OpenSwap — Telegram AMA — October 28
On Thursday, October 28, we had the pleasure to welcome to our Telegram chat:
Bruce Chau, Founder
We asked him some questions about the development of OpenSwap
Some sentences have been slightly edited for readability but the meaning has been conserved.
Summary
Interblockchain assets are incompatible and OpenSwap aims to dismantle these interchain boundaries. Multi-chains asset management can be more efficient with low cost. OpenSwap will revolutionize the existing Decentralized Exchanges (DEX) ecosystem in ways that no single DEX can provide.
The continuous growth of DEX from various projects inevitably involves multiple blockchains. Digital assets are often scattered across multiple chains making asset management uneconomical and ineffective. OpenSwap is the one-stop DeFi Hub solution that aims to reduce the friction of asset exchanges on different chains through a decentralized bridging mechanism. Allowing users to trade at the lowest cost chain and undergo yield farming for long-term value.
Innovative technologies are being put to use behind the OpenSwap solution:
-Spot Market Liquidity Queues — OpenSwap introduces Liquidity Queues as a complement to Automated Market Maker (AMM) swap, offering spot market trades based on the Secure Adaptor Protocol.
-Decentralized Bridge & Swap — A pool of decentralized Bridge Nodes leveraging MPC technologies to secure the bridging of cross-chain assets. Providing an order consolidator mechanism in groups trades to reduce gas fees on more expensive blockchains like Ethereum network.
-True-Value Farming — Staked assets will be used to generate synthetic stablecoins that can be swapped for other stablecoins, giving a long-term value to owners while ensuring the benefits of potential asset appreciations.
A series of new functionality releases will soon be available in OpenSwap. First will be the release of the liquidity queues, providing an alternative for users with “no-slippage” options when swapping assets. Followed by the deployments of native AMM pools and Oracle-based queues to the Ethereum blockchains.
Introduction
Q — Ayeley from GAINS: It’s good to have you back in the Gains Community! As we have new joiners here in our group, can you please introduce yourself and your team to some of the new Gains community members?
A — Bruce from OpenSwap: Thank you! Happy to re-introduce myself. It is a pleasure to be back here in this great community! For those who don’t know me, I’m Bruce, a key member and founder of the OpenSwap project, a recovering enterprise dev, enlightened by blockchain in 2018 and never looked back.
At the core, our team’s strength is technology, however, we’ve been aiming to build up a community of talent that crosses boundaries of technology, finance, marketing, and more through the many partnerships we have developed and continue to build. We hope to attract more developers and contributors to our team through participation events such as hackathons that ultimately build up the DeFi community.
About OpenSwap
Q — Ayeley from GAINS: Just a reminder for those who are new to our community, how did this project come about and what are the pain points OpenSwap is aiming to address?
A — Bruce from OpenSwap: Our team began working on what would become OpenSwap about a year and a half ago, during the summer of DeFi in 2020 when Uniswap was gaining huge popularity with its AMM liquidity pools. At that time, we wanted to address the two primary pain points: Slippage and Impermanent Loss.
Our idea was to provide on-chain spot market priced swaps without slippage, in the form of OpenSwap Liquidity Queues — which is also the first core technology we are rolling out this week!
Going back to the pain points in the DeFi space, at OpenSwap we firmly believe that DeFi users should have the choices and freedom to swap with any liquidity source. Instead of competing for liquidity with other AMM DEXes, we want to support them and let users make informed decisions on the optimal swap for their situation.
Q — Ayeley from GAINS: What are the core features offered in your dApp. Could you give us an overview of Liquidity Queues, Hybrid Smart Router, and Open Interchain Protocol?
A — Bruce from OpenSwap: Our primary goal is to revolutionize on-chain liquidity with a series of tools culminating in helping reduce friction with cross-chain swaps.
It all starts with our DEX aggregator offering users the choice to fulfill their swap with any liquidity source on any chain. OpenSwap Liquidity Queues will be one of these sources of liquidity that provides more attractive prices by bringing spot-market priced swaps on-chain without any slippage.
Then, the Hybrid Smart Router will allow OpenSwap to utilize existing liquidity in AMM pools in conjunction with OpenSwap Liquidity Queues to execute swaps in the most efficient manner providing the most return for the user’s swaps.
