This is episode episode 462 with guest humanely.
Welcome to episode and show which talks about the
Technologies projects and people driving decentralisation and
deduction Revolution. I'm Brian Crane.
And I'm here today with my coach Felix, Lurch, and today we're
going to speak with you, only? He's the founder of Crescent
Network Crescent is decentralized exchange.
JH & Order, bookie change on Cosmos, very Innovative project.
So we're really excited to speak with him about that.
Now, before we get into Crescent, we just wanted to
briefly talk about response to this week.
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yeah, with that young, thanks so much for coming on.
Yeah, thank you for inviting. Me is great to be here.
Yeah, so we've known young for quite a while and I guess the
thing I remember especially was that in, that was, I guess 2019.
There was the middle conference in South Korea and there was the
the cosmos Hackett Tom there. And you know, if we've course
one, we were participating there and we were actually working
together if you and, and his colleague and we were working on
some Cosmos liquids, taking stuff for the hackathon.
So I think that was very fun to work together.
So we've known him since then spend a bunch of time.
There were very impressed with his, especially understanding of
D Phi, and of sort of liquidity markets incentives, Financial
instrument. So it's yeah, it's great to
finally become an epicenter and talk a bit about some of the
work you've done since then. Yes.
Oh yeah, happy to be finally be in this epicenter talking about
things. So yeah, especially from myself,
like personally like meeting this like OT people way back in
late two thousand eighteen and nineteen.
It feels really good and it feels like family.
So I'm very happy to touch with you guys again.
And hopefully we We can see each other soon in Cosmo personal.
So, So, maybe we can just talk a little bit about your
background. How did you get into crypto and
how did you get into the cosmos ecosystem in particular?
Yeah, so, I majored, in mathematics in undergraduate and
then I studied some global financing and in master and I
worked as a market maker, and Arbitrage, Trader Investment
Bank in Korea and for about 10 years.
And then I am trying to have another chance to participate in
this like new move of Technology including like Ai and blockchain
and other stuff. Because from my nature we I was
like finding something more Innovative and more transparent
and more decentralized technology with a lot of new
philosophy. Like not very conservative.
So from my older job that was like very conservative
environment with very power and money came within and it was
quite boring and I wanted to have another chance to bring
this again in my life to like get another energy to move on
and and the block changes. I'll close my eyes.
So like At first like 2018, I was like deep into the interim
ecosystem, trying to build some financial application from it
and I was trying that like for three months and then finally, I
had made a transaction like costing, like millions of
dollars in it. I thought it was impossible.
So I try to find another project and that was like, Cosmos and I
Just like caught up with this like big Vision millions of
blockchain and connected each other and I just believed it
what in one side and then just like keep doing this for more
than four years as now. So that was like my history.
How to get into Cosmos ecosystem?
Yeah, super interesting. And then I think you started out
basically as a validator, as many In the cosmos ecosystem,
maybe you can talk a little bit about how how you made that
choice to start there and then how you kind of move to to the
to the decks space or what you're what you're building
today. Yeah.
So at that time, like POS is
even that very Universal in the space.
Like everything was either you and ERC trainee and smart
contract. So It was very new in the
blockchain area. So like I was trying to
understand and get some experience and knowledge on
this, like dpos environment and also studying deeply more about
Cosmos SDK and tender mint consensus layer, so that we can
fully understand and utilize this for new application layer.
So, like we started with validator or Fading in test net
for about. I think, what about like nine
months until Mainland lunch in 2019 and then studied our
validator business with participating in different
projects. While that we were like, one of
the validator who are like deeply reading the blockchain
core code bases like, including like Cava or Terror.
Or other earlier projects in Cosmos even we were
participating in several project with wood as an auditor.
So we write wrote some like report on this financial
applications. So from this like knowledge and
experience, we studied to build our own capability to understand
and innovate this defy space. So we started to participate in
other activities. Is like working with tender meat
cooperation and also I see are to build some modules and
features for tender meat and Cosmos SDK.
So one of the result was gravity takes operated on Cosmos job
with a MM and audio book at the same time.
So this is like one of the information who people doesn't
know is that big because the UI was embarrassed and the amaris
the didn't provide audible UI. But actually the in the code
base order book is already there in 2021 that was like hybrid
decks of from beginning. Original design was hybrid X.
So but we didn't allow the enabled it because it is too
experimental for Cosmos up. So that was our start to build
this one of the defy application which is like decks with am and
auto get the same time. So that was our first big move
into this device space. I think there's definitely a
lot. We want to go into their with
this, like order book a M&M's, but maybe just talking a little
bit more about. So, you know, gravity was was on
the cosmos Opti. Talk a bit like you know what
happened? And like how did it evolve or
result in, you know, you didn't launch and Crescent on its own
chain. Yeah, so as a like a big-time
believer in Cosmos and Adam we we were trying to persuade the
community to have decks in Cosmo support and incentivised from
Adam inflation. So that was our purpose to
persuade the community with this because for any decks Especially
with a MM formation liquidity. Incentive is the core part of
the functionality, so we believe that there should be some
incentive coming from Cosmo. So and that was Adam because the
community doesn't allow to meet another token in customer shop.
