Umbrella Network AMA w/ Crypto Royals: Recap
Umbrella Network’s Head of Marketing, John Chen, was recently invited for an AMA by Crypto Royals to answer questions from the community.
At: Crypto Royals Telegram Channel
On: Thursday, 2nd September 2021| Time: 1:00 PM UTC
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 ***
Q1. Could you introduce yourselves and tell us about your background?
Yes, sure. My name is John Chen, and I’m the Head of Marketing for Umbrella Network. Though these days I’m pretty much involved in everything that’s not actual product development.
Lot of things are cooking.
I have an entrepreneurial background, having started up several businesses across consumer goods, digital media, and marketing. Just prior to Umbrella, I was running a digital media and marketing agency in Asia. I’m originally from the New York area, but I moved out to Singapore about 6 years ago. Overall, happy to be part of a fast-moving project with amazing potential.
Q2. Please tell the community about Umbrella in detail. Can you please tell us about $UMB?
Umbrella Network is a decentralized layer-2 data oracle service. So like all other oracles, we bring data, usually off-chain data, onto the blockchain. What makes us different from all the other oracles out there, including Chainlink, Band, and others, is that we aggregate our data before bringing it on-chain.
Other oracles have to bring one piece of data at a time on the chain. So if a dApp needs the price of BTC/USD and ETH/USDT every single minute, then a typical oracle would have to write twice to the chain every minute, once for every data pair.
We aggregate thousands of pieces of data all at once onto the blockchain, and are, as a result, able to offer applications access to a much richer and more comprehensive set of data at a far lower price point and incredibly high scalability, more than any other oracle on the market today.
Q3. What do you think is Umbrella’s advantage over its competitors?
Our main advantage is our ability to aggregate data via a Layer 2 solution using Merkle trees, thus allowing us to bring thousands of data points to the blockchain in a single transaction, whereas other oracles can only bring one data point per transaction. This advantage allows us to offer data at a significantly lower cost than any other oracle on the market. It also gives us the ability to offer more data than anyone else as well.
So whether it’s the price of both BTC/USD and ETH/USDT, or the entire S&P 500, all of it is rolled up and put on-chain at once. This leads to massive cost savings, is much faster, and is more secure. As a result, this gives developers access to a lot more information, much cheaper, and can allow them to offer more complex solutions to their clients — similar to currently more advanced traditional finance systems — but decentralized and much more cost-effective.
And while most other oracles offer a few hundred data points at most, we currently offer over 1,200 data pairs, right now all for free. We plan to have over 10,000 data pairs available by the end of this year for applications to use. And finally, it’s not just crypto price pairs or even financial data that we can bring on-chain, if there is an API in the real world, chances are we can bring on that data. So it could be real-time weather, sports stats, insurance info, real estate pricing, personal health insurance, eCommerce data, you name it, the types of data are virtually unlimited. We are excited for what the future will hold as developers gain access to all this data that they can now use to innovate and build the next generation of apps on the blockchain.
Q4. Could you please tell us about $UMB, its total supply, its features?
The $UMB token is our utility token that really sits at the center of the Umbrella Network ecosystem. From staking and validating data to paying the fees for data access, $UMB is what drives it all. Our tokenomics structure is very decentralized too. The majority of our tokens, 60%, are allocated to the community, who will ultimately be responsible for selecting validators, participating in governance, using for staking, and overall consensus voting, among others.
The current circulating supply is about 85MM, and Max supply is 500MM, though that’s just the theoretical cap, which we will most likely not end up utilizing in its entirety.
Right now we have very attractive staking/rewards programs in place. For token holders who wish to stake, they can visit https://staking.umb.network and check out our programs. The last time I checked, APYs ranged from around 100% on our Hadley Stream up to over 450% for our Polar Stream staking. And these staking programs will be around for at least the next 3–4 years, with new ones planned as we continue to expand.
Q5. Can you briefly describe the top milestone you have achieved so far and your future target milestone?
Our top milestone achieved so far would be going live on BSC mainnet back in May. It was a turning point for the project then, just 4 months out of our IDO back in Feb, and to have already been able to go live and start having projects being able to utilize our data feeds. We are about to go live on Ethereum mainnet in just a few weeks, near the end of September, so that will be our next significant milestone.
And we’ve got a lot of significant milestones planned over the coming months as we continue to ramp up our momentum with many new product feature releases, several additional blockchains we will be integrating into and supporting like Polygon, Solana, Cardano, Avalanche, Polkadot, and others. Ultimately, we will be a blockchain agnostic solution, able to support all the major chains as we enter into a multi-chain universe in the coming years.
