Hello and welcome to The Ether. Today is Saturday, February 12th 2022. This episode of The Ether is brought to you by Orbital Command, a community validator on Terra dedicated to educating, expanding and promoting the LUNAtic community. Take advantage of their Terra Luna Intel Report on Telegram which brings you the hottest news and updates on all things Terra each and every day. Find it using the link in the show notes. You can also support their community efforts by considering them next time you’re delegating or redelegating your LUNA. Find out more at orbitalcommand.io This episode of The Ether is also brought to you by Luart. Luart is the first gamified NFT platform built on the Terra network. Luart provides a seamless minting and trading experience all while earning you rewards just for being a user. Be sure to follow them on Twitter and join the community in the Discord server for the most up-to-date news and announcements regarding all the hot new NFT launches, platform upgrades, and new projects hitting the secondary marketplace. Are you ready to #PutYourHelmetOn and join the movement? Find out more luart.io. TerraSpaces appreciates the support from all our sponsors. Today on The Ether we have the Dawn of Edge AMA with Stader Labs. Let’s take a listen.
Edge Protocol 1:55
Good morning. Good afternoon. And good evening for everyone here. We appreciate your time today to listen to the sessions today. Today’s session is going to be about… Our large plan is going to be about Dawn of Edge event, which is going to be the kickstart date of our Beta launch, which is going to be the 15th February this year or this Tuesday, basically. So we are here with Dennis from Stader Labs, which is one of our partners, and one of the the major key usage of our Edge Genesis pool. And from Edge Protocol, we also have Jern, he’s the head of product from Edge Protocol. In case that you guys have any questions, he will be more than happy to answer.
Jern Kunpittaya 2:47
Edge Protocol 2:50
Denis Balitskiy 2:52
Super exciting to hear this. By the way, guys, in about 5-10 minutes. Our CEO from Stader Labs is also going to be joining the call. He’s finally arriving. So hopefully we’ll have him today too.
Edge Protocol 3:08
Yeah, sure. Let me structure it this kind of way. Let’s talk about Edge in general first, so everyone could have a basic information about Edge Protocol. At Edge Protocol we are aiming to be the money market as a service protocol, a community based pool procreation platform, allows people, protocols, and DAOs to create their own lending pools. And yeah, that is basically our long term plan. But since there’s a lot of users demand from having a money market on the Terra ecosystem, we decided to create one, which is going to be our Genesis Pool, which is going to launch by the Tuesday. And yeah, just want to say that the Genesis Pool wouldn’t be the core product of ourselves for long term, but it’s going to be our kickstart point to kick start the first money market pool on Terra ecosystem and on Edge marketplace. That’s basically our plan and visions. So our launch is going to be available for you guys in this Tuesday, 2pm UTC. You will be able to lend, borrow and collateralize seven assets, including aUST, UST, LUNA, LunaX, bLUNA, MIR and ANC. So the pool itself is going to be a cross-collateral pool. You will be able to collateralize any of these seven assets. Yeah, and it will provide more flexibilities, capital efficiencies for all of you to have more utilities on the asset from your bags. And yes, as far as we know, the LunaX is going to be listed on Edge Protocol in the first day. And there’s a ton of use case that we could talk about today, especially when it comes to having LunaX as a collateral would expand the pool possibilities a lot more. Dennis, do you have any takes on this?
Denis Balitskiy 5:25
Yeah so this is amazing this is a great opportunity for both protocols to deliver a lot of value to the community. Just imagine all of the possibilities having your staked asset producing you stable yields, autocompounded yields, be able to auto claim all of your airdrops with only one click, and of course, use LunaX on many many different places. And of course with Edge, this is going to be amazing because what’s going to happen is once you have this possibility to have these LunaX first pool, imagine all the possibilities. I guess I would leave this to you because it’s just mind blowing how many things we can do, just to the very beginning, the first pool.
Edge Protocol 6:22
Yeah. Thank you, Dennis, for passing the mic. Actually there’s tons of use cases could be built on top of Edge and especially the first pool, because we list more than five or six or seven assets as collateral. Two of that is basically aUST and LunaX, which is both yield bearing assets containing the accrual yield from staking yield and savings yield, right. And when it comes to having those two asset as collateral, what could be possible is that you can collateralize those yie’d bearing assets and borrow one another assets for leveraging and maybe do some kind of low-risk leveraging, which is like… It could happen with LUNA and LunaX, you can use the LunaX as a collateral, and lend out the LUNA and repeat it as a loop. And it’s going to produce a lot more capital efficiencies and yield from leverage. And the same thing happens similar with aUST and UST as well. Yeah, so hese are the two major use case that could possible on top of Edge at the first day, but there’s a lot more that could happen. It depends on the needs, on what you guys think. And yeah, having aUST as a collateral, I think this opportunity is more than enough to say that you could have a maximum level of capital efficiencies by collateralizing your savings positions and lend out another investment assets. You can collateralize aUST and invest more LUNA, MIR and ANC. And yeah, that’s basically the use cases. Jern, do you have anything to add more?
