The Second AMA of Bifrost-Bifrost combines new scenarios of cross-chain extension staking
Bifrost started in July 2019, when it was a staking boom. There is no concept of staking on the market that has enough liquidity and no-locking-positions. During the development of the project, the shortcomings of single-chain smart contract development were quickly discovered. It is difficult to copy this model to multiple chains. For this reason, after the technical investigation, it was found that the Polkadot relay chain and the Substrate development framework can be combined, then Bifrost was born.
Ok let’s move to the 1st session
Q1. Hello, can u please briefly introduce the Bifrost project, what kind of problem is it mainly trying to solve, and what is the main application direction?
YEAH for sure,Hello everyone, I am Lurpis, the co-founder of Bifrost. I am very pleased to cooperate with LianDu to give you a deeper understanding of Bifrost and the new modes and scenarios that Bifrost brings to Staking.
The Bifrost project is a Polkadot parallel chain developed using Substrate that is perpendicular to the Staking ecosystem, allowing users to complete staking and obtain corresponding rights while assets cross-chain.
In the past, we heard that users always complained that they would encounter inflation when processing Staking. When they processed Staking then their positions got locked, missing good opportunities for the rising market, and got helpless when the market fell. the both revenue and liquidity could not be achieved become a normal state.
In this regard, Bifrost mainly uses Poikadot’s cross-chain technology to solve many problems in Staking such as high participation threshold, no liquidity, governance and conflicts of interest. Bifrost’s application direction will focus on staking without locking positions and reducing staking cost and improving the income of staking the three directions.
Q2. Bifrost is another Defi project of Polkadot Ecology, how is it different from Acala? Is there any possibility of cooperation between the two?
There are many excellent parallel chain teams in the Polkadot Ecology. In terms of cross-chain multi-collateralized stablecoins, Acala is currently doing very well. I personally like it. It belongs to a professional and reliable team. Acala is providing stablecoins. In addition, there is also an agreement to provide staking liquidity.
On the surface, everyone seems to be doing the same thing, but if you have a deeper understanding, there is a big difference between the two in providing staking liquidity and the way to generate staking revenue.
On the other hand, staking liquidity is a very large market, and it is still far from the stage of stock competition. Diversified competition and innovation will promote the rapid popularization of this segment in users Whether with Acala in terms of stable currency or staking liquidity, the cooperation space is very large.
Q3. Both Polkdot and DeFi are hot concepts this year, so what are the similarities and differences between Polkdot DeFi and Ethereum DeFi?
At present, most of the DeFi products in the market are built on Ethereum, but with the increase in transaction volume, the negative impact of Ethereum’s network performance bottleneck on DeFi is increasing, and the uncertainty caused by the transition from Ethereum 2.0 to POS Sex will also force current DeFi products and users to migrate to other platforms.
At the same time, the DeFi product on Ethereum will be subject to the functional limitations of the smart contract itself, resulting in a part of the business must be placed off-chain to run in a centralized manner, but compared to the DeFi project on Polkadot, the flexibility of the project is more prominent. Making smart contracts is only one of the modules, which can help the team to realize the product logic to the greatest extent.
At the same time, Polkadot uses a relay network to bridge each parallel chain and public chain to build an interconnected ecosystem. While using consensus security at a low cost, each service will not interfere with each other, nor will it cause any problem such as a single product transaction leads to the congestion that trigger the price of gas charge soaring high in the entire network.
Therefore, I am more optimistic about Polkadot. In the future, Polkadot will pose a huge challenge to Ethereum in terms of ecology and performance, which is also a reason why I am looking forward to the launch of the Polkadot this year.
Q4. Why did you choose Polkadot / Substrate, what are the natural advantages for project development?
This matter can be traced back to a year ago, our products developed based on smart contracts encountered business bottlenecks and could not break through the original chain rules for further expansion, so after comparing Cosmos SDK and Polkadot Substrate, we finally chose Substrate which has lower development difficulty and more full-scaled documentation as a technical solution.
