PIP-00: Pontem Informal Coin Kingdom List (PICKL)

alejo · November 3, 2022, 11:01pm

Hi all, the first Pontem improvement proposal is now up for comments if anybody as individual contributors to the ecosystem building with Pontem want to opine, your inputs and feedback are greatly appreciated

The question: to prefix or not to prefix bridged assets from LayerZero, Wormhole and others.

TL;DR The user experience across L1s for bridged assets is not ideal for us romantic idealists. We propose a metrics & community driven standard. Currently Wormhole is set as canonical (no pre-fix)

Summary thread:

Full proposal in our forum:

lzprimo · November 3, 2022, 11:19pm

Following up here as well by request.

Hey guys. So I think one thing to consider is what does the community actually use? Single market makers or addresses with huge balances don’t necessarily make the canonical asset for an ecosystem, and I think it’s important to see what real users actually trust and what has meaningful adoption. I just pulled the #s for both bridges so far and the users that actually use them and it’s like this:

Wormhole:

LayerZero:

3 categories – registered accounts, users with >0 in their wallet (gt_0), users with >10 in their wallet (gt_10)

Wormhole-WETH - 3,429 registered, 458 gt_0, 48 gt_10 LayerZero-WETH - 24,254 registered, 10,002 gt_0, 2,916 gt_10

this means LayerZero has 8x registered users, 20x users holding a balance currently, and 60x the users holding > 10 WETH

Wormhole-USDC - 24,153 registered, 8,201 gt_0, 701 gt_10 LayerZero-USDC - 60,981 registered, 25,773 gt_0, 3,672 gt_10

this means LayerZero has 2.5x registered users, 3x users holding a balance currently, and 5.2x the users holding > 10 USDC

Wormhole-USDT - 7,018 registered, 1,779 gt_0, 91 gt_10 LayerZero-USDT - 31,582 registered, 12,333 gt_0, 1,163 gt_10

this means LayerZero has 4.5x registered users, 7x users holding a balance currently, and 12.8x the users holding > 10 USDT

I think it’s important to measure not sure what a single entity has bridged over but what assets users are ACTUALLY using. I think it’s clear to see when looking at even just users who hold a simple balance of 10 or more and LayerZero has 60x, 5.2x, and 12.8x the number of users that the actual ecosystem are using LayerZero assets predominantly. If you want a secondary filter for adoption a simple scrape of github for every known aptos project in production or being built has >5x the number of applications currently being built on top of LayerZero, so as more applications go live it’s likely this gap will widen even further

alnoki · November 4, 2022, 2:56am

We believe users should make informed choices and diversify their risk based on their own preferences for security and performance architecture of different bridge options.

Agreed

The moving average on TVL seems straightforward, but tx count seems like an easy way to game the system (send a million fake txs with as little gas as possible). Unique addresses would be the same, but it looks like the verifiably unique caveat there should help.

Achieving canonical status once someone else already has it could be tricky - the canonical blessing will likely serve to entrench incumbents.

+1 on the dashboard and data driven approaches in general, including the brief analysis of LayerZero vs Wormhole at the end - I’d like to see more on all of the different bridges, which ones are dominant in USDC vs USDT, etc.

In an impractical, somewhat philosophical sense, I think the most straightforward solution to bridged assets in general is to have no default, such that users view individual bridged stables, for example as a kind of promise from the bridge, not an actual claim redeemable for USD (and the same for bridged BTC). But alas this would fracture liquidity across markets, and so isn’t ultimately workable in a DeFi ecosystem, etc. etc., and so hence the official list here.

In general I approve of this approach to get an “official” list for practical purposes and think overall the strategy is on point, within the constraints of a decentralized system where getting anything “socially official” (as opposed to canonical chain state) is implicitly difficult from the start.

Separately, did you get PIP and PICKL from Python? It has both:
https://pip.pypa.io/en/stable/
https://docs.python.org/3/library/pickle.html

kun_5 · November 7, 2022, 7:45pm

good luck guys, nice proposal!

staking_lt · November 8, 2022, 6:25am

I think this is a great proposal, lot’s of food for thought here, fundamentally, I see the big question as “who should decide what is the ‘canonical’ asset”.

I agree that it should not be an arbitrary decision by whoever has the most power or muscle - that would go against the spirit of decentralisation and ultimately we want to create the best experience for users.

I don’t have a clear answer in mind yet other than the fact that it absolutely needs to be something that can’t be easily gamed (easy statement to say, difficult to implement of course).

Personalisation by individual users definitely a very interesting options, I have my personal preference (as I’m sure others do), being able to set your default assets somewhere definitely is an interesting idea that gives individual users full control.

In terms of potential metrics to look at, I would think that we may want to explore the dominance / what are the canonical assets on other chains as well, as ultimately it is users from other chains we want bridging over to Aptos as well.

It may also make sense for the asset issuers themselves to weigh in here (e.g. Circle for USDC and Tether for USDT), ultimately they are the ones that issue the assets

ragemeowjinn · November 8, 2022, 9:28am

agree with @lzprimo, i think it’s not a straight-forward process to determine what assets should be canonical. Using TVL can be misleading as it can be easily manipulated by a few large holders, on the other hand its crucial to take a look at what assets users are actually using and bridging across. Also, isn’t it relevant to also compare of the number of applications are built on top of LayerZero and Wormhole?

alejo · November 12, 2022, 8:49pm

Given recent news re: FTX, Alameda and Serum we are going to assume aux.exchange is also compromised given their close ties to FTX and Serum and remove them entirely from this calculation.