Date: Tuesday, 17th November, 2020
Time: 02:00 UTC
The Sifchain team was represented by @Omni_Skyfather. He judiciously shared with us detailed knowledge and information about the project.
1st Segment: INTRODUCTION
Q1 : Can you briefly introduce yourself and your background, also introduce the Team working on Sifchain
We try to keep it focused on the team as opposed to individual members, but it’s no secret that a lot of our credibility lies with the fact that we have so many members from the Thorchain team, including its early architect. This gives us a lot of credibility and experience with cross-chain software and AMM token design.
Jazear was not just involved in early architecture on Thorchain but helped with development on Cosmos’s official Ethereum <> Cosmos bridge for the Interchain Foundation and the Polkadot <> Ethereum bridge for Web 3 so we are experts in cross-chain transactions.
Beyond that, our team has a lot of experience with other crypto projects including a YC-backed crypto startup and multiple crypto exchanges.
Purely on the development side, we have over a dozen engineers, most of whom have prior blockchain experience on other major chains. They’re supported by strong business development and marketing experience over many major famous cryptocurrency projects by our operations team team.
Q2 : Can you introduce the Sifchain project, what critical problems does it solve that existing solutions are not solving and what’s the competitve advantage
Ans : Sifchain is the omni-chain decentralized exchange (DEX), unlocking liquidity from otherwise siloed chains to free people from egregious fees and inefficient trades. Sifchain will target 20–25 blockchains (such as Ethereum and Stellar) for cross-chain integration. It will also simplify the process of blockchain integration, lowering the development process for the open source community so that additional cross-chain integrations will be cost minimized in terms of money and developer resources.
Sifchain’s goal is for new blockchains to consider cross-chain integration as essential as a wallet or block explorer. Liquidity from all cryptocurrencies can then be accessed on-chain, allowing the coordinated deployment of capital from all cryptocurrencies by DAOs.
The future of Sifchain is a Decentralized Autonomous Organization (DAO) and for SifDAO and other DAOs to self-sustain, they need access to massive capital. We believe that building cross-chain liquidity will be fundamental to the future of the blockchain industry: an expectation, not a feature.
Sifchain is built on the Cosmos SDK and is compatible with other Cosmos Network blockchains like Kava, Akash, and Terra via the Inter-Blockchain Communication (IBC) protocol. As such, it is 100 times more efficient than Ethereum-based DEXes like Uniswap in terms of both trading fees and transaction speed.
As a decentralized exchange, Sifchain combines the best elements of liquidity pools and order books for optimal order execution. While decentralized exchanges are currently dominated by liquidity pool algorithms optimized for token swaps, Sifchain will rethink the formulas used for liquidity pool algorithms from first principles of complexity theory to implement adaptive AMMs suitable to limit orders and token swaps alike.
Traders will be able to place limit orders that are executed against the liquidity pool as the market price fluctuates. Sifchain prevents validator front-running through a commitment-reveal scheme for order placement.
Sifchain allows traders to use margin on their trades by borrowing from the liquidity pool. Interest is set based on market demand and liquidity supply. This increases returns for liquidity providers in two ways — it provides interest as a second revenue stream in addition to swap fees and increases the size of swaps, and thus the size of swap fees.
The competitive edge for us is that there are no other projects even targeting omni-chain. There are a couple of independent projects targetting cross-chain with Ethereum but none trying to make omni-chain a standard to capture the entire $450B+ of market cap across all cryptocurrencies.
There are no other major projects supporting both margin trading and limit orders on a decentralized exchange.
We'll be the first to launch Ethereum compatibility in the Cosmos Network, bringing Ethereum liquidity not just to Sifchain but also other Cosmos projects like Kava, Akash, and more.
We are the most thoughtful about decentralizing control slowly over time. There are a few projects that have exited to community like Synthetix and Compound. We respect those communities and hope to have strong governance similar to them. However, we also want to give SifDao some control in the begining. This is why we will create an on-chain pool of capital for SifDao to control through on-chain voting separately from the Sifchain core team. We explain this more in our tweet thread here https://twitter.com/sifchain/status/1323162320382517248?s=20
Q3 : Can you briefly describe the Top milestones you have achieved and your target milestones with timelines, also share your roadmap
Ans : We started serious development on Sifchain in June and completed our raise from Tier 1 cryptocurrency investors in August. Since then, we’ve been highly focused on releasing our testnet, Monkey Bars, which came out in October - https://twitter.com/sifchain/status/1319862152648220672?s=20
From there, we're just focused on taking that testnet to mainnet launch. To make that happen, we've been working at a breakneck pace to implement world class devops and testing infrastructure. 30-50% of our engineers are focused exclusively on infrastructure at any point in time.
