#BuiltOnDAPP: Equilibrium
Equilbrium Recently Integrated LiquidOracles Into The EOSDT Stabletoken Framework. We Spoke With Alex Melikhov, co-founder and CEO, to Learn More
#BuiltOnDAPP is a LiquidApps blog series that spotlights the exceptional projects and teams building scalable decentralized applications which utilize the DAPP Network universal middleware of services. This series showcases some of the most cutting-edge use cases and remarkable projects being built on our platform today.
We spoke with Alex Melikhov, co-founder and CEO of Equilibrium, a framework for asset-backed stablecoins and DeFi products. Alex has been involved in the cryptocurrency world since 2013 and has over 14 years of entrepreneurial and fintech experience that includes co-founding cryptocurrency exchange, Changelly
What is Equilibrium/EOSDT and what was your motivation for launching a collateral backed stablecoin?
Our team has been building dApps for quite a while with experience in Ethereum development dating back to 2017. We were considering other blockchain platforms that could offer more convenient dev environments and better infrastructure prospects. At that time, 1.5 years ago, EOSIO caught our attention thanks to zero transaction costs and its promising network capacity.
The decision regarding what exactly to build on top was quite natural. With our previous experience in creating blockchain-based financial projects, we decided to bridge an obvious gap in DeFi instruments needed by the EOS community. Thus EOSIO has become the first blockchain platform for Equilibrium, the DeFi hub comprising synthetic assets and other production-ready DeFi products on multiple blockchains.
EOSDT became the proof of concept for Equilibrium and was the first decentralized stablecoin on the EOS mainnet. It enabled users to raise dollar liquidity in EOSDT stablecoins against the collateral of their EOS cryptocurrency.
EOSDT currently holds the most EOS cryptocurrency out of all dApps built on EOSIO. All funds are deposited into the smart contracts, which are under the control of our new governance framework. Our new governance includes a multisig for approving smart contract updates that includes high profile market players — Binance, eosfinex, EOS Nation, and EOS Cannon.
The role of being an infrastructural DeFi project on EOS motivates us to constantly improve our product line and user experience.
Which DAPP Network services does Equilibrium use and how are they being utilized?
We are currently using two services by DAPP Network — LiquidOracles and LiquidScheduler.
Robust price feed is the crucial part of any DeFi application and we were paying the closest attention to this component of our system from the start. We decided to take an approach of integration with third-party oracle services that are widely known and can provide reliable trustlines between our smart contracts and external data sources. To make our technology more redundant, we have integrated several independent oracles and we are building a median price on the basis of data we receive from them.
One of the oracle providers we use is the LiquidOracle service of the DAPP Network. We worked closely with the LiquidApps team to tune up its technical setup according to our needs. Eventually, we created the system that fetches prices just in case of price deviation exceeding a predefined parameter. It allowed us to reduce the frequency of price requests significantly and optimize the consumption of resources on the EOS network. We believe that other projects using the LiquidOracle service will enjoy this optimization.
Another important feature for DeFi applications is the periodic triggering of smart contracts that perform recurrent actions such as price feed updates and mark-to-market for debt positions. They can certainly rely on user actions that trigger smart contracts, but it might be risky if there are no active users to trigger contracts in periods of rapid price movements, for example.
An automated time-based job scheduler is the best solution, by far, to eliminate this risk. Decentralized services like LiquidScheduler work even better because they can’t be a single point of failure due to their decentralized nature. We are currently using EOSIO’s inline actions, but we are also integrating LiquidScheduler for these purposes.
And of course, we use several DSPs to achieve more redundancy within the system. We’re currently connected to EOSphere and our own DSP which we recently launched. We are planning to connect more DSPs soon.
“We are proponents of the DAPP Network and we believe it redefines dApp development. Thus running a DSP is also an important contribution to network growth. We are proud to be a part of this journey.”
What led to your team’s decision to deploy your own DSP?
Initially, we launched our DSP to create our own test framework on the mainnet so that we could promptly test our code when we were developing our integration with LiquidApps services.
The second reason was to run our own LiquidOracle service that would be used alongside other independent DSPs simultaneously to create more trustless feed prices for EOSDT. We think this brings even more redundancy to our stablecoin.
At the same time, we are proponents of the DAPP Network and we believe it redefines dApp development. Thus running a DSP is also an important contribution to network growth. We are proud to be a part of this journey.
What are the differences between makerDAO’s oracle system and your own?
Firstly, I want to outline that EOSIO-based DeFi applications can afford way more flexibility compared to dApps on other existing platforms and Ethereum specifically. Gas cost applies certain economic constraints on the frequency of recurrent system transactions. For example, MakerDAO’s price feeds are only supplying prices once an hour on average while our prices are refreshed every minute.
Furthermore, our approach to price feeds differs from the approach of MakerDAO, in general. For example, MakerDAO uses anonymous price providers who are pushing prices to the blockchain. The recent clog in Ethereum network has shown that MakerDAO’s price feeds are vulnerable in these circumstances.
We have integrated multiple professional oracle providers such as LiquidApps, Provable, and Delphi Oracle that maintain connections between our system and external data sources. Each of these providers introduces different mechanics. For example, Delphi Oracle is supplying their aggregated prices on-chain, while LiquidApps and Provable are just providing a communication line to the external price source we specify (CryptoCompare API for now). This diversity presumes that the system will remain fully functional even if some providers fail.
“Our main goals for 2020 are true cross-chain interoperability and turning Equilibrium into an all-in-one defi hub with a wide range of products and services in one place. Our dev team is focused on integrating Equilibrium with other blockchain networks.”
What makes Equilibrium different from other collateral-backed stablecoins such as DAI and what are some of the key advantages?
We were the first DeFi project that provided our crypto collateral with true fluidity. We have also created a risk-free way to stake all EOS for block producers and in return, they are paying voter rewards to our user community.
Thanks to block producer rewards, users are receiving roughly 2.3% APY on the collateral they settle in our smart contracts. With the stablecoin fee of 1.8% APR we have a unique value proposition for our users — a negative APR (~ -0.5%) on generated stablecoins.
Moreover, we have provided our Native Utility Tokens (NUT) with way more utility than protocol tokens of other projects obtain.
- NUT plays an important role in our liquidation system. Market makers can submit NUT to get access to liquidated collateral at 6% discount.
- NUT holders can vote with NUT for their favorite block producers that pretend to be on our proxy.
- NUT holders can simply stake their tokens in our governance contract and earn staking rewards.
EOSDT also became the first decentralized stablecoin to integrate Bitcoin collateral. We made Bitcoin collateralization as simple as just sending two blockchain transactions — to transfer Bitcoins and to redeem EOSDT.
What is something exciting that we can expect to see from Equilibrium over the next few months?
Our main goals for 2020 are true cross-chain interoperability and turning Equilibrium into an all-in-one DeFi hub with a wide range of products and services in one place. Our dev team is focused on integrating Equilibrium with other blockchain networks.
We have also created the basis for further product evolution by rolling out our brand new user interfaces that are receptive to scaling the amount of available services. We expect to add more DeFiproducts there soon and they will go way beyond just generating stablecoins. There will also be crypto lending and borrowing across liquidity pools on multiple blockchains, and other handy tools for DeFi users.
Join our telegram community at https://t.me/equilibrium_eosdt_official to stay tuned!
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Stay tuned for more of our #BuiltOnDAPP Spotlight Series, where we’ll highlight some of the most remarkable projects utilizing the DAPP Network Universal Middleware to scale their decentralized applications.
If you have a project you’d like to share with us, please email contact@LiquidApps.io.