All these critical pieces will be linked up to our Open Interchain Protocol, a new cross-chain bridging solution that will offer more efficient inter-blockchain swapping of chain-native digital assets through the usage of single-asset bridge vaults and decentralized mechanisms.
Q — Ayeley from GAINS: Let’s zero in on Liquidity Queues. Can you please explain in-depth, what exactly are Liquidity Queues, and how does it guarantee Zero Slippage? It would be nice if you can elaborate using real-life use-cases as examples.
A — Bruce from OpenSwap: The first iteration of Liquidity Queues scheduled to be released this week is our Spot Price Queues.
Spot Price Queues will enable users to execute on-chain swaps at spot-market prices with no slippage. Prices are obtained from decentralized oracles, and the queue uses a secure adaptor protocol that guards against many of the shortcomings of using oracles. The Protocol includes a series of customizable circuit breakers that ensure liquidity providers are protected against any kind of exploits, trades that fail any of the circuit breakers will not be carried out.
For an average user who wishes to perform a swap, OpenSwap will show various options from DEXes, including OpenSwap’s own Liquidity Queues. We expect that the spot-market price of Liquidity Queues will offer the most attractive pricing due to zero slippage compared to AMM pools.
There are two subtypes of the Spot Price Queues category, and they are Spot Priority Queue and Spot Range Queue, both of which are scheduled to be released this week.
Spot Priority Queues are designed for traders seeking to exit out of a position quickly, and at the spot market price. Priority can be achieved through staking a quantity of $OSWAP tokens. The order with the highest amount of OSWAP tokens staked will be sold first. Users can also set an ‘expiry date’ for their orders so that no more will be sold after a certain time if not already sold.
Spot Range Queues will provide the ability for liquidity providers to set price brackets, on which to make their liquidity available for sale. Trading DApps tapping into the liquidity queues can initiate trades using the liquidity as long as the market price is within the range set by the liquidity provider. The transaction price will be based on the existing spot market price.
In both types of Spot Price Queues, liquidity providers joining the queues have the option of canceling or withdrawing their liquidity as long as it hasn’t been swapped against yet.
Q — Ayeley from GAINS: You mentioned in our previous AMA that cross-chain bridging is a core component to OpenSwap’s end game, so how do you see Open Interchain Protocol (OpenSwap’s Bridge) being a better solution than other cross-chain bridges existing in the market now?
A — Bruce from OpenSwap: There are currently two ways to move tokens across different chains:
1. Lock and mint synthetic on the destination chain
2. Utilizing a cross-chain AMM pool
The lock and mint approach is much easier to implement, but it requires users to recognize the synthetic on the destination chain as the “official” token or users would have to take another step to exchange the synthetic into the “official” token they want.
The cross-chain AMM pools solve the issue of taking another step to exchange the synthetic by providing the desired token on the destination chain. However, it often requires an intermediary token to facilitate the cross-chain swap. As with all AMM systems, liquidity providers are subject to impermanent loss.
The Open Interchain Protocol leverages existing liquidity on the target chain by routing the swap through DEXes and liquidity queues to maximize the return on swapping tokens across different chains. Each chain would have single asset bridge vaults where liquidity providers do not suffer impermanent loss and receive a portion of the bridge fees. The bridge vaults are managed by a network of validators called bridge trolls where there is enough bond staked in $OSWAP to cover the size of the interchain swap requested by the user. The bridge troll will leverage the OpenSwap Hybrid Smart Router to route the swap through the top DEXes on the destination chain and OpenSwap Liquidity Queues to provide an optimized return for each swap.
Q — Ayeley from GAINS: We saw that OpenSwap recently announced a community-driven NFT initiative called “Troll Camp’’, what exactly is this? Does it mean OpenSwap users get to play a part in the Open Interchain Protocol?
