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I'm not aware of any serious financial application running at scale and relying on blockchain under the hood. Are you? What is it? Specifically.

Dwolb 5y ago
Curve Finance with $14B locked to its platform. Serves up low slippage stablecoin swaps. Some background on Curve (and Convex): https://medium.com/coinmonks/convex-curve-curve-d7e28cd6c1d9 https://medium.com/coinmonks/convex-curve-curve-d7e28cd6c1d9
- mikeg8 5y ago
  “Low slippage stable coin swap” is one of the most jargony things I’ve read on here in a while. Can you please ELI5 because I have no clue what this is or how it could be useful.
  - baby 5y ago
    Have you heard of leverages, margin calls, derivatives, put options, etc.? DeFi is pretty much the same level of complexity but implemented on top of cryptocurrencies.
    - mikeg8 5y ago
      Ok cool, so basically just fancy ways for traders/investors to gamble and “create value” that doesn’t really benefit anyone besides themselves and others tied to the platforms. Got it.
    - jodrellblank 5y ago
      This https://youtu.be/8CAafjodkyE?t=104 https://youtu.be/8CAafjodkyE?t=104 is a recent thing I found mind blowing; 2020 iPhone can do on-device image processing and object recognition and speak a description of what the camera sees. Just quietly a builtin feature. 2010 iPhone, I was mind-blown by the Word Lens app which could do OCR on text in the camera feed, translate the words into another language, and overlay the results on the image in near-realtime. http://edition.cnn.com/2010/TECH/mobile/12/20/word.lens.iphone.app/index.html http://edition.cnn.com/2010/TECH/mobile/12/20/word.lens.ipho... These are tasks I had never seen any computer do in any circumstances, things which would be unthinkable on a Java MIDP Blackberry from 2005, or a Pentium II desktop from 1997. Compare this to the wearable augmented reality devices Professor Steve Mann was building through the 80s and 90s[1] and this "describing the image" is so so far ahead in so many ways - processing power, imaging quality, battery life, storage space, size, weight, convenience, reliability, it's just mindblowingly better, neural networks and fast chips and solid state storage is a step change in a way that "faster" isn't enough to really convey. Google tells me "Derivatives have a long history in the United States, dating back to the founding of the Chicago Board of Trade in 1848.", you're telling me people are doing that but with blockchain, why is that interesting at all, why mind blowing? [1] http://cyborganthropology.com/Steve_Mann http://cyborganthropology.com/Steve_Mann
      - Dwolb 5y ago
        Personally the reason it blows my mind is because it’s now permissionless to craft a unique structured product or derivatives protocol, deploy it globally, and anyone on the planet can participate in that market. It’s fully customizable and accessible to anyone with an internet connection.
        jodrellblank 5y ago
        In what way "permissionless"? In the way "the government has agreed that they can be unregulated financial products" or in the way "hopefully it can evade government financial regulation"? or in some other way?
        Dwolb 5y ago
        Sure there’s definitely US-centric issues given the current regulations in place. But it’s permissionless in that if the financial markets don’t support a structured product you or your community needs, you can create and deploy it yourselves with instant global accessibility.
        jodrellblank 5y ago
        Why could you not do that with a few webservers in 2001?
        Dwolb 5y ago
        You could (Matt Levine talks about his ExcelCoin he tracks in a spreadsheet), but with the rise of AMMs [1] (and SSOV’s) it’s easier to make the market in the DeFi space. [1] https://medium.com/dragonfly-research/what-explains-the-rise-of-amms-7d008af1c399 https://medium.com/dragonfly-research/what-explains-the-rise...
        SanJacobs 5y ago
        Evasion of regulation. Not just from governments, however. From anybody who wants to control people without consent.
  - deleted 5y ago
    [deleted]
  - randomhodler84 5y ago
    The idea is you can lock capital in a pool, and as people trade between two usd stablecoins, USDC and DAI, you earn a fraction of the trade fees. The low slippage is due to the pool being large enough that you will get $1->$1.
- obstacle1 5y ago
  So this is Yet Another Liquidity Pool? $14B is not the kind of scale I mean. That is frankly trivial especially when transactions are large (or initial funding is high). What I mean is, if blockchain is going to be a revolutionary technology backing all finance, where is the evidence it can handle the kind of transaction volume that, say, major credit card networks generate?
  - somebodythere 5y ago
    Maybe check out DYDX L2.
    - obstacle1 5y ago
      Great pointer, thanks. This is a protocol that rolls up ETH transactions and executes them in batch, in an attempt to alleviate scalability concerns. I can't really speak to the side/unintended effects of transaction rollups on a blockchain, but I'm interested in learning. This excerpt from the FAQ > It is worth noting that anyone can become a relayer so long as they have staked the required bond in the smart contract. This incentivises the relayer not to tamper with or withhold a rollup. kind of bothers me. It does not seem like such a small step to go from 'decentralized' to 'cartel of relayers' to 'central bank and subordinate branches'. And the fact that this protocol is unavailable to US persons is interesting, though perhaps standard for the space right now.
      - somebodythere 5y ago
        The censorability of rollup relayers bothers me too. As you mentioned, the fact that US persons are blocked from the protocol shows this is a real problem. I think this is a problem with technological solutions (perhaps anonymous and redundant relayers, or private rollup transactions so that the relayer does not know the content of transactions in a block but can produce a valid output state) that will be worked on in the next couple years now that the base technology (rollups) exists.
  - Dwolb 5y ago
    We need more precision in the scale and performance targets you’re seeking prior to discussing blockchain analogs. It’s tough to respond when “serious financial application” or “revolutionary technology backing all finance” aren’t well-defined.

