Hello Defiers! Here’s what we’re covering today:
Aragon community exodus
Crypto calls for decentralized social media
Record CryptoPunk sale
Fixed lending protocol Notional launches
Kain Warwick posts Synthetix 2021 roadmap
Andre Cronje says (again) “building in DeFi sucks”
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🙌 Together with Zerion, a simple interface to access and use decentralized finance, Neutrino, an algorithmic price-stable protocol that enables the creation of stablecoins tied to real-world assets, Value DeFi Protocol, a suite of DeFi products including the Value Liquid AMM, which allows anyone to create trading pools with flexible ratio pairs, and Cartesi, an optimistic roll-ups solution that aims to revolutionize smart contracts by allowing developers to code with mainstream software stacks, has just launched CTSI Reserve Mining.
TLDR The Aragon community is facing mass resignations and nobody in the leadership team is being forthright as to what exactly is driving the exodus. Disagreements over governance and, ironically, lack of transparency, have been cited on Twitter threads and posts from some of those who were on their way out.
ARAGON IS A protocol providing the framework and tools to build decentralized autonomous organizations, or DAOs.
CO-FOUNDER RESIGNS The latest high-profile resignation was from Jorge Izquierdo, chief executive of Aragon One, the for-profit entity building tools and dapps on the Aragon protocol. Izquierdo, who is also Aragon’s co-founder, marked the 13th departure in the past week. He said he will continue to be part of the Aragon community.
Izquierdo tweeted that “a series of decisions were made in the Aragon Association” in the two weeks he had taken off from work, mainly regarding governance, that he disagreed with and that given the circumstances, he felt he couldn’t “keep doing a good job.”
Today I resigned as Aragon One’s CEO. Leading this team has been the privilege and adventure of a lifetime and I am immensely proud of what we achieved. I feel quite sad that it’s come to this, but given circumstances following, I don’t think I can keep doing a good job.
January 11th 2021
41 Retweets388 Likes
It’s unclear what those “series of decisions” were. In what might reflect at least part of the disagreement, Izquierdo had been the first to respond to a proposal by Aragon co-founder Luis Cuende to speed up the merger between ANT-ANJ tokens. Izquierdo wrote on the Jan. 8 post, “I am strongly against this proposal as it will require putting trust in a centralized entity (Aragon Association and the community multisig) to operate the exchange.”
LUIS CUENDE COMMENT Cuende said when reached for comment, “as Aragon grows, differences of opinions on how to best govern are inevitable.” He said, “recently, the Association took steps to further its own decentralization,” with a recent leadership restructuring, including his own replacement with Joe Charlesworth as Executive Director, while he stepped back to become Chairman.
Cuende said the move has always been on the roadmap, as being both a co-founder and the Executive Director made governance power too concentrated. The statement suggests the reshuffling may have sparked disagreements.
💰 TREASURY REBALANCE Following Izquierdo’s departure, Aragon Association’s new Executive Director Charlesworth posted details of a treasury asset rebalancing transaction agreed to by the Aragon Association Committee.
This would involve Aragon selling around 52k ETH over time in order to increase their relative position in BTC, ANT, USDC, and USD. The sale will be performed through one of Aragon’s financial service partners. It’s unclear whether the treasury moves are related to the employee departures.
GOVERNANCE LEAD LEAVES The trouble started when Aragon Association governance lead John Light posted his resignation letter on GitHub on Jan. 7. In the letter, Light says he believes that Aragon no longer reflects his values or the values of the Aragon Manifesto.
“If power becomes centralized, it doesn’t have to answer to anyone but itself. Decentralizing power is essential to minimizing corruption over time,” he wrote.
Light called on the Aragon Association to “publish all meeting minutes and financials for public review” and “to involve ANT holders and contributors more in Association governance.”
🌊 MASS EXODUS Following Light’s resignation 11 employees of Aragon One announced their departures in the Aragon Discord. All of them cited Light’s resignation letter as an apt reflection of their own reasons for leaving.
Demands for answers have continued to rage within the Aragon Discord, and as it stands, specifics still remain unclear.
“I’m just flabbergasted that the response not only fails to address the concerns the team expressed, it actively demonstrates those very concerns,” a community member posted.
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TLDR While half of America likely cheered the deplatforming of Donald Trump, crypto was calling for decentralized social media.
Coinbase and Paradigm co-founder Fred Ehrsam summarized the sentiment tweeting, “Why decentralization matters’ went from theoretical to mainstream overnight.”
NEED FOR DECENTRALIZED SOCIAL MEDIA Delphi Digital co-founder Tom Shaugnessy told The Defiant, “recent deplatforming events have demonstrated the need for truly decentralized social media apps not because we shouldn’t deplatform certain people, but because the community should be the one to make the decision, not a CEO.”
