**A** (0:00):
Sam.
**B** (0:28):
And we are live. Welcome to Staking Mondays. My name is Ken and I'm here with the co founder of Staking Rewards, Merkle Schmiedel. And we are delighted to welcome today's guest, Sunny Aggarwal, big advocate of Cosmos and the co founder of Osmosis, the leading AMM for the Cosmos ecosystem. Osmosis Zone is a open source defi platform based on the inter blockchain communication technology developed for the Cosmos network. Osmosis users can add their tokens to liquidity pools and exchange them on a decentralized exchange Osmosis. IBC technology enables cross chain transactions. In other words, IBC allows assets to be transferred from one Cosmos blockchain to another. So let's jump right into it today, please, Sunny. If you could answer the following questions in a very short lightning round format, I will start you off here. So what was your first crypto investment outside of BTC in Ethereum?
**A** (1:24):
I think it may have been Doge, if I remember correctly.
**C** (1:30):
That's a great one. And which person inspired you the most during your crypto journey?
**A** (1:37):
Probably Vitalik. I think that like, you know, you know, I think he's just done like so much cool stuff and just like know his entire ethos and vibe and. Yeah.
**B** (1:49):
And what was the most inspiring AMM outside of Osmosis?
**A** (1:54):
That's interesting, I would say, I mean, probably Balancer, because it kind of like a lot of the Osmosis design was inspired by what was sort of a reimplementation of the Balancer protocol. I think as we go on, we're starting to realize that, you know, there we might have to backtrack from some of the design decisions that Balancer made if we want to explore other routes. But I think that like, you know, Balancer really just was the first to show that like that pop open, like, hey, look how big the design space of AMMS is.
**C** (2:32):
Really cool. Yeah. And how do you stay up to date with crypto and crypto news and markets? Do you have a favorite newsletter or podcast or anything?
**A** (2:41):
Twitter. Crypto. Twitter, I guess is probably the best way of keeping up with everything. Do you have a favorite podcast? I mean, I guess I would have to show my own podcast Epicenter. So, you know, we, we do weekly episodes with like, guests and stuff and that's sort of my way. I do it mostly because it's my way of like keeping up with everything going on in crypto instead of like, you know, otherwise I'd be so focused in on like Cosmos and Osmosis stuff. But like with Epicenter, every other week I get to learn about NFTs or what's going on in gaming or what's going on on this other proof of stake chain or something like that. That's always nice.
**B** (3:20):
And speaking of keeping up with the ecosystem, when was the last time you checked your crypto portfolio?
**A** (3:28):
About 2 minutes ago when you informed me that Osno was at its all time highs. But I guess before that was right at the end of the year when I was, you know, doing some tax, you know, calculation stuff.
**C** (3:42):
All right, cool. And which destination are you planning to travel to next?
**A** (3:48):
I actually just got to Puerto Rico today, just visiting some friends here. So I guess after this I'll probably be heading to Berkeley because you know, one of the things we're trying to do is historically there's been this really strong Berkeley to Cosmos pipeline because you know, the original Cosmos office used to actually be in Berkeley. And so, you know, we poach students from the university into the Cosmos ecosystem. And so a lot of like the big projects in Cosmos is a lot of like Berkeley people all over the place. You know, me and one of our co founders, we met at Berkeley and so to try to restart that pipeline a bit.
**C** (4:30):
That's amazing. And do you have a New Year's resolution? Any plans for 2020?
**A** (4:37):
I think it's to be better at staying on top of my messages and like not procrastinating on those just because, you know, the number of platforms we get messages on is just like growing like crazy. And my telegram and email and signal and everything. But it's like, all right, my goal is like, you know, don't leave any message hanging for more than like two days.
**B** (5:02):
Very cool. Well, thanks for the lightning round questions there, Sunny. Let's get into some more general in depth questions. And just to remind the audience, if you're watching and you have a question for Sunny, please ask it in the comment section. We'll be sure to address your questions at the end. So now Sunny, so superfluid staking will allow OSMO holders to stake and provide liquidity at the same time. Why are you building this as a native feature and not just build an OSMO staking derivative and whitelist that as collateral for the amm?
