Recap of ARK Podcast with Do Kwon

(Source: ARK Invest)

The ARK Podcast with Do Kwon hosted by Frank Downing and James Wang was broken into two parts. The first part was an overview of the whole Terra ecosystem by Frank and James, and the second part consisted of the interview with Do. This recap will break down the second part.

Why Terra was built on Cosmos SDK: (28:35)

• Cosmos SDK allows people to build a sovereign blockchain without sharing security with the underlying chain.

Terraform Labs (TFL) team: (31:34)

• The entire TFL team consist of 150–170 people.
• TFL is not a business, they plan to dissolve at some point.

Ozone Protocol: (36:23)

• Ozone will facilitate auto claims that are based on algorithms rather than manual claims. This enables tokens insured by Ozone to be able to easily used in DeFi.
• Ozone is designed to be leveraged (ex: $1 billion in Ozone can insure up to $3 billion).

Anchor Protocol: (40:20)

• Lenders and borrowers in Anchor are both making money because TFL is essentially giving away Anchor’s equity in terms of ANC token.
• bLuna will be a small part of Anchor’s total collateral in the future.
• bETH and bSOL will come to Anchor first. When the ecosystem in Polkadot and Cosmos matures a bit, bDOT and bATOM will be implemented next.

Key incentives for UST: (51:03)

• 1) Increase seigniorage
• 2) Maximize transactions

Update on Chai: (54:20)

• 200,000 people on the waitlist for the Chai Debit Card.
• Chai also has a payment gateway service that currently services 1700 merchants in Korea. They have also rolled out a proof of concept with 4 merchants in Vietnam.
• Instead of Chai expanding to other regions, look for other payment companies like Alice, Saturn, and Kash, to launch in their respective regions.

How does UST compete with other stablecoins: (1:06:56)

• Centralized stablecoins (USDT, USDC) on DeFi doesn’t make sense because governments can shut them down at anytime. This makes decentralized finance (DeFi) not really decentralized.
• DAI can’t scale really well, because you need to lock up collateral to mint DAI. This makes it capital inefficient.
• UST is more capital efficient, because you only need to burn $1 worth of LUNA to mint 1 UST. This means UST can scale a lot faster than DAI (ex: UST reached $2 billion market cap in a few months).
• CBDCs aren’t really a competition as they most likely won’t be compatible with DeFi. Do views both of them as separate innovations, and both will coexist.

Terra and Luna’s dynamic: (01:12:08)

• Terra can’t always be growing. Similarly to an economy, it will always have an expansionary and contractionary phase.

Update on Apps/ dApps using Anchor: (01:14:22)

• Over the next 6 months most major crypto apps will leverage Anchor’s stable yield.
• Anchor will be integrating with a few FinTech apps that has nothing to do with crypto this year as an experiment.
• Anchor’s 20% yield will come down in the future as more people participate in proof of stake (POS), but in the short/ mid term it will stay.

Mirror Protocol: (01:18:32)

• $2.4 billion TVL, $60 — $100 million in daily trading volume.
• Mirror v2: introduce short tokens so mAssets can keep their peg better to oracle price.
• Mirror v2: staking rewards will only go to governance participants, every staked MIR token will be locked up during governance polls, regardless of if you voted or not.

Nebula Protocol: (01:32:15)

• ETFs will rebalance itself based on a narrative (ex: New is Always Better ETF: always hold top 10 latest tech stocks).
• Nebula expands the possibilities of passive investing, it’s up to the community to come up with creative ideas.

WEN BUSAN: (01:40:35)

• “Look into the concept of regional currencies”

What’s in the future for Terra: (01:40:51)

• Retail focused apps/ dApps being built by the community.
• About 50 new projects are launching this year that tackle existing traditional financial instruments. They are all leveraging various Terra products such as stablecoins, Anchor’s yield, and mAssets.
• You will start to see a flourishing financial ecosystem being built on top of Terra.
• Terra’s Engineering Bay will help make new apps/ dApps being built on Terra have similar design language. This allows consumers to easily use Terra applications without having to relearn each one, it also builds trust among consumers toward Terra’s financial products.

Terra’s biggest threat: (01:45:08)

• If Terra fails, it’s because the soul of the community dies.

Ways to get involved in the Terra community (01:47:13)

• If you are a builder, don’t hesitate to reach out to Do or TFL. He’s willing to be your cofounder and provide you with the necessary resources.

Important Links

• Podcast: https://ark-invest.com/podcast/ep98-terra/?utm_content=168881030&utm_medium=social&utm_source=twitter&hss_channel=tw-2398137084
• Terra Website: https://www.terra.money/
• Discord: https://discord.gg/seZ9BUa
• Telegram: https://t.me/TerraLunaChat
• Twitter: https://twitter.com/terra_money
• Medium: https://medium.com/terra-money