Why I Think Ethereum Will Succeed

The Power of Network Effects

  1. MakerDAO created DAI, a new cryptocurrency pegged to the US Dollar (1 DAI = 1 USD).
  2. Compound then integrated DAI in their borrowing protocol and users can now earn +10% interest on their crypto dollars (DAI) by lending them on Compound.
  3. Leighton Cusack then came up with PoolTogether, a no-loss lottery built on Ethereum, Maker, and Compound on which anyone can buy a ticket for 20 DAI, the proceeds are locked on Compound to generate interests → one lucky winner earns all of the interest generated by the pool at the end of the cycle.
  4. Finally, Decentral.ee created rDAI, a new token built on Maker and Compound as well, allowing anyone to allocate interest earned with their capital to the third party of their choice. Which creates a new opportunity for Ethereum project to finance their development without risking the capital of their “investors”.
“Money Fucking Legos” illustration from Damian Sowers.

The Removal of Intermediaries

Smart People for Smart Contracts

What are the Risks?

  • The centralized Oracle solutions of MakerDAO and Compound: Most of the DeFi projects being built right now are using DAI from Maker and Compound’s lending protocols which are built on centralized Oracles to receive the current price of the assets concerned. This is an issue because it creates a single point of failure that shouldn’t exist in a trust-less decentralized environment. It will be very interesting to see how the Open Oracle System initiative evolves in the coming months.
  • Smart-contracts risks: Since a lot of projects rely on the same building blocks (mainly Maker and Compound for now) it’s essential to make sure that all of those projects are audited and secure. It would be great to have a sort of Open Auditing System that would rank the robustness of any smart contract based on contributions from the Ethereum developers community.

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❤️ Passionated by #VR and #Ethereum — 💼 CEO & Founder @Unimersiv — 🔥 BoostVC — Tribe 6

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Baptiste Grève

Baptiste Grève

❤️ Passionated by #VR and #Ethereum — 💼 CEO & Founder @Unimersiv — 🔥 BoostVC — Tribe 6

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