**A** (5:32):
Yeah, so I think that. So you know, I've been working on staking derivatives for a long time. Like, you know, I've come up with a lot of designs for them. I do think that staking derivatives, while possible, I think actually do serve like a pretty systemic risk to like Proof of stake systems. You know, proof of stake systems have these unbonding periods and all this kind of stuff like for a reason. They're designed to like provide certain, you know, security guarantees and around like long range paths. And these are, you know, they seem often a little bit theoretical for most cases, but once you bring in IBC which is like this like light client system, it actually, the attack surface becomes a lot more tangible where you know like client style attacks can actually steal money. And so that's why you have, and that's why you know, staking derivatives. By making these staked assets liquid, it kind of undoes the whole, you know, security guarantees that proof of stake aims to give. And so superfluid staking was sort of this way that we came up with was like, hey, can we, how can we still give like 90% of the benefit of something like staking derotors while preserving the security guarantees that you get from proof of stake? And on top of that I think just by having it be this like more native thing where it's like hey, here's my OSMO that is staked and LP by this in protocol super fluid thing. I think you end up not splitting your liquidity. Like you wouldn't like staking derivatives where like, okay, you don't have to have like a separate, you know, lido OSMO pool versus OSMO pool. And you know, people just don't treat the lido OSMO as the same as like the native osmo. So I think there's a little bit of a, you know, mimetic like benefit to like the native assets as well.
**C** (7:26):
Does the super fluid staking introduce any other systemic risks potentially to the, to the system?
**A** (7:34):
Yeah, for sure. You know, it definitely adds a lot of new like so when you, when osmosis governance chooses, it has to choose which pools are allowed to be super fluid staked with because you don't want a situate situation where so you know, maybe would it be helpful if I give a little bit of a summary of superfluid staking?
**C** (7:56):
Yeah, that would be great.
**A** (7:57):
Yeah, yeah, yeah, sure. So what superfluid staking is was this idea that like, hey, we have all this OSMO sitting in liquidity pools on osmosis and you know, when you, when you lp, you get back these LP shares and these LP shares still have economic value and more important they have OSMO value underneath them that they are at any time redeemable for a certain amount of osmo. So if we state what if we allowed the chain to allow People users to stake their LP shares themselves. And you know, the chain can constantly be recalculating that saying like hey, these staked LP shares are actually worth this much osmo. And as like there's you know, trading on the pool, the amount of OSMO that's backing the LP shares is going up and down the chain will automatically like re revalue those LP shares on some, you know, maybe every five minutes, maybe every hour. That's still to be decided. Now governance has to be careful to choose which pools can be superfood stake because you don't want to have it such that awesome OSMO paired with shitcoin can be superfluid stake because if this like, if this shit coin is let's say like, like, you know, a fake coin that like sunny coins that I can mint infinite of, then what I could do is I could just mint infinite of that token and sell it all against the pool and basically make it so that the OSMO in the pool goes to near zero. But there's, there's always going to be this like lag before the chain recognizes that. And and more importantly, you know, you have to, it actually does have to like deal with the unbonding period of two weeks. And so yeah, you basically, you know, governance has to be sure to make sure only like tokens that legitimate tokens can be superfluid staked against osmo.
**C** (9:59):
How do you define which tokens are legitimate and which are not? Like where's the bar there?
**A** (10:06):
It'll be up to governance and I think like governance would vote it in and I think like the bar would basically be like making sure that it's not something whose value would go to zero within a will not foreseeably go to zero within a two week period.
**B** (10:26):
Okay. And talking some about interchange staking as another concept which allows someone to stake tokens across chains. Can you explain that briefly and how will it interconnect with super fluid staking?
**A** (10:40):
Yeah, sure. So interchange staking is a concept of like how do you do staking across multiple chains? And in that there's different types of interchange staking. So the one that we're kind of focused on is called interfluid staking. And what that is is so let's say we talked about like okay, you had these two chip tokens in a pool, we have OSMO and let's say AKT from the Akash network. And when you superfluid stake that LP shared, our chain only cares about the OSMO portion of it. But what about all this akt that's here, right? This AKT also has economic value. Interfluid staking is a model for basically the osmosis chain to let the Akash network chain know that like, hey, you guys actually have a bunch of akt basically superfood staked on our chain. Would you like it to also count for staking reward, you know, as fake assets for your chain? And if the, you know, if that validator that they're delegated to on that chain does anything malicious, you know, just let us know over IBC and roll slash them over here. So what it is is it's essentially super bullet staking as a service where as osmosis builds up liquidity for more of these assets, it can also basically allow these assets, these other chains, to still tap into that liquidity to help provide security for their own chains.
**B** (12:23):
Great. And why are you currently the only one working on something like super fluid staking? Is osmosis with its native AMM the only protocol in need of such a solution for or are there other applications out there that made it adopt such a solution like this themselves?