2nd Segment: TWITTER QUESTIONS
Q1 : -Being sifchain a decentralized finance project (DeFi), how can it solve liquidity and vulnerability problems in smart contracts? Also, what action plan can drive sifchain in the DeFi ecosystem?
Ans : We have a very strong focus on security. Our engineers pride themselves on creating a thorough test suite for every feature. We then have test engineers who enhance each test suite with a larger battery of standard tests (unit, integration, etc.) as well as more complicated end-to-end tests or testing harnesses that can spin up critical infrastructure for mocks (for example, standing up a service that should be running in the background adjacent to a major few feature).
Then, we've got auditors on top of that and an internal red team focused on attacking the network. Before mainnet, we'll launch an external red team in the form of bounties.
As for liquidity, we are including viral components in our subsidy (liquidity mining) program to incentivize swappers, stakers, and liquidity providers to participate on Sifchain right after it launches. We expect Sifchain to be one of the most highly trafficked platforms because it will be one of the most viral during its mainnet launch
Q2 : Can all Rowan token holders partake in on-chain governance? On which areas/topics/matters of Sifchain can users decide and vote?
Ans : Rowan holders can participate in any part of on-chain governance. You can view the dozens of cryptoeconomic metrics they vote on here
Lol this is the first time we’ve released our Token Economics paper. It’s not even on our website yet!
AMA Lovers Club exclusive
We want to allow people to vote on everything relevant. Ultimately, Sifdao will take total control of Sifchain across all aspects.
Our team is initially responsible for all aspects of the protocol, including software development, testing and quality assurance, product management, design, dev ops / IT, economic design, research, marketing, business development, legal, hiring, human resources, finance, partnerships, and public relations.
Wherever possible, the team’s responsibilities will be communicated to the DAO for the purposes of independently supporting the team’s efforts. Over time, the DAO will inherit all of the team’s responsibilities and will be entirely responsible for Sifchain’s continued management.
While we cannot immediately launch the DAO, we want to do it relatively soon. Developing the product with an operational DAO will ensure we stay at the cutting edge of the industry. It is more attractive to investors.
After the public token sale, the DAO will be seeded with a small community pool. Anyone with liquid Rowan can vote for allocations from the DAO on-chain. Quorum will be set based on historical voting precedence in other DAOs.
A DAO is not a legal entity, most of its agreements are only valid based on the social consensus of its members. An on-chain vote for a proposal is technically just a vote to transfer money from one wallet (the community wallet) to another (the wallet of the entity that will carry out a particular action. That said, because DAO voters are token holders, we expect they will act in the best interests of the community.
Over time, as they work together, they are expected to follow precedence they themselves set. If the DAO does a good job executing, they will continue the principles that brought about this good execution.
An exception to the rule that the DAO’s agreements are not binding is that a DAO can eventually change the protocols code itself, either to change economic parameters (like the lending rates of tokens or the CLP formula) or to modify technical functionality. The DAO will not have that power up front but will eventually get it in a handoff similar to Synthetix’s, Compound’s, or MakerDao’s.
We discuss Sifdao in more detail here - https://twitter.com/sifchain/status/1323162320382517248?s=20
Q3 : By targeting big blockhains you'll cover big percent of market with your cross-chain tech. Sif will end up a great ecosystem for any kind of crypto service Would you think of providing all, once done with the intial setup or will you focus some only
Ans : We think 20-25 is a good core but we will also open source schematics and provide simple funding mechanisms for other the community to add cross-chain tech. We need to make decisions on a case-by-case basis for creating new connections to blockchains and by the time we get to the 20th or 25th bridge, these decisions will have already been moved to Sifdao
Q4 : As Sifchain is built with the Cosmos SDK which equates to faster trades and lower fees, what is the rate fees per transaction made?
Ans : This depends on a number of factors but we’ve consistently see fees lower than $0.01 for each transaction
Q5 : Sifchain exchange is expected to execute transaction 100x more efficient than other DEXes, does that efficiency leads to certain drawback like users data security or leaving the system vulnerable to hackers?
Ans : Great question. The extra efficiency comes inherent to all Cosmos SDK blockchains not just Sifchain. Ethereum is the primary blockchain for DEXes so most consumers are not familiar with just how much other blockchain software like Cosmos SDK have improved on Ethereum.
