DeFi protocol Balancer is handing even more control to its users

https://decrypt.co/31037/defi-protocol-balancer-handing-more-control-users

Balancer wants to put the “De” back in DeFi, giving its users even more control in how they customize their use of the platform.

The decentralized finance (DeFi) token swap protocol launched user-generated shared liquidity pools on Friday, allowing liquidity providers to create customized pools of tokens directly from the dapp user interface. The announcement also added details on the BAL governance token to be distributed to liquidity providers, with reward calculations being launched today following user-generated pools on Friday. 

The two-month-old Balancer protocol has already seen more than $8.8 million in tokens added to existing pools—and user-generated pools could help the platform grow even faster.

Balancer provides swaps between different ERC20 tokens and allows liquidity providers to earn fees from providing the swapped tokens. At launch, liquidity providers could contribute to pre-made pools with fixed-fee rates and token types. Creating pools was previously possible via manual coding on Etherscan for tech-savvy users, but the new upgrade makes pool creation accessible to the average user.

Using the new tool, users can create and can customize both the types of tokens within their liquidity pool and the fees charged to swap between tokens. A pair or more of any tokens listed on CoinGecko can be used to create user-generated shared liquidity pools. Balancer also plans to release tools for creating private pools in the coming weeks, where only the creator can add liquidity and parameters like token types can be adjusted.

Smart contracts to distribute BAL tokens are in the final stages before release and are expected to launch in the coming weeks. Balancer explained in an earlier post that liquidity providers would receive BAL tokens from a fixed allocation per week proportional to their share of liquidity provided within a given pool. BAL tokens are planned to be used in governance decisions, similar to the recent shift to governance by COMP token holders on the Compound platform.

“Governance token holders will help shape decisions on what future features the next releases of Balancer should have,” Balancer co-founder and CEO Fernando Martinelli told Decrypt

Balancer’s new dapps could rebalance the DeFi landscape

“Depending on these new features, it could be the case that system parameters have to be maintained by BAL token holders to make sure the system works properly. An interesting effect of this is that token holders become liable for their decisions, incentivizing them to actively participate in Balancer governance, as opposed to being free-riders.”

The Balancer announcement also comes on the heels of the launch of Uniswap V2. Uniswap also allows users to contribute to liquidity pools but charges a fixed fee for token swaps. The variable nature of fees among Balancer pools mean that swaps using the Balancer protocol can often charge lower fees than Uniswap, assuming there is enough liquidity available. 

Uniswap, launched November 2018, has about $33 million in liquidity available across all tokens. Balancer, launched March 2020, has about $8.8 million in liquidity across all tokens in all pools.

Aragon Drama Pushes On-Chain Governance Idealists to the Meatspace

https://thedefiant.substack.com/p/aragon-drama-pushes-on-chain-governance

Hello Defiers! Here’s what’s happening in decentralized finance,

  • Aragon governance drama splits Ethereum community
  • Celebrating Bitcoin Pizza Day with renBTC
  • Devcon 6 postponed and to be held in Bogota
  • Polkadot launches network’s first phase
  • Foundation is latest to join red-hot tokenized asset space

and more!

The open economy is taking over the old one. Subscribe to keep up with this revolution. Click here to pay with DAI (for 70 Dai/yr vs $100/yr).

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On-Chain Idealists Take Legal Dispute to ‘Meatspace’ 

By Cooper Turley

Aragon was built with the vision of helping spur hundreds of communally owned organizations, governed by token-based votes and computer code. But now that problems with one of its own grant recipients have escalated, it’s turning to plain, old, physical courts.

The story broke when Autark posted this May 22 blog post stating that Aragon “filed a baseless legal action in Switzerland against Autark LLC,” a US company, and that it was seeking to nullify the remainder of the grant they were awarded. Aragon replied with its own post saying it stopped paying out Autark’s grant in January “due to breach of the grant agreement,” as the team hadn’t met agreed-upon goals, and that it filed the lawsuit to claim jurisdiction in Switzerland after Autark, which is asking for an $800k settlement, threatened to sue in the US.

Still, Aragon wants to move on, cofounder Luis Cuende told The Defiant. “We want to close this as soon as possible. It’s now on Autark to drop their threats and come to their senses,” he said. “Doors are open.”

Autark had yet to respond to a request for comment. The company’s CEO Yalda Mousavinia has previously said this is not the first time Aragon has had issues regarding its community grants and defends the company’s work.

$2.5M in Grants

Aragon, an open source platform enabling users to create and launch DAOs, raised 275k ETH in a 2017 ICO. It used its treasury in part to fund grants programs such as Flock, which was disbanded in February. Autark, a company building tools to enhance DAO coordination, won two grants, AGP-19 and AGP-73, amounting to roughly $2.5M in funding vested over the course of multiple years.