**A** (12:42):
Yeah, so I mean, I think the idea of superfluid staking like, you know, you know, you can see like, idea like glimmers of it in things like, you know, sushi, you know, with I remember it there, it's not for staking, but it's just for governance where you could have like you can either vote using sushi or you can vote using sushi power, just like in the original sushi governance system where like, you know, you can either have LP sushi be used for governance or you know, normal sushi be used for governance. And so I guess this is kind of taking that concept and applying it to the chain staking system itself. And I guess the reason that it works on osmosis and not somewhere else is that you kind of need to have an application specific blockchain to make this work because you can take something like a general chain like Ethereum or Solana or something. The reason superfood staking works is that our staking system understands the defi application that's built on top of it. It understands that hey, this LP share is, has economic value and this is how I calculate that economic value. Something like Ethereum being this like neutral layer. One does not, you know, the Ethereum blockchain does not understand Uniswap. Right. Uniswap can understand semantics about the Ethereum blockchain, but it doesn't go the other way around. But because osmosis is this like application specific chain. That's what allows this whole system to work. And I imagine that superfood staking style systems can work for other use cases as well in application spec specific chain. So you can imagine something like, I don't know, like a lending protocol chain, for example, you can imagine that that could also do super fluid staking with the collateral that's in the system. And so yeah, I can imagine other application specific blockchains which I, you know, I guess, you know, my big bet for 2022 is I think we're going to see a huge explosion in like app chains. And so I imagine this like super fluid staking concept will become more popular across them.
**C** (14:52):
Yeah, that's very exciting and I think there will probably come more use cases. And is there anything in particular you would see to use staked tokens for and proof staked blockchains besides security guarantee and liquidity or collateral and lending platforms and so on? Is there any other functions that you think these staked tokens could be useful?
**A** (15:23):
You know, I think that using them as like some sort of spam resistance kind of stuff as well could be interesting. So you know, one of the things that, you know, a lot of people really like about osmosis right now is we have like zero fee transactions, which is admittedly very, you know, it's a temporary thing, right, because as soon as our chain starts to get spammed or clogged, it will, those fees will have to go up. But I think, you know, I want to see if there's a way of keeping zero fee transactions alive somehow in some form. And you know, I think if you look at the history, I think the closest chain that has done something that, you know, almost like that was probably eos, not the eos. I like to say the EOS of the white paper was very different than the EOS that was delivered. The EOS that was delivered was like, you know, let's ignore that. But like in the white paper they had this interesting idea about like, hey, if you have a certain amount of stake, you get this much, right, to like use this much of block space without paying fees. And like they have this whole like model that like developers will stake and earn like to get block space. I'll give it to their users. I wonder if there's a way of like incorporating an idea like that back into osmosis where it's like, where can we let state awesome holders like make fee, like make transactions with no fees. You know, this is still something that's you know, in, you know, very much just in the thought process phase. But like I think there is something there that we can you know, give more basically capabilities and rights to people to like users that have or stake. Like another example as well could just be something as simple as like, you know, if you go on centralized exchanges, you know, they'll give like fee rebates based off of like how much BNB you have in your account, for example. Right. We can imagine something similar could happen as well where like you get fee rebates based off of how much awesome you have staked. Something like that.
**C** (17:36):
Really cool. Yeah. And so earlier you mentioned that superfluid staking works on osmosis because it's an application specific blockchain. Or like you, you have this AMM and it's like only this application. Nowadays it seems like osmosis is kind of becoming like the real hub of the cosmos ecosystem because everyone is using the AMM and it's kind of the figurehead of IBC and it seems like OSMO is that kind of thing, what Atom is always tried to be maybe. Do you think osmosis can be more than just like an application specific blockchain and more becomes something like a real like the Cosmos Hub, for example.
**A** (18:24):
So I think the term hub has always been a little bit vague and misunderstood of what it means. So I actually don't think of the point of the Cosmos, I don't think of the point of the Cosmos hub was to be this like relay our chain between all these, you know, and like be an IBC hub. I think that, I think that actually how IBC evolves is that you have every chain does connect to every other chain and these like more point to point connections. I think that what the Cosmos hub, it's what it means for it to be a hub is that it is this very high market cap chain that will be able to lease out its security to other chains. So you know, so we talked, I mentioned earlier there's like different types of interchange staking. Interfluid is like the one that we're focused on which is saying hey, other chain, you have your token on our chain use that. I think that the Cosmos hub really will be focused on like shared security, which is saying that hey, I have a new chain, I want to launch a new chain, but I don't want to like, you know, I think eventually the process of launching a new chain has to become as easy as deploying a smart contract. And today, you know, just being able to find validators and spin them up and like, I think that's quite a bit of a hurdle. And I think that will get to the point where it should just be like a one click button that like the Cosmos Hub validators will start running your chain for you and your chain will be secured by atoms themselves. And so that's sort of what I see the role of the Cosmos Hub going towards. And so I think that, you know, these, the use case of what we're trying to do with Osmosis is really quite different than where I see the Cosmos Hub going.
**C** (20:12):
So you think the Cosmos Hub, this sounds more like the Polkadot model kind of, right?
