This proposal registers the DAI, TBTC, WETH, WBNB, USDC, WBTC token to the foreign asset registry, so that in the future these tokens can be received via the Moonbeam wormhole bridge. It also registers GLMR, which will be necessary to interact with said bridge.
How will liquidity be provided for all these tokens to be traded? Merely with lending/borrowing or will INTR become just a reward token for liquidity providers? I think Interlay should concentrate its efforts to provide its core competence, i.e. IBTC hub, and not try to be one more DEX.
What good are WETH and WBTC going to do on the Interlay network? Not only is it pointless to start trading our competitor WBTC on Interlay, but WETH will also have no use in the Polkadot Ecosystem.
In an ideal world, iBTC should replace WBTC on the Moonbeam Ecosystem, wiping out the centralized wrapped BTC.
Conceptually speaking, I dislike the idea of creating any form of dependency between Interlay and centralized wrapped tokens.
Sure, BNB is centralized, and something like WBTC can stop Interlay's assets at the will of the management company.
If this were to be done,For example I think it would be a good idea to establish a token group table and set a rule that such "risk assets" should be limited to 20% of the total TVL, rather than allowing them as assets in a uniform manner.
I am afraid that BNB and WBTC could become the value of iBTC.
If technically feasible, it would be good to accept traditional, decentralized tokens such as LTC and XMR.
This proposal merely adds these assets to the asset registry. It does not yet propose what to do with these assets on the Interlay chain itself and this will require follow-up proposals.
Generally, having assets from other ecosystem is sensible for Interlay in the following cases:
Again, this proposal just proposes to add the assets to the Interlay chain. But it does unlock a myriad of use cases that will increase usability for the Interlay network and the iBTC asset. Each of these use cases are subject to their own governance vote. I'd urge everyone to not block all use cases but rather engage in the specific discussions that will follow this proposal.
This proposal has not passed the community vote. I believe it would be helpful to have a more in-depth discussion about why exactly members voted against it.
The main argument that was made against this proposal is the centralization risk of the Wormhole bridge. This is a fair and valid concern. However, I believe it should also be put into perspective.
The benefits of having more assets on Interlay are:
1)** DeFi Hub diversity.** Interlay is not only a bridge but also a defi hub. Having access to ETH, SOL, BNB, AVA assets on the DeFi hub is useful for creating different strategies and more options for traders
2) BTC On/Off-ramps. Having a wBTC/iBTC stableswap unlocks a trustless on/off-ramp to wBTC which has the most BTC DeFi use cases on Ethereum. This can generate bridge and swap fees and was the main business model of renBTC before it went down.
3) Stablecoin On/Off-ramps. Having access to more stablecoins, even if via WH, is useful for lending. It makes it easier for users to borrow stables against BTC and then offramp them. Polkadot offramps are very very limited today, so Wormhole->ETH->Offramp is a very good alternative route.
4) iBTC Collateral assets. Liquid staking collaterals are important for iBTC vaults. stETH is an interesting collateral candidate, even if via WH bridge. Whether or not stETH.wh should be a collateral asset can be debated - it definitely comes with pros and cons.
Of course there are risks associated with centralized bridges but in the absence of alternatives (wen Snowbridge?) and considering the wide adoption of the Wormhole bridge, it feels like a good risk/reward tradeoff.
I voted against the proposal because I don't see a clear plan for how all these assets will be traded without liquidity.
It seems, they would not just be registered to allow them to become collateral types for iBTC. But it seems also to be used in xyk pools for all of those assets (and stableswap too).
I don't think the current INTR rewards are good/healthy for the project and INTR holders and I don't want INTR to become "just" a reward token for liquidity providers. At least that's not the reason I got into INTR in the first place.
I thought the first "product" of Interlay would be the best decentralized BTC bridge out there that would bring BTC to DeFi. However, as a Polkadot project, I would expect Interlay to cooperate with other Defi projects in the eco, especially with the most promising DEX out there (HydraDX), and not try to compete and be its own DEX. We only need to see the facts, HydraDx holders/DAO have bought Ibtc like no other DAO (at least 750K DAI DCA orders into Ibtc) indirectly helping the success of Ibtc and the Interlay team has not even let the discussion to add INTR to omnipool become a referendum.
Since the vote is simply to connect with Interlay, I don't see much point in opposing it.
If it is to be incorporated into iBTC, it would be a different vote.