AMA Recap with GFS Group
Where: GFS Telegram Channel.
When: Thursday, 25th February 2021.
Time: 2:00PM UTC (21:00 UTC+7)
Umbrella Network’s Partner, Sam Kim, was recently invited for an AMA by GFS Group to answer questions from the community.
Umbrella is a scalable, community-owned oracle that securely brings external data on-chain. It is the first decentralized oracle service to empower the community with the scale and security modern DeFi applications require.
The transcript is almost entirely in its original AMA form, mildly edited for punctuation and readability only.
*** AMA starts ***
- Firstly, Can you give a brief introduction about yourself, your background, also about your project Umbrella Network and Umbrella’s Vision?
For the past 10 years, I have worked with the key members of Umbrella Network and have been building highly performant and scalable products, primarily in the digital advertising industry.
I first served as the Co-Founder and COO of Gimbal, a buy-side platform that recently acquired TrueX from Disney.
A few of us were frustrated by the fraud, corruption and general lack of transparency in digital advertising. In 2017, we discovered Ethereum. We were totally blown away. We thought it’d be the perfect tool to solve our frustrations with digital advertising. And so we decided to start Lucidity to provide a transparent, scalable marketing analytics solution to advertisers. Lucidity currently works with some leading traditional brands like Toyota, Hyundai, KFC and GroupM.
We noticed that the oracle market was also undergoing similar issues to what we experienced in digital advertising, mainly that oracles were slow and inefficient, writing one piece of data per blockchain transaction. That simply doesn’t scale well enough to support large enterprise-level applications. And so, we decided to take the same underlying technology that we were using to power advertising buys for clients like Toyota and GroupM, and move it over to the oracle space.
2. Can you share with us 3 of the strong points of the Umbrella Network when compared with other projects?
First, we have the lowest cost data available in the market for on-chain data.
Second, we have the most data available in the market.
Finally, our underlying technology has been battle-tested in an industry that operates at 500,00–1,000,000 transactions per second.
3. What makes the Umbrella Network different from other oracle projects? What do you think about the Defi industry and how is your project pushing the Defi industry to grow up?
DeFi industry has been struggling to advance because of the limited amount of secure data that is available. Look at the decentralized options market. Their current pricing models are very naïve or they require over-collateralization. That’s not very competitive with centralized options markets. With Umbrella Network, the cost of data is so low that we are able to make a wealth of new data available onchain. Data like implied volatility to price options as well as gamma, vega and theta to properly hedge a portfolio of options. We will enable this with the amount and types of data we can support. And we will do this in many segments within DeFi.
4. What is the UMB token? Also its use-cases, and what are the benefits of holding it for a long time?
The $UMB token is a governance token with liquidity mining features. So first, we operate on a Delegated Proof of Stake system. As a token holder, you can stake with a validator who will serve as a representative in governance. In addition, your stake in the validator will determine your rewards and share in the user fee.
Here’s a blog post giving more details about our staking: https://medium.com/umbrella-network/umbrella-network-announces-umb-staking-and-rewards-platform-upcoming-launch-8a6f6ea24df2
You’ll see that the rewards have incredible returns
- First-ever IDO — excited to be on the journey — not just in having the opportunity to be part of making some gains — but this ecosystem as a whole is interesting and captivating to learn. What are the near term and long term goals that UmbNetwork is aiming for?
Alright. A lot of questions. So Lucky Cat — Congrats. And welcome. Glad to have you join our community. The oracle market is very early. And it is going to be absolutely huge. Just look at the size of the data market in the centralized world and you’ll see how important it is for a decentralized world.
And Umbrella is going to be among the winners. So congrats on being one of the early members. There is so much more ahead of us. And there will be tremendous growth.
2. Umbrella has built its nodes by using Layer-2 Merkle Trees. How would you consider Umbrella to fit into this entity of various decentralized L2 applications on the market? What do you plan to improve from existing solutions?
There are many L2 solutions coming to market these days. And like I said at the beginning, I think 2021 and 2022 will be the years of L2. But those are mostly generalized L2 solutions. We built our L2 specifically for the purpose of an oracle service. And therefore, Umbrella Network is faster and cheaper than oracles built on generalized L2 solutions.
3. The Whitepaper does mention another token apart from the UMB, called rUMB so can you tell what are the use cases of each token? Also, where can it be purchased?
So rUMB is our reward token. If you own UMB, you can stake your $UMB token and earn daily rewards. And the return is quite high. However, we do not reward stakers with UMB. We reward with rUMB. rUMB can be redeemed for UMB in 1 year or when we hit specific business milestones.
Alternatively, you can buy rUMB on Uniswap where there is a thinly traded market.
4. Umbrella is Built in 2-layer of the Ethereum chain, so it is only capable to work with other Ethereum projects? Or is it a cross Chain Oracle?
We actually designed Umbrella to be compatible with nearly all chains. We started with Ethereum because it is the most mature chain. But our codebase can easily support and/or port over to other chains including Binance Smart Chain, Huobi Heco Chain, Polkadot, Solanda, Cardano and much more
5. What are the benefits of community-owned Oracle in a Delegated Proof of Stake (DPoS) consensus model? What are the penalties for misbehaving users and validators who act with malicious intent?
In a DPoS system, validators typically have to own a large number of the native token, in our case $UMB. So it’s in their best interest to ensure the integrity of the system. Second, they have to put tokens at stake during each consensus round. And therefore if they vote incorrectly, they will be slashed. And the slashing rate will increase depending on their reputation score. So it will be expensive for them. And those that stake with them will ultimately withdraw support for that validator. And they will lose the right to be a validator.
6. Would there be a need for more team members and ambassadors? also, what can token holders earn? Are they any provisions for staking?
Yes. There will be an ambassador program in the near future. I’ve started to put together a group to help us formulate this program. We want to be international immediately. And we recognize that English is not the first language for everybody. So we’ll work with the global community to realize Umbrella’s potential in other markets.
Join the discussion on Telegram at https://t.me/umbrellanet