The benefits of other Cosmos SDK (which Sifchain is built on) are described here by Aragon’s devs - https://blog.aragon.one/aragon-chain/
3rd Segment: LIVE QUESTIONS
Q1 : " Governance info, voting portals business and economic models " , all these things are currently unavailable on SIFCHAIN website, what are your plans bring this into completion ?
Ans : We’ll release them as soon as we’re done. Documentation and any other user-facing materials are created on an as needed basis but we’ve been behind since we’re so focused on the basics for launch. We even released our economic paper here in this AMA before we could get it on our websute https://t.me/amaloversclub/57016
Q2 : $Sifchain game is all about and can you win money from there, does it offer collectible NTF tokens?
Sifchain itself may support NFTs depending on how NFT support for Cosmos develops and how we progress with our core roadmap. I’m sure a lot of people would love to get their hands on Sif NFTs and it would be a pleasure to deliver value to NFT holders :)
Q3 : Please share us what do you think about the real philosophy behind DeFi?Where Do You See This Revolution After 5 years?
Ans : Good question. We think DeFi is really just heating up. For us, DeFi is about self-soverign control over finances. There's so much more that we can deliver to the ecosystem that hasn't yet been developed.
Consider, for example, how many new financial products can be released by a group like https://www.actusfrf.org/
We see the product development in this space as a small sample of what is to come
Q4 : Based on the roadmap, it seems the project doesn’t have an immediate plan for an app platform, so will Sifchain do it in the last quarters of next year?
Ans : We are not focused on building an app platform for Sifchain but you could propose it to Sifdao when it launches!
Q5 : 1. Ethereum has performance issues and it only covers a relatively small amount of the total cryptocurrency market cap. How possible is it for SifChain to control the entire amount of market cap for every current and new blockchain?
2. How can SifChain provide a strong platform for traders to have a one stop shop for everything they need with cryptocurrency trading?
Ans : The Sifchain core team and community need to work hand in hand to ensure that Sifchain’s mainnet is well-tested and well-supported, and that the full vision of the protocol is carried out beyond mainnet. If Sifchain’s mission appeals to you, we urge you to stay in contact by joining our Telegram, following us on Twitter, joining our Discord, and subscribing to our Newsletter.
If you feel called to contribute more, we encourage you to start by reviewing the code we’ve openhttps://github.com/Sifchain sourced at https://github.com/Sifchain. You can always address outstanding Github Issues https://github.com/Sifchain/sifnode/issues and speed up time to completion. We’ll be attributing rewards for some development help over Gitcoin. Until we can get our Gitcoin account set up, you should just feel free to review the issues filed in https://github.com/Sifchain/sifnode/issues and if you fix one and we accept your pull request, you will receive $250 or more via USDC.
If you’re looking for a way to contribute to Sifchain while earning income, we will provide opportunities to do that. If you want to invest in Sifchain’s success fund a bug or feature reward for a new issue or small feature. In special cases, the Sifchain core team may even invest alongside you!
Another way to contribute is with code reviews. Look at our developer documentation https://github.com/Sifchain/sifnode/tree/develop/docs and our pull requests https://github.com/Sifchain/sifnode/pulls. This is a great place to review what’s coming to the protocol. You can identify ways to improve the protocol and submit PRs of your own. The Sifchain core team doesn’t guarantee it will accept your PRs without substantial revision, or that it won’t leave your PR without being able to review it in depth, but it intends to put as much effort into cultivating community contribution as it can.
Yet another thing you can do is maintain a Sifchain testnet node. We have a strong community of testnet operators who serve as the first user of all of Sifchain’s code. By running and maintaining a Sifnode, you help the community test and operate at scale.
Beyond that, you can write community articles for Sifchain. Here’s one a community member just released for the Russian community!
Of course, there are still more way to help we haven’t thought of. One developer told us he’s been working on Promethus + Grafana integration for benchmarking. Other developers have already helped with building faucets and other critical infrastructure we need, or just answering questions on Discord and Telegram https://twitter.com/sifchain/status/1327419675672682496?s=20
We've been deeply grateful for all of the support we've seen from the community but know there's still a lot more to go. An unfinished article we want to write describes how we ultimately see Sifdao and Sifcore working to make Sifchain a premier cryptocurrency protocol. It heavily cites research on Teal Organizations which prioritize self-management.