PART TWO: QUESTIONS FROM TWITTER:
Q1. So the First question from Twitter
Umbrella collects data feeds from various sources to calculate the most accurate pricing in the market. But, it also uses a Delegated Proof of Stake consensus model. How does this consensus model help maintain data security? Why use DPoS instead of PoW, PoS, or others?
We obtain data from various data sources, including from paid, professional data aggregators. Not all oracles out there do that, a lot just pull or scrape free data, which may not be properly sanitized or may be open for exploitation or inaccuracy. So that means that we have several layers of data validation.
The first is having paid, professionally aggregated data that already has cleaned and sanitized data being pulled from multiple exchanges. The second is from Umbrella’s standpoint, where we then take multiple sources of data, including these aggregate data sources, and then run a consensus on that data one more time to ensure accuracy.
And from the consensus standpoint, we believe that Delegated Proof of Stake offers a more fair and democratic way to run consensus, as token holders have the ability to vote, or delegate, which validators will represent them in the consensus rounds.
So Validators must act in the best interests of those voters, or else they may lose the privilege to validate in the future. Whereas in Proof of Stake, it’s typically an algorithm that chooses who the validators are, there are no stakeholders to vote them in or out. Overall, whether it’s DPOS or POS, it is a more effective and far more energy-efficient mechanism than Proof of Work. We chose DPoS because it is the most democratic method and is a more community-oriented method.
Q2.Second question for Twitter
What can we expect from Umbrella in terms of the development and growth of its ecosystem for the remainder of 2021 and early 2022?
We are really excited about the rest of this year and going into 2022. By the end of September, we will be supporting both Ethereum and BSC already, and have our own internal token bridge connecting both chains. And we are working on expanding our multi-chain support and capabilities in the coming months and quarters.
By early next year, we will have integrated into and be supporting Polygon, Solana, Cardano, Avalanche, and 2 of the EVM compatible para-chains on Polkadot, Plasm, and Moonbeam, making a total of 8 chains, which will be quite an accomplishment as we move towards multi-chain interoperability. Ultimately, we just want to be where the data needs are, where the application developers are that will need access to large amounts of a variety of data and at a low cost.
And we are also aggressively growing our developer community, so that we can foster more application development within our ecosystem and have more dApps use our oracles, so whether that is forging more partnerships with existing projects, or being active in the hacker communities, or launching a grants program in the coming months to foster further development, we are actively pursuing various initiatives to grow our ecosystem of users.
Q3. Third question from Twitter
Not long ago, ChainSwap suffered an attack from hackers where Umbrella Network got affected too. Can you tell us more about how you’ve been handling the afterward of it and how will you assure your users this won’t happen to you again? Have you reinforced your security system?
While the Chainswap exploit was definitely a challenge for us, as we lost our token bridging partner as a result of it, we managed to move quickly to address the issues and were fortunate to have a supportive community as we rolled out various countermeasures in response to the incident.
The hackers that exploited Chainswap’s smart contracts managed to take off with the tokens of several projects, including ours and dumped about 110ETH worth of our UMB tokens on the open market. One of the things we immediately did was set up a fund to buy back 110eth worth of our tokens to counterbalance the effect.
We also moved immediately to take the bridging aspect in-house and will be releasing our own internal, audited token bridge, actually in just a few days from now, so that things will be safer and more within our control.
Additionally, we have also gone ahead and partnered with Uno Re, a reinsurance protocol, to roll out an insurance product that our token holders can now choose for coverage on all their staked tokens in our vaults, in case of any unforeseen black swan events, as another way of protecting our community. So while our own smart contracts were not hacked, fortunately, we still have taken various initiatives and precautions to increase our security and look to further minimize risk, both for the project as well as our community.
Q4. Fourth question from Twitter
One of your main objectives for 2021 is to obtain market adoption and real use case scenarios with applications. Could you comment on what are the main real scenarios you are evaluating for the application and use of Umbrella?
Yes right, that is one of our main objectives. Oracles are incredibly vital to the blockchain ecosystem and its applications. Without them, it is like having a mobile phone without a data plan or having your phone on airplane mode. Maybe you can play a few local games, but you aren’t going to be able to use about 90% of your apps. The same goes for blockchain apps. Without a connection to real-world data, how can any DeFi platform operate if it doesn’t know the latest crypto prices? How can an options, lending, or banking app work? Or how can a game work without the ability to have randomness? And as more applications are developed, there will be even more need for access to real-world data.
