Lodge Letter #34: A Singular Focus
Is it better to do one thing really well or spread your energies around? Plus: The run-up to ElkNet v2 begins…
Greetings Elks,
The biggest news this week was the announcement that “DeFi Godfather” Andre Cronje, along with his longtime partner Anton Nell, have decided to stop working on crypto projects. Their decision was in the works for some time, but speculation on Twitter pointed to fallout from the Wonderland scandal in late January. Wonderland Founder Daniele Sestagalli was set to collaborate with Cronje on a highly anticipated new trading platform — codenamed “ve(3,3)” and recently released as Solidly — but he was forced to withdraw as a result of the affair, leaving Cronje as the face of the project.
To be clear, there is no suggestion of anything shady on Cronje’s part. If anything, it appears to be more a matter of being reluctantly thrown into a spotlight combined with general exhaustion with the drama that tends to form around DeFi, of which this was but the latest example.
Putting aside speculation about motives, however, what was perhaps most remarkable about the announcement was the revelation about the number of projects Cronje and Nell had their hands in. Nell casually mentioned in his tweet that they plan to terminate 25 apps and services (!) in the beginning of April. The list includes well known projects like Yearn Finance, Multichain, Solidly, and Keep3r Network.
Twenty-five projects?! Even for two wunderkinds, that’s a staggering number. It raises an alternative viable theory, which is that they just got burnt out.
There are many paths to achieving success in business. Some people are relentless innovators, acting on new ideas and moving on quickly to the next one. There may be greater wisdom, however, in doing one thing and doing it really well. That’s the approach we’ve adopted at Elk: we’re hellbent on solving the single problem of cross-chain interoperability. Fortunately for us, that problem carries enough complexity that there’s little risk of getting bored; every new chain and each new feature presents a fresh challenge.
The announcement was surprising for other reasons, too. It’s strange to see any large crypto project terminated, let alone two dozen at once. More often than not, failed projects continue in perpetuity as zombie tokens for years after the devs have faded from view. In this case, most of the projects won’t necessarily end, since the underlying code is open-source; they will simply require others to take them over (and find new web-hosting). Meanwhile, the market judgement came swiftly, with most of the affiliated projects–along with Fantom, where Cronje held a Foundation seat–saw double digit drops.
The market judgment came swiftly, with most of the affiliated projects seeing double digit drops following the tweet. The real insight here, however, may be how dependent some projects are on single individuals. The fact that these projects could simply go dark because a developer decides to quit should rightly be seen as an alarming risk, one which is also antithetical to the resiliency gained by decentralization. What does it mean, for instance, that Multichain.xyz–a cross-chain protocol with $7.1 billion in funds locked on its bridges, is shutting up shop? (In this particular case, as with most of the others, the project will remain viable due to a recent merger with another cross-chain project — the general point remains).
One lesson here is that single points of failure–whether they are embodied in people or platforms–are a major liability. This is one of the main reasons that Elk plans to become one of the first truly decentralized cross-chain protocols in the near future. It’s also the reason why even sooner than that–indeed, before Q1 is complete–we plan to introduce our initial setup for community governance. The protocol will be decentralized, but so too will its operations.
Some people tend to roll their eyes when discussion turns to decentralization, dismissing it as an ideological abstraction, something that most people don’t actually care about. Against this, we keep seeing examples play out in real time showing why it is an important value to uphold.
In the lead up to Elk’s first anniversary, we’ve been running community contests in Discord as part of Elk’s 1st Birthday Jubilee. Happening right now is “Ralph’s Speedway Challenge,” which offers a bounty for whomever can move their ELK across all of our chains the fastest. Don’t miss the ElkNet throwdown!
On the partnership front, we announced an exciting new relationship with Omnidex, the largest DEX on Telos. We also re-upped dual token rewards for CRX-ELK on Cronos and DCAU-ELK on Avalanche, and dropped a brand new boosted Avalanche farm for RACEX-ELK.
Preparations are well underway for the ElkNet v2 launch, which is still on schedule to happen before the end of Q1 in a few weeks. There will be a few more surprises to coincide with the upgrade, which also sets the stage for a flurry of activity and new launches toward the start of Q2. Stay tuned!
