1/ As someone whoโs spent 5+ years as a blockchain dev and even longer as a degen,
@berachain
is undoubtedly the most significant opportunity Iโve ever seen and itโs not close. Hereโs my thesis around their combination of tech, culture and PMF. A thread ๐งต
1/ Wanted to write up a quick explanation of
@Berachain
โs Proof of Liquidity (PoL) and why its the most elegant crypto-economic system the crypto space has ever seen. Imo itโs the primary catalyst to make Berachain a multi $B chain so it's worth understanding (probably). A ๐งต
Iโve received many DMs asking:
โWhy wonโt the Berachain hype die down in 6 months like every other chain?โ
โOther VC backed chains have new token models too, why will Berachainโs work? Much less be sustainable?โ
"Why is this anything more than a cyclical meme chain"
A ๐งต
69/ As for me, Iโll be doing more research into 2 primary areas on Berachain:
1. Newer DeFi primitives unlocked by PoL
2. Newer MEV mechanisms/externalities in PoL
DMs open always down to jam on ideas. ooga booga
7/ While Bera jpegs have been flying and Twitter engagement is off the charts, I wanted to share WHY Berachain *actually matters.
It's up to you anon, fade at your own risk
(Disclaimer, this is a material oversimplification & info is likely incorrect)
5/ So net net, Trading Fees + $BGT rewards + Block Rewards + Double Bribes.
This means in an efficient market, majority of validator and protocol profits will be fed back to users
2/ Traditional PoS chains objectively perpetuate a flow of value AWAY from the user. Many design decisions contribute to this including:
- Single governance + network token
- No coordination layer between validators & dApps
- Not rewarding economic contribution
etc.
6/ The image below provides a more technical breakdown. To add, there will be further mechanisms to create a more robust system such as a trustless marketplace between validators and protocols
Akin to PBS majority of value will be bid forward except to users instead of validator
8/ In exchange, validators will boost $BGT emissions to said protocol's pool. In turn, more users will add liquidity to the pool due to increased rewards. Lastly, the deeper liquidity encourages higher protocol usage, generating protocol fees to complete the flywheel
3/ How is Berachain different? Let me tell you the story of Bob.
Bob begins his journey by providing liquidity to the native BEX.
In exchange, he receives trading fees and BGT rewards
4/ Now Bob can delegate his $BGT to a validator
In exchange, he can receive block rewards (gas fees, priority fees, MEV) and validator bribes.
Further, protocols can partner w validators to sweeten the bribes
14/ While we've the meteoritic rise of memes like Doge, Shiba etc. there is no innovation behind these projects. Imagine if a team can pair memes + innovation. What do you think? That is literally Berachain, the smartest meme play to ever exist in crypto
7/ Here's the crazy flywheel no one is taking about:
Protocols can strike agreements with validators to subsidize validator bribes to their delegators which helps validators acquire more $BGT stake.
2/ Berachain follows a Tri-Token model:
$BERA: is the network token aka โgas tokenโ
$BGT: is the chainโs governance token
$HONEY: is the native stablecoin pegged to 1 USDC
The design of system is incredibly utilitarian, solving the major problems associated w PoS chains
11/ As such, I expect protocols to spend majority of their profits subsiding bribes on behalf of validators. So ultimately, I expect majority of the value flows to come back to users. Now isnโt that something?
(disclaimer I'm a f*cking idiot and this is probs all wrong)
1/ Hey
@0xRaito_
@InfraredFinance
just a midcurve idea:
Infrared could Secure-Signer safe signing, Distributed Validator Technology and Remote Attestation Verification to build a far more secure and decentralized LSP than the likes of Rocket Pool or Lido. Hereโs the rough idea:
3/ The Technology:
For starters Berachain opting to be EVM compatible is incredibly smart. The dev tooling is light years ahead anything else and advancing at a blistering pace. Take Foundry, Alloy and Reth as prime examples. EVM is the Javascript of Web3 -> Mass dev adoption๐ช
1/ Misconception
#1
: Berachain is only a meme chain with weak tech
Yes Berachain's memes and community are next level. Just take one good look at
@SmokeyTheBera
and
@deepname99
and you may be fooled into thinking Berachain is merely some bear-themed degen chaos
2/ However, let's begin by recognizing the differentiation of Berachain.
Sui, Aptos, ETH L2s etc. have raised billions to effectively try and solve the same problem, "The Scalability Trilemma"
Berachain plays a different game. They are the only chain trying to solve liquidity
12/ People will continue to FUD Berachain bc it's a f*cking ber jpeg spin off L1. However, don't fade the brilliance of Berachain or Cosmos just bc ur favorite threadoor tells u it's garbage... There's just so much more to itโจ
8/ In the image below, the user could receive:
- Majority of Validator profit via bribes
- Majority of Protocol profit via bribes
- Gud $BGT yield bc of Validators
The USER is the KINGMAKER in the system for the first time ever. And that's what I believe makes Berachain special
13/ The culture of Berachain inspires creativity like none other.