A — Bruce from OpenSwap: On our rapid march towards our core technology rollout, we have also recently announced an upcoming launch of the OpenSwap Troll Camp, which will be a fun and community-focused initiative to allow OpenSwap users to stake $OSWAP and be rewarded with:
- Troll Camp rewards in OSWAP tokens
- Rewards Boost for future OSWAP staking campaigns
- Flash Sale participation on OpenSwap Restricted Group Queues upon release
- Exclusive Bridge Troll NFT
- And sustainable rewards program on participating as a Node Validator in the Open Interchain Protocol
Every Bridge Troll NFT will be unique and represents a stake, and it will entitle the user to unique-to-OpenSwap benefits as listed above.
These Bridge Troll NFTs are transferable, but the user will need it to get back the OSWAP tokens staked as the user will need to burn the NFT. Every time a Bridge Troll NFT is burned, the user will receive back the OSWAP staked, and it would also open up a free slot in the OpenSwap Troll Camp for someone else.
For those who want to participate in becoming a Bridge Troll (Node Validator) on the Open Interchain Protocol, they would need to hold a Bridge Troll NFT. The NFT will represent the brand for their node, and the user can build up the reputation and sell their NFT as they deem fit.
Q — Ayeley from GAINS: Any specific features that you are most excited about? How do they tie back to the pain points OpenSwap aims to relieve for the DeFi community?
A — Bruce from OpenSwap: In the short term, we are most excited about the release of our Liquidity Queues as it allows a variety of purpose-defined liquidity options to the user. We are starting off with Spot Liquidity Queues that will always offer spot-market prices without any slippage. With amazing feedback from our community, we continue to add various types of Liquidity Queues including a way to target your liquidity to a specific group of users. The community keeps coming up with new ways to use these Restricted Group Liquidity Queues including flash sales for membership groups and guaranteed buyback options for IDOs.
The long-term excitement is focused on the Open Interchain Protocol as openSwap will begin to fulfill its mission of reducing the friction of moving tokens across different chains. Our team has made good progress this month as we implemented an NFT into the bridge troll network as an additional access layer for participants in the network.
Q — Ayeley from GAINS: How does the Open Interchain Protocol compare to more popular bridging methods such as ‘Lock & Mint Synthetic’ and ‘Cross-chain Liquidity Pair Pool’ models?
A — Bruce from OpenSwap: The two most commonly used bridging mechanisms in the current DeFi space are the ‘lock and mint’ and the ‘cross-chain liquidity pool’ models. Both varieties are moderately acceptable cross-chain options, but at the same time, a lot can be improved on because the current solutions incur irritating drawbacks such as slow speed, high costs, involving the use of synthetics, and high complexity on the actual execution.
We believe that current bridges are more of ‘interim solutions’ that don’t actually provide the seamless and cost-efficient cross-chain experience that the DeFi space would want to see in the longer run. We believe that most DeFi users are just waiting for something better to emerge in the market, and to that, we present our Open Interchain Protocol.
The Open Interchain Protocol will be doing things a bit differently than conventional bridges in the current DeFi space. The Open Interchain Protocol will adopt the single-asset vault model and will also incorporate in-house innovations such as Liquidity Queues and Hybrid Smart Router to provide DeFi users a highly transparent and more capital efficient end-to-end interchain swapping experience.
Q — Telegram user Lily Speaking🗣: One of the main components to make the OpenSwap Open Interchain protocol different from other conventional bridges is the use of individual asset vaults. How do these “vaults” work and what wealth do these vaults generate for your holders?
A — Bruce from OpenSwap: As you indicated the vaults are single assets, typically a stable coin. Liquidity providers may park their liquidity in the vaults and receive a portion of the bridge fees as users move tokens across the bridge. Since the vaults are single assets, liquidity providers will be immune to impermanent loss. The vaults are managed by a dynamic multi-sig contract that requires bridge trolls with enough stake to cover the size of the transaction to access the funds. Any bad actors will have their stake slashed.
Q — Telegram user James: What is the difference between Green Trolls and Mean Trolls?
A — Bruce from OpenSwap: Anyone may become a Green Troll as long as they hold the NFT and stake the minimum amount required. Their responsibilities are to validate transactions created by the Mean Trolls. Mean Trolls have more responsibility in preparing the batch of transactions to fulfill the interchain swap requested by the user. Mean Trolls are required to stake a larger amount to cover the size of the transactions and can be only voted in through governance (typically nominated Green Trolls with good performance).
