katana is where defi grows up | 0xMarcB on Binance Square

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katana is where defi grows up

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We're not here to see a fork of the latest defi app and slap a new logo on it. We want @katana to cause a reset. A realignment between users, apps, and chains to build actually useful things that users want. This include apps with amazing experiences and building a chain that allows for sustainable returns and liquidity through actual usage, not just token emissions. We do not care about TVL for TVL’s sake. We care about capital that's alive, moving, and building. That's productive TVL.

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One fun thing about @katana is that it is both simple and complex. It is simple: deeper liquidity and higher yields by funneling liquidity into core apps. It is complex: mechanisms to permissionlessly enshrine core apps bring you down so many rabbit holes with fun degen stuff that can be built around them.

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There is a real cost to idle TVL. Chains are securing idle assets but receiving no value from them. At best, the value they receive is the availability of those assets to users at any time they want them. But that benefit only exists in a world of a bad onboarding experience. Katana will have lower TVL, easier onboarding, and significantly more activity than other chains. Users win: They can bring their assets to the chain only when they need it. Apps win: Users can bring assets to the chain easily and use them to drive fees for apps. Chain wins: Incurs no security cost while incurring fees from users who are active.

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One thing @katana will show is that having less TVL but having more productive TVL makes for a better ecosystem. Apps make more money, users get more value, and the chain is a place for constant exchange of value rather than dead capital.

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It has become a custom for chains to launch and target the highest TVL possible. This is a mistake. Not all TVL is created equal: 1. Productive TVL (i.e., TVL actively used in an ecosystem) is much more valuable than passive TVL, which is a cost to the ecosystem with no benefit. 2. Stables are more valuable than BTC given the greater borrowing and trading in those assets. From day 0 of @katana, we’ve decided to do it the hard way: bring in valuable, productive TVL. Don’t go for inflated TVL that has negative value. This means TVL on katana will be lower than other ecosystems. But the value the TVL drives will be much higher.

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