Thank you to everyone who joined AMA Blockelite x Equilibrium on 26th January at 11:30 AM UTC I 6:30 PM UTC+7. Here is the recap for those who missed this AMA.
Our special guest today is Alex Melikhov, CEO of Equilibrium
Segment 1: Introduction about Equilibrium and Alex Melikhov, CEO at Equilibrium
Q1: Can you briefly introduce yourself as well as Equilibrium?
I’m Alex, the Founder and CEO of Equilibrium, the leading cross-chain DeFi project. I’m an engineer in applied mathematics by training. Before blockchain, I was focusing on fintech — mostly payment systems and gateways. I have always been on the tech and architectural side of things.
I came to crypto when we co-founded Changelly in 2016, and it remains one of the largest instant crypto exchanges in the market today.
My current team has been working together since 2017 and we were building on Ethereum those days. In 2018, we kicked off the development on EOS. In April 2019 we launched the first decentralized EOS-based stablecoin as the first product of the Equilibrium’s product line, called EOSDT. Today EOSDT is the most liquid decentralized stablecoin and the biggest DeFi project on EOS, with over $14 million of total value locked in our smart contracts, and over 1,000 user positions generated.
Now we are developing on Polkadot to obtain true cross-chain interoperability and to turn Equilibrium into a full-fledged DeFi hub.
Q2: “Equilibrium – the first decentralized interoperable money market”, so what products do you building? What solutions can Equilibrium bring to users, and will it be useful in the future?
Equilibrium is a one-stop-shop for DeFi users — it is comprised of a comprehensive lending platform and a professional-grade cross-chain DEX. Think of it as a place where you can make use of all functionality that DeFi primitives can offer on Ethereum, but in a cross-chain and risk-free manner.
Equilibrium’s main features include pooled lending, a decentralized stablecoin, synthetic asset generation, decentralized margin trading, and perpetual trading. It’s a little like a combination of Compound, MakerDAO, Synthetix, and dY/dX with extra value added on top.
Q3: Can you tell us a little insight into EQ Token utilities, governance, features, and token economics?
EQ is the core asset at the heart of our interoperable money market, widely used throughout the system and the applications that run on top of it. The initial supply is 120 million EQ tokens, fully compatible across every blockchain bridged with Polkadot.
EQ token use cases broadly fall into four categories: paying fees, accessing system governance, liquidity farming, and bailouts/system liquidity.
Feel free to learn more about our token economy here: https://equilibrium.io/docs/en/EQ_token_economy.pdf
Q4: Can you give us more details about Equilibrium’s Upcoming Parachain Lease Offering? Why should users pay attention and join it?
Polkadot works on a system of parachains – projects building on Polkadot’s common substrate platform connect via these parachains, so that the entire community can use all of the resources which Polkadot and the other projects offer.
Parachains will be leased in an auction that Polkadot will host. Equilibrium intends to bid for and become a parachain and thereby a full-fledged part of the Polkadot ecosystem.
We are going to raise DOTs as a means to secure parachain slots in two consecutive rounds. The first round will be equity funding, the second will be a crowdloan.
The equity funding will take place by way of the token swap — users will swap their DOT tokens for our EQ tokens. This will be a risk-free mechanism that will offer a lot of boni and opportunities to earn. The crowdfunding phase will see users contribute DOT tokens directly to Equilibrium’s crowdloan module for Equilibrium.
This PLO matters because it is a meaningful way to get your hands on our core system asset, while receiving bonuses and simultaneously enhancing Equilibrium’s liquidity and functionality.
By the way, we have opened the whitelist registration, feel free to fill out this form: https://equilibrium.io/plo/whitelist
Q5: What is the community plan and roadmap of your project for 2021?
Regarding our future plans, we will soon be launching our fundraising for the PLO – Parachain Lease Offering as mentioned before.
Further milestones include enabling transfers of our EQ tokens alongside upcoming exchange listings, and the launch of our ETH bridge. Since our substrate will be bridged with Ethereum, we are expecting some amount of EQ tokens to be ported there. We are planning to launch the Uniswap liquidity pool then.
We will be launching liquidity farming alongside our main products on the mainnet in 2021. Liquidity farming will reward people in EQ tokens for supplying liquidity to Equilibrium’s liquidity pools.
We will announce all updates on our social media channels, stay tuned!
Telegram announcement channel: https://t.me/equilibrium_news_feed
Telegram chat: https://t.me/equilibrium_eosdt_official
Segment 2: 5 best questions from Twitter
Q1: Accoding to Equilibrium management, what is the competitive advantage or sources of competitive advantage you guys have which will drive project success in near future?
Other than the fact that we focus on cross-chain functionality from the outset, here are these three core components that set Equilibrium apart from other DeFi projects
1) A unique risk algorithm
This monitors the overall system liquidity in real-time across blockchains, starting from individual users’ multi-asset portfolios and aggregating them to follow overall system solvency. This method lets us achieve, monitor, and maintain maximum liquidity.
2) Programmatic interest rate
Our flexible interest rate adjusts system solvency and lets borrowers choose their own balance between risk and collateralization.
3) Bailouts are a proactive solution to bad debt
Most DeFi projects liquidate a debt by way of auction, but this isn’t as active a solution as it could be. That’s why we’ve introduced the bailout mechanism and the associated user role of bailsman: when the monitoring algorithm indicates low liquidity, the system automatically incentivizes to provide more liquidity to the pool. This means the debt is liquidated proactively and it avoids forced auctions, no matter what the market is doing.
