jakiro
Author: Godot; Source: @GodotSancho
Recently I have seen a lot of discussions about Monad $MON and public chain moats.As a contributor to L2, I really feelThe so-called “building an ecology” has been falsified.
If you have built a public chain or L2 from scratch and want to build a good project with a completely sincere heart, thenFirst, consider where users and on-chain funds come from..
When you ask for cooperation everywhere, you will find that no one will listen to you, and even paying KOLs for promotion will be rejected.
At this time, you understand that everyone’s most basic need is to ensure that you will not run away, rather than caring about the performance and technology of your public chain.You need strong VC financing for brand endorsement.
The problem is, what to look for in VC investment? You must have a background in a prestigious school or a big factory, and preferably a cryptography background, or a partner with a cryptography background.
Suppose you happen to have all of them, find a partner with a cryptography background, and successfully raise funds.At this time, a small number of people will follow the financing news and try to flirt with your chain, and KOLs will also come to you to inquire about cooperation opportunities.
Then you will face a problem, how do users transfer money to your chain.
If it is a public chain, without issuing coins, it can only rely on the test network to gain water.
If it is L2, you need to find a cross-chain bridge to cooperate. Most cross-chain bridges are pool-to-pool cross-chain, so the types of funds that can reach your chain are very limited, and will only be limited to the stablecoins USDT and USDC, and ETH and its LST assets.
Of course, the amount of assets will not be too huge, because everyone is still a little worried that you will run away.
And the most critical issue is that if there are no native USDT and USDC on the chain, then the two tokens on your chain are actually derived from the USDT and USDC locked on the cross-chain bridge. Once there is a problem with the cross-chain bridge, you will have no way to redeem the assets for users.
Go to Tether and Circle to discuss cooperation?The basic cost should start at least several million higher, so forget it.
Okay, then the DeFi liquidity on your chain is limited to the USDT-USDC trading pair and the ETH-wstETH trading pair, which is meaningless.
There are obviously insufficient assets on your chain relying on cross-chain bridges. The center of liquidity is the exchange. It would be a great help if the exchange could open your public chain for currency withdrawals.
Then you will find that most exchanges charge fees for listing coins. The largest one does not charge fees, but it must be valuable to them.Congratulations, you got the KPI.
What about TVL?You can only find institutions, BD whales and large investors one by one to promise profits.When the tokens are issued, use the tokens to make up for the APY of the TVL contributed by the other party.
What about activity on the chain?The big mature DeFi projects will ignore you. Unless you can promise to provide huge liquidity, that is, deploy at least tens of millions of dollars or more than 100 million dollars of TVL to the project, they will consider deploying on your chain.Otherwise, the depth is not enough, no one will use it, and there is no point in deploying it.
GameFi, NFT?Basically dead.
The projects that come to you are basically for Grant funding. They copy an existing project and deploy it on your chain. When you receive the tokens, they ask for Grant. Once they get the tokens, they cash out. Then they deploy on multiple chains and look for the next public chain or L2.
Even if they really want to deploy on your chain, they will not be limited to your chain.Because people also want market value.It is also necessary to expand the user group and market scale, and multi-chain deployment is the best strategy.
MEME is a good method in the eyes of most people. Many people think that by pulling in a few MEMEs, the chain can handle it.But the actual situation is that MEME cannot be posted by oneself. After all, the supervision in many countries is not strict.
Secondly, you cannot temporarily recruit a market making team, which is also a cost.Looking for a third-party MEME distribution team to work with?A few tokens may be stable at the beginning, provided that large investors do not make profits or cash out.
Once there are fewer new users, actual buying orders are insufficient, and large investors cash out, MEME will take orders at a lower price, and there will be more and more negative lines on the market.
The addition of high-frequency traders will make the situation worse. They will increase the gas price and snipe the pending orders that the MM has no time to cancel.Therefore, MM can only widen the distance between buying and selling, and user transaction slippage becomes larger and larger.Price fluctuations will become more violent.
Slowly, the user’s holding time is getting shorter and shorter, and he will run away after taking one lick.The time for MM to maintain prices can only become shorter and shorter.
The result of the constant game is to compare who can run faster.Finally, no one had to run.
If you are lucky enough to reach the KPI in the end, you will finally be listed on the currency.There is a problem that needs to be solved. Do you want to guarantee the interests of the VC?What about the giant whales and big players who contribute TVL to you?What about Grant for ecological projects?MM’s liquidity allocation, the exchange’s token airdrops, Stake rewards, airdrops to users, and the team.Whose interests do you protect here, and whose interests should you sacrifice?
In the end, you successfully listed your currency, but the exchange will still only allow deposits and withdrawals of your local currency on the chain, up to a maximum of ETH.
Tether and Circle still charge millions to tens of millions of dollars more. There is no native U on the chain. Exchanges cannot enable deposits and withdrawals of U based on your chain. DeFi whales will not believe in the security of cross-chain bridges and will not transfer large amounts of funds across chains.
To participate in activities on your chain, users need to withdraw their local currency and then sell it to ETH or U on the chain. The wear and tear itself is the threshold.
Oh, by the way, without native U, don’t expect RWA to be deployed.Even your oracle cannot use Chainlink, because its fees are also super expensive.
In the end, you will find that issuing a universal chain to build an ecosystem is a false proposition.
This is actually a huge “Emperor’s New Clothes”. Buying is not based on your fundamentals, but on conspiracy theories. It is the feeling that someone is behind you and supports someone.
You will find that the funds on your chain will eventually return to ETH, SOL, and possibly Base. The Matthew effect of these chains is already very obvious.
The open asset deposit and withdrawal support of exchanges, the liquidity of existing assets on the chain, the capital and transaction slippage of DEX, the scale and linkage effects between DeFi, the types and composability of DeFi protocols, spot contract options and other different transaction types, whether positions can be hedged, whether bond products can be constructed, the liquidation security of loan agreements, and even users’ trading habits, fixed impressions and path dependencies that users have formed, etc., are all moats for these successful public chains.
So, back to the why,Why must users use your chain, and why must ecological protocols be deployed based on your chain?What matters is not the technology itself, but the uniqueness.
This uniqueness must be helpful for both trading and profit scenarios.And it must be help at the consensus level, such as Hyperliquid order cancellation priority consensus sorting to help MM provide liquidity, or the ACE application being developed by Solana to control execution.
In fact, I have finished expressing myself as I write this.
Finally, I would like to say that the projects incubated by Manta will not be forced to be deployed on the Manta chain, but you can freely choose the chain that suits you, such as superfortune on BNB Chain, Junk.Fun on Solana, etc.But part of their income needs to buy back MANTA.
above.
