First off, we would like to give a huge thanks to the DeFi community for their wonderful support, and it has been a blast collaborating and working with this space. As a team who has benefitted tremendously from DeFi since the early days, we are excited about the future, and even more excited to build it together with everyone.
We had a great roller coaster year in 2019, fully focused on building & shipping features to help solve important DeFi problems, and today, we would like to do a quick recap of the key ideas we launched over the past year, the milestones we have achieved along the way, and lastly, explain our objectives for 2020.
After launching InstaDApp to improve the experience of managing the various DeFi protocols, we quickly realized the fundamental limitations of the typical Ethereum account. In particular, as it becomes easy for users to make sense of and keep track of their assets across many protocols explodes.
As such, we introduced what we soon formalized as a Smart Wallet, which aggregates major protocols and showcases a user’s assets across these protocols using an underlying smart wallet layer. As such, we pioneered the ability for users to use their smart wallet to minimize the hassle users would face while moving from one protocol to another.
Using this smart wallet layer allowed far greater programmatic innovation, allowing us not only aggregated multiple protocols on a single interface, but also opens up several potential cross-protocol, or even cross stable coin use cases.
Two things are well known in the crypto market — the volatility of the assets and the deep technical difficulties of managing them that follows. When ETH is either plunging or spiking, (often in the span of minutes), it is very technically difficult and time-consuming to perform many transactions needed to save or leverage their position.
This results in a situation where many users did not or could not perform them, even when it would have benefitted them greatly. To solve both of these issues, we combined multiple steps it takes to perform complicated transactions and combines them into a single transaction such as Leverage or Save, allowing many more users to do them as well.
By simplifying complex transactions into a single atomic transaction, we made the experience of managing assets significantly easier for users, and more importantly, made the power of DeFi accessible to many more individuals.
Many users were affected when MakerDAO increased the stability fees. Along with the high liquidation fee, many users were inclined to move their assets to other protocols such as Compound. However, moving from protocol to protocol becomes a cumbersome process, adding up to at least 6 transactions, and requiring capital for liquidation and re-collateralization.
As such, we created a bridge between MakerDAO and Compound to enable users to seamlessly move from one protocol to another. By removing the technical and financial burden, this gave users a clear view about the advantages of each protocol, enabling them to make informed and easy to execute decisions on where to move their assets.
The success of this bridge resulted in our first major growth spike, from 10K ETH to more than 150K ETH, validating our belief that portability between DeFi protocols is an extremely important feature in this space. Also, the Protocol Bridge turns out to be the #1 MKR burner the most number of MKR.
The importance of interoperability between protocols will grow in lockstep with the growth of the DeFi ecosystem as well, as the diversity of markets increases in returns, risk profiles, and purposes.
To help us continue our quest to make DeFi accessible to the masses, we raised a seed round of a network of strategic investors, many of whom are leading figures in the world of angel investing, cryptocurrency and decentralized finance. We were, are and will continue to be incredibly grateful for their belief and support — and will work hard to make DeFi accessible to the masses.
The launch of the MCD represented a transition point for the DeFi ecosystem. It was important this transition from Single-Collateral Dai to be successful in order to be a testament to the desirable resilience and flexibility of the DeFi space. MakerDAO did a beautiful job facilitating the migration from SAI to DAI, and from CDPs to Vaults.
On our end, we noticed that there were 2 potential issues that could cause user problems and systemic challenges. First, was the likely low supply of DAI in the migration contract, making it hard for big CDP users to migrate to using vaults. Second, the high level of difficulty for Compound users was high, given that they needed to have the pre-requisite SAI to liquidate their holdings first.
Given that big CDPs account for the vast majority of SAI generated, while Compound was the 2nd largest source of locked SAI, solving these problems was not just important for these users, but for the ecosystem as well. In particular, the inability for Compound migrations to happen could cause the debt markets to freeze up, as well as cause insufficient SAI in the migration contracts.
With the intent to simplify this transition for both users and the ecosystem, we launched the Migration Bridge to effortlessly migrate to MCD without hassle, regardless of where the assets might be. Like the protocol bridge, this feature was warmly received by the ecosystem and DeFi users alike.
This launch also represented an important point for us, where we expanded the use of our smart wallet to enable cross-stablecoin transactions as well.
As a result of ongoing progress, as well as the protocol bridge and migration bridge, we successfully crossed 260K ETH managed using InstaDApp this month.
In 2019, we focused on solving UX problems for the users to simplifying complex and cross-protocol transactions.
In 2020, we would love to start collaborating with fellow DeFi developers to drive greater interoperability, portability, and accessibility in the space.
We believe making progress on these problems will be crucial to the DeFi space growing further in the years ahead. To do so, we would be opening up InstaDAapp incrementally to start collaborating with developers passionate about DeFi.
We will be setting up official developer communications in the near term, but in the meantime, feel free to reach out if you have any ideas or thoughts about the above!
At InstaDApp, we observe the problems that occur across protocols and work hard to remove the friction points that result from them. We believe that reducing the technical obstacles to operating in this space will open doors to more and more users to enter the wonderful world of DeFi.
Lastly, we would like to express our gratitude to everyone who has been part of our journey. Special shoutout to all the people who have been supportive throughout the journey. It was not possible without your consistent support.
We love this community ❤️