This is epicenter episode 404 with guest Chris better forum.
Welcome to epicenter the podcast way.
Where we interview crypto Founders, Builders and thought
leaders. I'm Federica ants.
And I'm here with Sonny Agrabah today.
We're speaking with Chris butter, for all who is the
founder of badger Dow bat, it out brings Bitcoin to D5 in all
sorts of ways. We are talked about this with
Chris in a little bit, but first let Tell you about our sponsor
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So basically to the noses Forum, if you want to partake in that
there was a Discord lava launch for a cow swap.
So it's and I promise it's not just memes.
Actually people talk about any be in stuff for real and there
are public testing sessions of new features on Discord, and if
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I get a pull up for every trade? I do or do one pull-up word?
You only if you if you go if you join the puppy tests and testing
session on this book, so you don't you don't get it for
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I see. I feel like I should earn an FTE
for every single trade I do. And it's like, so I can bring
more realized everything. I wanted and of key for every
transaction I ever make on a theory.
Oh, but I'd like to see. I think basically if the token
goes through you'll probably get a token.
So I think that that would be that not quite an mft.
But you know, that may be good enough good.
So let's go back to Majid. Ow.
So Chris tell us a bit about yourself and what brought you to
this space and what what moved you to actually start Badger Dow
and, you know, try to bring Bitcoin to defy.
Sure. Hey guys.
Thanks for having me. So my story and I've been in
this space, quite a few years, almost your 2020, almost nine
years. Actually, when I purchased my
first Bitcoin, I was actually in New York at the time and my
office, just so happen to be right below the Bitcoin Center
and a friend from college was, okay.
We got to go check out this new thing Bitcoin and and they were
doing live off. Students with the gentleman with
the Bowtie in an Excel spreadsheet on the wall behind
and everyone brought their, you know, rigged up Miners and stuff
was pretty funny. What's this the Bitcoin sent on
Wall Street, there was okay. Yeah.
I remember that long time ago. And you know, that's really just
piqued my interest, but I've always been a believer in, you
know, just people owning their life and taking control for, you
know, how they live their life, and why, rather than taking
societal societal standards and making those just how you live
your life, because that's how you're supposed to live your
life. Right?
So I've always just believed in people taking Freedom that way
and owning their freedom. So that's what, obviously,
attracted me to bitcoin. And then over the years, I
continued to You know, invest in and be part of Bitcoin talk for
them and things along those lines.
And then, you know, being from Toronto, when a theorem launched
that was kind of, when a lot of light bulbs from going off of my
mind and I started seeing the potential for what was going to
what was going to come. And that's where I decided to
stop doing what I was doing, which was primarily in
e-commerce and digital marketing and sales and things along those
lines and invest my time, full-time in crypto and I
started Typing a few projects with those specific things
right? Digital marketing.
So forth continue to invest in different projects and then you
know as the years went on got involved in a variety of
different things. Help doing some crypto community
events like pump to San Francisco blockchain week in
2018. With with the Nora screwing in a
few folks and and and primarily just was a consultant for
different crypto projects until the Will class close to end of
2019. And that's that's where for me.
It was. You know, I wanted to have a
bigger impact on the space that I grew to love and have an
impact that lasts a really long time and I wanted to be a
builder, right? That's really what I wanted to
do. And I believed in the power of
Bitcoin and Bitcoin being used in financial applications and
being accelerated by Block chains, like the theorem
obviously, and potentially a variety of others, but that's
where the journey started. And, you know, going back to the
idea of freedom. I also have never been a big fan
of centralized corporations and just hierarchical decisions and
you know all the lack of transparency on a day to day and
you know, you start combining those things and and the
acceleration of decentralized organizations and in the
beginning of 2020 and actually seeing real In real assets
inside of these decentralized orgs, that's where, you know,
this is called the star starting line in my head and decided to
push forward with creating decentralized organization.
That was really had one core focus.
And that was to build the infrastructure to bring Bitcoin
to the centralized Finance. So, how did the team meet of us
their core team? And how did you, how did you get
more people put in to decentralize it?
It's pretty wild. I still can't believe I let some
of this stuff came together, but it was me and two other folks,
one leads to Lilly developer and one the front end and ux and I
pretty much handled, you know, the business development, the
marketing token structure, things along those lines, and we
brought it to Market, December 3rd.
And the way that we brought it to Market, we didn't raise any
money. We sell funded it and we wanted
to launch with the product that people wanted to use.
So are you know, we launched with our first product, which
are set vaults where people can deposit tokenize Bitcoin and
earn interest on it and it on custodial way.
And it was through that leading up to that launch.
We launched our Discord and September, and we had a program
that we called the early contributor program, right?
So, you know, we came up with a bunch of wild stuff, and we
essentially took all those ideas.
From like the token break down to how the products are going to
work to everything and we just spewed it on this Discord and
all these different channels. And people just started joining
people started joining through Word of Mouth people started
joining just through other protocols sharing that, they're
excited about our launch upcoming launch and and then
they're really contributed program.
Was that kind of incentive where people with the line values
wanted to help want to help figure some of these things out.
And that's exactly what They did right months in advance.
I called Day Zero type stuff. There was over 100 people that
were rewarded as part of their early contributor program and
and these people just not knowing the badger would be
anything. Just wanted to help from
everything from design to development to economic economic
decisions from the token structure and liquidity mining
program and a variety of things. And and then that just started
snowballing. And from that.
Point on every day. We have new contributors.
I wanted to help and some people that help the bed and then kind
of left and then some people that helped the bid and then
helped a lot and then stuck around.
And now there's almost 20 people that work full-time every day on
the badger protocol and a community of, you know, 15,000
people that are avidly. Excited about what's coming next
and adding value and helping and, and just being a part of
it, right? And it's been just interesting
for us because Because you know, there's no bank accounts.
There's no legal entities or is none of these things.
So you have to check certain types of people and it's not
like, you know, we can put a job post out and say hey come on
join and that really we've never done that.