@deepname99
is the epitome of Berachain. Founding
@0xhoneyjar
and creating the unbelievable lore of
@miberamaker333
. I've followed Jani for a while and am convinced he's an org of 69 people cuz bro ships like crazy
5/ The validator will stake your $BGT, bc validators are chosen to propose a new blocks based on the amount of $BGT they hold. Keep in mind, validators earn block rewards when they honestly propose a new block, so logically validators want to amass the largest # of $BGT possible
6/ This is where things get interesting, bear with me. Validators will do two things with their rewards:
1. Share earned $BGT via whitelisted liquidity pools
2. Share rewards to their delegators to incentivize delegation of more BGT to them vs other validators
6/ To prove the perfectness of their compatibility with the EVM, Berachain actually went to the extreme of having an OP Stack rollup use Berachain as a settlement layer. And it worked! This flawless compatibility is crucial for dApp onboarding and a key part of my thesis
3/ As far as pure tech, they've built Polaris an EVM compatible framework for smart contract execution. The tech is open-sourced and been extensively tested
And they've built Berachain precompiles to further the functionality of Proof-of-Liquidity (PoL), no small feat
6/ Misconception
#2
: Berachainโs hype will die down/is unsustainable
Berachain's economic model is fundamentally built around sustainability, it's just hard to see. Other chains favor validators, market makers, etc that perpetuate a flow of value AWAY from the user
11/ The Culture:
For starters, we are dealing with a bear themed project that raised capital at a 420.69M valuation just for the memes... need I say more?
4/ So what can you do with BGT?โ
You can delegate your $BGT to a validator which can be used to create and vote on governance proposals such as deciding on which LP pools receive BGT "emissions"
Once delegated, you will start earning various rewards from validators via "bribes"
10/ If thereโs anything I can leave you with: Berachain will unlock never before seen mechanics as every protocol will strive to incentivize validators to increase $BGT emissions to their token. Imo this will be absolutely beautiful chaos
4/ Given the insane testnet usage, Berachain UX has not been as many expected, but here's what's crazy:
Largest testnet OAT and...
- No material validator downtime
- No chain halts, reorgs or consensus bugs
- No significant block delays
- No issues w Polaris implementation
etc.
19/ I did not touch on Berachain's tri-token model as that also requires a post of its own. TLDR the model divides gas costs, governance and a general stable coin, which ultimately mitigates the liquidity fragmentation we've seen occur in other ecosystems
11/ Takeaways:
- gud memes, very gud tech, the best builders
- Cosmos advancing fast: ZK-IBC, new CometBFT mempool, txn fee mechanism, optimizing p2p lvl otw
- Berachain is built around sustainability
- Users are the kingmaker here
- Needs to b an L1 to customize base layer
2/ For the uninitiated, Berachain is an EVM compatible L1 built on the Cosmos SDK. Traditional PoS -> PoL which allows for the reutilization of staked assets to provide liquidity where validators stake weight is tied to the amount of liquidity they provide
3/ We'll only explain $BGT in this thread. $BGT is a non-transferrable token that can only be acquired by performing certain actions in authorized dApps. For example, a common way to earn the token is to deposit liquidity into the BEX (Berachainโs native DEX)
4/ Berachain is built upon Polaris, their OS baseplate for an EVM built on top of the Cosmos SDK. Without getting too into the weeds, Polaris bifurcates the block building, processing and storage from the execution itself using message passing to โconnectโ the EVM and Cosmos SDK
9/ I know it can be confusing but I'll try and summarize:
Users stake w the native BEX to earn $BGT. Users delegate $BGT to validators whom set emissions & send back bribes. Lastly, protocols can step in to partner w validators to establish a mutually beneficial relationship
7/ Polaris also offers protection against common attack vectors such as re-entrancy attacks and gas limit vulnerabilities. In addition, you can plug into different components from different clients, increasing client diversity, not previously done before in the Cosmos eco
12/ Berachainโs roots trace back to the creation of Bong Bears, an NFT collection launched in August 2021. After the release of the 5 rebases in April 2022, the team released an article on Medium revealing their plans to create a native protocol
5/ Why build another app chain framework?
Simply forking Geth or other EVM frameworks does not allow the ability to add complex logic to the base layer without introducing new attack vectors/breaking compatibility. As weโve seen w prior hacks, EVM-ish is simply not enough
10/ Esp w the proliferation of zkIBC, I have no doubt the Berachain team will drastically benefit from these introp improvements. Users/dApps will chase liquidity and a secure/easy way to move assets from Eth will be a game changer
9/ Lastly IBC is the most robust bridging standard in crypto. The tech is rapidly improving w improved relaying infra, packet forwarding middleware, multi-hop routing etc. In addition, ICAs and queries allow for async cross-chain composability to create 1-click experiences
@adamscochran
1. Due to overloaded RPCs bc one of the biggest testnet OAT. This was expected.
2. "Clusterfuck of Cosmos parts" Bera team built Polaris which is no small feat and have partnered w leading infra providers like
@SkipProtocol
3. "Could've built on L2s." check out PoL, nuff said
9/ Misconception
#3
: Berachain apps couldโve been built on an ETH L2
Yeah Berachain could've built a Bear-themed DEX on Arbitrum as many have pointed out.