"The Teal paradigm refers to the next stage in the evolution of human consciousness. When applied to organizations, this paradigm views the organization as an independent force with its own purpose, and not merely as a vehicle for achieving management’s objectives. Teal organizations are characterized by self-organization and self-management. The hierarchical "predict and control" pyramid of Orange is replaced with a decentralized structure consisting of small teams that take responsibility for their own governance and for how they interact with other parts of the organization. Assigned positions and job descriptions are replaced with a multiplicity of roles, often self-selected and fluid. People’s actions are guided not by orders from someone up the chain of command but by ‘listening’ to the organization’s purpose. Unlike the highly static nature of Amber, Orange and Green organizations, the organizational structure in Teal is characterized by rapid change and adaptation, as adjustments are continuously made to better serve the organization’s purpose."
If you see any way you can help Sifchain, please reach out so we can work together!
When we call Sifchain "omni-chain" this means it aspires to connect to every blockchain, not that it relies on the Omni blockchain that used to run Tether
Q6 : Q1-How does your limit orders work,is it the same with CEX?
Q2-This is the first time I heard an Omni-Chain solution that Sifchain is offering to users. May you please explain how this solution works and how will it improve or change the users crypto trading capabilities especially the newbies on crypto trading?
Ans : Hehe, for the bonus round we'll go with this eager AMA participant
Sifchain uses both an order book and a CLP for trade completion. Orders are placed with a commit-reveal scheme to circumvent front-running from validators. Committing a limit order will require traders to actually transfer the value posted, regardless of whether or not it is revealed. Generally speaking, this scheme is still vulnerable by either: (i) committing multiple transactions and selectively revealing only the profitable ones, or (ii) committing multiple transactions and selectively invalidating the unprofitable ones (not enough collateral, or proxy contract exception). However, we considered a transaction valid only if it was revealed within n blocks of being committed. If n is sufficiently small, traders will have nearly no time to selectively reveal.
Sifchain derives its internal asset price from its CLPs. One CLP is used for trades directly involving Rowan, two CLPs are used for all other trades. For example, the USDC:BTC internal price is calculated using the USDC:ROWAN and ROWAN:BTC CLPs.
Traders execute market orders (swaps) directly against CLPs immediately after placing them. Traders place limit orders by posting an on-chain transaction depositing their capital in whichever currency they prefer, along with the name of the currency they’d like to purchase and their requested price. When Sifchain’s internal asset price moves to a favorable range for a limit order, a CLP swap is executed so that the limit order is filled with an average price that does not exceed the trader’s requested price. This means limit orders may be partially filled.
The key benefit of the CLP is the fee structure, which is responsive to the demand for liquidity by market-takers. Prices inherit an inertia since large fast changes cause high fee revenue. As demand subsides, the fee paid decreases. This liquidity-sensitive fee penalises traders for being impatient. This is an important quality in markets, since it allows time for market-changing information to be propagated to all market participants, rather than a narrow few having an edge.
Sifchain supports conditional market and limit orders, including stop loss and take profit orders. It also supports amending limit orders that have been placed but not executed to enable trailing orders.
Sifchain prioritizes limit order execution based on the yet-fulfilled quantity of purchased tokens, not the time the orders are placed or the requested price. In this way, they differ from CEX limit orders that are executed based on the time the orders are place and the requested price with no care about the quantity of tokens. This allows CLP liquidity providers to maximize revenue and encourages traders to post trades that accurately reflect their market view. CLPs are expected to maintain accurate asset prices because any inaccurate asset price presents an opportunity for market makers to profit through arbitrage. However, traders are able to request oracle verification if they believe the internal asset price may temporarily deviate substantially from its external asset price. In such a case, orders will only be executed to the extent that the average price is within a specified range of the oracle price.
Sifchain enables liquidity providers to add liquidity into Sifchain’s liquidity pools where they can
earn income without the constraints that other exchanges put on them. Liquidity providers are able to deposit any token Sifchain supports to the appropriate pool. They can add liquidity asymmetrically, meaning they can add only Rowan or only TKN for any token. Liquidity providers can add or remove liquidity whenever they choose.
When we say "omni-chain" we simply mean that we'll attempt to build bridges to 20-25 different bridges and open source schematics for bridge building. Our hope is that with the help of community members like you, every blockchain will see cross-chain liquidity as an essential component, like a block explorer or a wallet
But before leaving, do you have any final words for the community, perhaps important links and how we can purchase Sifchain token
You should check out our website, https://sifchain.finance for more details. You can also follow us on Telegram, Twitter, Discord, and our Newsletter
We are set to announce token sale details for Nov 30. Thanks again for your interest in Sifchain
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