Q — Telegram user Karla Herrera Pulido⭐️: Regarding your “HYBRID ROUTING” feature, how is the process of routing the exchanges through the different chains in the DeFi space? Does this process have to be done manually by the user or does your ecosystem do it automatically, when they start using the OpenSwap platform?
A — Bruce from OpenSwap: The Hybrid Smart Router will provide suggestions on the best route through the OpenSwap DApp. You will be able to see the savings you get with routing the swap through different DEXes on the same chain.
In general, you may just select the best price and the router will do all the work for you so that you don’t have to manually do multiple transactions to achieve the savings.
Q — Telegram user Kiriux: I was checking your governance portal and there are three balances to take into account: wallet balance, staked balance, and voting balance, so could you explain how it really works? What is the minimal amount of each one to participate in the decision making and what advantages are there for voters?
A — Bruce from OpenSwap: Your wallet balance is the amount of OSWAP you currently hold in the address, this will be the same amount you see when you look up your address on BSC Scan. The staked balance is the amount of OSWAP tokens you staked into the governance portal. To prevent any possible flash loan exploits on governance, there is a cooldown period from when you stake into the governance portal and when it is eligible for voting.
Q — Telegram user Orlemys: Spot Price Queues will be released this week, would you tell us what are the main features this product will offer? Will it be accessible to everyone who holds your token? Was it beta-tested before release?
A — Bruce from OpenSwap: Yes, the Spot Queues have been on testnet over the summer and we have had two audits against the contracts. The primary feature here is that users may enjoy zero slippage swaps and liquidity providers may exit their positions quickly by prioritizing their liquidity through their $OSWAP stake.
Token
Q — Ayeley from GAINS: What will be some of the utilities of the $OSWAP token?
A — Bruce from OpenSwap: The main purpose of the $OSWAP token is to:
- Incentivize usage of the OpenSwap platform
- Encourage users to get involved in the governance of the protocol
- Enable platform privileges such as the ‘priority’ features when using the OpenSwap Spot Priority Queue
- Staking to become a Bridge Troll (node validator) on the Open Interchain Protocol. The stake becomes a bond to determine the transaction size the Bridge Troll is allowed to validate.
The token was established as an ERC-20 token and was also bridged to the Binance Smart Chain to enable the governance of the BSC version of OpenSwap during the initial launch.
Partnerships
Q — Ayeley from GAINS: We understand that you will be releasing Spot Priority Queue and Spot Range Queue very soon, assuming liquidity needs to be injected into the queues, how are your liquidity partnerships coming along?
A — Bruce from OpenSwap: OpenSwap has a headstart on the partnerships due to our strategic round prior to the IDO. This provided us with an initial set of partners who will be participating in our early bird liquidity providers program for our Liquidity Queues. We are always looking to grow the number of partners and the early bird liquidity providers program is a great opportunity for parties who missed out on the strategic round to support the project.
If anyone is interested, feel free to reach out to our team.
Funding
Q — Ayeley from GAINS: Now that OpenSwap’s IDO is done and dusted, can we finally get to know who are your investors and partners contributing to this project alongside the core team?
A— Bruce from OpenSwap: Absolutely! We are excited to have the opportunity to work closely with many partners in the DeFi domain. The OpenSwap team received a technology contribution from IJS Technologies, an award-winning technology firm that received grant support from one of the older DeFi teams — OAX Foundation in 2020.
Our contracts are reviewed by CertiK, Beosin, Peckshield, and we are also working closely with partners who share the same values and goals as us, such as the likes of Coin98 and Impossible Finance, whom the latter OpenSwap is also part of the first cohort with their launchpad release.
The OpenSwap project is backed by many reputable partners such as NGC Ventures, Coin98 Ventures, BR Capital, Legos Capital, Double Peak Group, Prime Block Ventures, Illusionist Group, Muhabbit Capital, All In Ventures, as well as angel investors such as Curve Finance’s Julien Bouteloup, Leo Cheng from CREAM Finance, Mark Borsten, and Ravindra Kumar Found of Frontier — just to name a few.
For our full list of backers, community members are encouraged and should be able to do their own research quite easily as OpenSwap has been mentioned in publications from Coindesk, Coinspeaker, and many other crypto-targeted media around the world.
