Jan 20, 2021
Huobi x BOR AMA Recap
Huobi x BOR (BoringDAO) AMA was a great success!
To thank the BOR community for participating in the Huobi x BOR AMA — Huobi wants you to have a special treat of a welcome bonus to Huobi.com.
🔹Now in the first section, we had an introduction of Enki and Ted:
Enki, BoringDAO core member, has been a college assistant professor for 5 years, teaching finance and economics courses. His research is focusing on monetary theory and policy, that’s when he found Bitcoin. Then he jumped into the blockchain world, till today.
Ted has been in the crypto space now for more than 4 years starting out as a BTC holder himself and eventually finding a more relatable use case for crypto in DeFi at the end of 2019. He currently advises for the BoringDAO as well as COVER Protocol and previously to this was in the financial services sector for 15 years spending 10 of those with GE Capital.
🔹About BOR
BoringDAO is a decentralized asset bridge project that operates as a DAO, which allows any blockchain with smart contracts such as Ethereum to become a Layer2 solution for Bitcoin, making BTC and other assets programmable. It uses ‘Tunnel mechanism’ and triple pledging to let BTC, LTC and other blockchain assets seamlessly engage with Ethereum and other blockchain networks.
BOR is the native token for BoringDAO ecosystem, and has both utility and governance features. It can be obtained through mint mining and farming. The use cases are pledging into tunnels to earn mint fees, payment and governance.
BoringDAO has a uniquely designed 3-layer security mechanism that safeguards users’ assets (Asset Layer: P2SH Multisig+OP_RETURN; Contract Layer: over collateral; application Layer: decentralized insurance, like Nsure & Cover etc.).
Mint Mining and Boring Farm works as a double incentive mechanism which further reward users for participation in the ecosystem. With the help of decentralized multi-signature mechanism and DAO governance, BoringDAO is an important blockchain infrastructure that brings Bitcoin into the Ethereum Network and DeFi world, and makes Bitcoin become programmable.
🔹In the second section, our CM asked some important questions related to the project and its development.
1. Can you tell us, as an ordinary user, how to participate in BoringDAO?
Ted: There are three ways to participate in BoringDAO, which are suitable for different users.
a. 【Minting Mining】Users who hold Bitcoin can obtain oBTC and BOR tokens through minting. Then use oBTC to participate in other DeFi protocols, or use oBTC for stake mining in the BoringFarm, which may be more suitable for giant whale users;
b. 【BoringFarm】Users can pledge BOR in the BoringDAO tunnel to earn BTC minting fees and BOR rewards. In fact, this is also one of the few ways to directly earn BTC in the current market, which is very friendly to retail investors;
c. 【Satellite City】Users who hold 9 mainstream DeFi assets of DAI, USDC, WETH, USDT, YFI, YFII, LINK, NEST and BAND can mine BOR tokens in BoringDAO’s satellite city. The current APY is about 30% -40%. It is worth mentioning that this is a staking-style mining, there is no impermanence loss, almost no liquidation risk. If it is mining through the three stable coins of DAI, USDC and USDT, there is no risk of currency fluctuations, which is more attractive. This way of participation, especially the way of participating in stablecoin mining, is very suitable for users who are extremely risk averse.
All the contracts have passed the security audit, and PeckShield has already released the audit report.
2. It sounds like BoringDAO has indeed considered different participation methods for users with different needs. It seems that the lowest threshold and the least risky participation method is Satellite City. What is the current APY of Satellite City?
Enki: Yes, it’s not just a satellite city, the APY of a pool is actually higher. This is the APY screenshot of our Farm pool at present:
In addition to simply being a farmer, users can also pledge into the tunnel to get part of the mining fee as a reward, and then put the PP-token in a pool to mine more BOR.
Of course, the current high gas fees may limit everyone’s on-chain operations, so we have brought a lot of benefits to Huobi users. First of all, users who hold BTC or HT can perform 7 days mining in Huobi, so there is no gas fee. Then, 7 days later, you can put the mined BOR in the BOR pool at Huobi to continue mining BOR, which has a very attractive APY. Everyone is welcome to farm.
3. Okay, it looks that BoringDAO has really brought a lot of benefits to our Huobi users. I think everyone may be eager to try it while listening, and some friends may have already started farming. So at this time, can you explain the mechanism of BoringDAO in detail and the difference between it and the existing Bitcoin anchor coin?
Ted: BoringDAO has three main characteristics: 1. It has a triple security mechanism, in addition to the backing of BTC itself, there are also contract layer asset mortgages, and finally there are multiple insurance mechanisms; 2. It is decentralized, with an advanced coin-minting mechanism design and much faster than renBTC ; 3. It is a high incentive. Our own Farm pool and the Curve pool are currently generating high yet sustainable returns.
Let me go over these three characteristics in more detail:
The current BTC cross-chain solutions are centralized and decentralized. The centralized ones include wBTC and HBTC, and the decentralized ones include renBTC. BoringDAO uses a decentralized solution.
Our advantages over renBTC are about three points:
1. Safer. Both wBTC and sBTC are single asset backed tokens BOR have a double asset pledge model. The first layer is to stake BTC and mint oBTC. In this process, although we will charge a fee, the user can earn double that fee in BOR, so as the user is repaid the BTC fee in BOR. In the process of destruction, we also have a mechanism to prevent them from collecting BOR equivalent to the value of users.