Jern Kunpittaya 8:24
Yeah, that’s very exciting. Yeah, basically, our first Genesis Pool Edge cross-collateralized, right. So basically, we allow people to collateralize these yield bearing assets. I think the most exciting is that, if you’re thinking carefully about LunaX and LUNA, and it’s a really safe position because the price is not deviate that much. So by doing so we believe that Edge Protocol allows you to have leverage, but a bit of safety because the price is not deviate from each other much. So yeah, that would be really cool things for yourself to leverage a lot while also there’s no need to be scared of liquidations. I mean, also, this is money market, right. So normal functions of money markets, like long these assets, short these assets. Or sometimes you can just leverage the native assets. You can just collateralize LUNA to borrow another LUNA and repeat, and other stuff. This is also possible, but yeah, again, we are really excited about the yield bearing especially LunaX as well.
Edge Protocol 9:22
Yeah, that’s it. And Dennis, could I ask you about how are we gonna capitalize the opportunity of having LunaX as a collateral on Edge?
Denis Balitskiy 9:38
So just think about all the things you can do it, right. I think this is the first time on Terra that we’re opening the doors to so many more possibilities. Because if you think about it, you just maximize your capital efficiency, just like you guys said, but also it actually helps the protocols and use cases for everybody. So think of LunaX as… And I don’t want to be comparing LunaX to LUNA, but think of it like what’s the benefit of holding LunaX in the first place, right, because you have all of these benefits like I mentioned at the beginning, all of the staking benefits that you get on Stader. Now, imagine that on top of that you’re having a liquid LUNA that you could be using almost anywhere with Edge, right? So imagine, for example, leveraging UST with it and all the things you can do with your UST. Maybe you want to use it on Anchor, maybe you want to use it on any other protocol. I mean, you have many, many, many use cases for that, right. And this is just a starting point.
Edge Protocol 10:58
Yes, exactly. Yeah, and the top notch value that we’re going to provide to the users is the flexibilities of all these assets could be listed as collateral. And, yeah, just want to be clear that the first pool it’s just a demonstration of what is Edge pool is capable off in the future. Because in the future, we are gonna do things called protocol owned money markets. Allow protocols like Stader, and many other protocols can create their own learning pools and having that one specific use case. And in the Stader case, would be leverage LUNA and LunaX by just having the two assets in a pool. And this is one of the use cases that are possible in the protocol owned money market phase. And the Genesis Pool for the Beta launch, which is going live on this Tuesday, is going to be a demonstration of how flexible it is, how flexible to having the interested model that we could customize and having the collateral factor or borrowing factor that we can set. And yeah, and which asset that we could set as a collateral, as well. So this is basically our key message that we’re gonna provide using the Genesis Pool and the Beta launch. Yeah. Do you guys have anything to add? If not, I think we are good to open the conversations from the listener?
Jern Kunpittaya 12:42
Yeah, just to be clear… Yeah, as we said before, basically, this Genesis Pool is… Let’s say we need to show you guys what Edge pool is capable of, right. Because Edge Protocol, we position ourselves to be money market as a service. So basically feel free to give feedback on how the Edge pool is doing right now, because we are going to take that feedback and improve it. So then when we come into the protocol owned money market phase, we would allow protocol, like again, Stader and other protocol to create their own money market. And to do that right, to do that best for users, we just make sure that our Beta launch is used as a feedback loop for the community to not only enjoy utilizing strategy like LunaX and those stuff, but also to get feedback so that we can be the best money market as a service platform to provide utility for you guys. So yeah, we really welcome all feedback and all those questions so that we can improve this as a community base together.
Edge Protocol 13:38
Yes. Exactly. And Amit from Stader here. Hi, Amit.
Yes. Hi, guys.
Edge Protocol 13:48
Yeah, we have talked about the launch, the possibilities that could happen after Edge Protocol is launched. And yeah, maybe if you have anything from Stader side that you want to add here, please do.
