerDAO 's Oracle is not ready for Wall-Street-grade prime time.

7/12

Project: Bitcoin
Weakest link: UBI & inevitable soft cap

UBI puts the following to the test: is creativity more valuable than accumulation of wealth? Under UBI, everyone can afford to be a "starving" artist/entrepreneur etc without actually starving

8/12

Project: @tezos
Weakest link: OCaml

Is this the year functional programming finally goes mainstream? How about: no. You can safely skip Tezos forever.

9/12

Project: Proof-of-location (e.g. @foamspace )
Weakest link: susceptibility to illicit proof market

Example: you're a trucker who needs to prove you're passing be city X no later than time Y. However you're running late b/c you took a nap earlier. So you buy a proof from..

..someone at city X that you did pass (yes you may have to give them your private key to sign location, but they seem legit according to reviews on the dark inter-webs). Speed up slightly above limit to catch up with the original timeline, keep buying proofs till you catch up

10/12

Lightening round:

@0xProject : order cancellation costs gas (must move to layer-2, @Loopring is pioneering this)

@maticnetwork: plasma is permissioned (h/t @jadler0)

@UniswapExchange: protocol fees. If turned, on deep liquidity (=smaller slippage) will forks away

11/12

@synthetix_io: SNX is unnecessary to the biz logic and risky to the debt backers. Example alternative design from @Jarvis_Network (cDai backs derivatives + capital efficiency from PoV of traders b/c backers cover over-collaterlization):

12/12
@chainlink/@EnigmaMPC/@OasisLabs: TEEs are centralized at best and hackable at worst (has happened)

FIN

A1/10

Addendum

Project: Ethereum
Weakest link: liquidity drainage

Imagine that an aspiring Ethereum competitor (EC) launched with a built-in liquidity bridge to Ethereum, a bridge which is accountable to Ethereum mainnet. The bridge allows you to lock funds on Ethereum and..

A2/10

..corresponding synthetics get minted for your on EC chain to play with or do some DeFi etc.

The bridge is accountable in that if you submit a redemption tx on EC chain & you don't get corresponding original funds unlocked on Ethereum, then you submit a proof..

A3/10

..to a smart contract on Ethereum and it will unlock your funds + give you extra tip obtained by slashing a bond pool.

This is a pool of funds that the EC foundation has put down themselves and advertised it heavily pre-launch.

A4/10

It is said that you must be 10x better than the status quo for people to bother migrating to your product.

But if EC implemented this smooth and secure bridge that might come down to, say, 2-5x which increases chances of traction.

A5/10

To attract even more liquidity, the EC foundation starts market making on its DEXes etc.

They fork Ethereum's margin trading DEXes and offer ~zero-fee trading for a few weeks etc.

A6/10

All this to say, rather than "killing" Ethereum, the EC(s) could have tried to drain liquidity out of it during this critical ETH2 migration.

It is very strange that not a single EC launched or is planning to launch with a liquidity bridge to the most liquid platform.

A7/10

This may simply be due to fear of the optics, ECs not wanting to be seen to acknowledge Ethereum success by bridging to it.

But a cynic may say that actually ECs don't really care about very long-term viability of their offering but rather about short-term..

A8/10

.. earnings by drumming up their project till its token is listed and they're able to exit. But that doesn't work anyway.

@cburniske predicted it and it came true: there is no one on the demand side to absorb these tokens when they get listed.

A9/10

Indeed, ECs that launched found no buyers to support the price of their tokens and they immediately take a nose dive.

And in terms of liquidity and user/dev activity, they're ghost towns.

A10/10

It is too late now imo.

Because of the active development of layer-2 rollups on Ethereum, I am fairly certain that ECs missed their window.

Fin