In the 1st episode of “Quick Flip Polygon”, Blockbytes hosts Clay and Austin discuss the latest news involving the MATIC blockchain, including Reddit NFTs, an attack on Quickswap, zkEVM adoption, and more.
Read our notes below to learn more.
Nubank
Nubank chooses Polygon supernets to launch token.
Nubank is a large digital bank with 70m customers across south and Latin America, with investors including Warren Buffet and Softbank.
Users will receive a sort of loyalty rewards in the form of Nucoin tokens.
Nucoins will offer discounts, rewards, etc. similar to credit cards.
The fact they’re launching on a Polygon supernet (custom scalable blockchains built on Polygon) means they expect a fair amount of volume.
The bank could maybe integrate polygon wallets directly into their existing software to provide easy UX.
Quickswap Lending Attack
Market.xyz allows creation of isolated lending markets, even for illiquid tokens.
Market.xyz allows their markets to be “white-labeled”; other protocols can provide this service themselves.
Quickswap (DEX on Polygon) used Market.xyz lending market through Quickswap frontend.
Qi DAO lost $220k in MAI stablecoin seed funds on Quickswap platform due to exploit involving Curve oracle price.
Ability to manipulate Curve oracles was pointed out on October 11, Market.xyz hadn’t updated protocol.
Quickswap lend has since been closed, Quickswap has called for Market.xyz to repay Qi DAO.
Aave Proposal
Aave V3 Polygon interest rate update proposal in forums to update settings around staked MATIC token.
WMATIC (wrapped MATIC) borrowing costs exceed yield of staked MATIC; users don’t have incentive to borrow.
Proposal would increase utilization of borrowing market 27%, reduce borrowing costs 12%.
MATIC has become a much more stable asset since Aave first introduced it.
Making liquid staked MATIC attractive to lend is important; it allows more people to secure Polygon network.
This enables more looping strategies: deposit staked MATIC, receive MATIC, stake MATIC via liquid staking provider, deposit staked MATIC, repeat process.
This process yields a higher APR, and has no impermanent loss.
Aave E-mode allows greater capital efficiency when deposited asset and borrowed asset are correlated, like MATIC and staked MATIC in the example above.
Reddit NFTs
Reddit launched digital collectible avatars in July.
Reddit didn’t use crypto terminology: called the NFTs “collectible avatars” and the crypto wallet a “vault”.
~2.8m holders of these NFTs.
Reddit NFTs launched in bear market; shows that they’re a status symbol, rather than just a speculative investment asset.
The NFTs allow holders to boost content on Reddit platform.
Secondary market is on Opensea, which brings new people into crypto.
$60k in royalties from secondary market paid to artists; Reddit wanted to uplift their artist community.
Reddit has ~50m active users per month, $400m in annual revenue.
Reddit “Collectible Avatars”
OVIX Live on zkEVM Testnet
OVIX is a “ve” tokenomics (mechanism which rewards users for locking tokens) lending market on Polygon with dynamic interest rates.
Users are eligible to claim OVIX with every transaction, can soon choose to stake for 1-4 years and have ability to vote on how rewards are distributed.
ZK (zero knowledge) allows for the ability for things to be proven without revealing every parameter e.g. someone could prove they live in a certain jurisdiction without giving their exact address.
ZK rollups can immediately get tokens onto ETH mainnet as transactions can be verified to be true unlike other types of rollups.
ZkEVM (zero knowledge ETH virtual machine) makes ZK compatible with other chains.
Some thought zkEVM was 4-5 years out; Polygon could be first to market and beat this expectation soon.
Real Estate NFTs
House in South Carolina sold for $125k on Opensea via company called Roof Stock.
Roof Stock is building a Web3 marketplace for real-world assets onchain.
Company opens LLC for each property, tokenizes it and mints NFT which represents ownership of the house.
Buying real estate is lengthy process with many steps, it’s unproven if NFT would be recognized by IRL governments.
Flipkart and eDAO “Flipverse”
Flipkart, e-commerce company based in India, partnered with eDAO to launch metaverse on their e-commerce site.
Users will have avatars and complete quests which unlock new e-commerce experiences with brands, creators, etc.
Virtual Shopping in Flipverse