We've never done a job posting. You never done anything like
that. It's just all been people from
the community getting involved and just having a gun that
that's shared vision for what could be if we were able to
actually accomplish this thing. As someone who's been in this
ecosystem, a long time and whose background is in business
development and marketing. And so on what I mean?
What we actually see is that there are these communities that
are basically their Grassroots, and they kind of they emerge,
and they are self-sustaining and so on.
And, and then they are communities that never really
take off, right? So, basically their communities
where there's lots of push and money, and everything behind it,
but still for some Reason, they failure to actually Garner that
critical mass and in a way, they're Dead on Arrival.
What do you attribute that to? I mean basically battered.
I was super successful and in how it took up a from from
nothing and how Dynamic and big the community is what do you
think are the contributing factors?
Well, there are a few I think the main one is having shared
values and shared value and belief system like everyone in
our community believes that Bitcoin is going to be.
And when I use the term Bitcoin, I don't necessarily just mean
Native pick one on the Bitcoin Network.
I mean, tokenized Bitcoin rapid corn.
Really a representation of Bitcoin is going to be a
Paramount, a critical asset to decentralize.
Infrastructure and the future of decentralized Finance.
Really? What we're all building and and
that shared belief in Bitcoin. As that leading horse, is really
what brings everyone together? And I think another key piece is
how you identify the right, people to even kick start that
Community, right? So for us, what we did is part
of our launches, we looked at 32,000 wallets for two years
prior to our launch. Identified 19 different actions
things that that we believe, you know, aligned with our values.
So for example, anyone that participated in unchain voting
with urine or sushi, or even option through, snapshot your
own Sushi Harvest, one Hive things along those lines or
people that use tokenize, Bitcoin on other compound or
provide liquidity on balancer or sushi, or, you know, swap, or
whatever it may be. Be and and the, you know, it was
those types of actions that really aligned the people that
we believe would be the right community members to really take
this and Lead it. And and, and those are the types
of things that we identified early.
And when we identified those, we also built a product that we
felt those same people would want to use, they won.
And then by saying, hey, you share in our values, you're
there. From day one.
It's not like you're coming day 40 after, you know, Venture
capitalists and a bunch of bunch of different groups, kind of
facilitated a certain start know, you're you're there from
day Zero, the ups and the downs. And you now have a product that
you've been looking to use. We thought at least people would
want to use something like this, and turned out, they did.
And then, by the way, you have the ability to decide all the
factors and the direction of said app and whatever.
You know, the protocol ends up becoming in the value that it
ends up incurring. So, you know, those were those
are some of the critical things that that we did early on that.
I think most aligned our community and made them really a
strong force. And and I think as well, another
big thing was, you know, when you look at those actions, like,
another key action that we looked at, was anyone that
donated to get coin for the first seven rounds at the time?
And we were the first ones to Drop two people that
participated in get coin and work with the team to help that
help gather that information. But also we carved off 2% of our
supply to get coin right from like right from the beginning.
And this is something that was decided as part of the early
contributors. And again, these are the types
of things that those actions align certain types of
individuals. And with those types of
individuals, if you actually want to build something, that's
LED and run by a community, you better hope that you have some
really good community members. As with this the right skill set
and mindset to take this route needs to go because it's not
about you know me or the other few people that started it all
becomes about the people that lead it moving forward to which
like I'm just, you know, I consider myself just another
contributor to the organization. So, you know, you mentioned that
like sort of The Guiding flag right now.
A lot of the Patcher Community is this no Bitcoin on defy.
What is it? About like, Bitcoin and divide
together, that leg excites you so much.
Well, you know Bitcoin in my opinion, I get some flat for but
I feel like it's the best money ever invented and it also in
just from a pure, you know, facts perspective, right?
It represents 50% of the entire crypto currency market cap, the
highest number of wallet addresses in the world, and
obviously, you know, the the amount of years that it has
behind it since launch and, you know, organic growth and things
along those lines that In my opinion, it becomes that asset
that everyone wants to use when they want to use a financial
application. And you know, the proof was
really in the pudding in the last year and a half, right?
I think in the beginning of 2020, there was a thousand
Bitcoins that were bridged to other chains.
I think now there's a 290,000 or little more than one percent of
the entire Bitcoin Supply. That's that's been bridge to
other change. And tokenizer wrapped and some
form or fashion. And if you look at like what's
happened during that time, you know, it's been the explosion of
defied apps and it's really those apps and the ability to
earn on it, land it or against it, a variety of things while
still being able to control your assets and see exactly what's
happening with your Bitcoin almost to the second that it
makes it that attractive. And if you were wind and look
at, you know, some of the use cases for Bitcoin, Admittedly
there hasn't been much over the years.
You know, one of the things I picked up quite a bit was
centralized lenders. I think you know Genesis trading
just came out with their to to report and the numbers are just
staggering like billions and billions and billions of dollars
worth of lending and borrowing with Bitcoin being the primary
asset is being used for these types of things and not pointing
at Genesis for anyone but just in general, you know, you give
up control of your assets. It's and you don't have the
ability to see what's actually happening with your Bitcoin.
And that's a big, big, big, big, big problem.
And it goes directly against the whole ethos of Bitcoin.
And I don't think that's going to be able to last for that long
before. The people want to be able to
have that level of control and have that transparency.
I think our hurdle that you know bitcoiners is they call them are
going to have to get over is like how is that enabled?
And that is not on the Bitcoin Network.
I'm not saying that it will never be on the Bitcoin network.
But I think the Bitcoin Network in general it's going to take
much longer and I don't think it's ever going to capture the
type of market, share that something like etherium has been
able to capture will capture move them forward.
So that you know, that's that's why I think Bitcoin is going to
be one of the biggest assets and most used assets and all of defy
obviously a theorem and obviously stable coins are up in
that up in that bucket. Bucket as well.
Yeah, I mean II mean I completely agree with you and
someone a couple weeks ago described me as the most Bitcoin
Maxi shit Corner they know which is like I'll take that as a
compliment. Yeah, I'd have to agree with you
that like, you know, I think I am also you know, I think
Bitcoin is probably the best asset that exist in all of
crypto right now. And you know, so there's a you
know, there's also like what I like to say is thank everyone in
crypto is a Bitcoin of right and I bet it'll be very hard to find
anyone who He's not like, you know, doesn't have Bitcoin, but
is Badger sort of who's the target audience right now?
