3 ms·

Out of curiosity, despite knowing all too well what to expect, I had a look at just one of your links, the "Alchemix" one. What the... are we supposed to do wi

by brabel 4y ago

Out of curiosity, despite knowing all too well what to expect, I had a look at just one of your links, the "Alchemix" one. What the... are we supposed to do with "self-repaying" loans, really? I clicked on "Learn More" under "Leverage your wealth" and was taken to a developer documentation page [1] with highly jargoned prose that give me even less idea of what this thing could really help me with. How the hell can I leverage my wealth, please?? Ok, just a loan, how do I get one??? Seriously here's a small excerpt from that site: "For example, if governance sets the liquidate() cap for DAI to 20 million with a 10 minute cooldown, then the maximum amount of DAI that can be liquidated from all of the strategies used by the alUSD Alchemist over the span of 10 minutes is 20 million. The cooldown period is linear, so if the 20 million cap gets hit, no more DAI can be liquidated in that block, but after 5 minutes users can liquidate up to 10 million DAI." What the actual... ?? If this is your example of a good crypto app we should be using, thanks but, no thanks. [1] https://alchemix-finance.gitbook.io/v2/ https://alchemix-finance.gitbook.io/v2/

pa7x1 4y ago
You are looking at the developer documentation. It explains the different classes and methods they expose, it's technical and the target audience is supposed to be technical. I didn't provide this example as a particularly good example of a decentralized application but as one that provides some unique financial product that is hard to find an equivalent in traditional finance. From the point of view of a user what it allows you to do is: 1. Deposit some collateral (e.g. ETH, rETH, or some USD stablecoin...) 2. Leverage that collateral up to 50%. I.e. You get debt of up to 50% of the collateral. 3. Do whatever you want to do with your leverage. 4. Meanwhile the collateral is put to work producing some yield that is repaying the debt you were issued. More interestingly, you can't get liquidated. Fortunately, if you don't find it interesting you don't have to use it.
- brabel 4y ago
  > You are looking at the developer documentation. Did you miss what I said?? > I clicked on "Learn More" under "Leverage your wealth" and was taken to a developer documentation page > It explains the different classes and methods they expose, it's technical and the target audience is supposed to be technical. I am about as technical as it gets. If this is not for me, really, this is for such a tiny minority of people who are just very interested in finance, and in particular using cryptocoins, as to be completely out of reach for anybody else. Like every other crypto app I've seen so far.
  - pa7x1 4y ago
    So you are making the point that one particular decentralized application has poor user documentation? Yes, I agree. I don't think it's a particularly novel observation when discussing small OSS projects. The following projects have better technical documentation, if you want to scratch that itch: - Uniswap: https://docs.uniswap.org/ https://docs.uniswap.org/ - Aave: https://docs.aave.com/hub/ https://docs.aave.com/hub/ - RocketPool: https://docs.rocketpool.net/ https://docs.rocketpool.net/ - OpenSea: https://docs.opensea.io/ https://docs.opensea.io/
otoburb 4y ago
>>What [...] are we supposed to do with "self-repaying" loans, really? [...] How the hell can I leverage my wealth, please?? I'm fond of the seemingly accurate sentiment that crypto is trying speedrun the history of finance (including spectacular failures). In this instance, a self-paying loan is a concept similar to a reverse mortgage, home equity loan, home equity line of credit[1], or 401K loan[2]. All are instances of paying back a loan originally borrowed against one's own money or value that has built up over time, and are financial products that exist in the US. The difference here is that the type of self-paying loan described by the OP is one where the collateral is a digital asset instead of, say, your house or retirement fund. Nothing new under the sun, except perhaps the ability to do this programmatically. [1] https://www.investopedia.com/mortgage/reverse-mortgage/reverse-mortgage-or-home-equity-loan/ https://www.investopedia.com/mortgage/reverse-mortgage/rever... [2] https://www.bankrate.com/investing/borrow-from-401k-loan/ https://www.bankrate.com/investing/borrow-from-401k-loan/
- pa7x1 4y ago
  I think there is a quite a bit of truth in speedrunning the history of finance. I don't see that per se as a negative, there is a lot of lessons that were learnt for good reasons. Many of these lessons are still valid and some lessons are valid but do not need to be enforced through regulation because the cryptography behind takes cares of them programmatically. This is the main advantage that is being explored IMHO, that you can enforce through code things that before were dependent in a complex network of trust, institutions, auditing, and humans doing busy work and moving papers. The speedrunning part can in itself be an advantage as it allows to iterate quick until you reach maturity. But this is just my personal opinion and I can understand skepticism until these products prove their maturity. Regarding the comparisons you propose. I don't see how [1] is equivalent. The mechanics are quite different. In Alchemix you receive a lump-sum at the beginning and pay it back gradually through the protocol that is using your collateral to obtain yield in various yield-bearing assets. [2] is closer in spirit. But as far as I know you can get liquidated. You have a repayment schedule and if you don't meet your obligations then your collateral will be impacted. In Alchemix your collateral is locked bringing some yield, there is no fixed repayment schedule, it adapts based on the yield. Anyway, the point was not to promote any of these smart contract and I have no affiliation with any of them. It was simply to illustrate the OP that it's not vapor ware, it exists, is implemented and is working today. It's niche, it's not for everyone, but is not vapor ware.