Absolutely. Absolutely. First of all, congratulations guys, for your Beta launch that is coming up next week. Really excited about your launch and all the possibilities that you are going to have, not just for Stader and LunaX, but for the entire Terra ecosystem. I mean, I’m sure the last one or two months have been quite stressful for you guys. And I’m very excited and happy for you. And thanks a lot everyone for tuning in today. Sorry for the delay. I was stuck in a jungle and couldn’t get to my room on time. I hope you guys have covered the vision of Edge as well as what’s going on, what’s coming in over the next few days on Edge Protocol.
Edge Protocol 14:56
Yeah, I think we covered maybe 80% of it, and we would love to have questions from the listeners right now.
Did you guys cover the possibilities with LunaX?
Edge Protocol 15:17
Okay that’s great.
Edge Protocol 15:20
We have talked about that. The LunaX and LUNA. And maybe if there’s any questions from communities, please feel free to raise your hand.
Yeah, absolutely. So if you have covered the LunaX possibilities already, then I think we should let the community members ask questions about Edge as well as our collaboration. Yes.
Edge Protocol 15:43
Yeah, sure. Yeah.
Are there any questions, guys? I see a lot of familiar faces. Tony. Matt. Hey, Matt, how are you? Matt is one of our angel investors.
Edge Protocol 15:57
Hi. Hi, everyone.
Does anyone have any questions? Please feel free to raise your hands. You have to request for speaker access.
Edge Protocol 16:11
Yeah, I’m monitoring it. If there’s anyone want to ask some questions, please feel free to do so.
For the benefit of everybody, guys, it would be great if we can also touch upon a few things around the Beta launch. The caps and how are you thinking about…
Edge Protocol 16:32
Sure. Qi Capital here. Qi is one of our angel investors. And yeah, we are so happy to have Qi speaking today. Hi, Qi Capital. Who’s here today?
Qi Capital 16:48
Hi, guys, how are you?
Edge Protocol 16:50
Qi Capital 16:54
Amir here, behind the Qi Capital.
Edge Protocol 16:57
I see. Welcome.
Qi Capital 16:59
Just a question is how you compare yourself with Mars Protocol, which is also launching quite soon? If you coul give us some parallels there. Thank you.
Edge Protocol 17:11
I mean, sure. And we can provide our thoughts on that. Basically, the key major things that differentiate us from Mars Protocol, Mars Protocol is aiming to be the Red Bank, the banking of the future, right. And in Edge Protocol, our vision is to become a money market as a service, not just the only bank, but we are going to provide the infrastructure for anyone, anywhere, protocols, communities can create their own money markets. So basically, we are not the bank ourselves. But we are the infrastructure to create the bank and we are going to be a marketplace for those banks that create on top of Edge. So this is basically our long term vision vision is where we differentiate from Mars Protocol. But in our very first product, which is going to be a single lending pool, cross cultural lending pool, it’s going to be some kind of overlap and similarities. But in terms of the values that we stick with ourselves is to provide as much flexibilities for asset listing for our parameters and anything else as much as we can. And one of the things that we value at the most level is the community. We would love to have every sound of the community to be counted in the development of Edge Protocol, especially when it comes to the phase of protocol owned money market and the community owned money market which allows anyone, any protocols to create their own lending pool. The community wise would be extremely included in every decisions of the protocol, to governance, to everything and community will have a right to own their bank as well in the futures. But yeah, just want to be clear that the Beta launch that we’re gonna launch is not going to be the product in the long run. Yeah, it just a demonstration of what is Edge Protocol’s infrastructure is capable of.
Awesome. That’s great.
Qi Capital 19:29
So what the community will be able to decide? You have some kind of examples maybe?
Edge Protocol 19:34
Yeah, sure. Just let you guys know, right now in our current phase, we are not going to have a token yet and no governance yet, but we will engage with the community, listen to the community of the voice that you have. Even in the landing page, we will have the voting page that you guys could select which asset that could be included in Edge Protocol. And, yes, for sure. The next race is going to be protocol owned money market, which we’re gonna work closely with our partner protocol and their communities to create the thing that everybody in the community needs. And to match those requirements we got to work a lot more.
Qi Capital 20:29
Okay, and what about token itself and tokenomics? Can you maybe explain a little bit more about that if you have something?
Edge Protocol 20:37
Right now, we have no plan to launch any token right now. Yeah, so we didn’t say much about it because we still have no plan about token.
Qi Capital 20:47
Okay. Thank you.
