Gnosis in 2019, 2020, and Beyond
The year in review and a hint of what’s ahead.
In 2019, many visions of the future had a reality check. The 1982 film Blade Runner had a vision of Los Angeles with flying cars, anti-android police, and ubiquitous virtual advertising. Another classic, Akira takes place in Neo-Tokyo 2019 after the original city was destroyed by a singularity three decades earlier. Some currents of these imagined futures have proved prescient, others less so.
In blockchain, many are still waiting for the systemic change projected by early ideas in cryptography and digital money, which built on cypherpunk visions from the late 80s onwards. While this year in Ethereum we saw the rise of decentralized finance and return of DAOs, we also tested the limits of usability, adoption, and system change.
In the glow of futures imagined three decades prior, 2019 was a learning experience for Gnosis. We worked hard and launched several products.
- dxDAO Decentralized Governance: We initialized and stepped back from the dxDAO in Q2 of this year. During the initialization period, over 400 participants locked 20 million USD equivalent in ETH and ERC20s to earn voting power in the DAO. Today, the dxDAO is run by a small and dedicated independent community who have rebranded the DAO and continue to use it as a tool to govern DEXs (decentralized exchanges). In fact, only weeks ago, Kleros and the dxDAO published a joint announcement about their TCR and DEX token listings. We are proud that the dxDAO was one of the first in hopefully a long line of experiments to give governance of software protocols over to their users, or in the words of Nathan Schneider, providing an option for platforms to “exit to community.”
- DEXs: In Q1, we deployed on Mainnet our first proof of concept DEX, the DutchX trading protocol. The DutchX uses an auction mechanism designed to handle large volume orders with minimal slippage. Today, the dxDAO governs the DutchX, including parameters such as its auction thresholds, token listings, and interfaces. While we’re glad the DutchX trading protocol’s use continues with the dxDAO, we did not find the user base we anticipated while designing the protocol. This launch was ultimately our most valuable lesson of the year, reinforcing the need to build more modular tools that are more closely aligned with the community’s needs. You can read more below on how we’re incorporating this lesson into development cycles for the launch of our new DEX protocol in 2020.
- Sight Prediction Markets: In Q4, the Sight prediction market platform launched in closed beta. Sight is the first regulated, blockchain-based prediction market platform, providing users with peace of mind regarding source of funds and market resolution. Sight builds on the conditional tokens framework, which means that its outcome tokens are interoperable and can share a liquidity pool with other prediction markets built on the framework. We hope to see conditional tokens become an open standard for prediction markets and many other use cases that require complex events to be registered on a blockchain.
- Gnosis Safe Multisig: Additionally in Q4, we launched the Gnosis Safe Multisig, the successor to the community-favorite, original Gnosis multi-signature wallet, which currently stores over 1B USD equivalent in crypto funds. The Gnosis Safe Multisig boasts of added security, with audited and formally verified contracts, usability, with over six months of user testing, and modularity by design. We strongly recommend moving your funds from the original multi-signature wallet to the Gnosis Safe Multisig for continued maintenance and new features, like the support of new ERC standard tokens. You can set your Safe Multisig up in less than 60 seconds here: https://gnosis-safe.io.
- Gnosis Ecosystem Fund and Community: We’ve also been tremendously happy to see many of our community initiatives grow during this past year. We held our second annual DappCon, a conference in Berlin focused on Ethereum development and applications, and tickets for DappCon 2020 will go on sale in March. Our co-founded workspace for blockchain and web 3.0 initiatives Full Node continues to be the heart of the community in Berlin, and this year we’re excited to announce a new, monthly public event series. Finally, our grants program the Gnosis Ecosystem Fund received 40 applications and funded 12 projects building on Gnosis.
While we’re tremendously proud of what our fantastic team and community have accomplished — being one of the most active in development ERC20 projects this year — we did not yet nail product-market fit with our releases. Acknowledging this, for 2020 we have reshaped our user research and development cycles to make sure that we both validate our assumptions and iterate on our products faster.
Into 2020, 2021, and beyond…
Our work at Gnosis in 2020 is centered on the public adoption of market mechanisms for trading prediction market outcome tokens and, ultimately, the long tail of tokens precipitated by the rise of open finance. This means building trading protocols that provide interoperable and highly liquid market environments — to capture public insight in a way that so far blockchain-based prediction markets have failed to do.
We believe that this aim can be supported by introducing a fundamentally new type of DEX to Ethereum, which we referred to under the working title of dFusion protocol while in stealth mode, now known as Gnosis Protocol. We have worked on this protocol for the last two years under the dex-research Github repository, and this year the project will move out of research and into a public, proof of concept launch.
Key to the Gnosis Protocol design is:
- Maximized liquidity through ring trades, in which liquidity is shared among all traded assets;
- First implementation of batch auctions promoting fairer, uniform clearing prices and front-running resistance;
- Fair settlement in which an open competition for order matching replaces an operator.
What does all of this mean for the year ahead in releases? Rather than continue iterating on research internally, we want to get the initial version of the Gnosis Protocol into the wild. Having conducted user research interviews over the previous six months, we are preparing for a release in H1 2020. If you’re interested in providing feedback before the launch, please do get in touch with us.
We see the Gnosis Protocol becoming the standard for trading prediction market outcome tokens and providing access to their largest liquidity pool. Alongside the Gnosis Protocol, this year we will continue shipping the most trusted code in all of our product lines: the Sight prediction market platform will move out of beta, and the Gnosis Safe Multisig will move into mobile.
Our goals, however, are still long term. With over five years in financial runway, we are designing even more use cases for our two-token system, GNO and OWL, that are also fundamentally embedded in our protocols, including the newest DEX protocol. Our blog post The Many Faces of an $OWL summarizes the current token use cases.
As we grow farther in time from the speculative dystopias of recent decades, an underlying hypothesis of Gnosis’ work is that more efficient market mechanisms create pathways for economic inclusion — and fundamentally rewire how we define economic value. This new definition of economic value privileges distribution over capitalization, wherein resources may have a greater chance of garnering use rather than accumulation. We hope that these tools decrease our reliance on dominant models of financial exchange, into the 2020s and beyond.
For now, we’d love to hear from you.
Telegram
- Gnosis General Telegram Group
- Gnosis Safe Telegram Group
- Gnosis DEX Telegram Group
- DappCon Telegram Group
Or, of course, send us an email at info@gnosis.io.