Is it? These people who are already in
to defy and I like, you know, you know, I already did defy
with my ease and u.s. DC and it's like, oh but I also
have, you know, a third to half of my portfolio and Bitcoin.
Let me bring that and use ND Phi as well, or are you actually
going to like, you know, this larger Bitcoin Community?
That's outside of defy right now and To bring them into the
valley. Well, it's the former right now,
right? So right now, the majority of
people that use our applications and products are those that are
already comfortable with tokenize or rap versions of
Bitcoin already comfortable using applications on a theorem,
and are already comfortable participating in decentralized
finance. That's where our main target
audience has been in the last three months.
We've worked hard to try and bring more Bitcoin into The
Entity file essentially and I feel like we've done a decent
job. We launched our Bridge product
in partnership with Ren VM that allows anyone to take Bitcoin
and deposit it right into our V to earn interest.
And we've had over 245 million dollars worth of native Bitcoin,
that's gone through our Bridge during that time.
So I'm pretty proud of being able to accomplish that but for
the most part Sunday right now it's about soup, you know, this
column power defy users and you know wanted To get the best
return on their Bitcoin. And in the most trusted way
because we know how notoriously untrustworthy certain
applications and new launches and things like that are
happening at this point in the market.
So, you know, having a place where they can trust and and
then of course get the best return but to speak to like
where we want to go which is this idea of anyone that is
thinking about holding Bitcoin or holds native Bitcoin and
wants to do more with it. And literally in a couple Clicks
in 10 seconds, they're able to earn on it.
That's where we want to go. And we believe that, you know,
this Maxi crowd is just a small small small, you know, bucket in
the entire pool and you know, the pool is not going to care as
much about over actually, bridging that Bitcoin to a
theory, right? They're not going to care about
that. The fact that they still have a
built-in, the total control around their assets in sand and
full transparency. I think is What they're going to
want and with us and some are the same as isomer different,
but then to then have a say in the app that you use every day.
It's like me going up to Robin Hood and being like, hey, your
Feast suck. I'm gonna call 10 other friends
on Robin hooding, and we're going to put a proposal together
to change the fees like that would never happen.
So I think that is how the mass markets going to start, you
know, consuming us and in a variety of other protocols.
But really with our push towards, you know, product that
we launched I think about four months ago called or two months
ago called interest-bearing Bitcoin.
We hope for that to be the quickest and easiest way for
anyone to start earning interest on their Bitcoin, simply by just
by swapping Bitcoin for it. And then, in any time they can
redeem for more underlying Bitcoin, you know, anywhere
between 4 and 5% API and all done completely by smart
contracts, not by any type of, you know, Lending and borrowing
and OTC dashboard or anything like that.
So let's uh, get into some of the products.
Like so, you know, the badger Dow is this community that's
building sort of a set of different products before we
start to Deep dive into any specific one.
That's just like, get up, give a layout of what are the products.
So, so far, you know, and I know you there's like to dislike the
big product and then there's the set product and then I you just
mentioned the Bitcoin, the the badger Bridge are there any
other main like product verticals?
Are those are the three main ones?
Yeah, we actually have four. So, you know, the foundation of
badgers really, what we call our CV, and this is, you know, smart
contracts, that optimize yield for users often called, yoga
yield aggregators, but Focus exclusively on tokenized
bitcoin. We then have our Bitcoin Bridge,
which enables anyone to bring Bitcoin and start learning on
it. Immediately we have
interest-bearing Bitcoin which is back 12-1 by any interest
bearing V positions in our set bolts.
And then finally, we have dig, which is a root, the first
rebasing Bitcoin that was, that was brought to Market inspired
by ampleforth. So which one do you think we
should start with? I think the set V make the most
sense again, they're under the, there's a nuclear says I call
them there by far, you know, our core product.
Yeah. Pet.
Can you maybe just give us an overview of what the the set
does? We have a bunch of different V
about 15 different V, and users can choose which Volta deposit
into each of all has a different strategy for how it generates
yield. And in most instances, each
Vault has a different asset that's accepted in that vault.
As an example. You might bring WBT seat or W BT
CE V that we built in partnership with urine and that
has you know, a set of strategies that it runs to
optimize the That users get you might bring TBT see by the keep
team and the curve LP token associated with that.
And the posit that into our vaults and earn, you know,
specific return. I think it's 15 or 16 percent.
While at the same time, running unique strategy, different from
the WBT c v for example, and then the list really, really
goes on. There's a whole bunch of there's
different LP positions like WBT, see eat pears.
There's obviously Badger you can deposit.
It did you can deposit interest bearing Bitcoin.
You can deposit all the different flavors of Bitcoin.
Spt CPT BT, C. OB T CW, B.
TC R, NPC, just just a whole slew of different ways to earn
on, and on your Bitcoin and really what we've developed are,
you know, smart contracts. That take those assets and do
things for you. That tend to be resource
intensive expensive from a gas perspective, and time-consuming.
And instead. You doing it.
As you know, just give you an example.
One of our one of our V is the IB.
B, TC W BT C, Sushi bulb. And when you deposit in LP on
Sushi, use you earn a percentage of the trading fees.
In that pool. If you if that pool is eligible
for sushi rewards. You can then take that LP token
that they gave you and stake it to earn Sushi, which is great,
but you need to claim that sir. Sushi, periodically and then
decide what to do with it. So we built we built a smart
contract that automatically takes your LP position sticks,
it for sushi, then takes that Sushi and sticks, it for X
Sushi, which is the protocol sharing State position for sushi
that yields anywhere between 10 and 20% Eqi and then we
distribute that X to shoot to the users, periodically.
So we save them all that time and effort and The amount of
harvest and how frequently we do it to get them, the best auto
compounding, apy and, and users like to use that, you know, that
both in particular, especially if they want to accumulate more
Sushi as an example versus no other types of strategies that
might be something like a levered up, compound strategy.