Just another question, guys. In the run up to your Beta launch I know you have been taking adequate security measures regarding the smart contracts. Could you elaborate on the audit, as well as the internal testing that you have been doing?
Edge Protocol 21:07
Yeah sure. Jern, can you explain this to Amit?
Jern Kunpittaya 21:11
Yeah, sure. So basically, our… Yeah, to be clear, again, we are a money market as a service, right. However, this Beta launch is just one pool that is created by our contract. So our contract, which is audited by The Z Institute, or officially audited where you can find the document on this, on Edge, is the audit of the whole Edge money markets as a service code. So we already officially audit, and the second audit will be scheduled later this month. And yeah, with that we have two audits, and we have our internal testing, which is the test case, like how liquidation happens, like how to monitoring the unusual activities. So then we can… Maybe someone explore those stuff, so that we can stop it sooner before they start to happen. And yeah, so basically, we are obviously the audited already, and the second one is coming. And we have done rigorous including peer reviews, and with board contract the frontend side to make sure the experience is seamless, and we prioritize your safety.
Amazing. And you also have… As a safety guard, you also have a cap, right, in terms of the total collateral value?
Edge Protocol 22:16
Yes. In terms of the cap of total value supplies, we gonna cap our total value supplies to be initial at $10 million worth of cap. So that means users can only supply a max of $10 million in the first day. But we are going to consider raising the cap gradually depends on the community demands or other circumstance of the pool. And the reason why we are doing this is to make sure that everyone notice, and acknowledges about all the risks that could possibly have in Edge Protocol. Once we got all these contract working seamlessly with the frontends and we got the second audit, it could be possible as well if we’re gonna raise the cap, or get rid of cap open to no limit cap. Yeah. So, the cap will gradually increase by the… It depends on the circumstance and to match with the community demands.
Gotcha understand. Anyone else who wants to ask questions around either the strategies or anything else? Please feel free to raise your hand.
Edge Protocol 23:42
To raise your hand. Yeah, sure. Yeah, all the questions and other feedbacks that happening today from you guys, we are going to consider about it a lot. And yeah, all ideas and all feedbacks are welcome in Edge Protocol. Please feel free to raise their hand to ask any questions and suggest anything.
Awesome. Can you elaborate maybe how the leveraged staking works for the benefit of the audience, guys? Is that something that is going to be available in Beta?
Edge Protocol 24:20
Yeah. So the leverage staking is one of the collaborations that we would love to collab with Stader Labs in the near future. But in the Beta launch as much as our pool capital is having both LunaX and LUNA in the same pool, in the same cross-collateral pool, right? And the front end of doing the automated leverage staking wouldn’t be available in the first day of the launch, but we are going to be building it over time after the launch or maybe before we got to do our protocol owned money market phase as well. And yeah, it could happen within the Beta launch phage. And the concept itself, let Jern elaborate more on about the leverage staking concept.
Jern Kunpittaya 25:23
Yeah, sure. So basically when you mean leverage staking you mean to have LunaX, right, which is Stader’s LUNA, but you also earn the perks of staking yields and the airdrops, which is really cool about LunaX. Shout out to them. Basically when you mean leverage, you just want to get more exposure to the staking yield and get more exposure to the airdrop. But usually if you don’t have that much money to buy, let’s say the 10 LunaX, you may start with just five LunaX, but you want to get exposure to the same one that can buy the 10 LunaX, right. So what we’re doing here is just, you got LunaX from Stader, right, and then you can supply it in Edge pool as a collateral and then enable to collateralize it and then borrow LUNA out. So you collateralized LunaX to borrow LUNA of Edge Protocol. And then you can use this LUNA, interact with Stader and get more LunaX. And then you have this more LunaX, right. So basically in this one flow, you have initial LunaX, you collateralize it, you get LUNA from borrowing, and then you change that LUNA to LunaX. So now you have more LunaX and this is called leveraging because now you get exposure to LunaX because you get more yields, you get more airdrops possibilities. And this can be repeated as a feedback loop. Basically use LunaX to borrow LUNA, exchange LUNA to LunaX by Stader, and they use that, exchange LunaX to collateralize again, and to borrow LUNA. And basically this is really exciting because it can just make sure to put your capital efficiency at it’s best, right, because with, let’s say, two times LunaX you get two times higher yield and two times exposure to the airdrops, which is just a big thing in LUNA ecosystem as well.
Amazing guys. Can this be automated in the future where the users can set the LTV as well as the number of times leverage that they want to take? And can all of this be automated?