In terms of technology, Substrate can greatly reduce the threshold of blockchain development, which will save a lot of development workload and allow the team to concentrate on the design of product experience. In terms of products, Substrate is natively compatible with Polkadot relay network, making multi-chain scenarios It can be quickly launched, of course, in addition to the Web3 foundation grant and Substrate builder program, it will provide assistance in many aspects such as capital, market, product, financing, planning and so on.
Q5. How does Bifrost staking and what is the staking mechanism?
At the user level, for example, 1 Token can be exchanged for 1 vToken through the Bifrost protocol. Over time, 1 vToken can be exchanged for 1.5 Tokens. These 0.5 Tokens are the staking income you get during the holding period, which means you participated in Staking by just holding vToken.
Of course, the way to get vToken is not only through the exchange of Bifrost protocol. You can also get vToken through exchange purchase, wallet flash exchange and other methods. The vToken obtained from different channels can all get Staking income.
At the level of use scenarios, thanks to the universal design of vToken, it is not limited to centralized or decentralized scenarios. That is to say, if users care about privacy and security, they can put vToken in their own address, if users care abuot Short-term liquidity can be placed in a centralized exchange or cloud wallet. Either way, you can get staking income.
Q6. How does Bifrost ensure the high yield and liquidity of staking and improve the marketization of staking income?
Staking liquidity is provided by the vToken’s liquidity incentive mechanism and cross-chain usage scenarios. The liquidity incentive mechanism refers to the role of providing liquidity for vToken to obtain the Staking income during vToken transactions to incentivize users and marketing staffs to provid the liquidity of vToken.
In terms of usage scenarios, vToken is a cross-chain asset developed based on the universal asset protocol. While Bifrost provides a variety of PoS currency transfer bridges, it will actively promote the exchange and compatibility of vToken usage scenarios, that is to say, vToken can be used as an anchor to the cross-chain assets of the original chain assets are used in other parallel chains.
Bifrost improves Staking income through the marketization of Staking votes. Taking Kusama as an example, the voting rights of KSM in Bifrost Staking Pool are obtained by market bidding. Whoever bids the highest, and who obtains the corresponding number of voting rights of KSM in Bifrost Staking Pool, It can enable small nodes that have not reached the threshold for block generation to self-incubate and enter the public voter’s field of vision to provide better services to confront head nodes, making the node network more secure and healthy.
Therefore, in the period of strong demand for voting rights, the Staking income generated by Bifrost may even exceed the highest return of the original chain. As a node, you can use KSM to buy votes from the fund pool to increase your voting rights. Like leverage, use the annualized cost of KSM to get more votes.
For example: pay 40% of the annualization, buy 10000 KSM and vote for 10 days at a price of 109.58 KSM (10000 * 0.4 / 365 * 10), compared to the highest 20% annualization of KSM itself, the extra 20% It is the premium generated by node bidding, and Bifrost will also distribute it to users as staking revenue.
Q7. What role does vToken play in staking? What are the application scenarios that the original Token does not have?
I personally feel that vToken is an inevitable derivative in the development of Staking, and at the same time plays the role of a guide. It will not interfere while solving the opportunity cost problem caused by the liquidity of Staking and the price fluctuation during lock-up. User’s freedom to redeem. vToken will not force users to guarantee the pledge rate of the original Token, but can let users participate in staking in the most interesting way.
At the same time, with the help of the Polkadot relay network, it provides the original Token with more other application scenarios. For example, after exchanging EOS to vEOS, use Zerochain with zero-knowledge proof, provide zero-knowledge proof solution to EOS in disguise, convert XZT to vXZT, use smart contract platform Edgeware, provide smart contract support to Tezos in disguise, convert Convert to vETH, use IOT parallel chain MXC, let ETH support the control of IoT devices in disguise.
There are many similar examples. In short, benefiting from the Polkadot relay network, the blockchain has changed from a stand-alone system to an Internet. The interconnection between the applications of various systems will bring a lot of attention due to network effects. New gameplay.
Q8. What role can BNC play as a Bifrost token in the liquidity process?