So that was only Adam is the only option.
So we are trying to persuade the inner Unity in Cosmos trying to
proceed to use this. Adam inflation for this
important utility. But there are some objection
with like hope minimalism and supporting this like new
projects in Cosmos ecosystem. Not by interfering this
business. With from these customers Hub,
like Taking all the market share.
So we thought about it and we also discussed about it with a
lot of people and we decided not to pursue pursue that because
eventually without without the decks in Cosmos up there will be
lots of text in Cosmos which is already happening right now so
that would be more resilient future for the cosmos ecosystem.
Having A lot of dex's with different characteristics and
advantages. So we decided not to have this
incentive for Gravity decks. And finally, we decided to
migrate this gravity decks into our own chain so that we can
proceed with all the Innovation and features we want to build or
Palm. So that was the history for the
day. Decision making.
Awesome. Yeah, I think before we get
into, like the features and what you're working on with crescent,
maybe one thing that would be interesting, we just earlier
looked a little bit in the you I looked at the governance
proposals and the very first one is about the Crescent ethos,
which, which I found. Very cool that you like a voting
to kind of approve. The ethos you guys have and
maybe that would be interesting if you could tell us a little
bit, you know. What's the what's the And what
are you trying to achieve with crescent?
Yeah, so I think decentralized governance is hard problem.
There's no like absolute and served to this because we don't
see any future yet. There will be like, lots of
different approaches to have this like robust decentralized,
community and decision-making process.
So we believe that there should be some balanced approach for
this governance. There should be some strong
leadership from this project Builders and then there will be
another decentralisation factor from community and token
holders. So I think there should be a
great balance between this two centralization and Leadership.
So that is why we put this at toast because we To have some
amount of leadership from our team, but also, I want, we want
you to 12 for the community to understand our Direction and our
vision, which is it will be very important for all these
Governor's decision making process.
So that is why we write this as a unchain governance, so that
everyone can transparently see how we think about At the future
of President and can be reasoning background for all
these other detail Governor's proposal, we are making.
So what we have in plan is that we are going to write several
Ethel's in coming months so that we can write in detail about all
the different topics and also write about all the changes in.
In environment and changes in our vision and roadmap and
directions so that we can let keep communicating with the
community and write down all of this evidence in on chain so
that we can make a better trust from this community.
But maybe looking looking at it a little bit differently or more
January, like if you think sort of in the long run, you know,
it's Crescent really succeeds. What do you think the role of
Crescent would be? You know, in the crypto
ecosystem? Like what does it look like, you
know, a crescent in like, you know, ten years when it has
like, work out amazingly? Well, So I think there should be
several roles we hope to take in Cosmos ecosystem but like more
most eminent role will be security formation for new
project. So currently there are lots of
new project coming into Cosmos like within a year.
I expect there would be like 50 to 100.
Produ project will come to customers ecosystem and they all
need liquid. 84 their tokens and other tokens.
They are creating such as stable coins and Lucas taking tokens
and other stuff. So, we believe that it is very
hard job for us to have all of this liquidity in the ecosystem
and there should be a better way, smart way and efficient way
to provide this liquidity formation with with sustainable
methodology. We believe that Crescent is one
of the team, who can do this role at best.
So we are doing our best to take this room for customers
ecosystem. When you say liquid information,
you had you have in mind, you know, like crowdfunding so
basically project wants to raise money and, you know, sell some
talking to the market or like, just that there is like, you
know, liquid markets for 40's tokens.
So that, you know, people can sell them and buy them.
You mean? I guess.
Mix it Beaufort. What do you think is the most
important aspect to liquidity formation?
So I think fundraising and liquidity formation is a little
bit different topic, which can be a little bit related.
But I think our role will be more on this liquid deformation
but still from this process of liquidity formation, there can
be a like additional token sale approach so which is called like
Ido so I think that can be on The role Crescent can take but
in more like a connection to the liquid deformation process.
So liquidity formation is more like an ongoing security so that
are any token holders can buy or sell these token at any time.
This is completely different from fundraising because
fundraising only allows you to buy this token within specific
time period. So liquidity will be more like a
continuous liquidity for users to trade or anytime they want.
All right, cool. The I think that leads us into
the meat of the discussion where I think you already mentioned a
bit that gravity tax and I think also Crescent basically has this
hybrid amm or the book approach may be for the listeners or also
because it would be great to hear you talk about it.
Can you compare kind of what what is the difference may be
also between amm and order book and what what are the advantages
or disadvantages of? Of either of them and how how
you chose to combine them in the end to, to create a better
product. Yes.