We take WBT. See, we lend it out.
We borrow. Yeah, we lend it out.
We take the boat assets. We re-inject it and do that Loop
four or five times. X and then manage that manage
that that positions accordingly to generate, you know, level of
apy, same thing on Ave and a variety of other.
So, you know, that's that's the beauty of D50 Lego pieces and
they're really just fun contracts and anybody at any
time, can just plug into those and create different types of
strategies to provide some value to a user.
And in the set V products. Its users that want to earn
interest on the Bitcoin and really just sit back and let the
smart contracts do the work. So who's in charge of devising?
The strategies? So the way that we we built our
this called our strategist bench similar to how kind of urine
started developing. There's Wi-Fi for us.
It's like everything else. It's a community-oriented
initiative. So anybody can become a badger
strategist can build different strategies and then as part of
that, you know, our vaults have different fees and we have a 20%
performance fee and then a point five percent.
Trophy on those bolts, the strategist that develops that
strategy earns up to 50% of that performance fee in.
This is all obviously, cemented in the, in the content in the
contracts. So, we know that's, that's how
we develop different strategies. As we crowd sourced from the
community, you know, early on, you know, our internal
developers develop many of the strategies in the beginning.
And then, you know, every month, we subsequently get more and
more folks interested in building with us.
And and that's how we developed different types of strategies.
They audited for economic viability and smart contract
risk. Most certainly, and we've done
that from this starts. And one thing I'll just point
out, as I auditor audits, right? Like, call it what it is, you
know, just a few days ago. There was a protocol that was
exploited for 21 million that had like three audits or
something. Right?
Like it's a must and they're in there.
A set of Smart Eyes. We obviously believe in it.
We audit everything we do, but we have a variety of other
measures. So even before we launched to
ensure that our On it. And then, as we started growing
up, we started implementing a few other things.
So we have a smart contract Advisory Board and this board is
a group of really really high quality developers within the
defy ecosystem, many that are part of other protocols and
that, you know, review early, iterations of our code.
And we bring anything that we do through the smart contract
Advisory Board, even before audit, we then work with an
auditing multiple audit. In firms, but in a primary
auditing firm on a monthly basis, that audits all of our
contracts. We then have a level of peer
review amongst a lot of the different protocols that we work
with. And then finally, we try and
protect users as much as possible by having guarded
launches. So, for guarded launches, what
we do is we limit the amount per wallet that can deposit in the
new V, and we capped the total amount that that Vulcan take in.
And then we also whitelist users.
Um, based on different activities that they've done.
Within the badger ecosystem. We call it a Badger score and
you know only certain folks can be certain can participate.
In certain guarded launches based on their Badger score
might be a they provided liquidity or they voted in
governance or they've been part of badger for x amount of months
or whatever. It may be an accredited.
Betcha. Yeah.
Yeah, we could loyal Badgers accredited Badger, a variety of
things but we have we have multiple weeks of a garden Lon.
And we kind of moved it up, like it starts very small.
Then after a week. We move it up further and move
it up further and move it up further.
And then we open it up to everyone once we feel
comfortable with the results or, you know, over that time frame.
Angel. Why is like the difference
between like, you know, let's say I have WBT see, why would I
put it in the badger of badger fault?
Instead of going to a you're involved?
Look. Is there any is it Lily just
competing on strategies? Or is there some other big
differentiator between what why go to a Bitcoin Focus aggregator
instead of a more generalized? One?
Karen. Well, we work closely with young
and we're and we partnered a lot of things including the WBT c v
that you would deposit on your own.
So there's some very stiff and you would deposit into Badger,
it goes through the urine v as well, but really when you look
at other, your aggregate aggregators, not necessarily
earn in particular, but there's a there's a variety of things.
First and foremost is just how the whole system works together.
So, you know, we have a few different mechanics and place,
but we believe that When people deposit in a variety of
different bolts, they're potentially going to want
liquidity out of those assets and they're going to want to
continue to earn interest while being able to put those those
deposits to work. It's not, you know, it's not an
ideal experience to just kind of deposit here and that's it.
So that's why we created interest-bearing bitcoin and it
really allows anyone in all of you can be in 10 volts and you
can consolidate those Vault positions and to, you know, it's
backed by a basket of those faults, but it's pretty much a
Meta token and then you can go and take that and bring it to
cream and borrow against it or provide LP on Sushi turn.
Additionally, py or Bridget to Solana and earn over there or
Bridget. Two polygons and deposit it into
a variety of different protocols.
So that's one of the things that we do that.
That most others don't is, you know, having the liquidity in
your position, I think as well. We've been relatively Innovative
around. Different type of mechanics to
incentivize certain actions in that or boost rewards.
So we introduced something called Badger boost.
And what Badger boost is is if a user has Bitcoin deposited in
the app, we look at what their steak ratio is.
Steak ratio is the Badger balance.
The US dollar representation of your Badger balance, plus the US
dollar representation of your dig.
It's another Badger acid. /, the dollar value of your Bitcoin
deposits, the higher, the steak ratio the higher, the multiplier
on additional rewards. You get when depositing in our
app, and why that's important is because it encourages the type
of behavior that best benefits, the Dow, which is people that
are not just using Bitcoin to earn and then taking some of the
additional rewards and then, you know, selling them off.
Illicitly, but instead people that are holding those rewards
but more importantly participating and getting
involved in what what the the app and the organization needs
to move forward. And so do you know, those are
certain things that that we do that others don't.
And then I think another big, another big feather on our cap
is just our laser focused from a security perspective, like from
day one, you know, that that's been our absolute focus and it's
going to continue to be our focus and, you know, we Move.
Some people think we move fast in our mind.
We move a little slow just so we can make sure like as much as as
much as in the development teams control, we can mitigate risk
and you know, building some of these new tools that really
haven't existed before. What's the amount of Bitcoin
currently under management with Badger about six hundred million
dollars? And then a few months ago.
There was a peak of about 2.5 billion.