Haha😀😝😆, when it comes to this issue, I think of the BNC red-envelope warmup event held two days ago. Everyone in the group enthusiastically participated in thinking about the value and application scenarios of BNC. At the beginning of the design, BNC has a total of six scenarios to support the operation of the Bifrost protocol. These six functions are income certificate, liquidity incentive, market value unit, ticket mortgage, measurement standard, and exchange medium.
In terms of the liquidity incentives that are most closely related to users and most concerned about, that is, at the initial stage of insufficient vToken liquidity, BNC will be issued as a reward to users who exchange vToken and provide vToken liquidity.
Users can obtain different amounts of BNC rewards based on the different market value and weight of vToken exchanged. Now we are perfecting the 1.0 official white paper, which will describe in detail the acquisition channels and incentive methods of BNC. Please pay more attention.
Q9. Bifrost’s testnet POC-2 was launched in March. How will the Bifrost network develop in the future? Interested friends, how to participate in node testing and development?
When it comes to future development, you need to always look back at the lessons in history. In the DeFi project in the past two days, some bad things happened. The Lendf project because of improper contract logic processing directly led to nearly 25 million US dollars. loss.
Almost overnight, this painful lesson has taught all DeFi projects a lesson. We believe that in addition to technical strength, the DeFi project is more important in risk control capabilities, not in developing products that can be traded on the line.
The prevention of financial risks in the middle requires a lot of effort and time to verify. Keeping vigilance is the quality that the DeFi team should have, so the Bifrost team will still maintain a consistent rigorous and serious attitude in the future, and carefully write each paragraph. Code, audit every contract, carefully select every high-quality PoS asset to cooperate.
Speaking of the test network, currently interested friends can already run Bifrost nodes to participate in the test network. Currently it is still a POA network. There is no open staking mechanism. Just execute this command `docker run -it bifrostnetwork / bifrost: poc2-v0.2.3 — name “Bifrost Node” `can complete the node construction, the minimum configuration after the main network is 2 core 4GB cloud host.
For more technical tutorials on running Bifrost test nodes, we are still finishing editing and will be published in the Bifrost documentation site in the future https://docs.bifrost.codes.
Q10. What role does Bifrost play in Polkadot Ecosystem? What kind of scenarios can the vKSM after connecting to the KSM bring to the Polkadot Ecosystem?
Bifrost’s positioning is very clear, and it plays the role of a staking liquidity provider in the Polkadot ecosystem. We will mainly focus on providing staking liquidity, small-node market bidding rights, lowering the threshold of parallel chain users’ staking, and expanding the use of vToken in parallel chains. These aspects of the scene play our role well.
After accessing Kusama, the first KSM nominated for the node will be liberated due to vKSM, and the overall pledge rate of the Kusama network will be improved. At the same time, some small nodes without KSM start-up funds can obtain Bifrost nomination support through bidding to enter the producing block list in order to present in front of the public voter.
In short, vKSM is a function that our team and the small partners in the community expect together.
Q11. What is the current progress of the project, when is it expected to go to the mainnet, and the specific development route plan?
In the next time, we will continue to improve the development of the POC-2 testnet, and plan to cross-link the EOS Jungle testnet into the Bifrost testnet. And on May 1st, we plan to officially launch the Bifrost Asgard pre-production network, which will be a permanently open pre-production network like Kusama.
Teams who want to access Bifrost can verify the business logic in the Bifrost Asgard network in advance. At the end of May, we plan to conduct an IPO preview in the Kusama network to test Bifrost’s entire IPO business process.
It is expected that at the end of June, Bifrost will participate in the official auction of the Kusama parallel chain card slot and complete an IPO in the Kusama network. Under smooth circumstances, it can successfully access the Kusama network to become its parallel chain to provide users with real KSM exchange.
Verify and optimize business logic in the Kusama network as much as possible, eliminate various online risks in advance, accumulate community size, and make preparations for bidding on the parallel chain card slot on the Polkadot main network. In short, we will take the Bifrost main network online rhythm. The process of Polkadot’s mainnet is consistent, and strives to be the first parallel chain to access Polkadot’s mainnet.
Thanks for the co-founder Lurpis’s wonderful sharing. Our main Q&A session is Finished.