Wombat Exchange AMA Recap

We had an amazing time engaging with the community in our first AMA held last Friday on the 5th of February, 2022! Our founder Alex Lee and the team are honored to have all wombats joining and bringing us inspiring questions, and showing your support!

Recap below for those who missed out! We’ve made some minor edits for formatting and clarity :)

Part 1: Pre-gathered questions from Twitter

Q: Will Wombat joint venture as a next BSC star project? Recently there are quite a lot of funds running out from BSC to other chains, wish wombat can bring them back!

So as you all know, we were in the Binance Incubation season 3, and now we have been included in the most valuable builder season 4! Although I can’t disclose it now, we have a lot of exciting partnerships coming up with other BSC projects. Stay tuned for more news in the coming while :)

Regarding funds running out of BSC, I think with all the new chains out there, there are issues with user stickiness because it’s getting easier and easier to move funds around. However, we know that people will stick around to quality projects, and that’s what we try to be. Have a solid project, build a strong ecosystem around it. Our goal is definitely to attract users back into the BSC ecosystem, and our team is confident that we are able to do that!

Q: Security is the most important thing, how secure is this project for users and investors?

That’s a fantastic question, I think for anyone using DeFi, security is one of the main concerns. We’re worried about hacks, and if our funds are SAFU.

This is undoubtedly the thing that the team at Wombat is most concerned with. Not only do you have to worry about your code being safe, but you also have to worry about the larger picture, the assets that you let trade.

In terms of the code, we are currently doing testing and preparing to submit our code to multiple reputable security audit firms, in order to make sure our code is secure. On top of that, we are partnering with Immunefi for the bug bounty program as an added layer to protect the people we hold most dear, you guys — the users! Nothing is more important to us than that.

Q: Wombat looks like one of the most professional teams on BSC and I wonder what we can expect in the near future from Wombat except being a stableswap?

Wombat’s bread-and-butter is definitely being the best stableswap as we can be. This is because we believe that in order for any blockchain and DeFi in general to survive and thrive, you really need a good stableswap, as it serves as a foundation for the entire ecosystem. You can see that the protocol on Ethereum that is the strongest and has the largest TVL is definitely Curve. That’s because even though they do something simple, it is fundamentally important to everything else.

What’s interesting about Wombat is that we do things more efficiently, but we approach everything in a very different manner. We want to be fairer in terms of the end-users. Where Curve requires you to lock in for long periods, Wombat strives to let the user choose. You can choose however you want to lock it because I believe that the world of DeFi should not be one that there is no choice. On top of that, we will have an ecosystem where people can stake their tokens for higher APY!

We will do multi-chain of course, and venture into different pegged assets in the future. While the goal is to have a strong multi-chain stableswap, we will plan to be a special multi-vertical stableswap as well! I won’t release too many details for now, but we will definitely be the first of its kind.

Q: Why did you decide that BSC is the best infrastructure to build this project? The transaction fee issue is great, but many BSC projects have suffered from vulnerabilities lately. Did you take this into account?

As many of you know we were part of the Binance incubation labs, and Wombat really was just an algorithm just a few months ago, and Binance gave us a chance. I think a large part is Binance having the trust at our project, CZ has given great advice and he is someone that genuinely wants DeFi to succeed and I think that’s cool, and also the wombat team acknowledging the glaring holes that the Binance ecosystem has.

They have no solid stableswap, everything right now is really just a fork, and their stableswaps don’t have a proper ecosystem to support what they want to do. Everything right now is just too complicated for something that should be simple. We believe our excellent design and slippage, combined with BSC’s low gas fees it will make for an amazing combination for end-users, borrowing, and lending protocols to give the users even better rates, which is the goal for teams who are pushing DeFi to the next level.

In terms of vulnerabilities, as mentioned in the previous question, we are addressing them with proper code audits, and governance to ensure and protect our users. To be fair, not just BSC has suffered from attacks, but what we can do, is work our hardest to protect the funds and hacks by constant code reviews, bug bounties. I hope to shed the bad stigma that BSC has, because you know, in life, you want to be the change that you want in the world, and that’s what the team at Wombat wants to do.

Q: A very good partnership is needed to strengthen a project. Do you have any other project partnerships with your project? Are you planning to partner to make Wombat stronger?

We do! As mentioned, as stableswaps are one of the key legos of the DeFi ecosystem, we are currently partnering and in talks with various top projects in not only BSC, but across the crypto-ecosystem. Wombat’s goal is to support and be a platform for DeFi to grow because my mantra is simple, together we are strong, divided we are weak. DeFi, to me, isn’t about Wombat vs. the world, but rather, wombat + entire crypto world vs TradFi. I hope Wombat can be a platform to raise everyone up, and enjoy crypto as how it was meant to be enjoyed, free and permissionless.

Part 2: Live questions from Telegram

Q: Wombat focuses on stableswap with single-sided pools, open liquidity and you’re promising that Wombat will be revolutionary. Do you believe that the Wombat will dominate stableswap dApps across all chains besides BSC, too?

The value for Wombat is not only from the fact that our design and algorithm are revolutionary, but also the fact that we have a strong roadmap to ensure this isn’t just a short-term play. I’ll let you in on another secret, Wombat’s investors are all locked in much, much longer time-frames compared to any other project on the DeFi ecosystem. this is because not only the team believes in the project, but our investors believe what we are doing is solid. We believe on top of our partnerships, our passion for crypto is genuine!

Q: What happened to MIM was probably the biggest news for stableswaps recently, how would Wombat have handled situations like that if you were already up and running?