That's when Bitcoin was much higher in price.
But neither here nor there those in the earlier days.
We had up to 2.5 billion in Bitcoin deposit in the ACT.
Oh, wow. That's that's a big number.
One thing I want to talk about actually as well do it like?
So what level of control does like the badger Koken hat
holders have over this like, you know because it lets say the
badger. I remember correctly.
The current market cap is around 150 million or something.
And so if the big value of the Bitcoin is in the 600 million,
like, how do you think about like dealing thing about the
security model around this? You know, so there's been
there's been a whole slew of we call them Badger token, V2
conversations amongst the community around, you know,
having different models security models and backstops things
similar to Ave and and looking at different things, like
Redemption pools, and a variety of other things.
But for the most part today, the badger token governs, the
parameters of all of our products.
It governs the treasury and and and that's really, you know, and
and obviously a governance, really, any economic decision
that the organization could make.
And and, you know, to be honest with you, some people kind of
say hey like, well you just governing, you know, this
protocol, like what does that mean?
Well, it's not it's they're not small numbers.
Like, you know, you know, in our treasury we have like 50
million. Hours of Bitcoin and stable coin
and you know, we have to put that to work.
You have to use that accordingly.
There's a variety of decisions that go into how that capital is
manage, our total treasury. When you look at Badger that's
in there too and dig it's like over a hundred and fifty million
dollars. So it's not by any means a small
number and there's a lot of critical decisions that need to
go into how that treasure is managed.
And then more importantly the app right?
We've had sixty sixty, six different Improvement, proposals
pass through governance. We've had 65 that have passed in
Sixty and one that had one of those failed during that
timeframe. And we have arguably one of the
most active voting communities, you know, based on, you know,
different types of Statistics from Deep bow and a variety of
other even even Snapchat themselves, but neither here nor
there. That's how that's what the
badger token governs today, but moving forward.
You know, the intention of the community and, you know,
different people that are working on bajor, every day is
to really build a more robust, more robust, use case, for
Badger around, you know, securing the protocol.
The applications token, hold their value.
And and I think the delicate thing here is, you know, revenue
revenue, share. And I know, you know, quite a
few protocols have accelerated even at launch to have the
ability. Users to earn a percentage of
whatever the protocol makes. I'm not saying.
I'm against that because I'm not but it's definitely something.
We were very conscious to not do trying to be as delicate from a
regulatory perspective as possible.
But I know it's something that a lot of people are looking at
potentially implementing or that we want to implement because you
know, it is again, it's pretty substantial numbers, you know,
over 25 million in revenue, and seven months.
That's that's quite a bit of quite a bit of money that Go
back to token holders, potentially.
Can you talk about how governance has changed from the
get-go? So I remember like couple of
years ago. I quipped that most hours are
just three white guys with the mighty Sig and basically,
obviously that has changed in the ecosystem quite a bit but
very few dollars. I've actually achieved or
decentralization. I mean, where's where's
badgered? Are on that scale?
Well Badger, Dow is closer to the beginning of that scale with
a path towards the centralization.
It's been a really interesting Journey.
You know, I'll just speak for myself in trying in the delicate
balance that comes with trying to decentralize while still
trying to remain agile and and protect users and users funds.
When you're putting, you know, smart contracts to the market
that touch hundreds of millions of dollars.
Was in days, right? Like in this environment is very
different, from what it was a few years ago, where you put a
smart contract to play smart contract, the open it up and it
gets like, you know, 500 Grand in like a few months.
I think we've launched products that have gotten 500 million in
two days, new contracts like, you know, naturally you want
smart contracts to be battle tested with a lot of time in
Market before you start removing certain functionality like
upgradability. T or, you know, proxy controller
or things along those lines, you know, so for us where we sit
today is we sit closer to the beginning where we have multisig
governance. That's dictated by the token
holders are contracts are upgradeable.
They are behind a 40 every other major country.
All of our contracts are behind a 48-hour time lock which gives
additional security to users to ensure that, you know, different
Rogue developers. Couldn't put a change.
Lowered users would always have 48 hours before that change gets
implemented, you know, but our goal, our 100% is to try and
decentralize as much as humanly possible, while taking it a
little slower for the purpose of ensuring that you know, our
contracts are ready and and the user and the user funds in the
ability to respond in case of an emergency that speed is still
there and adequate. So, you know, there's been quite
Quite a few discussions. What we call roadmap to
decentralization is proposed and being worked on within the
community, you know and over the course of the next six to 12
months. I hope we make the intentions to
make quite a bit of progress towards that.
So then back to the product. So you mentioned the
interest-bearing Bitcoin as a separate product.
If I understand it correctly, though, what would interest
would interest-bearing Bitcoin? Would it be as simple as taking
ever does? Is it just your tokenized
position in the set voltage? Or is it actually more common,
something more complicated than that?
Yeah, it's it's more complicated because it's a basket of your
tokenized positions in the vaults and it averages out the
underlying interest earned through your tokenize positions
in this basket. Would it be fair to call her an
aggregator over the badger sett bulbs will certainly but it's
not just it's not just for Badger sett V.
It is today. But something like aw BTC from
ah, They are CW B. TC from compound can easily be
included now, inherently. They have lower interest rates.
So that would be something that the community and want to vote
in and it potentially bring the under the overall underlying
down. But you know, neither here nor
there interest paid in Bitcoin is backed with tokenized v
positions which in turn or since you just smart contracts taking
optimized yield positions on bitcoin.
I don't know. Also, this other thing called
Clause as well. Is that related, or is that
something different? Your clothes was an initial
product that we started working on near the beginning of our
journey and the idea of that was a Bitcoin collateralized stable
coin and you know over time, you know with certain limitations
around how we would bring that to Market and the market
conditions, some of the developers decided to put that
on the back burner for now. So really the other Focus then
became really around interest-bearing.
Coin. And how do you bring that to
Market? But more importantly, like we
look at it as a product. That is the most, you know, the
most liquid Bitcoin on every chain, right?
Like you today you go, you know to Solano.
There's a wormhole W, BT C and R.