The second layer is the over collateralization of the protocol using BOR and other assets, which is also a feature of our project, so our collateral backing is 150%+ and keeps a safe peg to the BTC price.
In addition, in order to prevent the most extreme situation, we have an insurance mechanism. 50% of the redemption fee will enter the insurance pool. Currently, Cover has BOR insurance, and we have also reached a cooperation with Nsure, etc. After the Nsure mainnet goes live, it will also underwrite BOR.
2. The degree of decentralization. Ren is currently a team (that is, Greycore is controlling the private key) with Darknodes that have not yet taken over the ownership of the private key, at Boring it is the community controlling the private key, including HashQuark, DeFiance, etc. In the future, we are expanding the multi-signature to 5, 7 and 15. The other one is something we are very proud of. The community needs to bind its own BTC and ETH addresses when minting coins in order to receive the anchor BTC. Ren should use a centralized server, which generates a new address for everyone. However, using centralized services is problematic. It has a single point of risk of being attacked by hackers. But Boring, using BTC’s native OP-Return function, when you transfer BTC, you directly attach your Ethereum address through op-return, which cannot be tampered with by any hacker unless the hacker can break the blockchain in essence we use BTC as a decentralized server.
3. The third point, perhaps the one that everyone cares about most, is motivation. The incentive model has a much more aligned nature than other anchor coins. BoringDAO is able to “mint coins for mining” and mine 0.4% of BOR in the process for minting. We just connected to Curve.Finance and launched oBTC Metapool. Users can exchange oBTC with other Bitcoin-anchored coins with low slippage on the Curve platform, and can also provide liquidity in it’s trading pool and receive CRV and BOR dual token rewards. It should currently be one of the pools with the highest APY on Curve. There is also its own farm, BoringFarm, APY is also quite high, and everyone is welcomed to participate.
The key to remember is that as the price of BTC goes up more BOR needs to be pledged to meet the over collateralization ratio that is needed to keep the safe pegging of oBTC and other oAssets.This means as more BOR is pledged it will also need to rise in value to meet the needs of the protocol especially given the supply of 200,000 tokens. As more collateral value is needed the APY adjusts to incentivise more pledgers of BOR token.
4. We have learnt so much knowledge today. It is really intense. Maybe we have to go back and digest it. Now is the 8th day of 2021. The trend of the entire market in the past few days is also very exciting. Finally, can you please talk about your views and opinions on the market in 2021?
Enki : I think I will share some thoughts from macro fundamentals. First, we share the idea that this bull market is institutional, and it come from the Wall Street. Grayscale and MicroStrategy. And the Grayscale attracts other organizations to join in the market, forming a “Grayscale Influence.” I think the influence of Michael Saylor, the founder of MicroStrategy, is no less than Grayscale. He often shares his views on Twitter and Youtube. Also, I highly recommend everyone to take a look at Michael Saylor’s interview, which is better than mine. Rich knowledge, and clear thinking.
With the global epidemic in 2020, almost every central bank in the world has loosened monetary policy aggressively, causing all asset prices to go artificially high. Institutions are forced to hold BTC to keep the value of their assets. In the past years, we often heard people criticizing BTC, saying that there is no endorsement by the central bank. But I think this is precisely the greatest advantage of BTC. That is, no one can ever issue more, and it will always be 21 million. That is, BTC will never face inflationary. We will find new storage areas of gold from time to time. But for Bitcoin, none. This is a general logic.
🔹In the third section, Enki and Ted answered 17 impromptu questions from the community. We selected some of them:
1. What is the difference of fundamentals between BoringDAO and other wrapped BTC asset protocols?
Firstly, non custodial as well as other decentralized solutions. Keep tBTC for example while extremely secure in their approach are trading off efficiency for security — which is fine — however to make sure there is an efficient use of capital within the system the BOR pledge approach I feel mitigates any capital restrictions.
2. What are the features “Boring Farm” and “Mint Mining” — how can we as token minters be rewarded for using them?
Mint mining are the rewards earned from minting new oAssets — and the Farm is where you can stake you PP tokens (pledged BOR) to earn additional BOR rewards.
3. What are you going to offer to users in the future so that users do not go to competitors?
Right now we have the BOR farming rewards and they are on a very low emission schedule to ensure longevity of the project. The DAO in the future can make changes to how these are used as well as changes to the functionality of the BOR token, I think that is the fun thing about DeFi.
4. Do BoringDAO have any new partneship recently? And what advantage of this partnership to the project?
Recently BOR was listed on Curve.Finance — but with partnerships it is a little different in DeFi given the open source environment you don’t really need permission to build open another protocol. One of the beauties of working in DeFi.
5. How does the platform provide security and stability?Can users be sure that their funds are safe?
Right now the protocol secures the network as advised above. In addition to the underlying protocol security there are now coverage options with COVER and soon NSURE for additional peace of mind
After the AMA, we have received numerous positive feedbacks from the community, which motivates us to deliver more and more wonderful events in the future.
Join our telegram and stay tuned!