So we saw all this Innovation coming in in 2020 with uni
Schwab and other taxes to come back called finance and I'll
answer and we believe that there is some area where amm was
popular in either. An ecosystem, with very certain
reasons, including like listing was like a Our game within
centralized exchange and also like gas fee is too expensive
for Dex. Dex has to provide audible
utility. So that was like a more
centralized audible text was there before that but it was not
very successful because it was too centralized or and gas feed
doesn't allow either ecosystem to build autoboot X.
So there are some In for a mmm. And there was some reason why
would a poll tax was not successful in either young.
And I thought of this, like story of evolving, this text
feature, and our utility and we saw that actually in customers
there's no reason to ignore this great utility which is whatever
tax but still a MM provides a great way to form ERM initial
Equity because like market makers will have a lot of hard
time making this Market because of this huge risk of inventory
management for this unhackable tokens.
So I think there will be like some equilibrium point where, in
some circumstances am, can do better and in some
circumstances, although boot can do better.
So, Why not take all of these advantages in one market place.
So that was like, very obvious conflict, conclusion from our
team to build this from start. So when we build this grab
detects, most easiest solution will be just building this amm
copying UNICEF version to that was like easy conclusion.
But we didn't do that because we so or obviously order book Will
be the better approach in Cosmos.
So, we did instead of building basic amm, we built a hybrid X
from start. So, now we are doing our best to
take this advantages from these two different features or at the
same time. So I think, like, utility is not
the all for our project to success because We need like
accompanied business effort, partnership and market-maker
incentive, and LP incentive plans, and strategy.
All these things come together to make the project successful.
So we are trying to do that right now or doing more business
and doing more partnership so that we can bring more users and
partners and tokens with then the Crescent decks.
So can you explain like how do you, how do you combine, how do
you make a hybrid text? Like how do those two sort of
interact with each other? So this is more like how you see
a mmm? So if you see a MM as a
stand-alone Innovation from nowhere, then it is very
difficult to understand amm in a concept of auto book.
But if you see Within audible perspective and amm you can, you
can see that amm is restricted version of other book with, very
restricted freedom, for market, makers and Traders.
So Traders cannot do limit orders only Market orders and
market makers can provide liquidity.
Only following this constant product model formula, so this
is like a very small. Subset of Buddha book.
This is so when you see this space of freedom for this
design, for the decks, then it is very clear to understand that
am m is a subset of all the book.
So when you see this way then combining these two is much
easier because you can see a MMS older book and whatever feature.
And we built everything based on audiobook and then we place this
amm on audiobook base ground. So, what we did is to describe
this amm liquidity into multiple limit orders on order book so
that we can calculate each amount in each tick of the
orders, which is completely perfect.
Ali following the constant proton model, then we can derive
exact number of amount for each tick.
So we just place all of them within the order book and every
orders coming from users and liquidity pools, they are
matching each other without any proper prioritization or special
treatment. They just act as another limit
order and they just beat each other with the order book
matching system. Another special thing about
present X is that we use batch or institution which prevent or
Mev from start. So this batch execution is
matching this order each other without any time prioritization
within a block. So if there is a multiple orders
in one block with different sorting Still there's no
prioritization of order matching within what block, so it doesn't
matter at all. So, like, like skip protocol is
doing em every solution. Like, providing ways for Traders
to lobbying the validator to make their transaction at top of
the block, but still either your transaction at the top or bottom
the Results will be exactly the same.
So there's no need for Mev at all because there's no
difference. So this is another
characteristic we have in our decks So I guess, yeah, we
definitely want to go a bit into that since that seems to be a
very important feature of this lie of of questions.
I think, when you when you say like that, basically there is
one within a block. There's one clearing price than
40, different orders and you would have maybe, you know, that
you have three orders and they would all get the average price
in the end. Is that how it works?
Am I understand correctly? Oh, actually, we have two ways
to match each other with batch education, still in batch
execution. There can be like most people
shop price within the batching and in our first design, in
gravity Decks that was we used our Universal shop price Model,
which is what we did you describe, we have only one shop
price, For every matched pair of orders.
But now, we upgraded our decks to have or more matching within
a block, we need to allow multiple sharp price matching
price or for each block. So now we have like multiple
batching price within a block but still we don't have any time
prioritization only price. Prioritization.
So, we push your more optimization but still, we keep
our fairness of trading for this, like sorting of others
within a block. So with the M&M's right there, I
guess also there there's been a lot of, you know, movement how
this works, right? Because the tradition was
probably, you know, the significant number of listeners
are familiar with is, you know, you have some pool.
Maybe it's, I don't know if to die.
And then as adequately provided I can Just putting if and die,
you know, in equal proportions into this pool.
And then, you know, I get some trading fees based on, you know,
the people trading and, and then when the price changes, right?
