Author: FranceSCO Source: Substack Translation: Shan Ouba, Bitchain Vision Realm

After a year of bull market promises to fail to fulfill, cryptocurrencies have a new spiritual totem: BERA.

In the highly challenging habitat of cryptocurrencies, a project is more prominent than other projects.

This article introduces BERACHAIN, transcending speculation, and transforming the technical complexity of its own liquidity (POL) mechanism into a more understandable ecosystem.

What is Berachain?

Berachain is a novel layer 1 (L1) blockchain.

In contrast to the development of the development of the L1 solution, BERACHAIN and Monad together seek revitalization and redefine services that L1 can provide.

This method is in stark contrast to the current trend. The current trend is that most projects are either focusing on building the second floor (L2) solution on Ethereum, or as an independent application chain and the third layer (L3) network.Development.

The decision of innovation on the L1 layer is related to the most important progress of Berachain -its novel POL consensus mechanism -closely related.

Distinguish POL and POL

Readers may recall the concept of liquidity (POL) in the Olympus DAO era, which is a concept that may cause mixed emotions.

However, the POL introduced by BERACHAIN represents a unique innovation concept, which needs to be clearly distinguished:

POL = liquidity proof
POL = liquidity owned by protocol

Evolution of consensus

Since the advent of Bitcoin, the blockchain network has been trying to solve the dilemma of the blockchain.SecurityAs well asspeedandA balance between decentralization.

In a decentralized network,People have adopted different consensus mechanisms to coordinate incentive measures for online participants.

Initially, Bitcoin adoptedWorkload certificate (POW),Miners are required to invest in hardware and undertake the problem of decrypture and excavation of new Bitcoin.

POW is a form of encryption proof. Among them, other people have proved that it has consumed a certain amount of computing workload.

The POW model was originally adopted by Ethereum and others, becoming the most feasible way to coordinate incentives in decentralized networks.

However, with POW -related hardwarecostEnergyIncreased consumption, as well asMining rightConcentrateAnd long -term sustainabilityWorried, the industry begins to turnCertificate of Equity (POS)As the preferred consensus mechanism.

In POW, verificationrs must purchase physical hardware to dig Bitcoin.In contrast, the POS network (such as Eva) requires the verifications to participate in block creation and transaction verification through pledge of a certain number of online native currencies (such as 32 ETH in Ethereum), so as to thus“Participate in it.”

The incentives of the verifications are consistent with the correct operation of the network:If malicious behaviors occur, the verifications will lose (cut) some ETH equity.

Transition from POS to POL

Although the POS model ensures that the verifications have benefits in the game, it fails to keep their interests consistent with the agreement and achieve the goal together.

At least at the consensus level, the following coordination or deeper participation is obviously lacking:

Agreement to ensure the normal operation of the network
Verifications ensure that the agreement promotes the Internet’s economic activities

The lack of such collaboration in the consensus mechanism has also triggered people’s doubts about user characters.

This is where Berachain’s Pol consensus play a role.

POL consensus on the basis of POS,Introduced the incentive system at the consensus level,The interests of all network participants (verifications, applications and users) strategically designed the interests of all network participants.

The use of incentives is already mature in the field of cryptocurrencies, and the famous examples areCURVEAs well asConvexandRedactedIt shows the power of incentive measures in coordinating interests and expanding product scale.

However, BERACHAIN is the first to integrate the bribery system directly into a consensus model to ensure that the collaboration between network participants is rooted in network infrastructure.

Pol’s actual significance

In this model, BERAChain is building a network, which is expanding in proportion by the increase in the growth of liquidity and security with the growth of the network, which has promoted the coordination of the community from the beginning.

The POL system inspires all participants, especially emphasizing verifications, and their active participation is essential for the success of the network.

To understand the incentive balance implemented through POL, you need to introduce the BERACHAIN token model first:

BGTTheBERA govern tokens (BGT)It is the basic component of the POL model.It isUnable to transferIt can only be obtained by participating in POL.BGTNot just a simple governance token for voting, it represents the most important share in the POL award:The user entrusts the BGT to the verification person, and the new BGT is issued only as an authenticator’s proposal to the valid block, and then they allocate it to the application based on the bribes received.Users can only obtain BGT by increasing liquidity to LP issued by BGT -once they receive it, they can decide whether to use it or destroy it as BERA.
Bera: BERACHAIN’s GAS tokens can be transferred, and network participants must be pledged to become active verifications.
Honey: BERACHAIN’s mortgage stable coins linked to the US dollar can be cast by depositing different white list mortgages into the vault.

Berachain flywheel

BERAChain’s “modular liquidity“The ecosystemFrom zero -sum game to a collaborative environment, the flywheel effect of the entire ecosystem is generated:

VerificationInteracting directly with users and maximizing the BGT entrusted to them.The user entrusts their BGT to the verification person. The more BGTs they have, the more rewards they get.Verifications earn fees from these rewards.
appGet a larger BGT reward for their pools to encourage users to increase liquidity rather than competition
userAfter depositing funds into the pool, you can choose different options, and the funds will fluctuate with time.Their rewards will depend on the total asset share they pledged in the pool and the BGT reward amount issued by the verifier to the measuring device.