Edge Protocol 27:21
Yeah, it’s possible to have an automation in the future. But yeah, just want to be clear that it wouldn’t be available in this Tuesday. But we are going to work closely with Stader Labs to make it happen one day.
Awesome. That’s great. So last time when we did an AMA with Orbital Command, Rebel Defi was there and he was extremely excited by the possibility of leveraged staking. Rebel, do you have any questions? Or do you want to say anything about this?
Edge Protocol 27:54
Yeah. Hi Rebel. And, yeah, we are planning to have another AMA, which is going to be a full AMA of Edge with Orbital Command as well.
Oh, amazing. That’s good.
Edge Protocol 28:07
Rebel Defi 28:08
Hi, guys. Sorry, I just dropped out when Amit was telling us some stuff there. One question I’ve been sort of thinking about, I really enjoyed that looping LunaX to get more LUNA, what sort of interest rate do you think we’re gonna be paying to borrow the LUNA? I mean it’s still gonna be profitable to loop I’m assuming, but is it going to… Just how profitable basically?
Edge Protocol 28:35
Yeah, our interest rate model is going to be the utilization rate based interest rate model. It’s going to depend on how much the utilization rate is going on in each of these assets. But yeah, when we’re configurating the math of the interest rate model of the LUNA, we think about these strategies a lot, and we set it up in order to get these strategies most profitable, as much as we can. And but it couldn’t be… If the utilization rate rise more than the LUNA staking yield, it’s gonna be profitable, right. And yeah, we kind of set it to avoid that way as much as possible. So, Jern, do you have anything to add with this? Especially on the the utilization rate model, and stuff?
Jern Kunpittaya 29:41
Yeah. Yeah. Thank you. Yeah, definitely that is our concern, right. Because when you supply LunaX, of course, you earn the APY, right. But then when you borrow now you have to pay borrowing rate, right. So we configure, of course, the interest ratemodel has to be depend on the utilization rate, right. But we also make sure that when you borrow out the LUNA, the borrowing rate does not exceed the rate that the LunaX earn from leveraged staking, right. So we configure that already and we make sure that it’s not going to be loss for sure. And we make the slope so that it makes sense with this utilization rate, which used to earn a lot from leveraged staking. But however, the exact number, again, depends on the community from the utilization rate of that time and all those stuff. But yeah, we will make sure that it’s not gonna be a loss for you for leverage staking.
Rebel Defi 30:30
Cool, cool. And how risky do you think is? What were the… I mean, I can’t… In my head, I think LUNA and LunaX are essentially the same price. LunaX might be even a little bit more expensive. But are there rules of depegging type risks to the strategy do you think?
I can take that question. So the key risk that you’re referring to just for the better understanding of rest of the members, here is the LUNA-LunaX depegging and liquidation risk of LunaX collateral, right. So here, the risk is definitely much lower than, let’s say, taking UST as a loan compared to LunaX or LUNA, because the price of LunaX is going to closely mirror LUNA, similar to bLUNA. So essentially, even in case of a drawdown LunaX is going to go down and at the same time LUNA is going to go down but both of them are going to go down in similar proportions. So the risk of liquidations is much lower compared to non-like assets like LUNA-UST or LunaX-UST.
Rebel Defi 31:47
I mean, obviously, there’s still some risk there, but we just don’t know… It’s obviously up to us to decide.
Exactly, exactly. So it’s up to the users to figure out to decide what is the LTV that they are comfortable with. Some users could potentially go up to as high as 95%. But then obviously, there will be an LTV ratio that is more comfortable and less riskier compared to a 95% LTV.
Edge Protocol 32:21
Yeah, we are not come compromising the securities and the parameters that we’re gonna use to do with this kind of strategy. So the initial set of parameters, the collateral factors wouldn’t be that high until we have the isolated pool for these strategies specifically, but in the first one in the cross-collateral pool, the collateral factor and the borrowing factor of LUNA and LunaX wouldn’t be that high. So the users could be insured that is going to be safe. The risk that is gonna tie with this type of strategy is going to be just that depegging in case that LunaX and exchange rates have derived from the LUNA price itself. And yeah, as far as we could know that risk is where to happens. Yeah, it’s rare chance to happen. Yeah. I will say that.