Then kind of sort of, it will sell, you know, maybe even by
die or the other way around. So you have this impermanent
laws to deal with. But of course, the nice thing
is, as a user as a liquidity provider, I don't have to think
about I mean, it did decisions very easy, right?
I just put money in there, everybody puts money in there,
it doesn't really make a difference.
You know, there's no maybe where the sophistication does come.
In is understanding the risk. You're taking understanding the
in permanent loss and how to deal with that because that's
not so simple. And that I think is very
confusing for people as well, but of course, we already have a
few nice. Probably three.
Basically, you know, a big change where I think I can be
like, okay, I'm going to put money into this pool but now I'm
going to specify that, you know, I'm concentrating, this
liquidity on a certain price range.
And of course, that already goes a little bit in this hybrid
Direction. No.
Because it's now all of a sudden that decision is an important
decision. You know, where do you
concentrate this liquidity? If you know you concentrated in
the wrong place, maybe you liquid is Justin, get used and
you just don't know any fees or maybe otherwise you take more
risk. So already is something that I
think, as a normal user We know how to deal with this stuff,
right? That's normally quiddity
provider. So what?
How do you see a memes in the future?
Like, how do you think they will revolve?
Oh yeah. I just want to like share some
situation in either room first because like, obviously like
device in either you miss, like heading to the Future.
So we can expect the future of Cosmos, by researching this
idiom ecosystem. So like one year ago, UNICEF
Origins relaunched. And now if you can see the
liquid, ET the version to liquidity is almost like done
right now. There is no much liquidity left
and all the liquidity is coming from version 3.
And if you see this liquidity formation within all these
pairs, you can see that this liquidity is like very Dynamic
to the moving. So this is more like a very
sophisticated strategy for liquidity provider to This
liquidity with very frequent rebalancing of the position and
like, more more proactive, rickety, providing methodology.
So, I think that even within this situation, we also heard
that she's resurfaced launching. Also.
Same thing, which is called Trident, which, will be coming
very soon, and I think, like in sushi suppose, So like this,
like new feature will dominate all the liquidity, because
obviously, it is more Capital efficient, but like difficulties
is not the reason for avoidance. Even all the difficult solution
can be utilized by smart people. And this can be better solution
if it is more Capital efficient, but exactly directly.
The retail research cannot use it or if you use it, then it
will be very difficult to manage.
So that is also another effect. So what would be the solution?
And just just basically say, so when you say Capital efficient,
what you mean is, basically, that let's say somebody wants to
go and they want to trade. Then, you know, one way to
measure it, I get it sort of the slippage of like, you know, how
much Does your trade? Does your price move away from
the current market price? Will, you know, certain amount
of money? Let's say you're trading ten
thousand dollars worth that in in it.
Would you define like the capital efficiency that you
know, you need to rp3? You will need a much smaller
amount of capital in this pool to basically provide the same
kind of, you know, price for somebody trading ten thousand
dollars then in like you Probably three every to
something I got. So I think we should Define the
word liquidity. So the liquidity is not tvl,
that's for sure. So that was like one of the
biggest misunderstanding in defy space and text area.
Everyone is watching for tvl in defy Lama or like defy pulse and
other dashboard having like tvl. L 1 billion great.
But it doesn't like prove all these utility because they
liquidity and tvl is completely different within this like motor
and defying won't. So like, this is liquidity,
should be defined as like when you when you want to trade or
tooken without moving the price. More than one And or 2% and then
how much amount you can trade. So that is like in coin market
cap, you can see a liquidity price minus 2%.
So this is like, very basic approach to measure this
liquidity because it it calculates all the amount of
liquidity you can consume immediately within this price
range. So this is should be more like a
measurement. And for the liquidity.
So from this point having, same liquidity from smaller, tvl
means of capital efficiency, So we talked a lot about like
liquidity provisioning. Now we also mentioned market
makers, can you maybe kind of detail what is the difference
between a market maker and a liquidity provider?
And maybe what's the role of the market makers in Crescent?
Yeah. So because we are having sex
with am and audio book at the same time.
We it is very important for us to see, make a Synergy with
these two different approaches. So amm provides most robust
liquidity. Also in a micro sense.
Liquidity pool provides better. Liquidity in a Very narrow price
range which is like narrower than 0.2 percent or something.
So if you are shopping very small amount then it will be
very efficient to use this liquidity from amm because like
am is providing the quality or exactly from current price to
very near near the current price.
But this order book a market maker will provide Security are
not very near the current price. We will be distanced from
current price for about like 0.1 percent to zero-point-five
percent for the more volatile token, you will be like one
percent. So there are some different
aspect of liquidity provided within this micro security area,
different distribution of liquidity, and different
characteristic also. So when you trade in in amn, if
you trade one time and then the price will move and then it will
not come back until arbitrator trade back.
So if you trade again, the and the price will be worse because
you already moved the price. So this is like inefficiency of
a mmm, but for the order book Market maker, the market maker
will provide the price and then if you consume it and they will
replace The order again with it with it at this exactly the same
price again, you can consume it again.