In the end, the verifications decided to distribute BGT in various pools and protocols, and their strategies may be different.

Agreement can also be rewarded by native token rewards (that isBringing) Incubic verifications to attract more BGT rewardsEssenceLet’s see a practical example:

Ver offers point its BGT to LP of the protocol.
Assuming you areFranceScoprojectOwnFracoinEssenceYou want inFracoin/Bera has a strong LPEssence
For this, you will decide to use the number of xFRACOIN bribe verificationThen the verificationr sends his BGT toFracoin/beraLP.
The user wants to earn BGT, so it will increase liquidity for the LP

This model requires close coordination of verifications, applications and users to inspire all parties.The following is the way BERACHAIN participants participated in the flywheel.

Verification:Vermittor according to itRewardRe -assign BGT rewardIt is proportional to the number of BGT entrusted to them.The reward of the verification also includes bribes from ecosystem applications + rewards from block capture value (total reward fees, such as BERA from GAS, Honey from trading fees, etc.).In addition to protecting the network, the verified person must also:

Maximize BGT authorization
Direct BGT motivation

Users vote with wallets:They deposit liquidity into the white list and receive the LP tokens.They can pledge these tokens in specific indicators to earn BGT and then entrust the BGT to the verification.

Ecosystem project:Anyone can use BERAChain’s native distribution as a source of benefits.Applications can send bribes to representatives, thereby forming a positive feedback cycle, motivating the liquidity of specific indicators, and distributing more rewards to these applications (for example,, for example,Users will see this and choose to save more liquidity into indicators, so as to get BGT and more rewards compared to other indicators).

In this POL framework, the role of the verifications is becoming more and more important.

They can establish directly with applications on BERACHAINPartnershipUse bribery to achieve diversification of income sources.For example, verificationrs can cooperate with the agreement to enhance user incentives, thereby increasing LP’s participation.

Therefore, it is necessary to consider it carefully: Because they are interconnected with applications and users, they play a key role in the ecosystem.

The POS model ensures that the verifications have benefits in the ecosystem, and POLExtendThisconsistencyAt the consensus level, the interests of all network participants have been coordinated.

Although Curve and other agreements use incentives to guide discharge to a single pool, the BERACHAIN ecosystem operates collectively to determine the best value flow, thereby formingMore comprehensive ecosystem flywheel.

Copy the challenges of traditional liquidity providers

POL consensus also solve the traditional challenges faced by liquidity providers (LP) by providing a variety of rewards::

BGT distributed by verification
LP reward
Extra bonus and incentives brought by bribery

In addition to getting rewards, LP is okIncrease their governance participation by obtaining BGT.

In addition to getting rewards, LP can also obtain more governance participation through BGT, thereby further enhancing its role in the network.

POL also contributed to POL, itMake the BERACHAIN application use the native distribution of the chain as the source of benefits, rather than paying the liquidity from LP.

This method attracts liquidity by maintaining consistency and providing higher bribes by the verifier, thereby simplifyingguideLiquidityanddepositApplication process.

Conversely, this can promote the development of consumers other than Defi.These applications willReduce dependence on hiring capital, and can use the liquidity of the ecosystem to start its operation.

The Berachain Pol model assumes that as long as there are enough incentives to entrust BGT and participate in the network, the liquidity will follow.

More extensive influence and future considerations

Good technology can only help you go so far.

Although technological innovation is important, the method of Berachain is different. It pays attention to the ecosystem in the ecosystemPositive feedback cycleTo ensure continuous growth and collaboration.

The scarce resources in cryptocurrencies are users.

Because many people are competing for the same group of users, the POL consensus ensures that the Berachain users can enjoy better rewards and participation in the ecosystem since its establishment.There are many cases of new L2 launched and adopting predatory strategies to deal with users. These users are forced to lock liquidity for several months in the new ecosystem without any guarantee or decision -making power.

Berachain rewrite this scriptSo that users can not only exit liquidity, but also become positive and fundamental participants in this field, and play a decision -making role in determining where liquidity and value should flow in the ecosystem.

Although all previous incentive plans and closed -loop incentive systems are only beneficial to participants, POL is the first “scalability incentive system at the protocol layer” to ensure the long -term success and longevity of the network.

This is in line with FAT BERA argument, that is,“Applications built with POL as the core will occupy most of the value in the Berachain ecosystem.”

At present, the model is highly dependent on the relationship between the BERACHAIN verifier and the BGT client.Will this situation continue after the Internet is launched?

Many people also emphasize the important role of verifications in the ecosystem.
Will they eventually become too powerful?

The dependence of the verified by the authentication may also become a single point failure: What if the demand for block creation will decline?

In the end, the same important point is that many people have raised the problem of power decentralization.

Although BERACHAIN mentioned“Lobricity proof is serving the people”, butSince most verificationers and liquidity pools need to be included in the whitelist, will the system run as expected?Or is this another way to focus power in the hands of a few people?

Most of the theoretical assumptions of this model must be confirmed in practice.

The success of the POL model will depend on its implementation in the real world and ensure decentralization and sustainability.