“For Google, this is its critical moment (code red scenario).”
The search engine giant Google was recently launched an antitrust lawsuit by the U.S. Department of Justice and is in a “dangerous situation.” However, the impact of this case will obviously not be limited to Google itself. It may be a full stop to the Internet development model in the past 20 years. Of course, it can also be interpreted as the affirmation of the relevant development model by the regulators-Google is a masterpiece of it. By.
In the past 20 years, the development of the Internet has shown a significant “accumulation effect”, whether it is the development of a single-point “Apache” into a full-coverage Internet, or a scattered single Web “in the early stages of Netscape, Mosaic, etc.” Browsers, or scattered information gathered into search engines like Google, this feature is particularly obvious.
Accompanying this is the daily increase in the valuation of related products and companies: Netscape browser that aggregates the Web-Google aggregates information-Amazon aggregates goods, etc., each of them leads the way in the Internet stage where they are located. The main line of “aggregation” of Internet business development over the past 20 years has supported a huge story of tens to trillions of dollars.
The underlying logic of business is often the same, and similar scenarios are emerging in the DeFi field, which continues to flourish in today’s encrypted world.
DeFi midfield, lending, DEX, one super-multi-strong pattern is formed, aggregators still need to work hard
A brief review of the path of the almost instantaneous outbreak of DeFi in 2020, it is not difficult to find that based on various types of Lending (MakerDAO, Aave and Compound), the DeFi ecosystem has siphoned a lot of liquidity from inside and outside the crypto world, indirectly giving birth to USDt, USDC The issuance of stablecoins such as DAI and DAI has completed the “attractive” step. The subsequent asset precipitation and high-level arbitrage are facilitated by the joint efforts of Uniswap, Sushiswap and other Dex and YFI, Harvest and other income aggregators.
From the data perspective, the current total locked-up amount of DeFi is close to 15 billion U.S. dollars. As the three kings under the loan segment-Maker, Aave, and Compound, they have locked up a total of 4.4 billion U.S. dollars in assets, while Uniswap in DEX is 29 The lock-up volume of 100 million U.S. dollars is the best (ranking the first in the DeFi ecosystem). Curve, which specializes in stable currency exchange, and Synthetix, which is aimed at synthetic asset exchange, are respectively worth 1.1 billion U.S. dollars and approximately 650 million U.S. dollars. The second or third place in the DEX direction, the transaction volume of the DEX department has surpassed Coinbase Pro and Coinbase’s main sites in August and September, making the DeFi narrative more solid and robust.
The growth of the Lending and DEX departments has created quite a wealth of space for various strategic combinations of “financial income”. This allows us to witness the myths of YFI and YFII and see the edge of “aggregators”, but this is obviously not enough The long-term market has convinced the market, and the YFIs who have been stagnating in the “revenue aggregator” in the short-term have locked their positions drastically. In the next stage, how should the market demand be met?
Visualization of “One-stop Liquidity Capture”｜Source: Chain News
I think it is a “one-stop liquidity capture”. After all, you can’t let a DeFi-loving user endure the “shallow” stable currency liquidity on Uniswap (especially USDT) for a long time, and you can’t let the “DeFi refiners” continue Tolerate the high price difference caused by the different depths of DEX, not to mention the forced multi-party turnover in order to pursue the price difference, handling fee, transaction depth, etc., resulting in lower capital efficiency…
For the superimposed and evolutionary requirements of cost, efficiency and experience, DeFi is now very much like the Internet of the year. The market calls for aggregators to solve this pain point as soon as possible. What about the current status of the track composed of similar products?
“Trading Aggregation” crossed the river by touching the stones, and was blessed with funding, but regretted
Transaction aggregators are generally in the initial stage of exploration. They have not yet formed enough moats in the routing algorithm, have not yet explored a robust and feasible model in business, and have not yet fully “grafted” the energy of swap such as Uni and Curve in terms of transaction volume. This direction has enough room for imagination in the “market dream rate”.
If we learn from Placeholder’s discussion of middleware:
“As the glue between the underlying blockchain and DApps-oriented end users, the middleware protocol will make DApps creation easier and faster.”
For the strategic value of “transaction aggregation” to DeFi, we can learn from the meaning of middleware to DApp & underlying blockchain
Have a better understanding of transaction aggregation-inhabiting relatively mature DEXs, transaction aggregators can continue to provide users with a “comprehensive cost optimal solution” transaction plan with their own routing capabilities. In the long run, this will To create a unique brand ability and form a competitive potential for Dex, just as Google, which has long-term aggregated information, has become the “information master”.