NW B. TC and then you go to polygon or
BSC and it's etcb and you know, a variety of different things.
But if there's one Bitcoin consistent that you can bring to
any chain, and it's inherently earning interest.
You know, we think there's a space for that to really
accelerate in the market. And, you know, and it really
pleased back into our vault product because essentially, any
any IB B TC that's minted. It's almost like locked Bitcoin
inside of our vaults, which is really important since the app
earns Revenue based on the performance fees on those
specific V positions, and then, you know that eventually, we
hope it to become. You know that the easiest place
to earn on your Bitcoin because any, you know, centralized
platform anyone that's looking to offer you to their users.
They can go out like most of done to date where they built
like a lending and borrowing desk and they need to have
people and contracts and quantify lending and borrowing
Bitcoin to be able to offer a yield on BTC to their retail
users. If they have an app or whatever,
maybe to just integrating interest-bearing Bitcoin, and
users can Easily swap for me to be TC right into it and be
earning on that and redeem for it at any time and see exactly
where how the Bitcoins being put to work.
So we see that as you know, the future of really how The
Narrative of bringing Bitcoin to Defy is going to land with the
mass market and we think through different integrators that's
going to be one of the ways that were able to do that.
I guess then, the let's go on to the dig site of thing.
So, the set protocol is or and all the associated products
around, it seemed they have this, like, you know, they're
all intertwined. You see how the interest
bearing, the Cointreau kind of dependent on the set and all
that. But then this is like separate
Universe of this like, big product.
So, can you maybe talk to us a little bit about?
Tell us a little bit about what that is and then how it may be
does relate to the rest of the badger universe.
Yeah, most certainly. So you're spot-on.
Like the bridge in the vaults and I'd be BTC are constantly
working together. You can bring Bitcoin, native
Bitcoin through the bridge right into the vaults.
You can admit that b BT C and then use it wherever you want to
use. It did was actually our second
product after the vaults that we launched before the bridge and
IB B TC and you know, it really falls into this bucket that will
call like synthetics synthetic Bitcoin Alternatives and we felt
that that there was room for at a protocol level, being able to
create a resemble Bitcoin and do it in a noncustodial way.
And and we were inspired by the rebasing mechanics from
ampleforth. If you're familiar, which
essentially means baked into the token contract.
If the price on a given day, if the price of that asset, in this
case, dig is above the price of Bitcoin.
Then more dig would In your wallet.
Then the day before based on, you know, attend attend a
rolling average. So, for example, if it's 10%
higher than the price of Bitcoin today, there will be one percent
more dig in your wallet. Why?
Because they then the protocol then wants you to sell that dig
because now you have more of it. And that naturally should bring
the price closer to the equilibrium Zone, which is in,
you know, five percent of the The price of the underlying
asset that you rebasing against, and then vice versa on the, on
the buy side, or excuse me on the, on the lower price.
If it's a negative rebase or lower than the price of Bitcoin,
you actually have less dig in your wallet, which encourages
people to buy them to bring them back to the position and some
people look at it as an opportunity to hedge against,
you know, Bitcoin over a couple week period and a variety of
things, but at the core of it, you know, we felt that we
continue to feel There's room in the market for non-custodial,
synthetic Bitcoins. And these Bitcoins that use
different types of mechanics like rebase in to accomplish
that. Why re basic?
So, you know, I've actually spent a lot of time, look
thinking about rebasing systems, you know, I have this.
Like I'm trying to put together this like taxonomy of synthetic
designs. And in my taxonomy, I call
rebasing the poor band synthetics because it's like a
it's like, you know, it's kind of a synthetic but it's it's
really honestly this like sort of weird asset class that I
don't think as like has a good analogy outside of like crypto
already won. People using this big thing for
me because like, yes, I understand the price of dig will
always keep cremated. But like the value in someone's
wallet is is not really tracking the price of Bitcoin because you
know this, because if things are rebasing, you know, what I care
about is, how much is the value in my wallet going up and down
and so our people holding this as a way of getting exposure to
bitcoin, or are they using it in?
In some other way. It's the ladder right now, you
know, with these types of mechanics which you know, I
would argue a very experimental and we've seen that firsthand
from massive positive re basis that extended for months to, you
know, triple the supply to going the other way and reducing the
supply, you know, 80 90 percent. So people today, use it really
for opportunities to increase, you know, value in their
portfolio. How do they increase value?
You, they look at the market cap, right?
So if you're looking at the price that in many instances,
people would suggest us wrong way of looking at a rebasing
asset. Because if it, if the underlying
value of the assets that rebasing against like an ample
fourth cases that you is $1, for example, it ideally should never
be five, ten twenty thirty dollars, right?
It should really never be that. But if it's in a few points, you
know, 10% of one dollars. On 10 cents or whatever.
It may be, the market capitalization of it's going to
keep growing because there's going to be more and more in
circulation. So if something's a dollar but
it's had 100 positive. Re basis at 1%, each.
It technically is now should have doubled, the market cap of
what it had before and even at the same price, you know, that
speculative investor would have now doubled the capital that he
invested in the beginning and that's how people use this asset
for us. It's very volatile, extremely
volatile. It's very experimental today,
and we've seen that through what we've been building, but our
vision was always, you know, one being first, but also ensuring
utility because a lot of rebates and assets, don't have utility.
And if you can find a way to drive, relative stability, on
that asset, but more importantly of a bunch of different use
cases for it, which inherently bring more stability to it.
Since people be depositing, it to borrow against in variety of
different things. You know, that over time,
especially in this early, early Market of defying, like The
Primitives that are being built. Now.
There's something to be said around, you know, when
something's been around a long time and has a bunch of places
that you can use it, and, you know, obviously has some of the
other mechanics that people might be interested in.
So we've we've tried hard to find additional, we call like
third-party anchors for dig, because we, we've seen how the
buy side is not nearly as Effective as this Elsa like from
a token mechanic perspective. We're on the South Side.