Autark received half of the first tranche of AGP-73 for $200,000 in November, 2019, with the remaining $200,000 agreed to be distributed in January. It was at this time that Aragon stopped making payments and the dispute began. 

“Baseless Complaints”

Autark said in a blog post Aragon’s breach-of-contract claims are “baseless complaints,” and that Aragon stopped payments before giving them a chance to “cure any alleged defects in performance.” 

Cuende said on Twitter his team had tried to solve the problem amicably, but that all they got from Autark was the following answer: “Talk to our lawyers.” Cuende also said in a video posted Tuesday that Aragon isn’t using its own court system because, while “it’s great, it’s not recognized worldwide. This Swiss lawsuit is to protect ourselves so they cannot sue us in a  different jurisdiction than where the agreements” were made. Aragon Court doesn’t replace the traditional legal system when there are problems between two legal entities, he said.

Luis Cuende 🦅 @licuende

For those who don’t know, the Aragon Association has taken legal action against Autark…

This is ugly, but they threatened to sue the Association and claimed a whooping amount of $800k. Read more 👇

aragon.org/blog/autark-le…Aragonaragon.org

Community is Split

The Ethereum community is split between those who support Aragon’s decision to go to the so-called “meatspace” legal system, while others argue the dispute should have been resolved in the project’s own court.

Cuende said in the May 26 video that Aragon Court is meant to resolve onchain disputes such as 51% attacks, meaning that this particular case is not relevant to the Court’s design. Community members have countered this claim, stating that this case is the perfect testing ground for the highly-anticipated product.

Regardless of whether the Court is used or not, we’ve seen a number of responses on both sides of the table. Here are a few worth reading.

For Aragon:

Chris Burniske @cburniske

@thegrifft @AragonProject @autarklabs DAOs live on strong 🙂

Note that Aragon was not the instigator here. They offered avenues to Autark to avoid meatspace legal action – but when pressed in the meatspace, one must defend in the meatspace 🤷‍♂️

Hope it chalks up to a sense of, and learnings about, justice for all.

thibauld 🌍🔥⏳ @thibauld

This summarizes well my thoughts too. @izqui9 and @licuende are genuinely good people and their contribution to the ecosystem is massive. Criticizing is easy, building is hard.

Olivier Sarrouy @osarrouy

I dont have an opinion about the @autarklabs vs @AragonProject case and don’t wanna defend the AA at all cost. It even happens the @AragonBlackTeam – I used to lead – left the Flock program a cple of months ago when the AA decided to recentralize some part of its gov 1/n

For Autark:

James Waugh @BlockchainJames

“That’s why we decided to keep the matter private” @licuende – in a DAO, that’s not your decision.

@autarklabs @AragonProject

Eva Beylin @evabeylin

@licuende why aren’t you taking this to Aragon Court? if you can’t use your own dispute resolution platform for community challenges prior to seeking legal action, then you’re basically a fraud

DAOs Endure

Still, this is just a drop in the wider bucket of the vibrant DAO landscape.

Jack Laing @JackALaing

1/ Why the @AragonProject vs. @autarklabs legal drama is NOT an existential crisis for the DAO space
Thread👇


If nothing else, it’s fascinating to see the DAO hypothesis playing out live, and cases such as this demonstrating rare edge cases in which community sentiment runs both ways.


How I Celebrated Bitcoin Pizza Day Late (And on DeFi)

By DeFi_Dad

May 22nd was the epic 10-year anniversary referred to as Bitcoin Pizza Day. By now, you probably have seen a million pizza emojis and references to the fact that one poor guy spent 10,000 BTC on pizza, and not just once, but supposedly eight times! Do the math: if it’s true, he spent 80,000 BTC going back to 2010, equal to about $720 MILLION in USD —if you assume a price of $9,000 for BTC.

I think it’s kinda ironic that 10 years later it doesn’t feel much easier to spend BTC on pizza and even more ironic, no one spends their BTC! It’s been deemed digital gold by the Bitcoin community and Wall St. People buy and hold BTC versus spending it on simple transactions like pizza or coffee. Thankfully we have over $7B in stablecoins on Ethereum that we can increasingly depend on as a medium of exchange.

So what about my BTC?! Well, I can hold it in cold storage or transfer it wallet-to-wallet, but aside from that, I’m pretty much stuck having to use centralized services to open a collateralized loan (ie BlockFi) or use BTC to trade on perpetual markets like the most popular centralized ones at BitMex, Deribit, and Bybit. 