Jern Kunpittaya 33:29
Yeah, definitely agree because yeah, again, from the project of Beta launch, right, the genesis pool is cross-collateral. So we cannot boost the specific collateral ratio or borrowing factor of LunaX-LUNA to be very high. But again, this is possible with protocol owned money market later because once your pool just have LunaX-LUNA, you can configure the parameter to be higher LTV, so allow more times of leveraging. But yeah, that being said for the Beta launch, the parameter is set to be safe. And then about the depegging, again, this depends on the exchange rate of LunaX and LUNA, right, and as far as we know the contract of LunaX that is used to calculate the exchange rate has a huge liquidity already so it would not be that profitable for the exploiter to maybe try to manipulate that because especially we have hard cap, right, so the funds in the pool is made of other stuff. So yeah, the risk is there, but we just like make sure to adjust everything to address that.
Rebel Defi 34:24
Great. Sounds fantastic. Looking forward to it.
Edge Protocol 34:27
Yeah, it’s gonna be live on this Tuesday. So keep your eyes closely on Edge. We are going to provide more informations especially about the parameters and everything within a day or two. And we are going to have a Discord community. It’s coming around the corner. And yeah, we love to have all of you to be a part of our early community. Bouncing some ideas and get the products having its product-market fit and maybe we could move on to protocol owned money market phase and community owned money market phase together. Yeah. So anyone have questions? Hi, Cephii.
Hi, Cephii. Cephii is here.
Edge Protocol 35:15
Yeah. Cephii. Yeah. Sorry.
Hope you’re having a great weekend so far. Cephii, please do request for speaker access.
Edge Protocol 35:24
Yeah, I’ll invite him.
Rebel Defi 35:27
While we’re waiting on Cephii coming up, can you speak more exactly about when it’s opening on Tuesday? Or is that kind of secret?
Edge Protocol 35:35
Yeah. It’s going to be live 2pm on UTC on Tuesday. Yeah. Save the date, guys. It’s going to be an hour earlier than this session. And it’s going to be live on Tuesday 2pm UTC.
Edge Protocol 35:37
2pm UTC. And it’s capped at $10 million, is that right?
Edge Protocol 35:57
Rebel Defi 35:58
Great. Is there any way we can block Cephii from getting in at 2pm? [chuckle] Sorry, Just kidding. Just kidding. Okay. [chuckle]
Edge Protocol 36:09
Sorry, ser. Yeah, you could put it on calendar for sure.
Hey, guys. How are you? Sorry, I was kind of getting a drink at a checkout. So I was kind of AFK for a bit there.
Edge Protocol 36:22
Yeah, no worries, man.
So hey, I have a question for you guys, in this LunaX kind of partnership. I actually had a question for Stader here. Would it be possible… So let’s say we have a bunch of LUNA staked in the traditional pools, would there be a feasible scenario where we could issue maybe a liquid version, like issue a LunaX, based on the fact that we have LUNA staked there, and then you could, in theory reclaim… Almost like you’re borrowing LunaX off of your LUNA that you have staked at some point in the future, just because some people have a lot of LUNA staked in traditional LUNA, I wonder if there’s some mechanism whereby that could occur? Does that make sense?
I completely understand, Cephii. We’ve been trying to figure out how we can do that at a smart contract level.
It’s almost like you would basically issue some kind of derivative, sort of like you’re basically borrowing off of your stated LUNA. So it just kind of creates an alternative lending scenario, I suppose.
Yes, yes. Definitely. I think maybe we can try. We will, again, internally evaluate and figure out if there is a possibility. The only challenge here is if there’s a token that will be issued on top of the stake pools may not be fungible with LunaX. That’s the main challenge. Nevertheless, we’ll try that. I think it’s a great suggestion, as always. We will try that once again. And see if there can be something done at the contract level.
Yeah, really just something to brainstorm. I don’t know if it’s technically feasible, like you said.
Yeah. Yeah, both are two separate smart contracts. We wish we could do that. Unfortunately… I mean, we had launched two products because you probably know the reasons why a lot of people prefer plain staking over LunaX or liquid staking because of the tax implications and their aversion to using LunaX on learning protocols and automated money markets. So that’s the reason why we had two products, but obviously, we will try and figure out. We also want to make LunaX as much proliferate and widely acceptable as possible. So we will try it out.
Maybe maybe one consideration, you know how right now you have the ability to compound your… So in in the simple pools, you have the ability to get either UST or autocompound LUNA, maybe one possible other sort of end point would be you take your yield and you get LunaX with that yield as another option. And then you’d be able to then use that LunaX on edge protocol or whatever you want to use it for.
Yeah, understand, got it.