However, the brilliance of Berachain lies predominately in it's PoL model
8/ Polaris also offers a Precompile Dev kit, allowing devs to easily write precompiles to the EVM. Conversely, writing precompiles in Geth requires low level EVM experience and is far less secure and more time consuming
7/ Berachain on the other hand is user-centric. The architecture of the tri-token model will perpetuate a flow of value TOWARDS the user in an efficient market.
Key: PoL is the only model that is designed for all actors to direct value back to the user in a competitive market
16/ And if it can be done as simply as drag and drop your dApp from Eth L1 -> Berachain w minimal overhead, there is literally no reason every major dapp wonโt try and tap into the behemoth liquidity on Berachain. Yes its that simple
15/ The PMF:
Above all, Berachain has product market fit. While solving the scalability trilemma is of paramount importance, the tech is already good enough. dApps are chasing liquidity + users, exactly what Berachain provides.
10/ As afore mentioned, PoL perpetuates a flow of value to the user. To build such a system requires base layer changes that you simply can't make to an L2 or even a RaaS provider. Hence, Berachain needed to build a sovereign eco to implement their desired customizations
18/ PoL could enable fundamentally new primitives. To name a few: Exotic derivatives, new types of options and risk tranches, whole acc collateral via smart accounts and so much more. Even the prospect of newer DeFi primitives hypes me tf up
17/ In DeFi, weโve seen the same dApps launch in every eco- DEXes, Perps, Lending and Borrowing, etc. many of which have raised VC capital to largely become a marginally better fork of their predecessor. I think everyone is tired of this
@Dr_Kojipup
@SatoshiVM
@berachain
Berachain was the largest test net OAT and...
- No material validator downtime
- No chain halts, reorgs or consensus bugs
- No significant block delays
- No issues w Polaris implementation
etc.
This is good fren
There is also an opinion that the potential correction may be limited to the level of ~30k$ (orange dotted line).
OneChain rarely makes mistakes, so let's watch ๐
BTC Realized Profit/Loss Ratio indicator ๐
At the moment, the indicator indicates that Bitcoin is in a very overbought phase (compared to this year's peaks) as it approaches the green dotted line.
@GwartyGwart
Agreed. We are at a point where underlying tech is nearly good enuff, we need to pivot to abstraction layers, dev tooling and simple Web2 integrations
It is extremely important that this entire crowd does not begin to unload at current prices. This probably wonโt happen, since there is euphoria in the market and everyone is expecting the adoption of the BTC spot ETF.
I take $RUNE for a short term in
#LONG
๐
After yesterdayโs helicopters, the coin formed a classic triangle and is storming its upper border.
I expect to see a breakout of this sloped resistance followed by a growth wave as volumes have returned.
Although I really like the dynamics so far. During today's local growth, the Bitcoin oscillator was correcting, which allowed the alts to receive part of the liquidity and continue to grow.
I expect Wave B to reach the area of 0.407 - 0.415$, if the decline does not accelerate now, so I put a couple of limits in short by 2.5% of the deposit.
I will inform you about the goals after the position is set โ
Stop: $0.450 ๐ซ
I take $1000PEPE in
#LONG
๐
The coin has been trading within a parallel downward channel for a long time, and I think this could very well be wave 4 in the senior structure.
This may indicate that we are finally seeing the potential beginning of a long-awaited correction and at least some kind of โalt-seasonโ in the coming months โ
1/ Wanted to write up a quick explanation of
@Berachain
โs Proof of Liquidity (PoL) and why its the most elegant crypto-economic system the crypto space has ever seen. Imo itโs the primary catalyst to make Berachain a multi $B chain so it's worth understanding (probably). A ๐งต
@SquigsCat
I believe Berachain inherits the positive aspects of ve(3,3) but not the ponzinomics. It's far more user centric and incentive aligned than anything else
Review of Domination Cue Ball (
#BTC
.D) ๐ง
Now the wave pattern looks even more beautiful than before, but it is worth remembering that it can also be broken if wave 5 continues to lengthen.
@samoyedali
@berachain
@swaggyAlexyo
@SmokeyTheBera
@itsdevbear
@BeraMVP
These are great questions Moyed! Love how you've read into the docs and I have some of the same questions myself.
RE 1. Protocols can subsidize validator bribes (to users) to incentivize $BGT emissions in their token's pool to attract more liquidity
Good morning everyone, friends ๐
Bitcoin yesterday broke out of its local trading range with a new yearly high, allowing it to test the 0.382 Fibonacci level ($36,000).
In the next bull market, the asset will probably not be able to update its highs, but it will definitely be inflated by +400 - 500% from the current ones to the first Fib. I have no doubt about it.
Easy X's for those who know how to wait and survive drawdowns ๐
However, I think this indicator will still rebound (the number of unprofitable wallets will increase) at the time of disembarkation of excess passengers before halving ๐