The battle for decentralization: First blocks, Kusummer '22 & third generations
After 1.5 years of hard work, Mangata X has onboarded to Kusama as Parachain 2110! Mangata X produced block #1 on 2022-04-12 14:38 UTC. To celebrate the day, we want to use the opportunity to reflect on the current challenges of crypto and DeFi, share our thoughts on Web3, DeFi 3.0 & Generation 3 blockchains in Kusummer ‘22 and share our ambitions for Mangata.
The battle for decentralization
DeFi has come a long way. It is still only at the beginning. And the battle for decentralization is still in full swing.
We have noticed a phenomenon in old crypto networks: They are prone to centralization and privatization. Big players take control and leave very little for common people.
We see that even investment opportunities are not as they used to be. Back in the days, you could participate in the very early stage of any project and be on the same side with the team. Today we see that you have to wait until project gets through a private round.
Back in the days, the fees on blockchains were low, and blockchains were not prone to big players exploiting it. The battle for decentralization is still on and we need to keep pushing forward.
We strive to design blockchains that can guarantee free access to everyone. Decentralization is about much more than setting up different computers in different parts of the world. It is about economic, physical, geographical, technical and personal decentralization. Decentralization of the network in as many aspects as possible!
Generation 3 - A Movement to solve the big issues
While more and more players start to exploit the imbalances of older generation networks, the next generation of innovators is building out a remarkable new tech stack.
Mangata is part of this new generation of blockchain tech. A generation of on-chain convenience and off-chain culture, where our main goal is to give equal conditions to everyone. Blockchains designed with a focus on fairness.
We are proud to be part of the Polkadot ecosystem and to build on Substrate, which allows us to bring an ultra-specialized and very performant app-chain experience for the users of our DEX.
While DeFi has come a long way and we see a lot of basic primitives being fleshed out, it still has a long way to go. Fundamental problems like MEV will only become worse over time and force us to keep innovating. Generation 3 of blockchains is the way to go. Solving the big issues of DeFi is not trivial and takes time. We must not let shillers and short-term speculators distract us from the course we are on: To bring more fairness, opportunity and freedom to everyone.
Dreams of Web3 and DeFi 3.0
Web3 is about taking the best of Web2 and putting it under the ownership and control of the inhabitants of the web. The web belongs to us and it shall not be censored and controlled by anyone. It shall remain free and serve the good of all of humanity. In order to achieve this, we reject chain maximalism and instead believe in the internet of blockchains. A free and open network of consensus systems in which everyone can participate on on their terms is the way to create resilience and a path forward.
While it is not yet clear if DeFi 2.0 will become an established term or was just memed into existence by a few innovative protocols, we believe that Generation 3 chains will be the big enabler for Web3 and will allow the innovation neccessary to bring DeFi to the next stage of evolution, however we may call it.
Ready for Kusummer ‘22
We see Kusama as the innovation network for Polkadot. Wherever Polkadot goes, Kusama goes there first (including the moon). The innovative spirit of Kusama is what convinced us to launch our very first chain here: Mangata X. It is the perfect breeding ground to bring Web3 and DeFi 3.0 to live.
We see 4 main ingredients that form the recipe of Kusummer ‘22 fueling up:
- XCMv3 rolling out
- Parachains finally starting to open more and more channels each week
- Bridges to other ecosystems opening up
- aUSD as THE stablecoin of our ecosystem to create a financial base on which DeFi can rest on.
Substrate and XCM are bleeding-edge tech and it takes a lot of effort to bring a blockchain to life, but we are finally seing the fruits of it coming to live, with a lot of different parachains starting to deliver value. Now that network effects are starting to kick in, the true power of Substrate will start to reveal itself.
We are super glad to be there in the front row and offer Mangata X to the market to become the leading L1 DEX in Kusama.
