TransferWise/Revolut/etc To and From Dai via DAIHard — No KYC
DAIHard was re-launched months ago, and we were able to verify a basic level of functionality with a few hits from real uses. We’re now about to start focusing on marketing and liquidity, so I wanted to write a quick post on what is, to me, the most exciting immediate use-case for DAIHard: entering and exiting crypto via banking apps like TransferWise, Revolut, etc, all without KYC or signup.
Off Ramp: Dai to Dollars/Euros/Whatever
If you have Revolut or TransferWise, you can use DAIHard to turn your Dai into a balance on your banking app of choice—possibly in minutes, depending on the activity of the DAIHard marketplace. Here’s how it works.
1. Find or Create an Offer
First, head to the DAIHard marketplace and look through the offers (uncheck “selling” under “Offer Type” to just see offers to buy Dai). If there are a lot there, narrow the results down further by typing the name of your app (Revolut or TransferWise) in the search box on the upper right.
For each trade, you’ll want to read through the payment method text. Here, the Buyer has described how he is able to send payment. Make sure you can receive the payment as described—otherwise there may be burnable punishments in store!
You’ll also want to pay attention to the amount being bought and the price they’ll pay for it. The offer creator may have set the price in his favor to make a small profit, or it may be set in your favor to encourage a quick commitment from you and others browsing through the marketplace.
The benefit of finding an offer instead of creating one yourself, is that you can immediately commit and begin the trade. But the downside is that you can’t really customize anything — for each offer you must take it or leave it. Anyway, if you find one you like, click the offer to read more about it, and move on to step 2.
If you haven’t found any trades to your liking, then you can create your own Sell offer. Click on “Create New Trade” at the top, or go here. Make your own trade, and make it how you like it!. The downside is that you’ll have to wait for another user to commit, which may or may not happen depending on your terms (but you can always cancel for a refund before anyone commits).
(By offering to sell a little more Dai than is strictly fair, you can encourage a quicker commitment from another user. Or if you want to try to make some profit, offer to sell a little less for the same price, and play the waiting game.)
In “Accepting the Payment”, write something like “I can accept a transfer of USD into my TransferWise account”. Click around the other settings to learn more about them (particularly the time values at the bottom), and when everything looks good click “Connect to Wallet” at the bottom, then the “Review Terms and Place Order” button it’s replaced with. You’ll then be able to deposit the Dai you want to sell, bringing you to your newly created offer and listing it on the Marketplace for others to find.
2: Commitment
You should now be looking at an offer. If you found someone else’s offer, it will be an offer to Buy some Dai at some specific price, and you should see a button to commit to the trade. If instead you created the offer, you’ll be looking at your own offer to sell Dai, which other users can find. These other users would see their own commit button (you won’t, because you’re the creator, unless you change your Metamask/Nifty Wallet user).
Before a user commits to the offer, the creator can cancel and refund the trade at any time. But once someone commits, then as implied by “commit”, both parties are expected to continue to completion of the trade — if they don’t, there are some burnable punishments.
Committing requires putting in the Dai required by the terms of the trade. If you (as a Seller) are committing, this means depositing the full amount you intend to sell. If another user (a Buyer) is committing, he must put in the “buyer deposit” of 1/3 the trade amount, in Dai.
Either way, once someone has committed, the trade will have two parties and a pooled deposit: you, the Buyer, and the sell amount in Dai from you plus the 1/3 buyer deposit from the Buyer.
3: Complete the Fiat Payment
Now comes the meat of the trade. The Buyer is expected to send you the payment via TransferWise/Revolut/etc. You’ll want to send your account details to him over the encrypted chat on the trade, and make sure he’s not running into any issues. Once it’s done, the Buyer will mark the payment complete, moving it to the last phase: Judgment.
But wait, what’s this “the Buyer is expected to send the payment”? What if he’s a rat scamming bastard?
Well, that’s a good question. This is the stress a Seller on DAIHard must deal with. But it’s not exactly honey and roses for the Buyer either. He’ll be stepping carefully too, because as soon as he moves the trade forward, it’s Judgment time — and you’ll be the judge.
Being a rat scamming bastard would be a bad move, and I mean that in a game theoretical sense.
4: Judgment
When the trade was created, a “Burn Window” value was set (could be some hours, days, or weeks). If you don’t do anything for the entirety of the Burn Window, then the Buyer can finally claim the balance of the contract (your sell amount plus his 1/3 deposit).
You can even be a little nice, and prematurely release the balance, so he doesn’t have to wait so long.
But maybe he pissed you off: maybe he called your mum a whore, or he didn’t use the right gender pronoun in the chat. Or even worse— maybe he never actually sent the fiat to your account, and is blithely killing time until the Burn Window ends and he gets your precious Dai for free. The nerve!
Well, now you have an interesting option. True to its name, the Burn Window’s main functionality is to allow you to just burn the whole damn balance of the trade. Your sell amount and his 1/3 deposit would be sent to 0x0, never to be moved or used again, by anyone.
Harsh, I know. Well, he shouldn’t have tried the scam!
And if we’d just let you get your Dai back rather than burning it, then maybe you would have been the rat scamming bastard — taking your Dai back even if the Buyer really did send the fiat. Burning is a way of punishing without simultaneously rewarding (i.e. incentivizing), making it a useful last-resort threat to any would-be scammers.
Getting More Dai
DAIHard is a pretty good Off Ramp, but we can’t quite call it an On Ramp, because in order to use the platform to get Dai, one must already have 1/3 the amount they’re trying to buy. But, if you do get your hands on some starting Dai, then this could be a good way to “ladder up” to larger holdings.
Again, you would either search the DAIHard Marketplace for offers (sell offers, this time) or create a (buy) offer. As the Buyer, you’ll have to put in 1/3 the trade amount to create or commit to the trade, and in the second (committed) phase, you’ll be the one making the payment and then marking the payment complete on DAIHard.
And it will be you who suffers judgment in the last phase. So make sure you have their payment details right!