Edge Protocol 39:50
Yeah. And whichever token that… Everything that could be tokenized could be listed on Edge Protocol in the future, I’m gonna say that. Yeah, we in terms of partnership with Stader Labs, not just listing LunaX in the genesis pool only, but the real reason why we are here and doing what we are doing right now, which is the beta launch is we are going to face copy protocol owned money market, or POMM, just want to be [chuckle] shortening it a little bit. The protocol owned money market phase is going to be our full launch phase, which is going to be a bunch of protocols that are gonna create the landing pools and money markets on top of Edge infrastructures and including in the the Edge marketplace and as well as Stader Labs. This is the first step for Edge Protocol to come into the market, just demonstrating and elaborating how we could play with the cross-collateral pool. Yeah. And when it comes to protocol owned money market phase, the Stader Labs will have the full authority to set all the parameters or the configurations and we earn the revenues on top of that pool, which is going to be maybe LunaX-LUNA pool isolated, or maybe like SD token pool. Yeah, it depends on what Amit thinks in the future. But for the sake of partnership, this is not just the only partnership that we’re going to have listing their token in the genesis pool. The partnership is not just for Stader, but for all protocols in Terra ecosystem. We are looking forward to do protocol owned money market, which as many protocol as possible, because we do really believe that DeFi nowadays or the projects nowadays will need some more additional revenue in the future to fund the growth and sustainability and having the second revenue stream which is banking operations and and lending market… Their own lending market in place would match with that demand.
That’s a very interesting point that you’ve made about protocol owned money market. Can you elaborate it for the sake of the community? I don’t think many of them are familiar with that concept.
Edge Protocol 42:18
Yeah, sure, the protocol owned money market is the word that we created for describing the concept of… Edge Protocol is going to be the place where protocols and DAOs can create their own lending market or their own money market. Every protocols will have a right to create their own money market setting, or the configurations of the pool, the parameters, and asset that they want to list and yet they could earn the revenue on top of that. And this is basically the concept of protocol and money market allows protocol to have their own money markets. And where does Edge Protocol kind of belongs in that phase, right. And Edge Protocol is going to position ourselves as a marketplace with a bunch of protocol owned money markets in it. And for the end users you could just come in to the Edge Protocol and see a bunch of isolated pool or protocol owned money market pool in Edge marketplace and you could select the one that you prefer. And from the protocol side, you have your own bank and you could operate as a bank and having the second revenue stream. Yeah, that’s basically the protocol owned money market that I’m talking about. And this phase is gonna… We are heading towards this phase. But yeah, let’s start with the Beta phase first.
Amazing. So to rephrase what you said, any protocol can actually create their own money market. So for example, if let’s say, tomorrow Mirror Protocol wants to create a Mirror UST money market on Edge, that is feasible. Or if Stader, wants to create SD-UST money market or SD-LunaX, or SD-LUNA money market, that is feasible?
Edge Protocol 44:23
Yeah, it’s feasible. It’s going to be… You can choose right away which asset that you’re gonna list on your lending market. And in the Stader case, the partnership that we are going to have, the protocol owned money market from Stader, it could be having just two assets which is LUNA and LunaX and we could have the leverage staking in place for that pool. And the same thing as SD token and LUNA-UST as well. And yeah, it could be feasible to do when it comes to Edge launching the full launch in the future. Yeah.
Got it, amazing. And then you’re saying even the protocols that are creating these money markets have the option to make some revenues out of users who are borrowing the pairs, right?
Edge Protocol 45:24
Yeah. The protocol owned money market is protocol owned. It’s the money market that any protocol could own. The annual revenue stream is the alternative revenue stream that they could capitalize and earning an additional revenue from it. Yeah.
Got it. That’s very interesting and very useful feature for the protocols.
Edge Protocol 45:50
Yes, and we are planning to elaborate more of protocol owned money market real soon, about the concept and the integrations that could happen. And we will work closely with the protocols partnership that we have in our pipeline to aggregate the feedbacks and the demands as much as possible in order to develop the best product for protocol owned money market phase.
Sorry, could you guys describe briefly what the difference, for people, is between say for example, if I’m a protocol and I want to deploy some pairs on a decentralized exchange, so a DEX, versus putting liquidity on a money market. What is the fundamental difference between the two from the perspective of a protocol?