I’m DeFi Dad, not CeFi Dad! So this got me wondering, what can I do in DeFi to put my native BTC to use?

A New Day With renBTC

As luck would have it, Ren Protocol came through just yesterday! Ren unveiled the long awaited RenBridge at bridge.renproject.io, where I can swap my BTC for renBTC without any middleman or KYC, just the usual DeFi experience of connecting my Ethereum (and now Bitcoin) wallet while trusting only the Ren smart contracts.

(Btws, please be aware the Ren team does still have a pause function in their control as an emergency precaution. I think it’s very pragmatic when launching new smart contracts that could present a risk to newly deposited funds, even if they’ve been through audits. In the future when this admin right is abstracted away from the control of the Ren team, these smart contracts can then be deemed “trustless.”)

Tutorial: How to Swap BTC for renBTC and Open a MakerDAO Loan

I don’t have much else to share about this huge moment for DeFi and my first experience today using renBTC because I’d rather show you! Watch the following video as I:

  • Start with BTC in a Nano Ledger hardware wallet
  • Swap BTC for renBTC using the RenBridge
  • Then swap renBTC to WBTC with 1inch.exchange
  • Lastly, use WBTC to open a leveraged loan in MakerDAO to get Dai

Risks and Cautions Using These DeFi Apps

This is not financial advice and you should approach this new RenBridge with caution. There is always risk in using DeFi apps and protocols, including technical risks (ie smart contracts bugs), financial risks (ie liquidity crises), and admin risk. 

You should also be cautious and aware of the following risks: As I called out earlier, there is a pause function in control of the Ren team, meaning they can shut down the Ren network. It’s a precaution while these smart contracts are new, but you should be aware of it. If you use 1inch.exchange, renBTC is still very illiquid on Ethereum. You could end up with a terrible exchange rate and/or lots of slippage if trying to swap more than the small amount I demonstrated (ie. $100 of renBTC).

If you use DeFi Saver, you’re trusting their smart contracts to open a vault for you, which entails some risk. By opening a vault with MakerDAO, there’s risk of liquidation if the price of WBTC drew down to your liquidation price, if you don’t maintain a collateralization ratio of 150%. There’s also risk of a congested network like what we saw on March 12th when people were having trouble getting through their transactions on the Ethereum network. Please do your own research and never follow this tutorial as financial advice. I’m a DeFi product enthusiast, not a financial advisor.

Devcon 6 Was Postponed to 2021 & Will be Held in Bogota

Ethereum’s annual gathering will be postponed for the first time due to the COVID19 pandemic and held next year in Bogota, Colombia.

The large Argentine Ethereum community had been lobbying for the next Devcon to be held in Buenos Aires for the past several months. The push made the Ethereum Foundation look South and apparently Colombia’s more stable economy and venue options won out.

“Agora [the venue] presented us with an ideally-located and fully modern conference center that is built to handle the catering, WiFi, meeting-space and other needs of an event like Devcon,” the EF’s blog post said.

The EF decided to postpone Devcon rather than organize a virtual event or be subject to last-minute changes in travel and lockdown measures . This year, the plan is to hold “a set of worldwide and independent events this fall.”

First Phase of Polkadot Network Goes Live

After four years of development, the Web3 Foundation on Tuesday launched the first phase of the Polkadot network, a sharded protocol that allows decentralized blockchain networks to operate together.

The current mainnet will operate via a Proof-of-Authority consensus mechanism, in which the Web3 Foundation retains control of the chain, “to execute critical logic and security audits and calibrate final aspects of the network,” Web3 wrote in a blog post. In this phase, holders of Polkadot’s native DOT tokens will be able to claim their tokens and submit their intention to stake, Messari reported. The Web3 Foundation may conduct a “DOT allocation sale to further decentralize the token distribution,” the Web3 Foundation said.

Buying Crypto Just Got Easier in the US and Europe

Transak and Wyre partnered to allow residents of most US states and European countries to buy 300+ cryptocurrencies with their debit cards in minutes, without having to go through a centralized exchange or extensive KYC. Easier fiat to crypto on ramps are key to mainstream adoption and this is a good step forward.

Tokenized Goods Space Heats Up With New Player

Foundation is the latest in a series of projects seeking to provide a marketplace for tokenized assets —these are real-world assets linked to tokens which trade in secondary markets. Tokens provide traceability, allows creators to more directly profit from their work, and fans the chance to support artists, speculate on their success, and simply buy their goods. The first Foundation Market is live at NeueGoods.com


Crypto Chicks and DAOstack are hosting a virtual hackathon. Here’s the info:

Planet Wide SOS Hackathon -Solutions to Heal the World

Join Planet Wide SOS Hackathon to fund your ideas and solutions that help local communities (Anything Local Track) or create global remote platforms (Everything Remote Track). The prize fund is being raised and governed by the people from 40 countries via a digital decentralized coop The Builder Collective. Join to become a coop member with a voice to select which projects to fund. Open to all technologies, all countries, all genders. No programming experience is required – Top Business Ideas Awards are available. Diverse teams will be recognized with the Top Women-Led Teams Awards. Your solution matters – register to maximize your contribution and voice now at https://soshackathon.com!


The Defiant is a daily newsletter focusing on decentralized finance, a new financial system that’s being built on top of open blockchains. The space is evolving at breakneck speed and revolutionizing tech and money. Sign up to learn more and keep up on the latest, most interesting developments. Subscribers get full access at $10/month or $100/year, while free signups get only part of the content.

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Click here to pay with DAI.There’s a limited amount of OG Memberships at 70 Dai per annual subscription ($100/yr normal price).

About the author: I’m Camila Russo, a financial journalist writing a book on Ethereum with Harper Collins. (Pre-order The Infinite Machine here). I was previously at Bloomberg News in New York, Madrid and Buenos Aires covering markets. I’ve extensively covered crypto and finance, and now I’m diving into DeFi, the intersection of the two.

Expanding Compound Governance

https://medium.com/compound-finance/expanding-compound-governance-ce13fcd4fe36?source=rss----22e4df2110f5---4

To create unstoppable, upgradable financial infrastructure, Governance replaced our team as administrator of the Compound protocol; COMP token-holders and their delegates debate, propose, and vote on all changes to Compound.

The stakes are high — the protocol holds more than $100 million of assets, and dozens of applications rely on Compound markets. Which is why, for the past two months, COMP has been tested in the open, with a limited group of stakeholders.

During that time, the community proved that Compound is upgradable by anybody with a good idea, without relying on our team or middlemen:

  1. Our team added a new asset, Tether, to the protocol
  2. Dharma, an application built on Compound, created a new DAI interest rate model
  3. A community member managed the process to begin deprecating SAI

The functionality to create proposals, delegate and vote performed flawlessly in Coinbase Custody and the voting interface, and no vulnerabilities were discovered.

Today, we’re excited to announce that Governance is ready to scale from our core team and shareholders, to the entire Compound ecosystem.

Distributing COMP

The distribution of COMP will become a core mechanic of the Compound protocol. All users and all applications built on top of Compound will continuously, and automatically receive governance rights, for free— in order to shape the future of the protocol.

“The individuals, applications and institutions that use the Compound protocol are capable of collectively stewarding it into the future — and are incentivized to provide good governance.” — Robert Leshner, Compound Founder

How it works

  • 4,229,949 COMP will be placed into a Reservoir contract, which transfers 0.50 COMP per Ethereum block (~2,880 per day) into the protocol for distribution
  • The distribution is allocated to each market (ETH, USDC, DAI…), proportional to the interest being accrued in the market; as market conditions evolve, the allocation between assets does too
  • Within each market, 50% of the distribution is earned by suppliers, and 50% by borrowers; in real-time, users earn COMP proportionate to their balance; this is separate from the natural interest rates in the market
  • Once an address has earned 0.001 COMP, any Compound transaction (e.g. supplying an asset) will automatically transfer COMP to their wallet; for smaller balances, an address can manually collect all earned COMP

Public Testing, Review, and Planning

An upgraded version of the protocol is now running on Ethereum’s Kovan testnet:

  • The COMP Distribution codebase is available to review on Github
  • OpenZeppelin performed an audit of the release; no issues were found
  • You can manually test the release by setting your web3 network to Kovan on the Dashboard

Developers should plan whether & how to transfer COMP to users; with some planning, the distribution can be a powerful mechanism for user acquisition and participation.

Tracking the Distribution

You can monitor the distribution on a newly created COMP Distribution Dashboard, for the Kovan testnet and future Mainnet release.

Simulated August 2021 data

Next Steps

Allowing every user to participate in governance will be the most important milestone in Compound history — and one worth preparing for.

To begin the transition, we’ll first abdicate the Guardian functionality that allows our team to disable Governance in an emergency; once disabled, COMP holders have complete, censorship-resistant control over the protocol.

Next, one of the members of our team will propose a protocol upgrade to support COMP Distribution — this will likely occur next month. Once activated, the distribution will last for approximately four years—continually bringing more users, and more applications into the governance process.

If you have any questions or ideas, join us in Discord. From all of us at Compound, 📈.


Expanding Compound Governance was originally published in Compound on Medium, where people are continuing the conversation by highlighting and responding to this story.

Compound rolls out community governance system, with added support from Coinbase Custody

https://messari.io/article/compound-rolls-out-community-governance-system-with-added-support-from-coinbase-custody

Compound has announced its community governance system and associated COMP token are now live. The new model hands control of the protocol over to COMP holders, enabling them to propose and vote on governance actions such as adding support for new assets. At the moment, token holders include existing shareholders of Compound Labs and the protocol’s current founders and team members.

Coinbase Custody almost simultaneously announced its is launching support for Compound’s new governance system and COMP token. The voting solution will allow clients to use their COMP holdings to participate in governance decisions directly or by way of a third-party without having to move the tokens out of cold storage. Today’s announcement also stated the custodian would open deposits and withdrawals for all Compound c-Tokens, cETH, cZRX, cUSDC, cBAT, cDAI.

Why it matters:
The launch marks is a step forward for Compound in terms of decentralization, as the company removed itself from the decision-making process and handed these responsibilities over to a distributed set of token holders.
While the number of token holders consists of only current team members and company shareholders, Compound reserved over half of the supply for users of the protocol. The team is planning to release more details on the distribution model in the coming weeks.
Compound marks the second governance system support by Coinbase’s custody arm. The custodian launched a voting solution for Maker last fall (Oct. 2019). Aside from its flagship product, Coinbase now is a leading service provider for three of crypto’s most prominent activities: secure storage, staking, and governance.

MakerDAO Governance Approves USDC Stablecoin as Collateral

https://cointelegraph.com/news/makerdao-governance-approves-usdc-stablecoin-as-collateral

The MakerDAO governance has added the stablecoin USDC as its third collateral type in an attempt to improve liquidity and Dai price stability.

The MakerDAO governance has approved the USD Coin (USDC) stablecoin as the third collateral type accepted in the Maker Protocol, according to a community post on March 17.

The decision was put to an extraordinary executive vote outside of the usual weekly schedule, with the aim of urgently increasing Dai (DAI) liquidity following last week’s market instability.

USDC joins Ether and Basic Attention Token 

USDC now joins Ether (ETH) and Basic Attention Token (BAT) as accepted forms of collateral which can be used to open vaults and generate Dai.

The move follows extensive discussion in the Maker community on the merits of adding USDC, and appropriate risk parameters for the token. There was also a public discussion of the potential impact of adding a centralized stablecoin as a collateral type.

Ultimately, the community decided that the swift addition of USDC might address Dai price instability and liquidity issues that have been prevalent since the Ether market crash last Thursday.

$4 million hole

The Maker Protocol allows users to generate Dai by locking collateral into a smart contract or vault. The unprecedented price drop of Ether last week caused the collateral value in many vaults to drop beneath the generated Dai value, triggering liquidations.

While the Maker Protocol has mechanisms in place for such events, the scale of the sell-off led to these not functioning as intended, and in at least one case, liquidated collateral was auctioned off for 0 Dai.

The eventual debt, after consuming all Dai in the buffer, was around $4 million.

This has triggered the first MakerDAO debt auction, to be held at approximately 10:28 EST on March 19. The debt auction mechanism is also specified within the Maker Protocol, although this is the first time that it has had to be used.

As Cointelegraph reported, the Maker governance proposed adding USDC as a collateral type on March 16. By its very nature, a stablecoin is not exposed to market instability. The Maker governance has also implemented a Collateral Liquidation Freeze mechanism, to act as a potential circuit breaker, in case such a situation happens again.

Expectations of launching your own Moloch DAO

https://cryptonewmedia.press/2020/01/24/expectations-of-launching-your-own-moloch-dao/

Crypto New Media Press

Peter ‘pet3rpan’

What is it like to launch a Moloch DAO fork? This post was brought to you by $MAGIC In the spirit of experimentation, Totle recently purchased my time tokens known as $MAGIC and decided to redeem them. David, the CEO of Totle, essentially gave me a fairly wide prompt and suggested that I write about […]

The post Expectations of launching your own Moloch DAO appeared first on Crypto New Media.

DAO for blockchain storage protocol Arweave is now live

https://www.cryptoninjas.net/2020/01/23/dao-for-blockchain-storage-protocol-arweave-is-now-live/

The community and core team of Arweave, creators of a decentralized data storage protocol, announced today the live launch of ARCA, a community-governed DAO that will develop and expand the Arweave ecosystem, project, and network. ARCA DAO is now live on Ethereum mainnet, with a membership made up of long term miners, developers, and backers […]

CryptoNinjas: DAO for blockchain storage protocol Arweave is now live