Everyone's going to be a lot of people sell when it goes above
but when it's below, people get scared and cell instead of by
and get back in their position. So we've introduced a variety of
things. One of the things that's worked
really well in the last couple months at least is our kpi
options in partnership with Uma where we instead of saying, hey,
the Was it dig into our V to earn, you know, certain rewards.
We say those rewards are only paid out.
If certain actions are met, for example, at a minimum five,
rebase positive re basis and a 30-day time frame for every
additional positive. Rebates after five.
You incrementally, get more rewards as part of that.
So that additional anchor or factor, just just further nudge.
As users to do, you know what, the underlying token mechanics
needed to do to grow a market cap, essentially.
I mean and following, you know, Temple for there was like, you
know, a series of, you know, rebase 2.0 projects that came
out, you know, yeah. Yeah, but then, you know, I
think maybe the biggest one was ESD and, you know, they had
something interesting going on where they actually like folk
what I would consider a somewhat silly mechanism or rebasing and
I'm actually kind of try to apply it in a more useful
productive way. Have you guys been working
thinking about any other sort of these kind of things, how we
count, how to make I would take this dig and maybe I guess we'll
part of it is, how does so, how does it connect back to that
rest of the badger ecosystem? Does it feed back into Badger
value or in any way? Yes.
Oh, so right now dig is used as part of a major boost.
So the dollar value of dig that you hold their steak will
increase your underlying 8py when depositing Bitcoin in the
app. So that's his main utility
today. But we've worked with the
stabilized team to create what we call a stability Vault on.
So this is really how it ties back into our existing products
and this Vault. Essentially what it does is
based on parameters automatically.
Buys and sells at certain certain times.
And if we could have a larger percentage of that circulating
Supply deposit in that Vault, that V is really going to help
prevent dig from getting below a certain price and also going
above a certain price. But what's happening, there is
your inherently building WBT. See Reserve to your almost
having it being backed partially by wvpt.
See but doing It in a way where instead of just taking, you
know, WBT see and you know, just putting it against it instead,
you know, we use these automated strategies to create that
reserved and then help drive those help drive those
parameters as necessary to keep it in a certain range.
So that now that's again. This is what we've been trying,
you know, don't you know admittedly it's not it's not
easy like this tackling rebasing very, very difficult.
We like many have had challenges with it.
But we of course, continue to stay committed to try to make it
as successful as we can. I'm excited from it from the
perspective of that. Like I think what we've seen in
the last like one year is so many new stable coin designs.
Right? Really?
I treat stable coins as a very specialized type of synthetic
there. A USD synthetic and a lot of
these designs. So, you know, maybe USD is the
most demanded synthetic often in defy, but I'm willing to bet
that maybe a Bitcoin synthetic might be the second most like
demanded synthetic and so or Interest-bearing Bitcoin
synthetic, but but what I'm saying, is that still backed by
The Croc Bitcoin, but I'm talking about like a you know,
so I'm sure you know, how big is kind of trying to be like a no
collateralized like synthetic Bitcoin and so like, you know,
you look at something like and I'm a big fan of a protocol,
right? And so that's like a protocol
that like it's a new stable coin design that's like partially
collateralized. And so I wonder if there's a
ways to take like the idea behind the face table corn and
turn it into take that. The same mechanism design and
create lumps of some sort of partially collateralized Bitcoin
or something like that. So if there's no doubt that's
going to happen. It's not about if it's a win,
right? Like 100% that's going to
happen. I think a lot of these stable
coronary into mechanics are working themselves out, like you
talked about a few of them ESD DSD, you know, and some and
that, you know, rising and burning at the time when we were
launching dig. Actually, we're getting a lot of
scrutiny. Being like all using, you know,
old Can ex and you know these coupon and bond models are way
more effective. And look at this, look at that.
And you know, they'll the nature of the Beast is is like these
are all experiments that we're trying to figure out and I but I
do agree with you sonny like over time, many of the
interesting designs for for stable coins are it's going to
bleed into other assets for sure.
And you know, we've already started to see some of those
things already. But yeah, like, you know, I
think I'm not I'm not that familiar with Olympus, for
example, each em, but I think they just recently turned a
nonbonding for ether as an asset and I did you know, there's just
there's a variety of protocols and I'm certain that, you know,
all the top assets are going to have some type of representation
this way. Well, unfortunately, we're
getting to the end. So I have a couple of questions
about the future for you. So you're already kind of hinted
at this but what what are your thoughts on defy on bitcoin?
So things like rootstock? For instance.
Do you think that'll take off? Would you sales tax?
Yeah, I think takeoff is very relative.
Right, you know every day we decide what to build on and
every day it makes it more and more clear that building on a
theorem is where we want to build and we build on other
chains, but primarily their evm compatible chains just because
it's, we can just take what we've already built and poured
it over. And then, you know, we're
actively, you know, preparing to launch on optimism and orbitrim
as well. And differently or two
solutions. So, you know, for us at least
I'm not saying it's out of the picture defy on bitcoin.
I think is a very immature Market just because if you're
actively looking at the most effective way to to build it's
not on bitcoin no matter how you slice it even from like
interoperability of tools and the the developer audience.
Since the everything you could imagine, it's really behind the
ball. And it may make a lot of
progress there. But like a lot of these things
are super experimental. Anyways, like, look at some of
the standards in a theorem that have been around so long and
even how some of them continue like, I think, you know, a white
hat, a white hat, hacker found like, you know, critical
vulnerability in a contract from like four years ago or something
like that. Right?
Like these are the types of things that are going to
continue to come to the surface. So when you have In being built
there. It's going to be that much more
vulnerable to potential risks and S exploits.
And I think it's important for the builders that are trying to
build a new Financial system to really double down on trying
their best, at least to be act at a level of high integrity and
a level of high integrity in many instances.
When it's when everything you buildings, open source is, you
know, building where there's the least risk of Of screwing up and
putting people's funds or whatever.
It may be at risk. So, I do think, I don't think
it's a closed door. I don't think necessarily ever
be as big as a building on a theory.
Mm. But I do think there are going
to be some interesting projects that come out of it as that
space matures and grows and the bridges are further developed,
you know, there could be a place for Badger in particular to
build products there and provide value to users.