The bets of a group of investors in the primary market are yet another strong proof of “transaction aggregation.” Since the beginning of this year, “transaction aggregators” such as 1inch and Paraswap have successively obtained a single round of financing of millions of dollars, which is a qualitative leap compared with the tragedy of the previous year, but it has not yet been able to lead half of the DeFi track. Bit.
Investigating the reasons, the current transaction aggregators still have some problems: transaction execution efficiency still needs to be optimized, routing algorithm core competitiveness is weak, and operations are often stuck-aggregators dedicated to optimizing DEX have also become a need The object to be optimized.
How can it be a better transaction aggregator to open up the space of the primary market?
Lattice-a unique existence in the “transaction aggregator”
To break through the current valuation bottleneck of transaction aggregation, the introduction of new potential is the key, and Lattice has adopted this path.
It has gone out of the old path of relying solely on ETH, trying to build a high-performance DeFi liquidity protocol developed by Ethereum and Constellation’s Hypergraph Transfer Protocol (HGTP), including decentralized finance with modules such as transaction aggregation and automated market making (AMM) (DeFi) solution.
Compared with the shortcomings of the “transaction aggregator” represented by 1inch, such as general routing capabilities, complex transaction paths, and improper matching of multiple transactions that push up costs, Lattice uses the Hypergraph protocol of the Constellation network to achieve cross-chain interoperability. Based on this, the following four major advantages can be achieved:
- The liquidity pool based on AMM allows lenders to earn transaction fees from their farming;
- Intelligent routing algorithm, which can execute transactions on different platforms;
- Advanced platform of pluggable institution order matching algorithm for specific assets (multiple AMM);
- The governance token of Lattice (LTX)-gives holders certain rights to economic parameters such as transaction fees and inflation/deflation.
For Lattice, the industry’s top investment institution FBG Capital gave an appropriate evaluation:
The rise of DeFi has given other Ethereum competitors the opportunity to overtake in corners. We believe that as long as faster transactions and better prices can be provided on the aggregator track, there will be opportunities to attract more funds and users to form The network effect of the platform. Lattice connects the assets on the Ethereum and the more powerful Hypergraph network through a cross-chain method to provide users with a better liquidity aggregation platform.
LTX Allocation | Source: Lattice White Paper
In addition to the above unique features, Lattice is wiser than its “transaction aggregator” peers in introducing the governance and functional token LTX in the ecology in a timely manner. A fixed 100 million LTX will help the liquidity and pledge of the Lattice ecosystem. This further lays the foundation for the future data economy of its system, as well as helping users provide the best prices and market-making profits.
And Lattice’s excellent team ability provides a solid guarantee for the entire vision: Lattice’s current team includes members of Constellation Network and Inc, distributed system engineers and blockchain architects, as well as NASA, PwC, European Central Bank, Senior entrepreneurs such as Oracle. Its co-founder and CEO Ben Jorgensen is an American entrepreneur and investor with an academic background in anthropology, economics, and political science, focusing on the exploration of emerging technologies.
Lattice’s unique advantage lies not only in repairing the existing shortcomings to the greatest extent, but also in the need for us to see what we have learned, look at the present and make judgments from the perspective of the future.
If we look further into the second half of DeFi, I believe that we can understand the value of transaction aggregation such as Lattice’s “one-stop liquidity capture”: after months of passive abuse of hundreds of Gas ETH, the community deeply felt it. The necessity of Layer2, but ETH’s Layer2 solution is dazzling, each has its required products and it is difficult to be set under the same Layer2;
On the other hand, new-generation public chains such as Polkadot, Near, and Solana are rapidly advancing their own DeFi ecology. In addition to forming a competitive situation with Ethereum, they are also increasing the decentralization of users and funds.
In a word, a single product/platform trial of proprietary Layer 2 is a high probability event in the future. For example, Uniswap will use the Op-rollup solution in the future, while Curve will use the ZK-rollup solution. This kind of “parting ways” may cause The best solution for their respective products in the future will be the further fragmentation of DeFi liquidity, and the decentralization of the underlying platform will obviously further accelerate this trend.
“DeFi aggregators have a huge imagination, so you might as well compare them with other Internet aggregation products.” Source: Messari
From the perspective of broader market thinking, from the standpoint of startups in the DeFi field on the B side, whether cutting into Lending or Dex, or toddler YFI entering the aggregate revenue track, they are all rushing into the red sea market in the natural high-complexity field. Instead of this, why not use the “liquidity aggregation” field that addresses the real needs of the market and cleverly use plug-ins such as “cross-chain” and “DAG” to expand your comparative advantage.
I believe that similar logic is one of the underlying reasons for Google to bypass the web aggregation browser and choose the information aggregation search engine to cut into the Internet market and fight, and it is impossible to support Lattice in the DeFi world. What about the story?