**A** (20:19):
Yeah, for sure. I think that, I think that it is, you know, I think that, yeah, I think that the Cosmos Hub needs to provide this sort of shared security system similar to Polkadot. The difference is that here it's a lot more opt in where the Polkadot system is really designed in such a way like yes, you can go use substrate to go launch your own chain, but it's really designed for you being a parachain of their relay chain. But I think in Cosmos we kind of have go from the other direction where like sovereign first and then, you know, here's an option if you want, if you don't want to go, if you know, there's everything's about trade offs, right. Do you want more sovereignty or do you want more ease of launching? And I think giving people both those options, I think one, one thing that will often happen is chains might like start off by being a shared security chain and then they will eventually, once they grow big enough, might break off into a new sovereign chain. And I think that is like a flow that we actually want to encourage.
**B** (21:26):
Yeah, great explanation of the differences there between Cosmos Hub and what Polkadot is doing with substrate and the parachain model as well. So next question, a little bit about the competition here. So what are the main differences between the Osmosis Dex and the gravity decks?
**A** (21:41):
Yeah, so the gravity decks is this deck that was built onto the Cosmos hub itself. And so they both actually launched at roughly the same time in like last June. Basically, you know, the gravity depths. All right, so what are the differences? So one is Osmosis. Our AMM design was much more, as I mentioned, inspired by Balancer, while the gravity decks use something that they actually invented, this new AMM model called the ESPM model that uses like batched execution. Personally, I find that there's actually some flaws with that design which. But really I think a lot of it just Came down to, you know, so Gavin Deck still is running right now, but it hasn't gotten too much traction yet. I think a lot of it just comes down to like the ability for Osmosis to just move faster. We have a new chain that was able to like provide a lot of incentives to like early liquidity providers that allowed it to build up liquidity and also just like, you know, the ability for awesome Osmosis has this three day voting periods and that allows us to iterate on incentives and features and upgrades much faster. We have a goal in osmosis that we should do at least one chain upgrade every two months. So that way we can just be constantly rolling out and shipping new features, which is just like we're just operating on a sort of a different timescale than the release cycles of the Cosmos Hub. And so that just sort of allowed it to, you know, that's what sort of, sort of allowed osmosis to like sort of take off. Now I think what's happening right now is the Gravity Decks is actually thinking of, the team behind the Gravity Decks is actually thinking of moving it off of the Cosmos hub and onto its own chain and so that maybe can you know, inject some life into it and you know, allow it to compete in a more effectively.
**C** (23:48):
Awesome. And can you walk us a bit through like the best case scenario for osmosis and Osmo Token as well? Like how would you get there and how does the world look like in which osmosis is extremely successful?
**A** (24:04):
Yeah. So our goal is to, you know, our view is that to create the best decentralized exchange we need to provide a lot of the same functionalities and UX of a centralized exchange. And I think that centralized exchanges trading infrastructures are just one piece of what centralized exchanges do. Right. Centralized exchanges are really this suite of products that are all packaged together into one system. Right. So what do centralized exchanges do? They provide, you know, obviously they provide like spot trading infrastructure but then they also provide like margin and perks. They also are often like information services for people. They're also people's fiat on ramps or people's custodians. There's this like large suite of products and that are all tied together in this like single UX. And I think that, and you know, things like FTX are even starting to get into like NFTs for example. Right. Like I think you need to provide this like sort of super app that becomes. Or another one would be, you know, sometimes exchanges often are people staking platform where like they stake on different chains. And that's sort of what we're trying to do with interfluid staking is like hey, via the osmosis deck you can actually stake on other chains as well. And so like, I think that's kind of where we're going, where we're trying to figure out, okay, what are these different ux? Obviously a decentralized exchange can't provide custody in the same way that a centralized exchange can. So that's why we're looking at all the different things that centralized exchanges do and figuring out how can a decentralized exchange offer something comparable to those feature sets. So you know, I think, you know, some of the stuff that we're really focused on right now is especially one is on the margin systems. So I think that like, I think that any good trading platform, the trading engine, a lending system and a margin system has to be like intertwined into one unified protocol. I think that's sort of what makes FPX is like trading platform. So like so good. And I think that like being able to do that, to offer something similar is important. And then obviously just working a lot on the UX as well. So like we have this goal that like cross chain UX should be as easy and as similar to like single chain UX as possible. And so I think a lot of we're going to see that happen a lot more this year. But you know, there's a lot of work to be done there.
**B** (26:55):
Yeah, seems like decentralized exchanges have come a super long way from even just a year or two ago. So knocking off all these centralized exchanges will naturally come next. So fun question here. I know you're very much a Cosmos bull. Will Cosmos ecosystem absorb the rest of crypto and potentially bitcoin functionality, utilities?
