Thread: Why The $DEUS/ $DEI Ecosystem Is One The Most Exciting And Ambitious Projects In Defi
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Its very possible you haven’t heard of it… but some major gigabrains are quietly building something quite astounding on Fantom… 1/x
This is what I’ll refer to as the $DEUS/ $DEI Ecosystem, though that designation doesn’t do it justice.
Think of it more like $TERRA/ $LUNA + synthetics + oracles, all on a supraphysiological dose of defi testosterone.
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I will be honest that a lot of the math and tech behind it is beyond me… and its very possible this thread + #FrenchChart might have some mistakes in it... but I wanted to do a very in-depth thread describing it all as best as I could.
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To start, the whole thing appears to primarily be the brainchild of @lafachief though he also seems to have assembled quite a team of smart folks alongside him…
At the foundation of the ecosystem are $DEUS and $DEI.
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$DEI is a partially-collateralized algo-stablecoin, utilizing 80% USDC and 20% DEUS. So essentially $DEUS is burned/printed when $DEI is minted/redeemed.
This is roughly similar to $LUNA and $TERRA ($UST).
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$DEI and $DEUS are at the heart of the ‘Deus DefiX’ (“decentralized financial information exchange protocol”)… which serves as a foundation layer money-lego, where all sorts of synthetic assets can be created/traded/collateralized/used for building/etc.
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Utilizing the ecosystems infrastructure requires the use of $DEI/ $DEUS, creating a use case for the two tokens beyond just serving as a stablecoin and governance token.
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The idea is that eventually all sorts of third parties will build upon this foundation layer, interacting with Deus DefiX and the rest of the ecosystem.
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Right now a connected project (also by Lafa and co), @dsynths, is the primary protocol utilizing the infrastructure.
@dsynths is a synthetic trading platform where you can buy and sell synthetic versions of popular stocks, commodities, and even other cryptos.
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Long-term followers of my account (well, since I started it in December) will know that I am VERY bullish on synthetic platforms… and think they and stablecoins will be the next two big ‘themes’ that dominate crypto.
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Some other synthetic platforms I really like are Mirror Protocol, Float Capital, and Gains Network.
They each have very different and very interesting ways of achieving the trade of synthetic assets that are helpful in understanding @dsynths by way of comparison.
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To really simplify it...
-Mirror essentially relies on LP’ing, paying farming rewards to people for holding/farming various synthetic assets.
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-Float Capital uses a really cool system where each asset can be longed or shorted, and depending on demand, one side will pay funding costs and the other will receive those funding costs as APR.
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-Gains Network is a leveraged synthetic trading platform that I did thread on last month, which essentially relies on lev traders averaging negative returns, plus internal rules/gigabrainage built into the protocol to avoid excessive losses (cont.)...
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...with rewards paid out in $DAI coming from the burning/minting of the protocol token $GNS.
Of the three, I would say that @dsynths appears to be most similar to Gains Network (though they’re still very different).
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@dsynths requires users to open positions using $DEI, and also uses $DEI to pay out profits.
In this way opening a trade is fully collateralized (I pay $100 in $DEI to open a $100 gold long or TSLA short, etc), and if I lose money on the trade then (cont.)...
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...I just don’t get back all of my $DEI when I sell it (e.g. if my trade goes down 10% I’d only get $90 $DEI when I sell it).
If I make a profit then I’d get more $DEI than I put in.
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So, the main danger is that some trader makes a massive, gigantic profit, and ‘bankrupts’ the protocol. However it appears that this is prevented by- to really dumb things down- a wicked smart super-computer/algorithm thing meant to ensure this can’t happen.
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Essentially the @dsynths backend constantly scans all open positions in real time, constantly stacking them on top of one another in terms of liquidation order.
Here are some quotes from the whitepaper (link at end of thread) (+ screenshots from the whitepaper embedded):
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“A purely peer-to-peer version of bilateral agreements allows for digitized derivatives to be cleared directly between one party and another in a trustless way. Decentralized threshold-signature-based oracles provide part of the solution by verifying the agreement...
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...at any given time by economic-driven third party market observers."
..."We propose an n-dimensional “request for Quote” based marketplace…. Anything with a data point can be traded.”
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...“A global “peer-to-peer Bilateral Agreement System,” based on the name of its traditional finance predecessor, “Bilateral OTC derivatives.””
All of the above brings us to the final piece of this fascinating ecosystem, which is @muon_net.
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@muon_net is the custom oracle system that @lafachief and co built, which has been spun off as its own protocol with its own token.
Muon is what constantly checks all the various data sources to determine what is worth what and everything else.
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Note: Thread-break>>>>
End of part one (twitter only allows so many tweets in a row)
...with limitless scalability. As it is not a chain and does not permanently store data it is free from the restrictions of 'preservation of state'... With Muon, any web3 application can make use of external data..."
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“Muon creates bridges between all blockchains. Think of Muon-bridges as a cross-chain data application - and not just limited to tokens. Any type of data can be bridged cross-chain with Muon.”
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@dsynths@DeusDao@lafachief - have been geeking out on your protocol(s) all weekend and insanely impressed... I have a couple questions I haven't been able to figure out though...
One) What restrictions are there on the size of a synthetic trade that can be taken? (cont.)
And what determines them?
Two) Where does the money come from to pay profitable synthetic traders? And what prevents some extremely profitable trader from 'bankrupting' the protocol? (cont.)
I'm very familiar with Mirror/Float/Gains Network so trying to understand how DSynths is same/different vs them...
Again my apologies for hitting you up directly but I couldn't figure it out from docs and am really interested in utilizing + investing in protocol :) (cont.)
Thread: Thoughts On Delta-Neutral/Leveraged Yield Farming
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Alright sers, so lately I've been focused on delta neutral strategies, and also playing around with leveraged yield farming (the two overlap obviously).
Its a tricky topic though so wanted to do thread..
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As a quick synopsis, delta neutral strategies are where you earn APR on a token or LP position without gaining/losing money when the token goes up or down.
Many like this strategy when of bearish sentiment since it removes price exposure.
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An example of a successful delta neutral strategy would be depositing 10k of $USDC, borrowing 5k of $JOE at -10% apr, then staking it on the TraderJoe website for 50% apr, earning you 20% on the underlying $USDC deposit. [(50% - 10%)/2]
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Thread: Navigating The Coming Economic Craziness As A Crypto Degen
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Alright my fellow apes, frogs, and fighter-mages...
Time for a thread on this craziness...
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While I am primarily a degenerate ape, I have also been geeking out on macro to an insane degree for years now, and thus I wanted to bring your attention to some important variables to consider, AND discuss what we as degen yf'ers should do as a result of them.
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First of all, as we all know, the US gov is freaking out about inflation and pushing Powell/the Fed to "do something".
And I must admit he seems pretty focused on "doing" it. His recent Senate Q&A is a must-watch:
I spent the last 24 hours figuring out how to get going on Solidly and Solidex, and wanted to do a thread outlining exactly how to do so!
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In the process, I've seen many posts on Twitter of people wanting to LP on one or both sites, but not understanding exactly how they work, or running into stumbling blocks in the process.
I too ran into some stumbling blocks, but was able to finally get it all going :)
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This was in many ways bc of the extremely helpful tweets of @Cryptoyieldinfo and @kamikaz_ETH, so big thanks to them!
So yeah, here's what you do to get started yield farming (liquidity provisioning) on Solidly and/or Solidex...