LFG (Jupiter) Voting: Round 3

BbyA...nMtW
18 May 2024
271


From JUPnary to infinity

After one of the largest token launches in crypto history Jupiter Exchange is now deploying their long term strategy for the $JUP token: Grow the pie.

You can find all the details at: https://station.jup.ag/


An integral part of this is the Jupiter DAO and the LFG Launchpad.
https://vote.jup.ag/




Before we dive into the candidates for the second round of voting I want to give a plug for Jupiter Research. It's a great place to learn about new projects and engage in an ecosystem which is only just starting. You may not get this opportunity again in your lifetime to be this early to something.
https://www.jupresear.ch/



I also want to stress the below is my opinion. Please follow the links to each candidate's Jupiter Research forum post and read more about them and the resulting discussion and ask any questions you might have. The teams always love to talk about their projects and appreciate any and all questions.




Round #3 LFG candidates

Vote opens May 22nd, so there's still time to hit the forums and ask the teams any questions you have.

This round we see a few changes to the voting mechanics.

  • 1 Vote, 1 Winner
  • Blind Voting

See https://www.jupresear.ch/t/kicking-off-3-of-lfg-voting/16462 for more details.

Only 3 candidates this time but they are fairly established projects and quite different.



deBridge: The fastest growing bridging solution on Solana right now

https://www.jupresear.ch/t/introducing-debridge-to-lfg/5351

deBridge brings a novel and not-so-novel approach to bridging.
Traditionally bridging between blockchains has relied on wrapping assets to port the between different blockchains. This was technically a good solution but operationally has been a bit of a nightmare for two main reasons:

  • the wrapped assets, whilst seemingly very liquid (e.g., BTC, ETH etc..), are actually very illiquid on the bridged to chains as they are unique tokens that then need LPs to be funded long term in order to allow people to use their bridged liquidity on that chain. You frequently still get situations where a bridged USDC or USDT token (the most liquid lowest slippage tokens in crypto today) will be near impossible to swap. Which is incredibly frustrating. Not only that wrapped assets can take many hours (and even days) to bridge properly.
  • the bridge retains custody of the assets you deposited in order to mint the wrapped version. That means anyone holding wrapped token versions is at risk of losing them should the bridge get hacked. In very recent times we've seen very large bridge hacks or failures (Wormhole, Ronin, Multichain) which resulted in users losing some or all of the money they had in assets that seemed non-risky e.g., wrapped versions of BTC, USDC, USDT etc.. It's one thing to deposit into a protocol and lose your money, at least in that case you've made the explicit decision to take on that risk. It's quite another to simply have the assets you're holding go to zero because a protocol you may have never used (or known existed) was compromised.


So deBridge's solution is to not do wrapped assets (least for their main product). Instead they use something called DLN

DLN is a high-performance cross-chain trading infrastructure that consists of two layers:

  • Protocol layer: on-chain smart contracts
  • Infrastructure layer: Takers that perform off-chain matching and on-chain settlement of trades

https://docs.dln.trade/the-core-protocol/dln-overview

Basically what deBridge does is swap out of whatever asset you want to bridge into a stablecoin (USDC), bridges the stablecoin, and then swaps that into whatever you want on the target chain. This service is provided by liquidity partners who facilitate the swaps.
There's also validators for the bridging process. I'm not yet clear on what validators actually do, but I have asked on the forums.

Not totally sure what purpose the token will provide. deBridge say governance (like everyone does) and says they'd use it to vote on validators but it's not clear (yet) what function that would have or how someone would be able to vote effectively.

Whilst the current main product of deBridge is non-wrapped assets they do have plans to expand the wrapped assets side of their offering with deTOKENs and deNFTs for bridging NFTs. I assume this will be a service they can offer for lower liquidity tokens they can't find enough liquidity partner support for. The token in this case will likely come in very handy incentivising liquidity providers to provide support for the wrapped assets.