A space for everyone
We love the creativity and innovation that DeFi in Kusama that is forming. From Acala, the DeFi Hub and early adopter, over Bifrost, the liquid crowdloan and staking provider, and Basilisk, the dedicated LBP chain, to full stack innovators like Picasso, there are more DeFi chains and protocols than we could reasonably mention in this paragraph.
We believe that there is so much growth potential in our space that there is a space for everyone here and indeed, for everyone who joined so far: WAGMI. While “we’re all gonna make it” is a motto that will not hold true forever, it still holds for the foreseeable time.
Mangata X: THE Dex
The power of Substrate is that every chain and protocol can specialize in their niche and create value from that specialization. We have decided to specialize Mangata X for one very specific thing: Trading.
This narrow focus allows us to optimize Mangata X to offer the most capital efficient and fair swapping experience on the market. As the only L1 chain that has decided to do this, we believe it positions Mangata X to become THE Layer 1 Dex of Kusama. It is the DEX best equipped to get the job done.
Unhindered by politics, trustless to use
Mangata X will be the most decentralized and trustless DEX in the Kusama ecosystem. You will be able to
- trustlessly deposit any token from Ethereum and other ecosystems
- trustlessly create pools
- trustlessly select which collators you trust to protect the network against value extraction
Community ownership of >50% of tokens will be achieved within 2.5 years. Mangata X is a chain unhindered by the needs of other primitives on the same chain.
Trading ALL the tokens
There is something very magical about new projects and protocols launching and for us to be part of this innovation. New projects need liquidity and they need their token to be traded in order to get as much exposure to the open market as possible. We want to give them a low-barrier access to the capital available on the market.
Mangata X is set up to have free commerce with any other parachain and ecosystem. After opening up our bridge, we expect to connect to multiple ecosystems at once and allow trading of the major L1 ecosystem tokens.
Economic gravity centers: MGX and aUSD
To bootstrap this economy, we think it is crucial to set up governance with clear policies on how to incentivize liquidity the right way. At the center of this activity, we think that having a strong liquidity base with MGX and a strong stablecoin like aUSD as the gravity centers of the DEX will create strong network effects and provide the basis for an expanding network of liquidity pools.
We believe that the Kusama ecosystem can flourish when it is connected to other ecosystems. We see KSM-ETH as an important gateway to open the floodgates of capital exchange. This is why we want to help it achieve deep liquidity with our 10m USD Kusama Treasury proposal.
The road ahead
As the first blocks start to get produced on Mangata X, we have some very important steps ahead of us.
- The first big liquidity bootstrapping event: MGX-KSM
- Opening our first channels to other Parachains
- Opening of the bridge to Ethereum
As we are going into Kusummer and these epics are playing out, our focus will shift to onboarding more and more liquidity into our ecosystem and making sure that our theories on Proof-of-Liquidity, Algorithmic Buy & Burn and Time Incentivization of Liquidity Mining play out as we expect them to. We will focus on user feedback and build tools that offer more transparency and analytics for traders and liquiditiy providers.
We are asked when we will be launching on Polkadot. We will go there once we the market is ready. Polkadot is still bootstrapping chains, channels and XCM and needs a bit more time. We will use the time to get Mangata ready, by establishing ourselves in Kusama, eliminating any issues that appear and gaining the respect of the broader ecosystem. And once everything is in place, we will be making our move for Polkadot.
Winning the battle for decentralization: An open ecosystem of yield opportunities
As more and more development teams start building on top of Substrate and enter the DeFi space of Dotsama, we think the ecosystem can flourish best when we architect it as an open ecosystem of yield opportunities. We believe that every parachain should strive to be as open to other parachains as possible and expose its interfaces in the most trustless way possible.
We think that bridges and channels, a focus on great user experience and automation will be the key drivers that will bring the success that Dotsama deserves and start Kusummer ‘22.
Make sure to stay in the loop!
- Join the Mangata X Newsletter at x.mangata.finance
- Join the Discord
- Follow us on Twitter: @MangataFinance
Stay tuned for the blog updates
Subscribe to the newsletter and follow Mangata on social media.