Edge Protocol 46:41
Yeah, having the liquidity provided in the DEX or the exchange would increase the liquidity of having their tokens and it could be earning yield from yield farming or the fee from exchange, right. But when it comes to deploying the liquidity in their own money markets, it’s not just deploying the liquidity to earn yield from borrowing, right. And the liquidity could be extend to borrow against assets that the protocols provide. Just for example, in case of Stader, if Stader choose to deploy the SD token in Stader owned money market, Stader will have a right to borrow UST against these SD token as well. And the key major difference is the lending market is a liquidity engine, which as a protocol you have more options to play with, could be leverage and maybe utilizing some of their treasuries, and yeah, some stuff like that as well. Jern, do you have any more example for this?
Jern Kunpittaya 48:00
Yeah, sure. So basically, yeah, DEX is the exchange, right, and money market is basically the platform where you can lend and borrow. And for protocols, there’s many… Actually the terms like protocol owned money market, what makes it special is not only it’s allowed protocols to be more flexible in listing their assets, listing the parameter, LTV, those stuff, but it’s also more flexible for that protocol’s community to talk to protocol and say like, “Oh, yeah, we want to have this use case about lending and borrowing.” So the protocol owned money market is the place where protocol can interact directly with their communities, because it’s their own lending and borrowing platforms. So about why would protocol deposit money in the money market instead of the DEX, of course, the first thing is it’s their own, right. So basically, they not only own lending yields, but they can also, let’s say, utilize their treasury, they can lend their treasury out and collateralized to borrow some liquidities for funding the operations of the protocols. And also because it’s their own money market, they can…
Nice, very interesting. I had a genuine question, guys. I was wondering if you also have an option to actually take leverage on LP tokens or yield farming tokens?
Edge Protocol 49:14
Yeah. Yeah, let’s consider it as an idea first, and we we will work on that idea in the future. And yeah, we still have no development about it. But yeah, that’s the idea that we have in mind as well.
Gotcha. So for example, if any user who has an LP of ANC-UST can come and collateralize it on Edge and take out a loan. Is that possible?
Edge Protocol 49:43
Yeah, it’s gonna be possible if we aggregate the information enough and stuff in the future. And yeah, our internal team working hardly on that, and let’s make it possible someday. And yeah, in maybe the phase of the protocol owned money markets, it’s going to provide the protocols to do the leverage on top of LP token as well. And yeah, that’s one other key infrastructure that we’re gonna deploy. Yeah, we have this idea in our backlog as well. Yeah.
Edge Protocol 50:22
So, is there further questions from any listener? Yeah.
Tony is here. Tony, do you have any questions?
Edge Protocol 50:31
Hi, Tony. Yeah, Tony has wrote about one of the key strategies that you could play with Edge Protocol in the Beta launch on the genesis pool, which is very amazing. And yeah, that’s a good catch.
Edge Protocol 50:52
And if there’s no further questions, I think we are good for today. And just to remind you all, we are going to launch by this Tuesday, 15th January… No, 15th February, 2pm UTC. Please stay tuned for any further update. We’re going to provide you more information, especially about our product document real soon. And yeah, hope to see you guys in the launch.
Amazing. Thanks a lot, guys, and best of luck for the launch. Look forward to exciting times.
Edge Protocol 51:28
Yeah, thank you, Amit. Thank you, everyone, who are listening to us today. This is our first AMA, actually, and we appreciate all of you spending time with us today. And looking forward to have all of you being our very first community members. And yeah, we would love to have you on our community. Thank you guys.
Thanks for checking out another episode of The Ether. That was the Dawn of Edge AMA with Stader Labs. Recorded on Saturday, February 12th 2022. This episode of The Ether was brought to you by WeFund. WeFund is a community crowdfunding cross-chain incubator on Terra, and it’s the first launchpad that implements a milestone funding release system to protect investors. All money raised for projects is deposited in Anchor Protocol and it’s refundable, and all decisions are based on community voting power. WeFund is community focused and designed to be a user friendly experience for both project creators and investors. Be sure to follow them on Twitter and join the Telegram for more information. Links are in the show notes and check them out online at wefund.app. This episode of The Ether is also brought to you by Talis. Talis Protocol is the NFT platform for independent artists on Terra. Talis helps to provide artists with the tools and resources needed to transition from traditional arts into the NFT world. With their V1 launch coming soon, Talis will be the place to see real world art reflected on Terra. Be sure to join their Telegram and follow Talis on Twitter for updates on their roadmap, validator, and other Talis news. Find your next favorite artist on talis.art. TerraSpaces appreciates the support from all our sponsors. For terraspaces.org, I’m Finn. Thanks for listening.