So I call this rechargeable liquidity.
This is not the case in LP, but the market maker can do this
because they can hatch in other market.
So this these are like very different characteristic for
these two different liquidity and there should be a good way
for our community and governance to decide.
And calculate the contribution of liquidity coming from
different methodology and measure this support of
liquidity from different methodology and we need to like
distribute our incentive wisely or so that we can create this
like very healthy competition between LP.
And what about market makers or so that we can optimize this
Capital efficient orally. Quality providing incentives.
So probably a good amount or listeners.
You know half actually provided liquidity before, you know,
whether that was an uni swap curve Sushi swap or you know
like osmosis very popular or some questions.
Right. Like so there's like many
different places where people, you know, have kind of your
normal people or like, okay, I can provide liquidity.
What's you know what's going to happen with that?
Is there, is there a future where, you know?
Normal token, holder can still, you know, provide liquidity on
these exchanges or do you think this will all be replaced by,
you know, professional sophisticated market makers
that, you know, can just play this?
Play this new game that's arising.
So I think great thing about blockchain ecosystem is that
everything every different protocols can be connected each
other without any trust, assumption or verification,
assumption. So everything can be connected
very well with this code base only.
So if we can trust this algorithm, then everything can
be connected very well. So, I believe that even though
the the management of capital will be much more difficult in
range. Liquidity concentrated,
liquidity world still. There will be like professional
fund manager participating in this Capital Management, and
like, providing capital from retail investor for this fund,
so which is called we are calling this managed P.
So minus Del p is fund. Operated by professional fund
manager but invested by all these like my retail investors.
So within this minimal trust or within this fund manager, or we
can trust this manager to manage this Capital with very
restricted functionality within this decentralized to connect
fund. So I think the future will be
more like ranged LP fund. Operated by professionals but
invested by retails. So one of the example is called
Iraqis in either area, which is providing this platform for
users. So this fund manager has very
restricted Freedom about how to manage this fund.
So it is quite safe for users to invest into because they don't
allow any send out all these assets within the fund.
Only they can do is like a minimal amount of swap or like
changing the range of the lp that is the old things manager
can do. So I think more of this
functionality will be available in the ecosystem.
So I think retail investors can participate but the actual
operation can be more delegated to professionals.
All right, that's cool. So we can remain being LPS in
the future too. It's good.
So we wanted to I guess maybe switch topics a bit.
Now we talked a lot about kind of liquidity in the context of
this decks of the singer Network.
Now, obviously the cosmos ecosystem as you mention
already, potentially will have like thousands of networks and
already has a lot of different textures.
And yeah, maybe it would be interesting to hear your
thoughts, how, like, you can aggregate liquidity across these
different ecosystems and maybe at the role that Crescent Place
in this story. Yes, I think text aggregator is
one of the interesting topic to discuss also.
So I think in either real, it is a transitional phase right now.
Like one inch users are trading. Maybe more than you nice up
front end users right now. So it's like, this is like a
golden cross of web to evolving to Webster.
So like web to web 3. The definition is that when you
when the Traders are locked into one front end which is unisa
then they cannot utilize other liquidity coming from balancer
or sushi shop or other products. So you you are your jailed into
one website, so that your back end is also jailed to.
So this is web to in our definition when you You use one
inch then you can reach out to all these taxes even, like very
only one because you don't need any Trust on this.
If your shop is successful then any decks you can use because
you believe in result not the that the service provider.
So one inch is more like a webserie service provider who
are connecting all these existing back-end service By one
front end. So this is like the change of
service within web three environment and unfortunately in
Cosmos we are in web to like most of the users are locked in
in certain decks. And there they are jail there
until now. So we want to free them.
So when we want to free them there should be like Like
aggregator for Cosmos, right? And there are like several
project coming in like such as mango exchange but I'm looking
deeply into solution called Squid from axilla.
So, the problem with in this customers ecosystem is that all
this environment is asynchronous compared to either you.
Either room is everything is synchronous but In Cosmo
speakers. All this application is
indifferent, blockchain the this asynchronous or create problem
of delay and latency of like trade execution.
So like especially like IBC transfer is really slow and
unstable. So we need to wait like one
minute or more for this one execution of trade with IBC
transferee. In it.
So if you use like bangle exchange, then sometimes it
takes like more than a minute to complete a trade.
So, this is not the good ux for users to experience.
So, actual screen is more like, skipping, all this IBC transfer
layer by utilizing liquidity layer.
So liquidity layer will do all this job for DPF of The users
and then get this reward back from the users after the shop is
completed. So, in this model, they can
erase all these like latency caused by interchain
communication. But only like if if there is a
block confirmation coming in once in one second in Crescent
and like another block confirmation in to second in
osmosis So then you can you do this like interchange swap or
within two seconds like routing Crescent and osmosis at the same
time this is practically not possible right now because of
this transfer between blockchain IBC, transfer will take at least
like several tens of seconds, but if you remove this and this
is like like matter of s. So I think this solution can
bring More practical sense of interchain decks or greater
because it removes all the unnecessary Delay from this.