by brabel 4y ago

pa7x1 4y ago

You are looking at the developer documentation. It explains the different classes and methods they expose, it's technical and the target audience is supposed to be technical. I didn't provide this example as a particularly good example of a decentralized application but as one that provides some unique financial product that is hard to find an equivalent in traditional finance. From the point of view of a user what it allows you to do is: 1. Deposit some collateral (e.g. ETH, rETH, or some USD stablecoin...) 2. Leverage that collateral up to 50%. I.e. You get debt of up to 50% of the collateral. 3. Do whatever you want to do with your leverage. 4. Meanwhile the collateral is put to work producing some yield that is repaying the debt you were issued. More interestingly, you can't get liquidated. Fortunately, if you don't find it interesting you don't have to use it.

brabel 4y ago
> You are looking at the developer documentation. Did you miss what I said?? > I clicked on "Learn More" under "Leverage your wealth" and was taken to a developer documentation page > It explains the different classes and methods they expose, it's technical and the target audience is supposed to be technical. I am about as technical as it gets. If this is not for me, really, this is for such a tiny minority of people who are just very interested in finance, and in particular using cryptocoins, as to be completely out of reach for anybody else. Like every other crypto app I've seen so far.
- pa7x1 4y ago
  So you are making the point that one particular decentralized application has poor user documentation? Yes, I agree. I don't think it's a particularly novel observation when discussing small OSS projects. The following projects have better technical documentation, if you want to scratch that itch: - Uniswap: https://docs.uniswap.org/ https://docs.uniswap.org/ - Aave: https://docs.aave.com/hub/ https://docs.aave.com/hub/ - RocketPool: https://docs.rocketpool.net/ https://docs.rocketpool.net/ - OpenSea: https://docs.opensea.io/ https://docs.opensea.io/

otoburb 4y ago

>>What [...] are we supposed to do with "self-repaying" loans, really? [...] How the hell can I leverage my wealth, please?? I'm fond of the seemingly accurate sentiment that crypto is trying speedrun the history of finance (including spectacular failures). In this instance, a self-paying loan is a concept similar to a reverse mortgage, home equity loan, home equity line of credit[1], or 401K loan[2]. All are instances of paying back a loan originally borrowed against one's own money or value that has built up over time, and are financial products that exist in the US. The difference here is that the type of self-paying loan described by the OP is one where the collateral is a digital asset instead of, say, your house or retirement fund. Nothing new under the sun, except perhaps the ability to do this programmatically. [1] https://www.investopedia.com/mortgage/reverse-mortgage/reverse-mortgage-or-home-equity-loan/ https://www.investopedia.com/mortgage/reverse-mortgage/rever... [2] https://www.bankrate.com/investing/borrow-from-401k-loan/ https://www.bankrate.com/investing/borrow-from-401k-loan/

pa7x1 4y ago
I think there is a quite a bit of truth in speedrunning the history of finance. I don't see that per se as a negative, there is a lot of lessons that were learnt for good reasons. Many of these lessons are still valid and some lessons are valid but do not need to be enforced through regulation because the cryptography behind takes cares of them programmatically. This is the main advantage that is being explored IMHO, that you can enforce through code things that before were dependent in a complex network of trust, institutions, auditing, and humans doing busy work and moving papers. The speedrunning part can in itself be an advantage as it allows to iterate quick until you reach maturity. But this is just my personal opinion and I can understand skepticism until these products prove their maturity. Regarding the comparisons you propose. I don't see how [1] is equivalent. The mechanics are quite different. In Alchemix you receive a lump-sum at the beginning and pay it back gradually through the protocol that is using your collateral to obtain yield in various yield-bearing assets. [2] is closer in spirit. But as far as I know you can get liquidated. You have a repayment schedule and if you don't meet your obligations then your collateral will be impacted. In Alchemix your collateral is locked bringing some yield, there is no fixed repayment schedule, it adapts based on the yield. Anyway, the point was not to promote any of these smart contract and I have no affiliation with any of them. It was simply to illustrate the OP that it's not vapor ware, it exists, is implemented and is working today. It's niche, it's not for everyone, but is not vapor ware.