**A** (27:18):
Yeah, I mean it depends on what does the Cosmos ecosystem mean to me. I always thought that Cosmos was this idea of a network of interconnected blockchains and obviously today that sounds obvious, but if you go back four years ago when this idea first came about, it was actually this very radical idea that at the time everyone was like, no, hey, what are you talking about? This Ethereum chain is just going to have all the applications built on top of it. And we were just like, no, that doesn't really seem to make sense for us. And I think that like, you know, what we're seeing today with this explosion of new chains and like all these interconnectivity between them I think is a step towards how we see that like this is the Cosmos vision. Playing out. I think sort of the two big questions I think that are from our original thesis that have yet to be seen are one, are these interoperability protocols going to standardize? So currently we oftentimes we see between different chains, we have all these very bespoke bridges and we kind of created this single protocol called IBC Inter Blockchain Communication. And that's what it is. It's not really a implementation. What it is is it's a protocol. It's a series of specs that anyone can implement. And I know this analogy is maybe overused, but it's really supposed to be like this TCPIP stack where hey, it's like TCPIP is not an implementation, it's rather a spec. And then it's implemented in different OSes that can allow them to talk to each other. And so I think that's what, you know, we have, we have an implementation for this in the Cosmos SDK already. But you know, there's people building them in substrate right now in Celo and all these like different protocols. And then you also see things like, you know, the layers, layer zero, which is this like bridge protocol, but they're actually using the IBC spec semantics in their own bridge protocol. So I think that's sort of another thing that we'll see is like, hey, will these standardized protocols become more widely adopted? And then the other question, big question to see what will play out is I call this the multi chain versus the Interchange vision. And what that means is the multi chain is like, you know, one thing we're seeing right now primarily is explosion of a lot of L1s that they're like, okay, here's an EVM compatible L1. And then you go get sushi to go reapploy on all these different chains. And I call this like the multi chain approach where it's like, okay, they're sort of all like non differentiated EVMs that each just have their own little farms and stuff going on. The Interchange vision is more one of application specific chains where I think that eventually that the L1s actually become commoditized and the value is really in the application layer because those are what the users interface with. And so I think what's eventually going to happen is the applications are going to decide like, hey, you know what, I'm going to just go spin up, let me go build my own L1. I think that for example, Compound has this mentality where, where they're like, no, we're not going to redeploy on they haven't redeployed on any chain other than main net Ethereum because their take is no, we're going to go build compound chain and have that be the place where connect it everywhere else. And that's sort of like what things like osmosis and Thor chain and Terra have really set the groundwork for building these application specific blockchains.
**C** (31:19):
Are you familiar with the Fed protocol thesis? And like do you think like what do you think about it? Basically it says like that the general value accrual in for blockchains will be on the protocol level, not on the application level. Opposed to like in Web2 where it's like primarily on the application level and not on the protocol level.
**A** (31:43):
Yeah, I think I tweeted a couple weeks ago I was saying Cosmos is a rejection of the fact protocol thesis. I think that I actually just don't think that's right. I think that L1s do generalized L1s become commoditized and I think the closer you are to the users, that's where value accrues. You know what's interesting is part of the whole bet that we made with osmosis is was this bet around vertical integration where I think that like a fully vertically integrated system will be able to like you know, iterate faster or not faster but like iterate do more interesting things. So Osmosis, like other Dexes for example, they can control the application layer, we control the application layer, we have our own front end, but we also control the blockchain itself. And our team also actually maintains the Kepler wallet, which is the main wallet used in the Cosmos ecosystem. So having this entire stack all the way up from the wallet all the way down to the blockchain itself, I think that allows us to ship new things very quickly. For example, one of the things that Asanasa started off with was a lot of focus on privacy related stuff. So especially on front running resistance. And I think to make that work there's actually changes you need to do down at the blockchain layer. We have to add new cryptography and things like that. But then also we have to make sure our wallets know how to generate this new transaction type. And so like by having this entire stack we are able to like shift these kinds of features. And I think that you know that's sort of going to be one of the main draws towards these application specific chains where like you chains are going to, if they want to provide like levels of like customizability that they can't do today, they'll want to go onto their own chain to do that. So, you know, know, a maker chain, for example. Right. Wouldn't it be nice if they can have, like, you know, the maker dao existed on a chain where all the transaction fees were able to be paid and DAI instead of eth? I think that would be like, I remember, like, one of the first times I tried to show one of my friends who was like, not crypto. Like, I sent him some DAI just to show him, like, hey, look how simple and easy this was. And then he got it, and then he's like, wait, I can't send this. And I'm like, oh, shoot, I just realized you don't have any ETH for transaction fees. And, like, this is like, a terrible UX right now. And so I think, like, you know, by having your own chain, these applications will be able to custom tailor their UXs that could best serve their users.
**C** (34:38):
Very cool. And I. Yeah, I think that's. That's a great point. Why? The UI and UX on Osmosis is also very, very smooth. Really? Like, what are your general goals for onboarding new users, and what are your communication goals there for users entering Osmosis? Like, what you want them to see? And also you have these nice artworks. Like, maybe you can give a little bit of context on who did them and so on.
