ICO Drops Waves & Neutrino AMA 16.07
https://icodrops.com/
https://wavesprotocol.org - Waves
https://beta.neutrino.at - Neutrino
Q1. Neutrino is a rather young project. As far as I know, it was launched in January, 2020. However, Neutrino Dollar already has a substantial market cap on CMC. Could you please summarize the project and tell me how you launched it?
A1: Neutrino Protocol is a tech specification of an algorithmic stablecoin based on volatility crypto as a collateral. Neutrino Dollar (USDN) is the project’s native token on Waves blockchain.
Neutrino is a non-profit project focused on ecosystem development. It has always been supported by grants from Waves Labs and Waves Association. Currently, several teams of core Waves developers are working on the project. Waves.Exchange plays a central role in supporting the protocol and its token. Recently, USDN has even become the exchange’s go-to stablecoin.
Our team, Ventuary Lab, continues exploring the technology and proposing protocol improvements. We are also working on more low-level protocols - Gravity and SuSy to further decentralize Neutrino and enable interoperability with other blockchains, such as Ethereum and Tron.
Q2. At the moment, the cryptocurrency market features a wide range of stablecoins. Despite being criticized for centralization, USDT and USDT have enjoyed the majority of the market’s usage for several years. The Neutrino’s approach is rather different from these stablecoins and is more DAI-like, if I understand it correctly. Could you please share your view on why the market needs so many stablecoins, and what is the value proposition of USDN (Neutrino stablecoin)?
A2: Algorithmic stablecoins is an innovation in the cryptocurrency industry aimed at increasing censorship resistance, automation, transparency, and decentralization. The wave of algorithmic stablecoins has already started, and so far, we’ve seen four popular solutions: DAI, USDN, sUSD, and USDJ. USDN comes second of third by the market cap and liquidity after DAI.
One of the major USPs of USDN is that holders can stake it thanks to LPoS tokenomics and Waves monetary structure focused on accumulating 8-15% annual rewards.
Another competitive advantage of USDN is its on-chain liquidity. A smart-contract can be used to trade hundreds of thousands of WAVES and USDN bidirectionally and without a spread.
Q3. Trading without a spread is a way to win any DeFi user’s heart. :) I use various DeFi platforms for farming yields on my stablecoins. To maximize profits, I diversify across a range of cryptos and loof for the best APYs. If I understand you correctly, Neutrino has a staking feature. Could you expand on why USDN deserves the community’s attention? Any estimates of the expected yields you can share?
A3: Like I just mentioned, one of USDN major USPs users’ ability to stake them for rewards. This mechanism is different from DAI, which requires collateral for issuance and imposes a fee.
As a developer, I can explain the technical aspects and the potential of algorithmic stablecoins. However, I recommend everyone to do their research when making investment decisions, mainly to assess risks and possible outcomes. You also correctly noted that diversification is a sensible strategy for capital management.
Q4. At this stage of the market’s development, DeFi has a hype element to it. Probably, the hype will pass, but the demand for earning yields on stablecoins will stay. What can Neutrino offer to a long-term investor? How much safe is to lock tokens on the smart-contract? What are your plans going forward?
A4: Neutrino protocol is an alternative way of issuing stablecoins. The smart-contract fully automates all the protocol operations and makes them fully transparent.
The market has experienced several DeFi hacks, so our smart-contracts were audited by a credible firm Beosin, which didn’t find any critical vulnerabilities.
The protocol has a room for improvement in terms of security. Decentralization-focused solutions like Gravity protocol can be used for this. Besides, to improve the decision-making process of updating Neutrino, we are exploring and developing improvements for the network’s second token – NSBT (Neutrino System Base Token), which features governance among other utility functions.
Q5. I see. A new governance token, how can I buy it? JK. Why am I kidding? I think DeFi governance tokens returned the market to the 2017 craze in a sense. Currently, they are a hot topic, and we see numerous listings of such tokens. Could you please tell me more about your plans for decentralizing the protocol’s governance?
A5: Neutrino’s base token—NSBT is primarily focused on the system’s recapitalization in the event of WAVES decline. However, this token and its holders play a systematic role in Neutrino’s stability, so this token is the best candidate for the governance use case.