The NFTs I'm not really clear on how or why they need a bridging solution, though I do know there have been some high profile NFT migrations (deGods famously left Solana and now have come back) and those have been cumbersome and slow. Maybe this is a good solution for those, but I can't think there's much demand outside of a few rare instances collections change chains.

I have used deBridge a couple of times and can say it was one of the best bridging experiences that are out there. However it's a really low bar and the functionality they have is no different (in my direct experience) to Circle's CCTP or AllBridge Core.




Divvy.bet: The Future of Betting Where Anyone Can Be The House

https://www.jupresear.ch/t/introducing-divvy-bet-to-lfg-the-future-of-betting-where-anyone-can-be-the-house/12030

Sportsbook betting on Solana. That's pretty much the long and short of it. It's very similar to what Overtime Markets offers over in Ethereum land.
Though it is significantly different to other Solana sports betting protocol BetDex who are completely decentralised and offer peer-to-peer wagering.
Divvy.bet are centralised, offering bets in crypto and a insurance fund you can stake in to collect betting revenue and offer protection to the protocol and users from bad debt. This is exactly the same as insurance funds on perp dexes (e.g., Drift) or lending platforms (e.g., Hubble) operate now.
An interesting future development here is the ability for JUP stakers to use their staked JUP to provide liquidity to the insurance fund and retain their voting rights. It sounds great but there's no technical implementation details yet as it's just a proposed future upgrade they might do. I can see some significant issues they'll need to address before that can happen and they're all around how liquidations will work when they happen.

I don't know why they need a token but I can see the logic in swapping all protocol fees into that token to distribute to holders and thus generate trading fees and usage. Of course, as always, governance is front and centre but in a high regulated industry such as gambling there's little you can delegate to token holders from a legal and compliance perspective as goes significant market making decisions the type a wagering platform makes regularly.




Exchange.Art: A marketplace catering to independent artists

https://www.jupresear.ch/t/exchange-art-application-to-lfg-launch/15808

If you've not used Exchange.Art the best way to describe them is to think of NFTs marketplaces as being on a spectrum from trading focused on one side to artist focused on the other. Exchange.Art sits at the artist end (and something like Tensor at the trader end).
It's not that Exchange.Art doesn't have trading, it most definitely is a marketplace, it's just they have little tooling for trading unlike marketplaces like Tensor or Blur which have extensive trading tooling.

In my experience I think Mallow is doing a better job of trying to find a balance between traders and artists but I think Exchange.Art wants to keep pushing themselves out on the artist side of that spectrum and become the go-to place on Solana, and eventually all of crypto, for very art focused NFTs.

What then does an exchange like this need a token for? On first glance the use case here might be the lest compelling but I think it's actually the strongest use case, but for non-obvious reasons:

  • the lack of trading infrastructure on Exchange.Art means a token would give them access to a bunch of basic crypto tools (e.g., LPs, staking etc..) that would help them drive more revenue without needing to fundamentally change the NFT trading experience they have now (which is very non-trader focused).
  • art is subjective so the token price might likely also take on a more subjective valuation amongst the Exchange.Art community which would unlock more liquidity for the team to use growing the protocol and that would also benefit community members who were token holders.
  • Exchange.Art have flagged the other token use case, apart from, you guessed it: governance, would be funding grants for up-and-coming artists. I like this. A lot. I think a lot of people have underestimated the value of this. Unlike the grant programs you see from other crypto protocols these types of grants would directly provide listings (and therefore: revenue) to Exchange.Art. Holding the token might in some ways been seen as holding a piece of an art focused venture fund but one where you're also the platform your investments are deploying on (which is sort of like how blockchains fund development but the value capture is less so than what an individual protocol can achieve).


For those reasons above I'm voting my JUP for Exchange.Art this round.




These are my opinions: What are yours?

Like I said at the start of the post these are my takes on the candidates. I think they've all done a great job getting to this stage.

Who are you voting for and why?
What do you think of the field of contenders?

Let me know in the comments!

Let's go space cats!






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