- Berachain is about 79 million Bera tokens.
- The launch of the blockchain will launch competition between its DEFI applications.
- The more there is control of Berachain’s governance, the more he can win, the more he can win, creating a steering wheel.
Three years after its creation, Berachain is finally launched.
The blockchain on the bear theme, which collected $ 142 million in VCS, announced Tuesday that it was going to broadcast 79 million Bera tokens – nearly 16% of the offer – to its community and to the first users during the launch.
“Thousands of people who have been part of this ecosystem for three years have finally been rewarded,” said Wajahat Mughal, CEO of IVX, a protocol of options, built on Berachain, said DL News.
“Those who stayed and involved became beautiful out of parmbs.”
Berachain aims to solve coordination problems between validators who deal with blockchain transactions and those that build its user -oriented applications – as IVX.
It does it thanks to a new mechanism for the validation of liquidity, an alternative to proof of stake in Ethereum or to the proof of work of Bitcoin.
The excitement for Berachain is high. Users DEFI have locked more than $ 3.2 billion in pre-depot boxes that will automatically be transferred to the blockchain when it was launched.
Pre-depicts will make Berachain the eighth largest blockchain by deposits when it was launched, exceeding other well-funded blockchains, including Avalanche, Su and Aptos.
Join the community to get our latest stories and updates
The launch will also launch a race among the DEFI protocols to secure as much indigenous blockchain governance token as possible.
What is Berachain?
Berachain is a blockchain based on Ethereum. Instead of the validation mechanism of Ethereum proof, Berachain uses one of his own inventions, called proof of liquidity, or PO.
Under Pol, DEFI users win the governance tokens of Berachain, or BGT, providing liquidity on the native blockchain applications or by performing a validator.
Users can convert BGT, which is not translated, in Bera, the blockchain negotiable gas token, to one to one. But conversion only works in one way.
Validators who treat transactions cannot maximize the rewards they get to do so without the users delegate them. In return, validators are forced to give part of the BGT they earn to users of DEFI applications.
It is a new system, and it was not tried by any other blockchain. Hope is that this will align the validators and the protocols defined while creating a sustainable means of securing the blockchain.
Fierce competition
Pol aligns the incentives of validators and DEFI applications. But this will also lead to fierce competition.
Berachain gives only a limited amount of BGT at any time. Determine which validators can convince users to lock their BGT with them, and in turn, which applications can convince the validators to direct the awards to their users, the applications will have finally succeeded.
The more a BGT control application, the more BGT it can gain and directly to its users, creating a steering wheel effect.
One of the main priorities among the applications will be to capture as many BGT token emissions as possible, said Mughal.
For IVX, it means being heard with the validators.
“We focused on creating extremely strong connections with the best validators in the past 12 months,” said Mughal.
Some applications, such as the infrared liquid implementation protocol, choose a different path.
“We direct our own validator infrastructure,” said an infrared spokesperson DL News.
This allows infrared to easily direct the rewards that its validators must give to those who use its application.
Infrared claims that its objective is to bring users of deffi to lock the liquidity, in bootstrap the initial initials of the protocol.
Liquid like infrared applications are very competitive. On Ethereum, Lido, the largest liquid implementation protocol, represents a huge 68% of the market, despite numerous attempts to reach its domination.
Bera fucking
The police system shares certain similarities with the decentralized exchange curve.
DEFI applications, wishing to obtain validators to give their users to give BGT, can choose to offer them additional tokens to do so. This type of agreement, known in DEFI as a bridge pot, is a well-established practice on the curve.
On curve, the applications ponted CRV notebooks to increase yields on certain liquidity pools. In simple terms, it allows applications to buy liquidity for their tokens, which makes them more attractive to users.
Likewise, Berachain applications can bribe validators to make their offers more attractive to users by increasing the yields they can win by using them.
It is likely that several Berachain applications compete for sudden validators.
Mughal said IVX planned to use his first income to bribe the validators to give him an advantage against other protocols.
However, these systems do not always work as expected.
Firmly, a decentralized exchange that used a similar bridge pot system, received severe criticisms when launching after buckets in its code and problems with its token reward system have moved users and suppliers to liquidity.
Tim Craig is DL News’ DEFI correspondent based in Edinburgh. Handle with advice Tim@dlnews.com.
Disclosure: The two co-founders of DL News were previously main contributors to the curve protocol.