The blockchain space showcases that DeFi tokens have a substantial demand from traders and market makers, which paints a lucrative future for the NSBT token.
Neutrino protocol is largely in the beta-stage. I assume that NSBT will gain more of the market’s spotlight as it will become more liquid and popular. However, let me repeat myself—all of this is not financial advice.
Q6. Got it, we’ll wait for NSBT then. :) Let’s get back to the present. Currently, Neutrino is backed by Waves. We can swap USDN on the Neutrino portal or buy the token off an exchange. Then, we can stake it, using a dApp interface. What are your plans regarding further integrations? The community is actively using various lending dApps for yield farming on stablecoins. Do you have any plans for integrations or cross-chain communications?
A6: We are happy to see the increase of Neutrino integrations to other platforms. In the near future, the contributing teams have serious intentions to integrate Neutrino’s tokens to various popular DeFi dApps.
The vast majority of DeFi dApps happen to be based on Ethereum, so Gravity plays a vital role in creating a fundamental solution to enable cross-chain integration into popular Ethereum-based services.
Q7. We’ll talk about Gravity in a bit. I have one last question about Neutrino. According to the project’s website, the project is currently at the beta stage, while the product is already available. Why is that so, and when do you expect the final release? How will it differ from the Beta?
A7: As I mentioned earlier, there several of the protocol’s areas need more work to take the project out of Beta:
- Governance and utility functions of the base token (NSBT);
- Increasing oracle decentralization through Gravity protocol;
- Integrating Collider expansion, which will enable the tokenization of Forex, equities, and commodities on the Neutreino protocol;
Several teams, including Waves.Exchange, Waves Protocol, and Ventuary Lab are currently actively working on the features mentioned above. 2020 will provide a summary of their progress.
Q8. This item just came from my colleagues. The fully diluted market caps of the oracle-focused projects (like Chainlink) is going through the roof. Traders are optimistic about these projects and push them to new ATH. Why do you think they are so highly valued? You mentioned Gravity, can you unpack what Waves offer the space for the blockchains in its ecosystem?
A8: A token-agnostic solution for oracles and cross-chain communication, Gravity protocol, is being built atop Waves. The major feature of Gravity is that it doesn’t have its token, instead it will monetize oracles via tokenomics of the blockchains that host these oracles.
Such an approach is not very attractive for traders, but it has advantages regarding the ecosystem development. For instance, the architecture will enable Chainlink’s oracles to work on top of Gravity adapters and be monetized in any of the liquid tokens, including WAVES, ETH, LINK, BAND, USDN, NSBT, etc.
A couple of days ago, we secured a strategic partnership with Band protocol, also known as the major Chainlink’s competitor supported by Binance, Sequoia Capital, and other large industry players.
Economically speaking, the expansion of Gravity’s usage and popularity will bring more attention to WAVES tokens, which are the base for the Gravity’s ecosystem.
Q9. Thank you, Alexey. Let me summarize our discussion of governance by a layman’s question. Not long ago, the market saw how USDC and USDT teams blocked some of the users’ addresses. Can anything like this be done on Neutrino?
A9: The major point of decentralized algorithmic stablecoins is that a single entity doesn’t control them. They are emitted by a smart contract and secured by the native tokens and the algorithm itself.
USDN and DAI wouldn’t logically allow such restrictions at their current stages of development.
Q10. Great, thank you. I’d like to finish this off with a long-term projection. You have an interesting outlook on Neutrino’s future. The next stage is Collider. What’s the gist of it, and what should we expect from the ecosystem down the road?
A10: One of the key opportunities to trigger the long-awaited mass-adoption is giving users access to the traditional markets without any restrictions.
Synthetic assets are tokenized traditional assets: gold, currencies, equities, and indices.
The Collider expansion creates a set of rules on top of Neutrino, which will enable issuing and even staking such assets.
The ever increasing demand for these instruments significantly increases the demand for USDN and consequently, for WAVES and base tokens. Fundamentally speaking, such projects are crucial for the Waves ecosystem and token holders.
Once we have a baseline for cross-chain integration with other projects provided by Gravity and SuSy, these instruments will be available for numerous other ecosystems.