Thread by @terra_money

1/ Today’s Alliance integration unlocks a myriad of opportunities for growth and collaboration for Terra and other @cosmos ecosystems 🤝

Discover what makes Alliance the ideal tool to scale decentralized economies in our new article from @Zion_Schum 👇

medium.com/terra-money/al…

2/ An overview 🧵 of some of the key takeaways 👇

3/ An exciting feature that’s emerged from the transition from Web2 to Web3 is the ability to enable large-scale coordination among disparate participants by utilizing economic incentives 💰

4/ As an open-source Cosmos SDK module, Alliance builds on this concept, empowering blockchains to align incentives with adjacent chains, developers, and users to strengthen and expand their ecosystem 🌐

5/ Alliance thus aims to serve as an economic tool that steers a decentralized economy's monetary policy (i.e., staking rewards) toward achieving desired objectives 🎯

6/ Functionally, this is accomplished by allowing users to stake multiple tokens on a single chain to earn a portion of native staking rewards – a feature never before possible in Web3.

7/ Any token can be staked within it, and no changes to consensus or common core modules are needed for chains to integrate, making Alliance both flexible and non-invasive.

8/ Here's how it works:

1️⃣ Two chains integrate the Alliance module and determine, through governance, which tokens users can stake on their chain. These are known as Alliance assets.

9/ 2️⃣ Each Alliance asset is assigned a Take Rate (the percentage of staked Alliance assets the chain redistributes to native chain stakers) and a Reward Weight (the portion of native staking rewards the chain distributes to Alliance asset stakers).

10/ 3️⃣ Users of each chain can then bridge their assets via the Inter-Blockchain Communication protocol (IBC) to the other chain and stake them to earn the Reward Weight.

11/ While the name Alliance implies its aptness to form mutually beneficial relationships between chains, it can also be leveraged within a single chain. This means chains can add tokens from other networks, or even native apps, as Alliance assets in a permissionless manner.

12/ The Alliance module's versatility thus presents several use cases, including:

✅ Diversifying and augmenting staking yield
✅ Attracting users, liquidity, and devs
✅ Incentivizing native application devs
✅ Deepening liquidity for essential token pairs

13/ And with the ability to transform any token into an Alliance asset and adjust its Reward Weight and Take Rate via chain governance at any point, Alliance acts as a dynamic, adaptive tool that can scale as an ecosystem’s needs change.

14/ One of the first chains to showcase the utility of Alliance in driving value to their ecosystem has been @Migaloo_Zone, which has added #ampLUNA and #bLUNA as Alliance assets 🐳 🤝 🌕

15/ By adding these Alliance assets and offering $WHALE rewards to stakers of each, Migaloo has begun using Alliance to attract users and liquidity (~100K combined #bLUNA and #ampLUNA in less than a week) and utilize $LUNA Take Rates to diversify and boost $WHALE staking yield 🐳

16/ Not to mention, using Terra’s Alliance module, @Migaloo_Zone enabled a Cosmos first (!):

At block height 766297 on Migaloo, an anonymous user performed the first delegation on a mainnet Cosmos blockchain using a non-native token: staking #bLUNA on Migaloo 🔥

17/ This achievement once again highlights Terra’s capacity to deliver inventive solutions, showcasing our commitment to building the picks and shovels that enable a freer financial system ✊

18/ Several other Cosmos chains want in on the Alliance action as well, including @TeamKujira, which has already integrated Alliance on mainnet and begun exploring how they might integrate native app tokens as Alliance assets 👀

https://twitter.com/TeamKujira/status/1638642504747610112?s=20

19/ With Alliance live on Terra, anyone from within the #LUNAtic community is now free to propose the addition of new Alliance assets and their associated Reward Weights & Take Rates via governance.

Share your thoughts and start a discussion on Agora 👇

commonwealth.im/terra/overview

20/ From its inception, Terra has championed the importance of freedom. Our community has embodied fervent resiliency at every turn, and we continue to envision and fight for an open, more decentralized financial system.

21/ By offering use cases that strengthen decentralized economies, Alliance takes us one step closer in our journey toward building that system.

22/ We’re only beginning to witness the potential of this technology, but with several chains, including collaborations like Migaloo and Terra, embracing the capabilities of Alliance, the future looks brighter than ever for interconnected, collaborative blockchain ecosystems 🤝

23/ For chains interested in incorporating or learning more about the Alliance module, check out this quick integration guide on how to get started 👇

alliance.terra.money/guides/get-sta…

or have a look at the open-source codebase (audited by @goFYEO) 👇

github.com/terra-money/al…

24/ For those interested in trying out Alliance on @Migaloo_Zone, follow the step-by-step guide from @eris_protocol👇

https://twitter.com/eris_protocol/status/1646630138644135937?s=46&t=JSz5WNDu0wJrrS4Xim8JpA