**A** (35:05):
Yeah, so, yeah, so our designer, his name is Kevin. He's amazing. He's actually the first person we hired at Osmosis. And, yeah, so, you know, we knew we wanted to have something fun and, like, interesting when people come on. And, you know, I think, like, the character, the. The guy, when you open up the thing, his name is like, the community sort of just deemed his name to be Washington off of this, like, I don't know, a tweet that I made once where I. And people just assigned that name to him. But it's like, it's cool because I think, like, you know, if you look at, like, traditional companies, that companies tend to have, like, mascots, right? McDonald's has, like, the Ronald McDonald guy. And, like. No, but why don't we see actually more of this in, like, decentralized crypto apps, right? Where, like, I feel like decentralized protocols should have, like, mascots and, like, you know, interesting branding and, like, you know, we want it to be like, hey, when you open something and you see that this very clearly is, like, an osmosis branding with, like, the colorful aspect and the. The chemistry and all this kind of stuff. And so that's Sort of, that's sort of why we like really leaned in a lot into like making sure we have a certain design image in the entire like osmosis branding. Yeah.
**B** (36:31):
And I almost wonder, is that going to be maybe an NFT series released relating to that artwork as well down the line?
**A** (36:39):
Yeah. You know, I'd just say Kevin has definitely been playing around with some stuff.
**B** (36:45):
Definitely a crowd pleaser. So talking about the stats dashboard, I think this is a really important feature of any ecosystem's DAX mother chains have popular dexes that seem to have load issues and accuracy issues with their stats dashboards. What advantages are you working with that allow you for real fast time data and load efficiency?
**A** (37:08):
So I mean honestly I think the biggest benefit that we have is just the people. So there's a team. So basically we actually have a full, you know, once again our view of, you know, centralized exchanges offer a lot of things and so you know, we actually have a full in house data team of like, you know, three people and like, you know, we're just like constantly churning out different APIs to like serve data for integrations into different things. So for example, like you know, one of the, I know one of the big things that we had was like it was really hard for Coingecko, for example, right. Like you know, we spent a lot of time working with the Coingecko team to make sure that like they're able to consume our APIs and serve as a price feed into that. So that way a new Cosmos chain that's launching just had to integrate into Osmosis and now you suddenly have a price feed that CoinGecko accepts and you know, sort of building out this sort of integration into other things. You know, we're working on like TradingView for example, we're working on integrations into like different dashboards and then one of the, you know, a lot of the data that we're providing right now is at this very high level chain level like data of like, okay, this is how much is in all these pools. The next big thing that will be coming out is more user specific dashboards. We want the ability for users to be able to see, okay, here's my LP positions, here's my rewards I've earned, here's the impermanence loss I've had over the last my staking period and stuff like this. A lot of this comes. Our data team has been able to really execute on this really well. The Cosmos software stack I think has. What's nice is that because it's its own Software stack, we are able to go in and change how it works in order to improve how easy it is to query data off of it. An example would be something like the Graph, which is actually this separate protocol on Ethereum. We can actually provide a lot of similar indexing style stuff into the core software itself. And so I will admit that the Cosmos stack actually has a long way to go, especially on this performance and node querying stuff. But I do most chains, but the nice thing is that we actually have a path to actually fix that.
**C** (39:47):
Cool, that's exciting. And so interestingly, like osmosis is almost about to hit like 1 billion USD in TVL, like across all the whole platform. I think it's around 986 right now. Million. Can you walk us a little bit through like what contributed to, to the success and like to the usage in general adoption of osmosis? And also like, yeah, is there any other things like other Dexes or other projects could learn from you, for example, like what are the things that you've done? Right.
**A** (40:25):
Yeah. So I mean, I think one of them is it obviously just tapped like a necessary, you know, a latent demand that was being unanswered, which was there's a lot of Cosmos chains. And one thing that people maybe don't realize, I would actually say Cosmos is probably maybe the second biggest ecosystem after Ethereum because people focus too much on what's going on with atoms, which is the native asset. But if you actually look at, if you go onto Coingecko and look at the top 200 assets by market cap Cosmos, there's like, I think at least 10, 15 of them are Cosmos assets. And like, you know, once again I think this is more evidence that Cosmos is this like rejection of the fact protocol thesis where like, hey look, all these application chains have been able to accrue like a lot of value within the Cosmos ecosystem. But a lot of these chains had a lot of trouble getting listed on centralized exchanges, right? Because centralized exchanges, like it's not as easy as adding an ERC 20, right? They actually have to run a lot more infrastructure, run new nodes, all this kind of stuff. And so I think there actually already was all this interesting assets and liquidity that was just like looking to find a home in Cosmos. And so by this guy being that first ammo, that first deck that provided that, I think that that was a big part of it. And then I think the other big thing was, you know, just having a lot of, you know, way for users to get involved early with incentives and things like that, where, you know, we actually didn't have any, you know, we never fund, we never raised money for osmosis or anything. You know, luckily we were able to fund it all using. We, we had a validator called sika and so that, you know, we had some recurring revenue from that. We basically took that revenue and just put it into osmosis development. But because of that, because we had no investors, you know, we had no one to please in like our, in our tokenomics and it's just like, hey, we can actually go and give like all these incentives to like our liquidity providers and have these like. And, you know, the initial airdrop, the initial distribution actually happened via an airdrop to Atom folders and that also got people's attention. And so I think, you know, interesting, like tokenomic designs and like, you know, definitely contribute a lot to like the success of the bootstrapping phase of project.