Would you separate or exclude algo stables / small stables in first place, manually intervene, or just let MIM dry out the pool of other stables? Or do you have any other creative way to overcome such limitations?

As we saw with the whole MIM fiasco, there are inherent issues with algo/small stablecoins. The whole ordeal really shocked the crypto space, and we can see once the news broke out, people immediately swapped their MIM to BUSD, USDT, USDC, or DAI. As much as we love decentralization, I think we are not there yet (although I am sure we will eventually be). But we can see that centralized stablecoins right now are still what users trust at the end, and I don’t think that will change for a long, long time.

How we will mitigate this issue is simple:

• We will have a mainpool, and a subsidiary/smaller pool
• In the mainpool we will have BUSD, USDT, USDC, and DAI only
• In order for a new stablecoin to be included, they will need to go through rigorous analysis

I don’t expect any stablecoin will join the main pool anytime soon. I won’t even include UST in the main pool. Why? Because the users are what matters to me, I want to protect your funds. I want Wombat to do what it does best, swap stablecoins without the users paying a high cost. So you can go buy what you want to buy.

For Wombat, I don’t think we would include a token like MIM into the pool, and if there was a token that will unpeg, the most likely scenario would be to freeze that specific token and allow withdrawals only to protect the other pools from being drained. How we will freeze the pool will be defined by different factors such as large deviations from the price, black swan news like the MIM fiasco. We have a few other ideas, but we will run them through simulations before we tell everyone. But at the end of the day, my goal is to have a ‘stable’ stableswap, protect the assets of the end-users, and help DeFi grow indefinitely.

Q: I actually have a follow-up question, I’m curious how the sub-pools work in case of unpeg? Since it’s made up of less safe coins so it might be even more likely to happen in the pool, would you just let the users freely swap and let it be or will there be rules to prevent a worst-case total loss? Say UST breaks down and the pool ends up with an extreme ratio like 90% UST and 10% others.

Great question, even our subpools will have a mechanism to protect the assets, most likely when there is a risk of depeg (say it starts deviating at a certain range), we will freeze that coin immediately so that it can only be withdrawn and not traded, so it protects the other tokens from the risk. Again our goal is really to protect users' assets, I don’t want any of our users to go through what they did with the whole MIM fiasco in the main pool.

We will have strict governance methods to determine whether a pool can be included, so that will act as the first layer of protection, when it gets into the subpool, then that will be governed by price movement, news, etc. I don’t even think for us, MIM, or UST would make it into our mainpool, ever.

Q: I am pretty sure Wombat will reach success in the long run with this new generation protocol. What is the main motivation behind developing such a unique product on Stableswap? Which stablecoins will you list at the beginning? Will Less popular stablecoins be included on your platform?

I think the motivation is really building something to fix a serious problem in the stableswap space, especially in BSC. One of the main things we can see in BSC is that there isn’t an easy-to-use stableswap in crypto. Most of them have a lot of UX/UI issues, and I don’t think that’s how it should be. The math behind it is hard, but the entire experience shouldn’t be hard for the users. Our team believes that should change, and we believe we have solved it :)

We will list BUSD, USDT, USDC, and DAI in our main pool, and in our smaller pool, we are in talks of a few stablecoins to consider integrating them!

Q: Do you have any plan to incentivize investors to invest Wombat in long term?

We know that stablecoin users/stakers, or rather people who invest in stablecoins really only care about one thing — APY. Nothing wrong with that (not everyone is a degen trader like myself lol jk!) but Wombat has a long roadmap to provide value to the end-user. Wombat will use a brand new ve-token staking model, which will be fair and transparent. Current designs have a few issues in that they penalize users who stake late, who stake little — but this is all not fair and I want to change that. I want users who use our platform to be as fair as possible, so our token will help with that.

We believe we have figured out the mercenary capital issue by not only having our unique ve-token model but also a community-driven team that will create a new Convex/Olympus DAO-style, helping support voting and staking, which will ultimately add value to Wombat token holders.

On top of that, as Wombat becomes bigger, we plan to have our own incubation platform, where we will help support up-and-coming DeFi projects, in which you can invest indirectly with a relationship with Wombat’S native token. So the use cases for Wombat are great, and besides, our team and our investors are in it for the long haul. We all are locked much, much longer than the industry standard, and that is just a sign of how we plan to work hard and stay true to the protocol and our values.

Q: What is the tokenomic of your token, and how will you stimulate the users to hold your token in the long run? What are your main features that distinguish you from other projects and what competitive advantage do you have?

The main features from our project are really multiple aspects: We have an entirely innovative design and algorithm, and I might add it might be the most elegant solution for any stableswap to date. We are solving an issue in BSC, in which they don’t have a solid stableswap that has a good ecosystem built around it.

Wombat has all of that and the main thing is that we make it simple to use. our competitive advantage there is very clear, and on top of that, Wombat’s value proposition is that we are working together with the entire BSC ecosystem to grow it together. I know I sound like a broken record, but I want to change it. I want to be a platform where we can help join hands and grow, and not just function as a place where people just farm and dump tokens (mercenary capital).

In order for an ecosystem to be healthy, we need a proper ecosystem and the team at Wombat not only has the skill, determination to do that, but we also have a strong vision, and strong relationships with Binance and everyone in the BSC ecosystem to make that a reality.

Our competitive advantage is having investors and the team understand that this is a long and arduous journey and they are here to be there with us (we made it clear that the terms are locked for a long time and they are okay with it and support us), but for the future of DeFi, I can 110% say it is completely worth it.

We would like to thank you all again for joining the AMA! Feel free to ask more questions in our telegram group, or @definitedude on Twitter. 😉

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