Make DeFi summer 2021 happen! Reef Chain ($REEF) will revolutionize DeFi

Hey guys, and welcome to Box My Name. So if you guys are interested in decentralized finance, I think we have one of the best and most knowledgeable people in this space, and that's Denko Machensky. He's making the chain ReefChain. We've talked to him all the way back in late December, and the whole cryptocurrency landscape has changed. And in fact, not only has decentralized finance grown, but Reef Finance has also grown drastically. So we're not only just talking about Reef Finance, but we're going to talk to Denko a little bit about how this landscape has changed, what are the opportunities in this space, and what's the inside dig of what's going on. So Denko, welcome to the channel. Thank you. Thank you, Michael. Thanks for having me. So I guess let's start off. Super excited to talk to you again. Yeah, let's start off and let's start off with kind of like where we left off in late December. So I think the whole cryptocurrency and decentralized finance landscape has completely changed since the last time we talked. And, you know, I guess let's do a recap since then. You know, like what to you has been the biggest change and what do you think has really kind of improved in this space? Yeah, so the growth has been really incredible over the past month. But what we've seen also is rapid, rapid evolution in the DeFi space. So back then, as you probably remember, you had all of those food kind of DeFi activities like spaghetti and sushi and so on. And those are really cool for like testing and starting, like people get into it, like they understood, okay, what is the yield? What is this? What does this financial primitive does and so on? So how we see that it's like some form of like a test net for DeFi. And since then, we've seen how, you know, new projects which pushed the bar even further showed up that are actually rendering serious financial services, as I would call them. And obviously, you know, with that, you are getting more and more serious players, big players coming in the game. They can understand the true potential of this whole DeFi concept. And it's extremely easy to take a parallel from the traditional and then add all the positives. And then, you know, we are here now. It's been exponential growth, over 65 billion locked in DeFi already. And it's growing on, you know, daily basis. So, yeah, it's been really exciting. It's pretty impressive. I mean, if you think about it, you know, I totally agree with you. Early stages, it was all about the food coin, food memes, and a lot of the experimentation that was going on. But those experimentation yielded good results, right? I think that's kind of important to remember the milestones that have been achieved. Even for something as simple as Uniswap, the amount of trade volume and amount of volume locked there is just pretty amazing. And so in that front, so you see that there's more parallels coming on. Like, where do you see the growth potential for DeFi to be? Yeah, so how we see it, what we've been obsessed with generally is product market fit. And with this amount of growth that we've seen into the DeFi landscape, we believe that the current infrastructural layers are not at the, currently, are not at the point where they can serve this growth. As we've seen, you know, we have a lot of issues with the gas fees and, you know, the level of complexity that those, you know, financial primitives can get because it's, you know, on Ethereum, you have to be careful with every line of code because it costs more and more gas. So, yeah, these are the main issues that we've seen that are currently, you know, kind of slowing down the evolution, even though it's still obviously a huge, huge uptrend. So this is, this is where, where Reef is positioned. So, so I guess for people who haven't heard a little bit about Reef, can you tell me just like what's the base understanding of what you're trying to do here? Yeah. So Reef is basically this layer on top of the DeFi landscape, which aggregates the protocols and then it completely decreases the technical barriers of entry for newcomers. And as we've seen, there are many newcomers every day. So what happens is we are just abstracting away so that people don't have to learn about each protocol on their own. They don't have to understand all the things that are happening in the background. They can just come with a few clicks and get invested in DeFi. So this is, this is our main goal to make DeFi easy for everyone. And then the second aspect of Reef is the Reef chain, which is the infrastructural layer, which is, which is built to serve the next generation DeFi, DeFi activities, which are rapidly coming. They're completely new concepts as we've seen even with Uniswap. They iterated multiple times from their initial concept. So those are completely new generation of DeFi activities coming. And this is where we are positioned. We are building an infrastructure Reef chain, which will power the next gen DeFi applications. Got it. So, so that's kind of interesting. So it's, there's almost like a evolution of the project since we last talked, because first of all, it was based on DeFi, kind of making it easier for people to get into decentralized finance. But now you're talking about a bigger scope. You're talking about building your own chain. So that's very exciting. But, but I mean, obviously, like, what does that mean? Like for, for anyone that's new getting in, you know, what does it, what, what does building your own chain entail? And what, what would that bring to the ecosystem? Yeah. So, you know, it's a, it's a pretty big, it's a pretty big project because first of all, our main goal is achieving decentralization, which is extremely, it's a process, right? You have to get there, but it's important that you have, you have a plan how to get there from the very beginning, because, you know, if we take comparison with Ethereum and Bitcoin, that they don't have on-chain governance, it's extremely hard to, to shift based on what is necessary for the industry. So, um, uh, reef chain, it's a, it's a, an ecosystem of its own, but it's