**B** (43:06):
Yeah, very interesting. The airdrop to Atom holders where you could potentially bring in other users that may not have, you know, already been knowing or interested in platform, but they're holding Atom, so it's easy for them to understand what you're trying to do. So final question here before we lead into some of the community questions and there are some great community questions to ask. Can you walk us through a bit about the Q1 roadmap for osmosis and what are the next big milestones that you want to achieve?
**A** (43:36):
Yeah, sure. So I think, I think the Osmosis Zone Twitter account tweeted like two days ago about like, you know, I guess sort of the big things coming up on Osmosis in the next couple months. So I think we had five of them that we listed there. One was the superfluid staking, which we already talked about. The other is Ethereum integration. And so what that means is, you know, the Cosmos Gravity Bridge, which is like the bridge from Cosmos chains to Ethereum, just went live recently and we'll be integrating that pretty soon. The main thing that we want is actually, you know, there's a certain UX that we want where we want it. We're actually making it so that users who come in from Ethereum will be able to continue using their Metamask wallet with the osmosis chain. So this is like something that once again we're able to do because custom blockchain where we basically added the ability Cosmos signature formats and stuff are different than what's on Ethereum. But we just went and modified our chain to actually accept Ethereum signature formats. As well. And so now you can sign things using metamaps. I think eventually users should probably switch to Kepler to get the best full ux. But it's a nice onboarding step where it's like, hey, come over, make your first few transactions using Metamap and then switch to tech load when you're ready. So that's number two. Number three was stable swap. So I think that once that Ethereum integration happens, I think one of the biggest a big market that we want to capture is between is the stable swap between UST and Ethereum stablecoins because there is UST on curve for example, but there's only about $30 million of like liquid UST liquidity on that over there. Meanwhile, on Osmosis there's already like I think 50 to 60 million dollars of UST liquidity and that's only on the ball pairs. I think that like having a stable pair between UST and Ethereum stablecoins will be a big usage for osmosis. Osmosis, what was number four? I thought what number four was, number five was Cosmos. So Cosmos is basically it's like the smart contracting platform that was built for the Cosmos SDK. And you know, it's one of the most popular smart contracting systems, it's what's used in Terra. And so that entire ecosystem is built using the Cosmos system. And so the team that actually built cosmosm, they're called Confio, they're actually going to be working with us to integrate Cosmos into Osmosis and actually a custom version of Cosmos that one integrates very well with the actual AMM and decks of Osmosis. And then two, it's actually going to be sort of more permissioned where deployments are not going to be. The goal of Osmosis isn't to become a generalized smart contracting chain, but rather have a permissioned way where like, you know, particular, you know, we don't want random NFT or dog Coin or something to be deployed onto Osmosis, but like if people are building something that is like very related to and like complementary to the core product. So for example, if people are building a yield aggregator, you know, that helps people or liquidity management tooling that helps people manage tool like liquidity across different pools or you know, I know, you know, like the leverage kind of stuff that we were talking about and like, so like this we want to enable like people to build these sort of complementary protocols on top of osmosis. Ah yes, the comments are saying LBP 2.0. Yeah, that was it last month? So LBP 2.0 was this. You know we currently take LVP's are this like way up. It's like a bootstrapping system that's actually like a price discovery system for like new chains that want to like launch a token. We kind of copied the model from Bowser and I think that that model, while it works, I think it leaves a lot, you know, a lot to be desired. And so we actually sort of are working on a new model of doing ldp and so that should be hopefully landing well the next supplements.
**B** (48:10):
Yeah, certainly a lot to be excited for here. I think anyone that is interested in the Osmosis project is definitely going to be rewarded in the coming quarter, in the coming year. So getting into some of these community questions, we have the first one from dude guy and he wants to know what is your favorite Cosmos SDK chain outside of Osmosis?