So I think like IBC transfer is not dependent variable for
liquidity relay ER and interchain swap functionality.
So like this, we want to like work with them.
We are communicate with them. So that we can provide this
option for for the users users does not know the benefit of
this aggregator. So we want to like, promote this
and marketing this. So that users can use more of
this aggregator for themselves, because your shop price will be
much better than use. Only one decks front end.
So, within this environment, ecosystem can be more healthier.
Because the competition will be not about marketing or business
or front-end locking, but more like more efficient, liquidity
more more cheaper, trading cost and stuff.
So it is always good for users to have this like better
healthier competition rather than like spending a lot of
money for marketing and community.
T locked in to one platform. So we believe this like Webster
rework will open all this new environment for all these new
taxes, like kucera, say all these taxes are new but it is
very difficult for them to attract new users but this
aggregator will allow them to attract users or without
marketing effort. So this will be better for for
all this ecosystem. So, one question on this,
indeed, maybe kind of touched on it.
But the, you know, one of the things if you in the cosmos
ecosystem or in general, right? If you have things that are like
cross chain, is that, you know, you can't make these Atomic
transactions that any theorem like you really have some, some
transaction that you know, like automatically those different
things and different chain. Don't you know using different
smart contracts and you know everything works once.
So how do you think this is like an issue when it comes to this
cross? Chain decks aggregation?
Or like how is this? What are the implications of
this? Yes, there should be some
issues, so relative sense either.
IAM ecosystem is better at aggregating everything because
it is synchronous and asynchronous environment will
prevent some optimization for users, but still it is better
than aggregating. Nothing.
So it is more like a relative sense.
If you can do 90 percent and then still 90% can be quite
good. So everything is like very
statistical. So if you trade, like hundred
times and your trade is most optimal for 90 times, and that
is good utility already. So I think, like a synchronous
environment can result in a non-optimal shop.
Ping route. But still, when you achieve this
for most of the time, then the decks agreed Gator, makes a lot
of sense. Cool.
That's, does it change anything? So you mentioned that Crescent
basically gets rid of from running or Mev in the sense of
like on the decks with the batch patches.
If we're talking about this, aggregator interchain world,
does that change the equation? Somehow, do you like, I guess
how do you generally see a movie in the interchain world on a
high level, maybe? So, Like, there was some data
coming from skip protocol about Mev situation within osmosis.
So they had about like, six million of profit from me3
Trading, so, I think it is quite large and when when our
ecosystem grow, the Mev problem will be increased over time with
more amount of cash. Money extracted by all these
like smart Traders. But still, I think most of the
profit coming from osmosis right now is with this U STC which is
like older version of OST from Runa.
So it is very like restricted area of Mev Execution because
like most other pairs does not have significant Mev problem
right now. That is the what data is telling
us right now. So I'll maybe immediately
problem is like overstated, especially in Cosmos ecosystem,
where like gas prices, much cheaper, and like the if I is
much smaller than either him, right?
Now, so I think it is little bit overstated and interchanging
word still. Immediately can be a tool for
extracting value, but still, I I don't think it is like
preventing any core functionality or creating
significant economic problem yet, but I think it is it is
very City of within very narrow range of applications such as
like auction and trading venues like Texas.
So if in those application I think it is better for our
architect to build this application in a way that we can
prevent this from start so that we don't create a solid problem.
So which does not need to exist. So I think that is one of my
philosophy. Okay, yeah, definitely, thanks
for expanding. That makes sense to me.
I think, maybe I guess you kind of touched upon it, where you
talked about little bit about UST, just now that a lot of that
movie came from this. Now, obviously, that was a big
event in the cosmos, wider ecosystem, the Luna collapse,
and the I understand also Crescent had like Luna assets
listed, you know, maybe you can you talk a little bit about how
that impacted the crescent and maybe also to listen lessons you
learned from that for crescent as decks but also, yeah, maybe
the cosmos SDK or in general ecosystem.
Yeah, so we had a great lesson from this lunar crash.
One of the biggest lesson is that it is very dangerous for us
to decide any canonical solution for any text related liquidity
or tokens who are bridges or other Solutions.
Because I think in Cosmos. Especially it is about for
Rarity and like robustness or resilience of the ecosystem.
It means that a minor project should be respected enough to
provide these all this connection for the users.