So our broader objective, as stated in our mission statement, is to “Bring the world’s data on-chain.” So what we envision is ultimately bringing any data that any application needs from the real world onto the chain for them to use. Like mentioned before, this could be for an insurance app that needs real-world insurance information.
It could be a gaming app that needs a verifiable random number generator. It could be an advanced options trading platform that needs ultra sophisticated wall-street level options pricing data.
It could be an investment platform that needs the pricing data of private assets to be tokenized onto the blockchain. Or it could be a digital advertising platform that is trading digital media over an exchange that needs its data transparently added. These are not just theoretical potentials, but actual projects that we are currently working on to make into a reality, and stuff that we don’t see others doing currently.
And we feel that this is just the tip of the iceberg. There will be applications in the future that we haven’t even dreamed of, and this will be made possible with the availability of large amounts of data at scale and at incredibly low cost.
Q5. Fifth question from Twitter
Can you explain what the cohort of community validators is, what is their function, and who is in charge of choosing them and assigning them that responsibility with the project and its ecosystem?
Community validators will be a critical component of our system, and another key differentiator for us. Many other oracles are actually not decentralized, but operate under a Proof of Authority, meaning that the validators are ultimately chosen by the people who run the oracle and not by the community.
Part of the reason for this is because, for most oracles, it is incredibly expensive to run a validator node, so only large, well-capitalized professional operators can afford to do it.
Because of our cost advantage, almost anyone with basic experience running a cloud server can be a validator for Umbrella. So having a community of validators allows us to have a proper decentralized, delegated Proof of Stake consensus operation that is truly community run and owned.
PART 3: LIVE SESSION:
Q1. Are Umbrella Network’s products and services only limited to price feeds and trading pairs? Do you have product integrations for NFTs and their features? If so, how does the Umbrella Network apply its services to NFTs?
While we currently are offering mostly financial price feeds and trading pairs, we have several initiatives in the works that will be expanding into gaming & NFTs, and other types of real-world data that is not just financial, digital media, and ad data, and also several other market segments. So please join our Telegram and Twitter and stay tuned for updates in these areas in the coming weeks.
Q2. Recently In Developer Community, $UMB At @EthCC presented a great product/use case. Can you share those details with us? Or can you share the link??
Here’s the link to the recap of our recent ETHCC Hackathon that we sponsored in Paris which talks about some of the cool apps that were developed using our oracles -> https://medium.com/umbrella-network/umbrella-network-hacks-mid-summer-recap-eth-cc-edition-cb5930c67b69
Q3. Umbrella Network is a decentralized layer 2 data Oracle service. But, how competitive are they considering other leading oracles such as Chainlink, for example, being one of the most used by the MMA or NFT protocols and markets?
While Chainlink is the current market leader, we believe that the market is immense, and has room for many players. We are targeting applications that need large amounts of data, and that may need that data frequently. So if an app just needs the price of BTC/USD for example, they can probably get that from any oracle. But if a project needs a lot of data, or data that is currently unavailable on the blockchain, then we have a potential fit to support them.
Q4. While you build your project, do you take into account community feedback and demands? thank you, sir @chen225
As a community-oriented project, we are always listening to the feedback from the community. Some examples of feedback that we took recently include us moving forward with the release of a verifiable random number generator in our roadmap, and prioritizing support for Cardano, and our recent token burn of 1.5M tokens of the tokens that we bought back from the chainswap exploit. This was all the direct result of feedback from our community that we listened to, assessed, and then went ahead and implemented.
Q5. Layer-2 Merkle Trees are something that you have implemented into the decentralized nodes of Umbrella. Which L2 network are these trees using or is it completely built by Umbrella? Do you plan to share this technology with others if it is built by you?
We are a proprietary project and our layer 2 sidechain, along with the rest of our smart contracts are built from the ground up and are not a fork of any other project. Our code is also audited by Slowmist.
Thanks to everyone for your time! And please come say hi over in our community if anyone has any further questions. We’ve got a great and welcoming community! Here are some links:
Website — https://umb.network/
Telegram Community — https://t.me/umbrellanet
Discord — https://discord.gg/G9x4TsHSd7
Twitter — https://twitter.com/umbnetwork
Join the discussion on Telegram at https://t.me/umbrellanet