1st generation blockchains are all very sovereign with just one purpose, think about Bitcoin for example. The big issue is that those 1st generation blockchains don't speak/interoperate with each other.
Created to solve 1st generation issue: we put everything in one system (an "Empire") with great composability. With that, it's easier to go from one app to another as long as you stay in the Empire. This is the case of Ethereum and all major L1 chains.
Cosmos wants to bring the best of both worlds: application specificness of gen1 & economic composability of gen2. This brings mass scale economic integration without mass scale political integration.
@osmosiszone@laurashin@sunnya97 Cosmos is about enabling sovereignty, scalability and customizability through app chains. IBC opens up a world of globalization between all the different #Cosmos chains.
The purpose of Osmosis is to show how app chains can win.
Osmosis has:
- Its application
- Its front end
- The control over the blockchain itself
- And the team also built the Keplr wallet.
@osmosiszone@laurashin@sunnya97 Having full control from the wallet to the blockchain makes them able to ship features much faster than any other DEXes out there.
If a DEX wants to compete with Centralized Exchanges, it needs to work on user experience. This is the most important thing because user experience brings retail, liquidity, volume, institutions and natural order-flow.
@osmosiszone@laurashin@sunnya97 Being able to pay fees with the native token of the chain only is a bad UX too. A DEX on Ethereum can't change that but Osmosis can, because it controls the blockchain.
This is the power of app chains, paying fees in whatever you want.
As you know, Osmosis main is not permissionless and this is a desire from the team to keep a great UX. To connect Osmosis to another chain that doesn't support IBC, you need another bridge.
@osmosiszone@laurashin@sunnya97 The problem with a permissionless DEX is that it brings different tokens that are not fungible with each other. We often see different prefixes like axUSDC, gUSDC, madUSDC... and if you want to keep a nice UX, this is an issue.
@osmosiszone@laurashin@sunnya97 All those prefixes are not on Centralize Exchanges and this is why Osmosis is not permissionless, you need a canonical version of an asset. To solve that, the team created Osmosis Frontier which is permissionless and kept permission on Osmosis main to preserve the UX.
@osmosiszone@laurashin@sunnya97 The community decided to vote for @axelarcore as the canonical bridge. Therefore, Ethereum assets on Osmosis main are all coming from the same bridge, which is Axelar (Eth, USDC and so on)
The security is provided by $OSMO staking and it's also by default the most popular base pair. The problem was that so many OSMO were in liquidity pools but not securing the chain, this is how the idea of superfluid staking came up.
@osmosiszone@laurashin@sunnya97@axelarcore Instead of having a derivative & liquid version of your staked tokens that you can use in DeFi (which can imply security issues) Osmosis decided to take the problem on the other way. They take staking assets, use them in DeFi, get the DeFi assets and stake them
@osmosiszone@laurashin@sunnya97@axelarcore To do this, Osmosis added Cosmwasm which is a smart contracting system built for the Cosmos SDK. However, Osmosis made it permissioned to make sure that what is being deployed on the chain are high quality apps & well integrated with each other.
That's similar to IOS Apple store: you have to go through a process to list your app on the Apple store & Osmosis is similar but let the community decide on the deployment of the said app or not.
The toxic part of MEV is front running. Front running is related to a privacy problem, everyone is leaking their intent before the trade is executed. To solve that, Osmosis created a system called "threshold encryption"
@osmosiszone@laurashin@sunnya97@axelarcore With the threshold encryption, the transaction is encrypted when you broadcast it to the network. It's only decrypted once the block is finalized and the transaction executed. This feature is a top priority for Osmosis this year.
The advantage of @axelarcore is that it is built with the Cosmos SDK, meaning that Osmosis doesn't have to integrate a custom bridge protocol to talk to Axelar, it just uses IBC.
@osmosiszone@laurashin@sunnya97@axelarcore Axelar has a feature called deposit addresses: the system is designed to give an address on which you send coins & the coins will directly show up in your Osmosis account. This is helpful to connect Osmosis to Centralized Exchanges directly for example.
@osmosiszone@laurashin@sunnya97@axelarcore Osmosis is also working with Axelar to give people the opportunity to swap ETH on Ethereum for AVAX on Avalanche using Osmosis. Everything is done in one click only, without having to download the Keplr wallet.
@osmosiszone@laurashin@sunnya97@axelarcore The idea is: people approve the swap on MM, Axelar takes the assets and uses Interchain Accounts to swap ETH for AVAX on Osmosis, then send the tokens to Avalanche. All of this in ONE click and in a decentralized way.
👉 Leaving your money on an exchange/entity that went bankrupt/stole your funds (Mt. Gox)
👉Losing the private key/seed of your cold wallet
👉Leaving you funds on a specific blockchain/protocol that crashed (Terra)
👉Having a poor risk management
@cobie To survive, @ledgerstatus used a great analogy called the "Horcrux method", which is a Harry Potter reference.
To survive, you just have to split your soul into many different places. Same for your money: spread across exchanges, custody types & blockchains to survive
A bug on Osmosis liquidity pools happened right after the v9 nitrogen upgrade. If you added liquidity to a pool and then remove it, your money grew by 50% instantly.
Fortunately, validators worked with the core team to halt the chain and protect it.
The estimated loss is ≈$5M, the team is in contact with majors exploiters to get the funds back & will use the developer treasury to backstop the unrecovered funds.
This event demonstrated the power of a sovereign chain when everyone collaborates together to handle a crisis.
@EvmosOrg Please understand that 300M tokens will be issued through inflation the 1st year. #Evmos has a high inflation rate at the beginning, that's why it's important to stake your tokens otherwise your bag gets diluted 🚨