So our philosophy has been strengthened from this
experience because even though the Luna was Tara was the one of
the biggest Sustained in Cosmos, it just vaporised within one
week that is like how blockchain evolve and even for current
status or very small project can rule the cosmos within six
months that is also true. So we we are more humble right
now. We don't believe in
decision-making like all these like centralized into one
solution and stuff that Is why we are providing incentive for
both Bridges accelerator and gravity Bridge because we are
not sure anymore. Everything is humble, but still
small projects should be respected within this like a
variety of ecosystem, especially in Cosmos, that is the
philosophy. So we believe that there should
be lots of different, stable coins, lots of different Bridges
or lots of different liquids. Taking In one decks.
So like variety of choice will be our philosophy for crescent.
And we are going to pursue this philosophy to provide better
more option to users. But I guess the downside of that
being that, I mean, what's the argument?
The other argument would be that.
Now, your fragmenting, the liquidity and the users maybe
are confused and then don't really know what to use.
Do you do you see that problem to or when?
And if yes I guess how do you address that?
Yeah. So that is very interesting
problem to solve. So like, for example, if you
have, like a different kinds of stable coins, then obviously the
liquidity will be separated within one decks but still the
liquidity is connected each other.
If you have like, is T versus u.s.
DC from gravity and obviously, see from axilor and then die
from Gravity. Are those like, all of these,
like, stable coins, pairs are connected to each other.
So, if we have this, like, multi hope swap with in feature, so,
which is coming very soon in Crescent.
We look at it is connected each other.
So there will be like multiple routes you can take to have this
best shop price, or so every Lickety is connected with this
smart features. So if we And utilize the smart
features or within the decks, then we can connect all this
liquidity, so that users can utilize this liquidity.
Let me have one example, so if you want to trade or a through
to the token and you have like a with a with b and a with c.
And then B with d and c with d, then you have Have two routes A
to B, to D &, A to C to D, and then you can utilize routing
through b or c to be rigid in D. So, actually, you are utilizing
both liquidity. So if you're, if you're
shopping, large amount of equity, then you will separate
this amount of swap into to route or a DVD and a CD then it
is just like swapping a from from A to B plus C combined to
D. That is like exactly the same
result. So if the liquidity is connected
each other very well, then, the separation is not the
correlation. What, what are the things you
wanted to touch on? I guess this ties into what we
talked about, you know, in the beginning, you know that
hackathon we didn't create together which was around liquid
staking. I think back, then there was
like, you know, different different liquids, taking ideas.
You know, we have been working on this kind of Delegation
voucher idea that, you know, we sort of also built on in Korea,
but you had another sort of other design for liquid staking
and of course, liquid staking is actually also one of the things
that, you know, built natively into Crescent.
I'm actually not sure if anyone else has built liquid staking,
you know, into the kind of Base protocol, like the way you guys
have done. So can you talk a bit about
like, you know, how does liquid staking work in Crescent?
Yeah, so first of all, way back in like, 2019, I really enjoyed
like brainstorming with you guys talking about different ways to
build this liquid, staking problem, and it was great
motivation for us to study further about these liquids,
taking area. So, we were researching
different kinds of solutions. But in our Crescent.
The solution is not very Universal.
This is restricted solution with some assumption, which is called
Lucas taking validator. So, we assume that there is a
whitelist validators who are participating in liquids taking
activity, and they will separate the delegation power evenly each
other. So, in this assumption, Oh look
he's taking is much easier. We just distribute this, all
this power and then when you on the relegate then you will just
on the legate all this same power from all these validators
and give it back to you. So this is like very basic stuff
and also when you have enough staking rewards accumulated then
automatically in the end block the module will just rip With
your this reward and Reese, take.
So this is quite basic stuff. But from this Innovation, we
have more interesting to come, which is called liquid farming.
So liquid farming is not very Universal world right now.
There's no much application using this words or using this
concept for defy but it is increasingly important within
this current customers ecosystem right now.
So there are lots of capital locked inside LPS.
So like we So users are are trying to we utilize this
Capital, but it is impossible for them to utilize this capital
for other purposes. So for example, if there's a
pool with Adam versus pure atom, which is coming from Quicksilver
and there would be like farming rewards coming from Quicksilver
and questions. So the AP wire are we required,
fruity? Maybe 30% or 40% and then the
the reserve tokens are just a demand and Q Adam.
Right. And these are or Adam actually.
So if you want to use it for like collateralized lending,
then you can receive all these farming and use it as a
collateral to lend, some stable coins.
But if you use collateral for Q Adam, the Then the the sticking
reverse is all you got like, farming viewers will be much
higher so this will be a good solution for users to utilize
this pool token as a liquid, liquid farming solution.
So this is will be like a minty token coming from LP position.
But Otto compounding, this farming rewards.
So lik is taking liquid farming similar concept with Aunt
purpose or Target to liquid Vicki Phi.
So this is farming is liquefying the lp position.
So this is another concept we are building.
I think like there's like like next month we are going to
launch this. Okay cool.
So just so I understand that the liquidity position because you
just have just not the range liquidity in in Crescent so
basically you, you agree. Liquidity provider is the same.
There's no, the as long as you provide liquidity.
