Consistent incentives are the superpowers of cryptocurrency

THORChain’s year has not been easy. After three attacks in one month during the summer, the protocol’s native token (RUNE) suffered a heavy blow, plummeting from a historical high of over US$20.00 in May to a low of approximately US$3.50 in late July.

The protocol is advertised as a way to exchange encrypted assets on different blockchains without an intermediary. The protocol completely disables the exchange because it aims to strengthen the network against attacks.along with Restart Ethereum swap However, in late October, the recovery of THORChain was actually completed-the price of RUNE was once again close to the $20.00 mark.

Then there is the public sale of THORSwap.

THORSwap, a decentralized exchange backed by THORChain, successfully conducted an initial cap sale, oversubscribed by 198%, because community members paid up to $300. But the second unlimited sale made a serious mistake, because the robot ran the initial Dex product (IDO) before the public could even access the application and THORChain’s own treasury confiscated the tokens.

However, just a day later, the fall in the price of RUNE seems to be reversing, and community members who were dissatisfied on Twitter before are singing praises to the THOR team. So, how did THORChain succeed when countless other DeFi projects failed to recover due to hacker attacks or exploits?

Why after these three loopholes, some wallet holders actually donate Ether (Ethereum) To the THORChain agreement to help make up for the loss?Why did THORSwap’s Twitter account receive it after a botched IDO Annotation It’s like “This is the real @THORChain. They know how to get along with the community. They know how to treat the community.”

According to some members of the community, the answer is not only that participants have a deep commitment to the decentralized spirit of the project; even most of the anonymous developers and managers behind the THOR ecosystem are as diligent in community development as in technology implementation.

This is about a virtuous circle of consistent incentives among developers, managers, moderators, and the community to create a true anti-fragile economic system.

After IDO, THORSwap and THORChain quickly resolved the community’s anger over the mistake of preventing many supporters from participating in sales.

in a Autopsy The THORSwap team stated: “Frankly speaking, the $THOR token issuance on THORChain was a terrible experience for everyone involved. Over the years, we have built trust and we know that it is easy to be broken from such incidents. Many lessons are learned, and we hope to regain your trust.”

However, the THOR team did not simply apologize, but went further-the first is the THORChain Ministry of Finance possible Donate 10% of its tokens back to the liquidity pool, and then redistribute its entire USD 11.25 million THOR position to those liquidity providers who cannot obtain tokens.

THORSwap Admin, an anonymous contributor to the agreement, told Cointelegraph, “THORSwap—products, ideas, and contributors—was actually born from the community. So when the release did not meet the expectations of the community, we personally adopted it. We enthusiastically Work to provide solutions that suit as many people as possible.”

In addition, the THORSwap team also announced plans for additional airdrops to prove “We love THORSwap and the THORChain community and are absolutely committed to you.”

But even apologies and “free funds” have their limitations. This is why THORSwap has been developing a passionate community for nearly a year. “Our Discord channel has more than 18,000 members,” explained CrowdPleasr, a pseudonymous representative. “As long as community members have questions, we will still provide 24/7 one-on-one support. Our response time is less than 30 minutes on average. And I I think no other DeFi project has worked so hard to serve its supporters.”

Auditing the Discord channel is a challenge, and it has plagued many encryption projects-they often become a cesspool of spam and phishing expeditions-but THORSwap’s chief moderator and product manager “The Bull” explained that they The overwhelmingly positive emotions are determined by the transparency and continuous communication of the team. They explained: “We have always been the first to make announcements about hacking, and we have announced every stage of recovery…so the community can easily talk to team members.”

The THORSwap team has been practicing deeply, actively recruiting and paying for experienced community modules instead of relying on volunteers to maintain peace.

In addition to trying to create a safe environment for users in the online community, THORSwap has also launched a number of product lines to reward people who have made positive contributions to the project; as non-fungible tokens (NFT) are becoming more and more popular The more popular (let’s face it, cheap) ways to build loyalty, this trend has accelerated.

THORChads DAO has its own website, Described as “…a LAUNCHPAD and…the main destination for all THORChain creative projects”, users who meet various criteria can “prove their Chadness” and use avatars, NFTs, and airdrops And bonuses such as increased distribution are in the recently concluded public sale. It will also serve as a startup platform funded by developers to further develop the ecosystem.

(Although the online etymology of “Chad” is related to the incel world and positive alpha male characteristics, it has been adopted by the cryptosphere specifically related to bold or fearless traders. Not to mention, Chad Barraford is the name of THORChain and its One of the most obvious supporters.)

CrowdPleasr is particularly excited about the charity aspect of THORSwap. He describes it as “an opportunity for the community to decide where we should allocate 5% of our income, because very few people do this. We think that getting some benefits is important in our lives. Outside the currency bubble.”

THORSwap Admin explained that, all in all, about 75% of THORSwap’s income is expected to go back to the community. He described the success of the project as based on the theory that adjusting incentives will lead to greater scalability and “trading black holes”, in which discounted transaction fees will lead to more transaction volume, which in turn will lead to greater Income, which leads to more value accumulation in the community, which leads to further discounts in transaction fees…

All these consistent incentives have achieved tangible results. The community’s support for the public sale led to the project’s first round of public sale with more than 5,000 participants, who promised 100% of the required funds in the first 17 minutes. CrowdPleasr pointed out that this is “in the same way as private investors”. Price”.

Despite the mistakes in IDO implementation, the community seems to be satisfied (in most cases) with the solution the team created.

As an integral part of the THORChain world, THORSwap is the epitome of the wider support that the protocol has enjoyed since its establishment.

Erik Voorhees is an advocate of derivative power in the community. He founded Recently decentralized The ShapeShift platform describes THORChain as “…this leap, most people have not dealt with it yet. There is no other similar thing available.”

Do Kwon, the founder of Terraform Labs, said: “THORChain is interesting because I believe that the future will be cross-chain and interconnected. The bridging potential of THORChain is that it can introduce Bitcoin-which is huge.”

Even so, it makes sense to argue that the best technology does not always win. Betamax and VHS are a typical example, that is, a walled garden with superior technology (Sony’s Betamax) has fallen into the hands of competitors, whose ecosystem provides consumers with more attractive products, just like JVC’s VHS has established a stronger relationship with film companies.

We are seeing the same phenomenon today-Bitcoin is not the most technologically advanced cryptocurrency, it has many shortcomings and will immediately kill any new project. But it has a community of developers, supporters, and integrations, and at least so far, it provides it with an indestructible advantage. The community is probably the main reason why Bitcoin Cash is not Bitcoin today.

Despite advanced technology, THORChain and its ecosystem projects have found that in the rapidly expanding crypto world, technology alone is not enough. Technology can be copied, improved, eliminated… But when the interests are the same, the community and the system can survive.

As Barraford, the core developer of the protocol, pointed out briefly video He compared the consequences of THORChain exploits with the impact of Mt. Gox hackers on Bitcoin. These incentives are two-way. “This community, I mean, obviously this community is absolutely amazing. You only have diamond hands. I am very grateful to everyone for persisting and continuing to support this project. This is very important to me, and I must continue to invest all my energy… …With the support of all of you.”

This is why THORChain still exists, and the smaller DeFi project has been put aside when faced with exploits.

Consistent incentives It is the core innovation and commitment of the cryptocurrency experiment. If executed properly, as proven by the pragmatic builders of the decentralized THOR ecosystem, they can create an anti-fragile economic system that quickly recovers from black swan events (such as hacking or preemptive IDO).

After the 2008 financial crisis, this should indeed be an ideal innovation.





Source link

Recommended For You

About the Author: