|
|
What Have We Gained in Cryptocurrency?
As the ink on the crypto constitution has just dried, someone asked Benjamin Franklin, "What do we have? A republic or a monarchy?" He replied, "A republic, if you can keep it."
The incredible trading volume of Bitcoin ETFs driven by BlackRock, Fidelity, and other major banks marks a significant milestone for cryptocurrency.
We have won over TradFi. We have entered new territory. The warm welcome from TradFi signifies that cryptocurrency will never be illegal in Western countries—at least some form of cryptocurrency.
This has its benefits. TradFi now serves as a shield against our critical adversaries. They can no longer strangle us in the cradle—we are too powerful, and we have too many friends.
This is the transformation. Our question is no longer "Can we survive?" but rather "Can we maintain decentralization?"
Reinforce our anti-corruption and anti-centralization protocols. If we aim to create a financial system lasting for generations, this must be achieved in this decade.
The development of Bitcoin and Ethereum is not complete. So what have we gained? A new set of bankers or an open monetary system?
We have an open monetary system, if we can preserve it. The recent 5x surge in Metis, just before the Cancun upgrade, undoubtedly captured public attention. But what is driving the development of Metis behind the scenes?
MetisDAO is a Layer 2 scaling solution compatible with the Ethereum Virtual Machine (EVM). Like other Layer 2 solutions, it eases the burden on the Ethereum blockchain by packaging and sending L2 transactions to the L1 network.
However, unlike other L2 solutions, Metis employs the innovative Hybrid Rollups technology, combining two mainstream blockchain scaling solutions: Optimistic Rollup (OP Rollup) and Zero-Knowledge Proofs Rollup (ZKPs Rollup).
OP Rollup handles potential dishonest transactions through its fraud-proof mechanism, while ZKPs provide a more secure verification method, ensuring only valid transactions are confirmed. Therefore, Metis' Hybrid Rollup effectively reduces the risks of fraud and erroneous transactions.
Metis' Hybrid Rollup makes the system both efficient and secure in handling a large number of transactions, ensuring scalability without limitations for any EVM-compatible DAPP to seamlessly integrate with Metis. Thus, Metis provides users with an efficient, secure trading environment and offers DAPP developers a convenient access platform.
In the implementation of Hybrid Rollup, Metis incubated the zkMIPS project to assist in the implementation of Hybrid Rollup. ZKM, from the CPU level, achieves zero-knowledge proof (ZKP) security for all virtual machines (VMs) and applications and supports various blockchain smart contract engines, allowing developers to easily apply ZKP in development.
ZKM can verify all blockchain and non-blockchain transactions, reduce gas fees, and shorten withdrawal waiting times. The introduction of ZKM is one of Metis' technical advantages compared to other L2 solutions.
In addition to its Hybrid Rollup technology, the most promising aspect of Metis' current development direction is its upcoming decentralized sequencer.
Decentralized Sequencer
The sequencer in L2 is responsible for sorting, organizing, packaging, and submitting transactions to the L1 network. Currently, most L2 projects (including Optimism, Arbitrum) rely on a single sequencer to perform these tasks, leading to three potential risks:
1) Single point of failure: If the sequencer encounters problems due to an attack or technical failure, the entire network may come to a standstill.
2) Scalability issues: A single sequencer may struggle to handle the growing transaction volume.
3) Limited resistance to censorship: Centralized sequencers make the community and on-chain users passive participants rather than sharing in sequencer revenue.
To address these issues, MetisDAO plans to launch a Decentralized Sequencer Pool to mitigate the risks associated with centralized sequencers, increase network scalability, and establish a sustainable, community-centered Layer2.
Advantages of Metis' promotion of decentralized sequencers:
1) In the decentralized sequencer pool, multiple sequencers work together, and any sequencer staking in has the right to see the transaction pool content and process transactions. This not only increases the speed of transaction processing but also enhances network fault tolerance (even if one sequencer encounters a problem, the network can still operate normally).
2) Users can become new sequencer nodes by staking native token METIS. Network participants can also supervise sequencer nodes, improving overall system transparency and credibility.
3) From the perspective of sustainable community development, node staking helps reduce circulating METIS supply, potentially positively impacting the token's long-term value.
4) The introduction of the sequencer pool also means that liquid staking/re-staking will be introduced into the Metis ecosystem. Liquid staking has become one of the most important components in the DeFi field, occupying the largest share of TVL in DeFi since last year. The introduction of liquid staking to the Metis ecosystem can bring more possibilities and use cases for $Metis.
Metis Sequencer Transaction Process:
1. Initiation: Users start a transaction.
2. Sequencer Node: The transaction is forwarded to the network's sequencer node.
3. Block Generation: The sequencer receives transactions and creates blocks when transactions are valid.
4. Final Confirmation: Multiparty computation (MPC) nodes merge these blocks and forward them to the Ethereum main chain.
To encourage community participation, Metis also provides staking rewards for sequencer nodes. These nodes, in addition to gas income (currently the main income for sequencing), can receive additional METIS rewards.
This design encourages more members to participate in sequencer node staking, ensuring that power is not overly concentrated and reinforcing the decentralized ideology.
Before the official launch of decentralized sequencers, Metis will undergo three rounds of community testing. The sequencer pool of Metis has already completed two rounds of community testing, with the first round starting from 1.3 and lasting for 27 days. Nearly 200,000 users participated in the first round, generating 4 million on-chain transactions.
In the second round, more than 300,000 participants generated over 11 million on-chain transactions. Those who missed the first two rounds of testing can stay tuned for the release of the third round and participate promptly.
Ecosystem Incentive Flywheel
On December 18th last year, Metis officially launched the Metis Ecosystem Fund (EDF) development plan, allocating 4.6 million METIS to further drive the development and innovation of the Metis system.
At the current price of $106 for Metis, this ecosystem fund is nearly $500 million, making it the largest incentive fund among all L1/L2 in the past two years.
The fund is allocated as follows:
- Sequencer Mining: 65.4% (3 million METIS, used to incentivize sequencer node mining income, promoting community participation).
- Ecosystem Funding: 34.6% (1.6 million METIS, used to fund projects for development, protocol deployment, liquidity provision, and incentives for users that contribute to ecosystem development).
On February 8th, Metis officially announced the launch of the Liquid Stake Blitz plan. This plan aims to utilize the Metis Ecosystem Development Fund (EDF) of up to 4.6 million METIS to accelerate the growth of the LSD protocol on the Metis network and LSD-focused product development.
According to the Liquid Stake Blitz plan, from February 8th to the end of February, the LSD protocol in the Metis ecosystem will be able to initiate proposals within the Metis community governance system, and in March, it will enter the formal voting stage.
After the vote, a limited number of winning proposals can gain the right to be paired with decentralized sequencer nodes (whitelist seats), thereby obtaining stable node participation qualifications and receiving a 20% Mining Reward Rate (MRR) mining incentive for the first year.
It's important to note that the development of the LSD protocol in the Metis ecosystem is very helpful in reducing the staking threshold issue on this network.
Unlike the LSD protocol on Ethereum, which reduces the staking threshold for POS nodes, the staking protocol in the Metis ecosystem, such as ENKI, reduces the staking threshold for sequencer nodes.
This gives ordinary users more opportunities for income:
1) At least 20% guaranteed mining income from the ecosystem fund.
2) Corresponding rewards from future LSD tokens.
3) Increase the demand for METIS, allowing the METIS ecosystem to achieve a positive development flywheel effect.
Taking Enki as an example, the protocol launched the Genesis Airdrop plan called Fantasy in early February, which will airdrop 1 million ENKI tokens to community users (10% of the total supply) as a reward.
In addition, Enki announced that the team would not reserve any tokens. The remaining 90% of other ENKI tokens will be released over time in various forms. This means that Enki users can continue to earn ENKI income through various protocol interaction activities, such as re-staking eMETIS as seMETIS or participating in METIS/eMETIS LP pairs.
For large capital entities, they can stake 20,000-100,000 Metis tokens to become sequencer nodes.
For individual users, they can stake Metis on different LSD platforms to receive corresponding node income, and staking certificates can also circulate and be used in the ecosystem.
The pioneers of decentralized sequencers, the emergence of income-sharing models, and the development of LSD all distinguish $METIS from other L2 tokens fundamentally.
For other L2 native tokens, they only have governance functions and cannot share income with holders. Therefore, when Metis is empowered with income, more people are willing to participate as nodes, driving more tokens to be staked, further promoting the scarcity of Metis tokens and pushing up the price.
Price growth attracts more participants, making the ecosystem more prosperous. The prosperity of the ecosystem strengthens sequencer node incentives, with more people participating in staking. The entire development process gradually forms a positive development flywheel.
Metis currently has a TVL of $82.82 million. From the changes in Metis TVL since 2023, we can see a significant increase in on-chain TVL since the design of decentralized sequencers in 2024, proving the community and the market's optimism in this direction.
Current key projects in the Metis ecosystem include:
1. ENKI: The first LSD project in the Metis ecosystem, aiming to simplify and democratize participation in the Metis sequencer node ecosystem. It allows ordinary investors to earn rewards by staking Metis Sequencer nodes. It is currently in the testnet and has not officially launched.
2. Hera Finance: An AI-driven DEX aggregator that helps users find the best trading prices.
3. Ethena: A recent stablecoin protocol on Ethereum, aiming to provide an uncensored, scalable native cryptocurrency solution through USDe. Announced collaboration with the Metis ecosystem on February 28th.
4. Aave: Currently, the largest protocol on Metis in terms of TVL and the largest lending protocol on the entire chain.
5. Hermes Protocol: Allows users to conduct slippage-free DEX trades.
6. Net Swap: The first DEX in the Metis ecosystem, allowing users to trade tokens quickly and at low cost on the Metis network.
7. Tethys Finance: The first perpetual trading protocol in the Metis ecosystem, allowing users to trade major tokens and METIS with up to 50x leverage.
8. Stargate: An asset cross-chain bridge developed by LayerZero Labs for cross-chain interoperability. Through Stargate, users and Dapps can transfer assets across multiple chains.
9. Artemis Finance: A liquidity staking protocol designed for the Metis decentralized sequencer pool, also one of the official collaborations announced by Metis. Users can stake their $METIS tokens on Artemis and receive the liquid token $artMETIS, accumulating earnings automatically while using $artMETIS for on-chain interactions on Metis.
10. WAGMI: A comprehensive DeFi solution with a liquidity pool that automatically rebalances dynamic fund allocations for maximizing user trading profitability. It received a 2 million Grant from the Metis Ecosystem Fund and announced a collaboration with DWF. |
|
Post time 12-3-2024 14:12:49