Q2: What current problems do you see in the blockchain environment that prevent you from growing and what are you doing to solve it?
Currently, we see several obvious DeFi industry hurdles that we are also addressing at Equilibrium. They include:
1, Market fragmentation. Before us, users needed to use several apps on different protocols.
2, Lack of interoperability. We design Equilibrium to enable asset transfers across chains & and use of different assets in lending combining them in collateral baskets.
3, Inefficient bad debt liquidations. We are introducing the bailout mechanism that will prevent situations like with MakerDAO in March 2020 by ensuring bailout liquidity in advance
4, Liquidity issues. Equilibrium maximizes cross-chain, non-custodial liquidity by using multiple assets from different protocols
Q3: What is “3-layer proactive system solvency protection”? Can you talk more about it? Is it really safe?
Our unique three-layer protection mechanism is constantly maintaining system solvency. Its unique bailout mechanism secures loans and liquidity in advance to ensure system stability. Bailouts prevent issues of a kind that MakerDAO faced in March 2020 when over 7.5M USD were extracted from the protocol.
Q4: The hot new term in crypto is “YIELD FARMING”. So Do you have a plan to develop the Yeild Farming system?
Yes, we are working on a yield farming mechanic that will pay passive income to people who put digital assets into our platform. The idea is that users supply some of the various currencies that make our suite of financial services work, and they earn a bonus over time for temporarily parting with those assets.
Q5: Regarding the Equilibrium ambassador program, what are the requirements to be an ambassador? Do you only accept English speaking ambassadors or can it be any other language?
The second round of our Ambassador Program was launched on December 30. We accept only content in English. To take part, you need to do the following steps:
Fill out the general participation form here: https://forms.gle/zHTpW9A4peXueocy6
Then check small tasks here: https://gleam.io/axfr7/equilibrium-ambassador-campaign
Once those tasks are done, you will receive a unique code. Send your code to us using this form: https://forms.gle/iwmG9c1vGpMzEkZZ8
Feel free to read the full Ambassador Program description here: https://medium.com/equilibrium-eosdt/become-an-equilibrium-ambassador-v2-bde2ee9e4149
We invite everyone to participate in the program! 💙 By the way, we do various lotteries and giveaways for our ambassadors, so please join the dedicated chat to be up to date: https://t.me/eq_ambassadors
Segment 3: Live questions.
Q1: Equilibrium project looks good but it confuses me that there are so many other good Blockchain project. Why should I pay attention in Your project to give it the importance it deserves? What are your planning to achieve with your project?
We intend to expand the DeFi market so that it can reach its full potential. Over 90% of the current DeFi market is on Ethereum, but ETH is only about 10% of crypto.
With our cross-chain lending pools, we will be able to expand the reach of DeFi to other major platforms.
Further to your question, what sets us apart. You are right that there are other lending projects, but were are unique in several ways.
We are a one stop shop, offering all key DeFi use cases in one place.
We use three key elements that no one else offers:
1) Risk algorithm:
Monitors & corrects liquidity continually in real time. Incentivizes bailsmen & liquidity providers to add more liquidity if needed.
2) Programmatic interest rate:
Users can choose their collateral ratio – & influence their interest rates(these are not fixed)
3) Bailouts instead of forced auctions to resolve bad debt:
We recall what happened on Black Thursday with Maker DAO last Spring. That was because auctions are a risky mechanism – especially in adverse markets. That’s why we have replaced them with bailouts instead – thereby minimizing your risk.
Q2: What is Equilibrium target market? Who are poential clientele that you are focusing on? What is Equilibrium’sMarketing strategy or plan to attract more users globally, especially in communities where people don’t know about Cryptocurrencies and don’t speak English?
We are indeed targeting a global audience, and focussing on several regions. We use English as a common language for many communities, but we also publish blogs in Chinese and Korean. Our geographical foci are Asia, USA, EU. We also do regional marketing events – AMAs are just one example – and we are thrilled that you are hosting us from Vietnam today!
Q3: Can you tell me some benefits or preferential policies for long-term Equilibrium holders?
Obviously, the value of every blockchain-based token project becomes evident with time, and it is not a coincidence that there is an associated term – to “hodl” (hold) onto your tokens for the long term to let them grow. As Equilibrium grows and our products go live, we expect that the value of our token will increase considerably.
A key point here is that we are not currently selling the token – the only way you can become one of the first to get it is to participate in the next fundraising event – our PLO, which I told you about earlier. If you are interested in this, please fill out the White List under the link I sent.
The other way that you can get EQ is to do liquidity farming – please follow us on social media for updates – we will be informing our community about this product as it develops.
Being a EQ token holder not only gives you an asset that could increase in value, it also enables you to participate in governance, use our products & do all other essential activities on our platform.
Q4: According to Oxford English Dictionary Equilibrium means a state in which opposing forces are balanced. But why did you and your team use the name Equilibrium? Is there anything special about that name?
Yes, “Equilibrium” is the point at which the balance is achieved between the liquidity in the bailsman pool and the lending pool.
Q5: One of the main problems with blockchains today is scalability and high gas rates. How does Equilibrium manage to remain unaffected by this? What tools do you use to make your operations fast, scalable and slip-free?
This is exactly what Polkadot solves with its technology: Scalability, interoperability, and of course there are no gas rates.
Our AMA session is now over !!!