Competitive Advantage
Q — Ayeley from GAINS: How do you intend to compete for liquidity with existing protocols in the DeFi space?
A — Bruce from OpenSwap: OpenSwap Liquidity Queues sit in between the AMM DEXes such as Uniswap, PancakeSwap, and the order book-based CEXes. Spot Price Queues always execute at spot-market prices, removing the possibility of sandwich attacks by frontrunning and back running given that trades do not affect the reference price.
Our Limit Offer Queues (to be introduced later) will not expose the order book to limit front-running opportunities. OpenSwap Liquidity Queues offer an alternative way to buy and sell tokens without causing any slippage.
Business Development
Q — Ayeley from GAINS: Assuming Interchain Bridging is OpenSwap’s end game, which will happen early next year (according to your docs), what should users expect after that?
A — Bruce from OpenSwap: The OpenSwap ecosystem including Liquidity Queues, Hybrid Smart Router, and Open Interchain Protocol are designed to not only be decentralized but also extendable to new chains at the same time.
OpenSwap Liquidity Queues will be launched on BSC, adding new types of Liquidity Queues to offer users more choices, and expanding Liquidity Queues onto other EVM compatible chains including L2 ETH such as Arbitrum and Optimism. Our Bridge Troll network will enable interchain swaps — leveraging our Hybrid Smart Router and Liquidity Queues deployed on the different chains. Longer-term plans are to expand to other chains such as SOL, DOT, AVAX, as well as other emerging chains.
In addition, as DeFi users would surely understand, new chains are emerging in that space all the time, OpenSwap aims to spearhead (or at least stay relevant in) this space for a long while, and to do that — our bridging mechanism would need to be easily extendable and highly adaptable to new chains. Our bridge enables additional chains to be quickly added to Open Interchain Protocol by simply deploying the set of contracts on new chains.
At these initial stages of the OpenSwap project, our protocol will support Binance Smart Chain and Ethereum, but the core team here envision that the Open Interchain Protocol will soon support other EVM compatible chains.
Q — Ayeley from GAINS: Aside from traditional staking programs that most DeFi projects are already doing, will OpenSwap offer any unique reward programs specifically for the OpenSwap community?
A — Bruce from OpenSwap: Yes, as mentioned earlier — we will be introducing an OpenSwap community-focused initiative called the Troll Camp, where OSWAP holders can stake their OSWAP and obtain these Bridge Troll NFTs which will enable them to enjoy a lot of unique-to-OpenSwap benefits, and also would allow them to participate in the Open Interchain Protocol as a Bridge Troll (upon feature release).
Becoming a Bridge Troll on the Open Interchain Protocol essentially means that they will become a Node Validator for the transactions. And Bridge Trolls will be rewarded for the “work done”, meaning they would get rewarded a portion of the Bridge Fees as assets cross the OpenSwap Bridge!
Q — Ayeley from GAINS: Aside from the much-anticipated Liquidity Queue release, is there anything else OpenSwap supporters should be looking forward to?
A — Bruce from OpenSwap: The most exciting event for OpenSwap in the very near future would be our release of Spot Priority Queues and Spot Range Queues, which are scheduled to go live this week!
Our team has already uploaded tutorials in our docs for those who need them, and we encourage all DeFi community members to go try executing swaps on our queues and enjoy this zero slippage experience that OpenSwap Spot Price Queues will offer.
Other core OpenSwap features scheduled for introduction later this year would be the other types of Liquidity Queues such as Restricted Group Queues which can be used by IDOs who wish to offer their participants a Guarantee Buy Back for their tokens. Furthermore, we aim to be releasing our Open Interchain Protocol early next year.
Thanks Bruce, for coming into the GAINS community to answer our questions. For GAINS community members who aren’t already in the OpenSwap community, where should they go for project updates? — Ayeley from GAINS
Thank you for having me here today to speak to your wonderful community. We always encourage DeFi Community members to actively participate in discussions to help make the OpenSwap ecosystem a better place for all.
Website | Document | CoinMarketCap | CoinGecko | Swap | Discord | Twitter | Medium | Youtube — Bruce from OpenSwap
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