But yeah, I think Come. I think it's quite a ways away.
Yeah, and if you look at what percentage of Bitcoin is
currently wrapped and used as collateral in defy, that's on
the order of 1%. How do you see that increasing
over the coming year or two? I think it's just going to grow
exponentially. I see it as you know, 30
eventually 30 40 % of all Bitcoin will be wrapped in
tokenized on other chains in the next year.
In the next two years. I'd say we probably hit five
percent if we continue growing at this pace, which I think
which I think we will. And and and really, we haven't
even this is what's crazy. We haven't even seen.
Dean, you know, big institutional money
participating in defy applications and institutional
money to me is not like Morgan, Stanley.
Crap like that, you know, even some of the largest crypto
native funds in the world that have been around for five years,
that manage billions of dollars of LP.
Money are not participating in a big way in defy apps, and
they're not participating big way in defy and that, That wave
is just going to be crazy. And and, and I think I tend to
believe, of course, if these funds and it's, you know, crypto
native institutional players have had been around awhile.
There's probably a couple assets that they hold the most in and
those are mostly Bitcoin in a theorem.
And then obviously stable coins. They're definitely not, you know
looking to lend out shit coin number four for one or whatever
the hell it is, right? So that that's where I think a
lot of the Institutional and just overall acceleration in
rap. Bitcoin.
Like you can already see the writing on the wall with Galaxy
digital acquiring bit goal, which is the custodian creator
of WBT. See.
So some of these things are just going to start accelerating much
quicker than we anticipated. And all of a sudden we see
corporate treasuries, you know, earning two or three percent on
their Bitcoin and and a variety of things happening and that and
that number to your point is just going to.
It's just going to grow like crazy.
So do you think Bitcoin is going to end up as a limited Supply?
Yes. He 20.
I don't think so. I think, you know, that would be
suggesting that a lot a lot like 80 90 percent of Bitcoin is
tokenize and represented off of the Bitcoin Network.
I don't think that would ever happen but getting close to 50%.
I wouldn't be surprised. And it's really going to come
down to how, how Bitcoin, how the Bitcoin Network can evolve,
and they've always been slow. Rightfully.
Ooh, so, you know, from a security perspective that's
always been their mandate slow to make changes to the
underlying protocol and just building on the network in
general. But you know, if they continue
to be that slow, I think it's going to be I think it's going
to be eventually get to the point where there's more Bitcoin
off of the Bitcoin Network than on the Bitcoin Network.
More questions. No for me about badgers
pacifically how important you think like the culture and The
Vibes and aesthetic is to like Badger likey, you is there, is
there a sense to which the brand is the product here?
And like, you know, it's big that such that is like, you
know, the product, you know, you guys are iterating on a number
of different products. But the real product of the
badger Dow is this idea that like, hey, Hey, I want to use
Bitcoin and defy that's like going to be my One, Stop Shop to
go. Go to the badger.
Dow and look, you know, it'll be my dashboard a little, be my
even in a world where let's say, you removed, you know, like you
mentioned like, you know, the WBT see Vault, insect is
primarily, you know, it's mostly kind of interacting heavily with
the yearn WB, DC volts. And so these are you think that
the, the value really Come from being you can treat it almost
like a custom skin or custom user experience.
That's that like wraps around. All these other d by protocols,
but really tailored towards Bitcoin users.
Yeah. Yeah, from a product
perspective, Sunny like, I feel like that's where we, we started
our journey, right? The One-Stop shop like, your,
your ultimate dashboard to everything, Bitcoin and defy
that's changed a bit, you know, where we eventually want to get
to is just be the most trusted place to earn on your Bitcoin
and we believe with, you know an interest interest bearing
Bitcoin type product that will kind of be our retail focus and
then all like the super users will come to like the badger Pro
app, which is more similar. Into what you see today and
that's integrated with a variety of different protocols.
There's tranching there's in there's all these different
things you can do with synthetic assets and pick your pick which
chain you want to, you know, go on and use the Boost mechanics
and all these different types of things.
But yeah, and most certainly think that even when we look to
partner with different protocols, they always say, you
know, in partnering with Badger, you know, we're bringing the
Bitcoin crowd to whatever working and, and I think that's
The nature of it, like it's really our community.
That's the strongest and that you know has has shared this
shared belief system. But even in this is really why I
chose the name Badger. It's because you know, a honey
badger has certain characteristics, right?
They're Relentless their Fierce. They're small, they can take a
bite from a rattlesnake. They can fight a tiger.
That's why Bitcoin was always that was the big that is the
Bitcoin mascot. Because it was always The Little
Engine That Could and something that you know, was, was totally
going Against All Odds. And that's, and that's how we
look at it. And that's how all the community
members that are fighting the same fight that were fighting
here and building a new Financial system.
Rewriting The Playbook on how organizations can grow and scale
but maintain a level of decentralization and
transparency and most important bring utility to what we believe
to be the best asset ever created being Bitcoin.
So it's a mix of a mix of a few things son.
And we have a direct product Vision on that one.
Click and S to earn for the masses and being integrated in
every major platform that wants to offer that service to their
users. And then on the flip side, you
know, our ethos and our belief system aligns very closely with
the honey badger. Thank you Chris.
So where can people find out more about what better Dow, and
how can they partake in the experience?
Well, you can come to our website badgered off.
Finance. There's a link to our app there
which is apt up vegetal Finance. I'd say the best place to start
is our Wiki Badger dot Wiki all the resources.
You would need around Badger all of our products, how it all
works. Everything is there.
And then of course, our Discord Discord is where the company and
organization, more importantly, the community lives and
breathes. So joining our disc orders of
Lincoln or Twitter, which is just badgered.
Ow. And you can go there and join
our Discord. And there's quite a few Badgers
that will welcome you with open hands and answer any questions
that you have and really just including myself and just be
there to support you on your journey to become a badger.
Great. It's been a pleasure to have you
here. Same.
Thank you so much as it was a great conversation.
I appreciate it. Thank you for joining us on this
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