HIVE can participate in the emerging DeFi landscape.

LeoFinance
6 months ago
6 Min Read
1188 Words

There is an incredible opportunity on the horizon for HIVE to become more than it is today. Defi is booming, and driving the start of the current Bull market for crypto we see emerging. There will soon be a way for HIVE to participate, and it could solve some of the issues that people have been discussing recently, without needing to alter the base layer of how the HIVE reward pool works.

Rune Logo.JPG

Thorchain. Native token RUNE.

Thorchain is an up and coming project that has caught the eye of a few people here in LeoFinance. Most notable is @shangaipreneur, who has been writing about it since before DeFi captured the market attention. I would encourage anyone that has missed them, to look back on his articles about Thorchain. The easiest way to find them is by following the links in this tweet.

For those not aware, Thorchain is developing a cross chain swap platform, using a continuous liquidity pool model, with RUNE as the native token. Simply what that means is a decentralized exchange - but one that rewards liquidity providers (people staking assets to the pools) and node operators. This means that anyone will be able to stake their coin (BTC, ETH, BNB, whatever) into a pool on Thorchain, and earn RUNE rewards based on swap fees from the pool, and some token emissions.

It is a fair bit more complex and nuanced than that, and I would really recommend anyone interested to do more research on RUNE. The token is up roughly 8X over the last 3 months. The project is still in test-net phase, with the next stage (Chaosnet) about to begin. This is the final preliminary phase prior to the launch of the main-net.

How can HIVE join the party.

Thorchain is a "Chain agnostic" protocol. That simply means that it can bridge to any blockchain. Once the mainnet is up and running, linking is a matter of creating a new pool for the token. This will build the bridge from the chain (in this example HIVE) to thorchain - and thus every other chain already linked. Once people "stake" their HIVE into the liquidity pool, It grows the pool and adds it to the queue to be added into the list of active pools. Thorchain is designed regularly and aggressively churns its nodes, and to re-enter the system nodes must be running the latest version. This ensures that any changes or new chain links are quickly cycled into the system.

In simple terms, once the Thorchian mainnet is up and running, the Hive community can link itself to Thorchain without having to ask for any ones permission. We can just do it.

Why would we?

I have seen some debate around Hive lately about the nature of the Reward pool, and making significant changes to the tokenomics here on HIVE. Linking up with Thorchain could be an alternative solution, that would keep everyone happy. Here is how it would work:

I want to invest in HIVE, make an ROI, but not bother with the blogging and P.O.B. side of things:

  • Buy HIVE - or swap other coins into HIVE via Thorchain.
  • Instead of "Powering up" and locking my tokens away for 13 weeks, I can stake them into the HIVE liquidity pool on Thorchain.
  • Tokens remain available, and can be unstaked at any time - meaning investors can earn ROI from HIVE stake without Powering it up.
  • A deep pool of liquidity would make it easy to swap from any major coin into and out of HIVE, making HIVE a more attractive investment.
  • Return for staking HIVE in an LP is payed in RUNE - meaning their is no inflationary impact on HIVE. If this becomes popular, the investor class here can earn ROI with better liquidity, and those who do choose to power up the old fashioned way will earn a higher ROI due to less competition from whales for the reward pool.

Why Thorchain in particular?

  • It is chain agnostic - it can link to anything.
  • Tokenomics design is genius - from what I can understand.
  • It's like a "cross-chain Uniswap"
  • It's not on Ethereum - so you wont have a massive GAS bill any time you transact.
  • No KYC.

Imagine a world where SMT's finally exist - as a layer 1 part of HIVE. Once the bridge between Thorchain and Hive is built, SMT's can easily have their own liquidity pool on Thorchain. Imagine being able to swap directly your LEO or NEOXIAN or whatever into whichever crypto you like, without having to go through multiple steps and various Centralized Exchanges/KYC processes etc.

Other synergies:

The communities of RUNE and HIVE are remarkably similar. Both are passionate about decentralization. The HIVE community did battle with centralization - original suffering under Steemit control, then with Justin Sun, and eventually forked away as a community to create HIVE as we know it today. Thorchain is being built by "semi-anonymous" developers, and is being designed to be 100% community run asap. Both communities have backed the underdogs in many regards, being involved in a community run project instead of a centralized - big money alternative. Both communities seem to value a lack of KYC, and are looking for economic freedom.

Ways HIVE could integrate:

  • Liquidity pool - as discussed above.

  • Tools and links could be built in to existing HIVE projects. Imagine being able to swap HIVE to BTC, ETH, BNB or whatever your coin of choice is (or indead swap these coins into HIVE), directly in your HIVE Keychain. Or on HIVE engine or LeoDex, or in your wallet on PeakD. HIVE developers would have an incentive to build in these services, as the Thorchain platform allows custom fees to be included. PeakD for example could add swap capabilities in by adding Thorchain, and place a 1% fee on the transactions. This would become an attractive monetization option for these services to include.

  • Makes HIVE more attractive to investors.

  • Investors wouldn't need to participate in the "Proof-Of-Brain" aspect of HIVE, leaving the Reward pool as it exists currently for those that want to participate. No need to Stake and delegate, or actively manage your HIVE power to maximise ROI. Retain higher liquidity and still earn bank via pool fees.


If you have read this far, Thank You. I'd strongly encourage anyone interested to conduct further research into Thorchain and the RUNE token. I would love to hear from some of the HIVE leaders and core developers what you think of this opportunity. I don't have any development skills, and am just a little guy around here (and have a small RUNE bag I've collected in the last month or so)

Tagging a few HIVE people to see what you all think.

@khaleelkazi
@theycallmedan
@blocktrades
@therealwolf
@ausbitbank
@neoxian
@aggroed
@yabapmatt
@themarkymark
@lukestokes
@quochuy

Apologies if you don't like being tagged, but I would really like this idea to be considered.

Cheers,

JK

Posted Using LeoFinance