They are fungible between each other and then you were able to
use that. And is that actually stable pool
or How do you like I guess? Is it using the constant Market?
The function is you have different functions actually.
I guess we didn't ask this in the thing but do you use is it
possible to kind of utilize different Curves in incr for
let's say stable coins versus you know just a constant product
Market the one? Yeah.
So the range it LP feature is just like University Union shop.
Gentry utilizing constant product model.
So this constant product of formula will be used for
shopping those two tokens or within predefined price range.
So, our calculation is that when you provide liquidity within 10
percent range price range, then the leverage of liquidity will
be 40 times about so if you Provide like 1 million liquidity
for sure. Adam versus Adam.
Then it is equivalent to 40 million liquidity in osmosis.
So this is our 40 times or Capital efficient.
So yeah, that is how we form this arranged LP, which is
completely different. From the approach coming from
current Finance conference is using a different curve but
range LP is providing LP with the same formula used in unison
opportunity. Okay?
So you really find this range for this specific pool.
That's done by the team essentially, and that's how you
achieve the fungibility I guess, but I guess maybe that goes a
bit into detail. But I wandering because I guess
the Q Adam might accrue rewards as far as I understand.
Do you have to change the mid-price there?
The liquidity. And how would you do that?
Yeah, so like it should be a manual right now.
So like we are going to provide like this is 10% is like very
practical range or price because it cured term is or crew
emulating about like Max 20% of a PR right now.
So in quarter, you'll be like 5%.
So 10% is like wider enough Range for this pair.
So we create this pair and then after one quarter, we create
another pair and then we distribute farming, to this new
pair. So people will migrate this
liquidity into this pool, and we are going to provide front end.
So that we just one click, they can just migrate this liquidity
to new pool. So this is like a manual process
right now, but I other new approaches from this like called
finest that, the price can be automatically the price range
can be like automatically rearranged from this Oracle or
like shop price pests or prices. So we are currently researching
ways how to mitigate these so that we don't need to like
constantly like Like migrating this liquidity to do pools so
that is like one of our roadmap. Yeah, I mean, maybe talking a
bit about roadmap in general. Yeah, tell us like, what are
they mean, you know, the main Milestones that are coming up
for, you know, Crescent in the next, you know, two years So
immediately like next month, we are going to launch farming
version 2 with this wicked farming feature.
So in farming version to we allow farming distribution
within to compare not to compose.
So because we have ranged pool with one took Compare like,
like, Adam versus speak Cree. We will have multiple pools
already, we have multiple pools, but right now, we are, we are
Distributing the incentive. Targeted to each pool right now.
But after farming version 2, we're going to distribute this
incentive into this, to compare Adam verses speak cree.
And then from this liquid, Leti contribution from each pool is
calculated automatically so that we can distribute this rewards
in a very fair computation so that we don't need to decide or
farming rewards for each pool. But only for each pair, then
each pool will compete each other for for the, their
liquidity providing. So that is how Initiative is
doing right now so you need to have if you see you nice up
there is like to pour kind of posts either reinforces die with
like 0.3 percent commission fee and then 0.05 percent commission
fee. And based on circumstances, the
trade is executed Within These two pools and they are these two
poles are competing each other or to provide optimized or
liquidity for the users. So this is like same thing in
farming version 2. So now, farming version 2 will
allow pools to compete each other for the best liquidity.
They can provide. So this is our like imminent
feature. And we are going to launch also
after swap after backdrop, which allows multi hope swap.
So like if you want to serve a routing to be C and then to D,
then this will be Allah allowed in.
Our next upgrade. So this is also in plan.
Yeah, we have several more but that is, I think like most
eminent upgrade right now, we are going to also launch like
managed LP within. I think like five months.
So manage LP will allow users to invest.
Into LP fund so that they don't need to manage their position,
but delegate this to a professional fund manager.
So this will be also launched early next year.
Cool, very nice. Well, thanks so much room for
coming on. It was really a pleasure to
speak with you, but, you know, Crescent and about a M&M's and
Market in crypto in general. I mean, this is obviously an
area of, you know, enormous Innovation, enormous speed of
development. Some really excited to speak
with you about it. I think is also becoming an area
of great complexity, right? That's like getting hot, I guess
like so many things encrypt. All right.
Getting harder to like wrap your head around it, for sort of the
you know, the normal crypto person.
So hopefully this is helpful also for listeners to like
understand a little bit like where is this all going?
And you know, how can people still participate?
You know, so I'm excited that there's going to be this managed
liquidity coming so that you know, normal people can still
still participate in all of this.
And yeah, thanks so much more excited to see where question
goes. And It goes next and you know
hopefully we can have your own again at some point in the
future to, you know, get an update about how things are
going. Yeah.
Thank you for inviting me and looking forward to see you guys
in Cosmo verse Thank you. See you soon.
And thanks so much for listening for tuning in.
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