**A** (48:34):
So my favorite cost SDK chain outside of Osmosis. That is a great question. You know, I mean I'm pretty, you know, I'm obviously a really big fan of Terra just because I think that their stablecoin design is like something that's really interesting that like, you know, we'll see how it works out. But yeah, you know, I'm a big fan of like what Secret Network is doing because I think like, you know, providing like that practical privacy like, you know, I, I'm not, I'm not sure like SGX is the best form of privacy like possible I think like, but like you know, they have something on the market that's usable and like and so I think that's like really important and useful. Big fan of like Akash Network because I think that like you know, having on Chain Compute Marketplace will be really important, especially if you think daos are going to become more important economic actors. So eventually, you know, what we want is the official Osmosis front end should be hosted on a cost network and paid for by the osmosis community pool. So I think that, and I think that we're going to see like more and more hopefully daos start to like pay for like web deployment. So and so I think that's another use case that I'm pretty excited for.
**C** (49:56):
Cool. And we have a thousand sailor asking is the team working on diversifying revenue generation for the developers besides swap fees for example, things like gamified achievement, season passes and so on.
**A** (50:12):
So yeah, so you know, I mean the developers don't really have any, you know, we don't have any plans on Diversifying revenue for the development team. You know, the development team is a, you know, nonprofit. It's a foundation. And so, you know, I think anything we do will be focused on like, you know, potentially more new like models for like what the OSMO token can be used for. And so, yeah, you know, things like gamification and things like that, I think it's definitely something, you know, I think we're looking into as well.
**B** (50:49):
Very cool. And to wrap it up here we have goho with what is the main improvements with LBP 2.0.
**A** (50:58):
So LBP, the current version from Balancer, how it works is the, it uses an AMM pool and it uses the weight change system of Balancer style pools. And effectively what it does is it starts the price off really high and then it like decreases the price over a certain amount of time until it like, you know, you know, and what that does is it's like, you know, people can start buying at whatever price they think is right and but over that entire period it's going to keep pushing the price down and hopefully the buy demand should offset that. So you know what a couple of issues with it. I guess two of the big ones is one, I think it's very complicated for people to understand and like, despite however much education that like, you know, the teams try to put put out the I think what ends up happening is people keep like selling at buying at the very beginning at the incorrect, at an overly high price and because they don't understand how the system works. I think another bigger issue as well though is that the current LBP design, because people can both buy and sell against the pool while it's at that absurdly high price. You can't really, it's not recommended to do an LBP with a token that has already been distributed. So let's say your chain has already done an airdrop or something or you've already had some investors and then you want to do an lvp. You know, there's concern that the people who already received the token can actually sell against the pool at the high price and that's like not really what you want. So the new LVP version that we're doing, it's, you know, calling it LVP 2.0 is a bit weird because it's not, it's not even really, you know, based off of the liquidity bootstrapping pool model. It actually takes a lot of inspiration from. So Paradigm has this blog post called T1 Time Rated Automated Market Maker. And then there's Actually this project on near called Skyward and it kind of like combines the ideas of these two protocols of these two things and allows it to. So how it will work is the seller of the token will put up a certain amount of token that they want to sell. Let's say they want to sell 1 million foo coin. And then there's this buy pool which let's say it's in UST for example and buyers can deposit UST into this buy pool. And what will happen is these two pools will stream at each other over, over a like certain period, let's say 24 hours. And so the more money that's in the Bible, if people add more money, it's basically the same amount of the same rate of food coin is being streamed but at more UST is being streamed in the other direction which means the price goes up and then if people remove money from the buy pool the price goes down. And this basically acts as a way for the seller to basically swap a certain amount of tokens for the token that they're buying. And once this happens then it, you know, they could go ahead and create an LVP with the, a normal AMM pool with the proceeds from the sale. But I think that basically it's take, it's, it's using more of like the, it's more like a normal auction that people are very familiar familiar with but it makes it more continuous rather than just like discrete one moment auction which is like vulnerable to like front running and things like that.
**B** (54:59):
Excellent, thanks for the answer there and hopefully the comments didn't distract too much. So Sunny, it's been great talking with you today. We've gained a lot of insights into the Osmosis ecosystem. Can you give us a little bit of information on where people can find more about you and the stuff you're working on?
**A** (55:18):
Yeah, sure. So you can find our Twitter ismosisone and my personal Twitter is sunny a97. And yeah, you can join our, you know, if you go on our website Osmosis Zone on the landing page this would be like links to all the different social, you know, the discord and telegram and all this kind of stuff where you can sort of learn more.
**B** (55:51):
Thanks again everyone. So this is Sunny Aggarwal, co founder of Osmosis. Again you can find the website app Osmosis Zone. Check out previous episodes of staking Mondays on YouTube and Spotify. Also you can visit stakingrewards.com to learn more about the SR20 product that we recently launched. So please like and subscribe to our channel Share this video around and as always, everyone, happy staking and Happy New Year's as well.