Dwolb 5y ago

Curve Finance with $14B locked to its platform. Serves up low slippage stablecoin swaps. Some background on Curve (and Convex): https://medium.com/coinmonks/convex-curve-curve-d7e28cd6c1d9 https://medium.com/coinmonks/convex-curve-curve-d7e28cd6c1d9

mikeg8 5y ago
“Low slippage stable coin swap” is one of the most jargony things I’ve read on here in a while. Can you please ELI5 because I have no clue what this is or how it could be useful.
- baby 5y ago
  Have you heard of leverages, margin calls, derivatives, put options, etc.? DeFi is pretty much the same level of complexity but implemented on top of cryptocurrencies.
  - mikeg8 5y ago
    Ok cool, so basically just fancy ways for traders/investors to gamble and “create value” that doesn’t really benefit anyone besides themselves and others tied to the platforms. Got it.
  - jodrellblank 5y ago
    This https://youtu.be/8CAafjodkyE?t=104 https://youtu.be/8CAafjodkyE?t=104 is a recent thing I found mind blowing; 2020 iPhone can do on-device image processing and object recognition and speak a description of what the camera sees. Just quietly a builtin feature. 2010 iPhone, I was mind-blown by the Word Lens app which could do OCR on text in the camera feed, translate the words into another language, and overlay the results on the image in near-realtime. http://edition.cnn.com/2010/TECH/mobile/12/20/word.lens.iphone.app/index.html http://edition.cnn.com/2010/TECH/mobile/12/20/word.lens.ipho... These are tasks I had never seen any computer do in any circumstances, things which would be unthinkable on a Java MIDP Blackberry from 2005, or a Pentium II desktop from 1997. Compare this to the wearable augmented reality devices Professor Steve Mann was building through the 80s and 90s[1] and this "describing the image" is so so far ahead in so many ways - processing power, imaging quality, battery life, storage space, size, weight, convenience, reliability, it's just mindblowingly better, neural networks and fast chips and solid state storage is a step change in a way that "faster" isn't enough to really convey. Google tells me "Derivatives have a long history in the United States, dating back to the founding of the Chicago Board of Trade in 1848.", you're telling me people are doing that but with blockchain, why is that interesting at all, why mind blowing? [1] http://cyborganthropology.com/Steve_Mann http://cyborganthropology.com/Steve_Mann
    - Dwolb 5y ago
      Personally the reason it blows my mind is because it’s now permissionless to craft a unique structured product or derivatives protocol, deploy it globally, and anyone on the planet can participate in that market. It’s fully customizable and accessible to anyone with an internet connection.
      - jodrellblank 5y ago
        In what way "permissionless"? In the way "the government has agreed that they can be unregulated financial products" or in the way "hopefully it can evade government financial regulation"? or in some other way?
        Dwolb 5y ago
        Sure there’s definitely US-centric issues given the current regulations in place. But it’s permissionless in that if the financial markets don’t support a structured product you or your community needs, you can create and deploy it yourselves with instant global accessibility.
        jodrellblank 5y ago
        Why could you not do that with a few webservers in 2001?
        Dwolb 5y ago
        You could (Matt Levine talks about his ExcelCoin he tracks in a spreadsheet), but with the rise of AMMs [1] (and SSOV’s) it’s easier to make the market in the DeFi space. [1] https://medium.com/dragonfly-research/what-explains-the-rise-of-amms-7d008af1c399 https://medium.com/dragonfly-research/what-explains-the-rise...
        SanJacobs 5y ago
        Evasion of regulation. Not just from governments, however. From anybody who wants to control people without consent.
- deleted 5y ago
  [deleted]
- randomhodler84 5y ago
  The idea is you can lock capital in a pool, and as people trade between two usd stablecoins, USDC and DAI, you earn a fraction of the trade fees. The low slippage is due to the pool being large enough that you will get $1->$1.
obstacle1 5y ago
So this is Yet Another Liquidity Pool? $14B is not the kind of scale I mean. That is frankly trivial especially when transactions are large (or initial funding is high). What I mean is, if blockchain is going to be a revolutionary technology backing all finance, where is the evidence it can handle the kind of transaction volume that, say, major credit card networks generate?
- somebodythere 5y ago
  Maybe check out DYDX L2.
  - obstacle1 5y ago
    Great pointer, thanks. This is a protocol that rolls up ETH transactions and executes them in batch, in an attempt to alleviate scalability concerns. I can't really speak to the side/unintended effects of transaction rollups on a blockchain, but I'm interested in learning. This excerpt from the FAQ > It is worth noting that anyone can become a relayer so long as they have staked the required bond in the smart contract. This incentivises the relayer not to tamper with or withhold a rollup. kind of bothers me. It does not seem like such a small step to go from 'decentralized' to 'cartel of relayers' to 'central bank and subordinate branches'. And the fact that this protocol is unavailable to US persons is interesting, though perhaps standard for the space right now.
    - somebodythere 5y ago
      The censorability of rollup relayers bothers me too. As you mentioned, the fact that US persons are blocked from the protocol shows this is a real problem. I think this is a problem with technological solutions (perhaps anonymous and redundant relayers, or private rollup transactions so that the relayer does not know the content of transactions in a block but can produce a valid output state) that will be worked on in the next couple years now that the base technology (rollups) exists.
- Dwolb 5y ago
  We need more precision in the scale and performance targets you’re seeking prior to discussing blockchain analogs. It’s tough to respond when “serious financial application” or “revolutionary technology backing all finance” aren’t well-defined.