ARGUMENTS FOR DEPLAFORMING ABOUND Noam Chomsky, MIT professor emeritus and political commentator said in an email shared on Twitter, “The argument is simple. He’s extremely dangerous, and delaying his appearance for a brief period is not substantial interference weighed against the dangers. In fact it is quite mild as compared with common practice by other private organizations.”
⛓ SOME TURN TO CRYPTO Gab.com, an alternative social network that uses Bitcoin as a form of payment, tweeted that they received 1 million sign-ups in the past 48 hours.
DLink, the video streaming service with an integrated token reported 150,000 viewers on the day rioters stormed the capital, demonstrating that crypto companies can gain new users in response to perceived free speech infringements of other platforms.
IMPACT ON DEFI At first glance, it would appear that censorship affects the crypto social apps more than DeFi. But Isiah Jackson, author of Bitcoin and Black America, offered another perspective on Twitter, quipping, “AWS (Amazon Web Services) banning Parler means ‘DeFi’ will actually have to decentralize now.”
NFT SPACE IS ON FIRE
🙈 CryptoPunk Sold for Record 140k ETH Last Week
TLDR A 24×24 pixel image last week sold for 140 ETH, or $176k, the highest USD price on-record for a non-fungible token. It’s the latest sign that the crypto art market is heating up. The piece sold is CryptoPunk 8219, one of 24 Ape punks.
BUT WHY To some, it’s just a low-resolution image of a monkey linked to an Ethereum token. But to those buying these tokens for many thousands of dollars, they’re scarce collectibles, badges of honor, or even tickets into an exclusive club.
💎 SECOND RAREST Within the CryptoPunks line—which consists of 10,000 unique, algorithmically-generated 24 x 24 pixel characters—apes are the second rarest. (Aliens are the rarest, with only 9 out there.) Each one sports a different accessory. The high-selling ape is wearing a beanie.
“…With a NFT, by posting it as my avatar on twitter and discord, I can quickly ‘flex’ with a picture,” he tweeted in a thread explaining his purchase. “It has the same effect as wearing that Rolex in real life, but digitally.”
NEW PROJECT ALERT
TLDR Notional Finance has come out of stealth with $3M in liquidity following a closed beta over the past quarter. Notional users can lend and borrow the stablecoins DAI and USDC at fixed rates using ETH or WBTC as collateral.
RATES A 10k USDC loan has a fixed APR of 4.27%, while a 10k USDC deposit has a 3.61% APY, currently on notional.finance. This compares with variable borrow rates of at least 7% on Aave, Compound and dYdX, and a 9% stable rate on Aave, according to LoanScan. Lending rates on those DeFi platforms are also higher, at over 6%.
DOMINANT FORM 90% of loans in DeFi are issued at variable rates, while fixed-rate lending is the dominant form of financing in traditional financial markets, with over $2.5 trillion of fixed-rate debt issued in 2019 in the US alone.
Yearn Finance founder Andre Cronje published another post titled “Building in DeFi Sucks,” after writing a column with the same title in February last year. He says development takes time, it’s expensive, and real users are scarce; they will only go wherever they are getting the most tokens.
In the same vein, he complained that all people seem to care about is the value of the platform’s token, and that users will blame you if the project gets hacked, but attribute it to the community if the project succeeds. Cronje appears to regret not keeping part of the YFI token he gave away entirely to the Yearn community, sparking the “fair launch,” movement. He said “Community is bullshit,” because most people won’t contribute and instead endlessly demand updates and explanations.
“My best advice, honestly, don’t be a dev, you need to be some kind of sick masochist to be a dev in this space, be a shitcoin trader, you can meme and shitpost all day long.”
Synthetix co-founder Kain Warwick published a 2021 roadmap, which he highlighted, it’s just his opinion, as he doens’t have actual power to enforce these changes.
Synthetix on Layer 2. “Launch of Optimistic Ethereum will enable Synthetix to deliver on its promise of taking on both CeFi and TradFi.”
Synthetic futures: “one of the first releases of the year will be a testnet for futures.”
Synthetix V3: “A ground up rewrite of the entire contract suite,” whihc will remove backwards compatibility and require user migration.
Upgrades include new SNX staking mechanism, tokenised debt, order matching, continuous staking rewards.
Asset expansion: More crypto, commodities and FX and most importantly, equities.
🧑💻 ✍️ Stories in this newsletter were written by Daniel Kahan, Owen Fernau, and Cooper Turley, and edited by Camila Russo. Video was produced by Robin Schmidt and Alp Gasimov. The podcast was led by Camila Russo and edited by Alp Gasimov.
The Defiant is a daily newsletter focusing on decentralized finance, a new financial system that’s being built on top of open blockchains. The space is evolving at breakneck speed and revolutionizing tech and money. Sign up to learn more and keep up on the latest, most interesting developments. Subscribers get full access, while free signups get only part of the content. Click here to pay with DAI (for $100/yr) or sub with fiat by clicking on the button above ($10/mo, $100/yr).