positioned differently than all the other ecosystems because we are not about competing directly with Ethereum or BSC. We are more about connecting those, uh, those ecosystems together and incentivizing projects to, to, to write, uh, the next basically, because they, they all have ideas how to improve, how to, uh, evolve their existing products, but it's extremely hard with the current infrastructure. So we are working with a lot of these projects so that they can deploy a more complex code base, uh, still be based on solidity, still be, you know, on Ethereum. And I, I, I can explain why, why is that? Um, but you have more freedom, you have, uh, uh, different, different, uh, tokenomics, the different mechanics of how, how the fees work and so on. So this is, this is, uh, what reef chain is about. It's about incentivizing those projects to get to the next, to the next level. Right. So, so we've seen the explosion, right? We've seen the, the original kind of primordial soup of Ethereum, you know, bringing the whole DeFi landscape to light. And then of course we saw the whole narrative of Binance smart chain, right? That the whole ecosystem just blossom and, and blew up. And it's just right now it's super, uh, super exciting. Of course, now there's other chains as well. We've got Solana, we've got Avalanche, and now you're building your own chain. So you're building your own chain, but instead of what you're saying, instead of kind of being your own isolated ecosystem, you want to cooperate with other chains. Right. So how do you want to achieve that? Right. So, so let's say I'm an Ethereum user. Um, you know, why would I want to, you know, get access to reef chain and how does this all work together? Right. So, uh, just to explain how, how we fit into the existing ecosystems to have Ethereum on the, on one side, which I, I, in, in my long-term vision, this would be the main like settlement layer, which is, you know, a slow because it's not very scalable and due to the governance, it cannot get a lot better from here. Then you have BSC, which the growth of BSC has been insane. And the result of why this growth happened is because the, the smart contract market was underserved because of Ethereum. We have a lot of user base that cannot afford to use, uh, those smart contracts. They cannot afford to pay those gas fees, but then you have certain attributes that are very important, such as, uh, being, uh, being decentralized as well as, as well as the, the possibility to upgrade the chain to allow for more complexity to allow, allow for new features. So, so Reef is somewhere in between where we developers, which have been building Consolidity, they can still come on Reef and deploy their app with just a few clicks, but it's very extensible. We have something called EVM extensions, which allows you to, uh, to write your own native bridges. And this is where, where, uh, the, the Reef chain comes into play and connects to the, to the other ecosystem. So we are building our own liquidity bridges, which are again, abstracted away. So the, the goal is that the user doesn't understand that he doesn't have to care that this is on another chain. It's like, they come here that they have like this palette of things that they can do. And through, through all of those EVM, uh, extensions, uh, we were able to communicate with the other ecosystems seamlessly. Obviously this is, you know, uh, an, uh, an effort from the whole ecosystem. We have Polkadot building the XCMP. We have, um, uh, we have multiple protocols, which, uh, which helped with the, with the, you know, transport layer of those message, you know, uh, state, state, state passing and so on. So what we do is we, we, uh, we are combining all of those things together, but we are still keeping in mind that the currently the, the, the most evolved developer ecosystem is, uh, uh, is solidity is Ethereum. So we, we don't want people to have to switch completely to a new programming language. So whatever is already working, you know, it should still completely work on Reef, but they'll be able to add more and beyond solidity soon. So they'll be able to write Rust, uh, ink smart contracts as well, scheduling mechanisms, native tokens, and so on. Right, right, right. So, so it's really about kind of, uh, courting the current developers to come over to bring their applications over and then you can allow them to have more extensions. Now, this is, this is almost sounding like some sort of glue, right? So you're kind of gluing. So now we have this web of, um, blockchains. We have, you know, Binance Smart Chain, we have Ethereum. You want to combine all this together. So in terms of experience, obviously it's going to be, uh, for me, right, it might be a little bit complicated because you have so many different things interacting. So if I, you know, once this launches, how would I, how would I use this? Like, do I use it with MetaMask? How, how, how would the end user experience be like? Yeah. So, um, as you know, Reef is all about, you know, the end user. So UI, UX. So we are, uh, the goal is that you would use Reef Chain seamlessly. So initially we have the Polkadot JS support and MetaMask support is coming soon. So the user doesn't have to do anything. Now MetaMask, they even added some, some things so that it's super easy to add the new RPC. Like this is again, slowly getting abstract, abstracted away in the infrastructure layer. So for you as a user, there won't be much of a difference than what you're used to out there, except that you will pay way less fees, uh, and you will be able to participate in activities, which are more, you know, complex in the background, but more complexity means that they, their utility is, you know, um, uh, is, is, is, is better. So there is, there is more connections to, to, for example, to more liquidity pools, to more, uh, activities. So, you know, when you do this like loans and, uh, and, and borrowings there, they can be like tied together into multiple protocols, like, uh, basically composed on top of each other. And this is, uh, this is the result of having, uh, low fees. This is the result of, of having the EVM extensions, which allow for more complex processing on the lower, lower level of the blockchain. So for you as a user, nothing really changes. Uh, it's, uh, it's very simple. You just come, you link your, your MetaMask or your Polkadot JS extension and you're good to go. Oh, okay. So, so, so really a front end. So in the front end side, right, from a user perspective, not much has changed. And, uh, you know, because right now it's so easy for an app to just like add a custom chain and voila, you're done. You can use your existing programs. You can use your existing MetaMask extensions, but in the backend, that's where the power is, right? Because that's where developers have access to more tools. They have more extensions available. Now, obviously to build an entire chain is to build an entire ecosystem. It's a huge, huge task because even, even something I've learned from Binance smart chain is that initially when Binance launched, smart chain launched, there were very few projects on, and there was very little traction. It was only until three, four months later when there were enough developers that it blew up. So on this side, you know, how, how are you going to get your developers over? I mean, even if you're using Solidity, uh, you still have to have a big pull factor to pull projects over and draw them over. So what are your plans for that? Yes. So, uh, this is, uh, we've been discussing with multiple people like KOLs from this industry about this approach. So our first goal was let's, uh, come up with what's the best plan to incentivize adoption. And obviously, you know, incentives are extremely important here. So, so the number one priority is the project that the first projects that are building on reef, they will be the ones that will be, uh, become validators. So technically in a year from now, reef, the reef team, and, uh, we will not be a majority of the validator. So that means we will achieve decentralization pretty, pretty fast. And this is one incentive, one out of multiple incentives that would bring projects because they're like, look on Ethereum, our users are getting hurt by the fees and we don't own the network. But here, if we do well, if we bring our user base, if we, if we deploy our products, we have the chance to own the network. And then if you're one of the first projects, uh, that, uh, that achieved, you know, uh, adoption on reef, you will, you will be voted as, as a validator. And then, you know, the goal is to achieve like 20, 30, 40 validators over the next year, year and a half. So this is, this is one, uh, uh, the next, the next is how easy it is for you to basically open another shop, you know, because you just have to, to, you know, deploy your existing smart contracts without doing anything. And it's like, okay, they, these guys have a lot of user base. Why don't I deploy my app here and then see if there will be adoption. And then we have incentives for our users to start using their apps so that then they can validate, you know, their product market speed, uh, even, uh, even faster. Uh, they can, uh, they can test, you know, the new features that they could not on the other ecosystem. So this is, this is the second, second incentive, uh, incentive, uh, attribute. And, uh, and the third one obviously is we are coming up with a big. Uh, developer support program, uh, grants, um, uh, for different kinds of projects for tooling, for projects that want to do, uh, IDEO, uh, on, on, on reef and so on. So the whole non-tech kind of, uh, marketing slash business development slash funding support that's also coming. Um, and, uh, so those are the three main like attributes that, that we've, the reef ecosystem has that we believe will ignite a huge growth. Awesome. And so what's the timeline for everything? So when is the mainnet launching? Like what are you expecting for the main milestones? Yeah. So, uh, we, we, uh, announced the mainnet launch for next month. So in May, sometime in May and launching mainnet is a process on its own. So since it's a substrate, it's a substrate based chain, we have a process of getting, uh, you know, the final mainnet launched. So, uh, there's something called, uh, like guarded launch where we have to test certain modules so that, uh, and once they go through a certain threshold, they will automatically become, uh, you know, final. So, and then from, from there we can officially announce mainnet. So the actual mainnet starts in May. Uh, so somewhere, uh, by the end of May or mid, like early, early June, we will have all of our modules, uh, live in production. That's, that's our timeline. Awesome. So I'm super excited. So if people want to find out a little bit more about it, uh, what's the best way to, uh, research and find out about what we've changed? Yeah. So we have, uh, we just, uh, released our new landing page, which has, uh, way more resources, uh, our community, uh, we have over 10 community managers in different languages so they can come and they can chat there in real time. They can ask their questions. Uh, I'm making sure that we have a 24 seven coverage from, from that point of view. Uh, we also have people who can reply on Twitter. So those are all the, those are the best channels to, to communicate with us, to ask questions and the website and medium are the best resources to learn more about it. Awesome. So what we're going to do is we're going to put these links down below and I'm definitely excited for the launch of the mainnet. I think the project has definitely expanded hugely, vastly in scope. So that's very, very exciting that you're having your own chain. That's like amazing. Right. So I hope that goes well. I hope we can get those developers. If you guys are interested in developing, obviously contact Danco. I think, you know, he's very, very passionate and eager, so he can offer a lot of support there and Danco. Thank you so much for coming in and sharing some of your insights. I hope to catch you up, uh, in the future. And, you know, maybe next time, like everything's going to just explode again. And this is going to be one of those best times again. So thank you so much for coming. Thank you. Yes. Thank you, Michael. As well.