Safeguard Assets Against Smart Contract Risks – Amulet appears on Deus Ex DAO


We were invited to appear on Deus Ex DAO’s innovative podcast series to introduce Amulet and our solution to a new but relevant audience.

As Amulet continues to grow in 2023, we sat down with them to discuss:

  • Amulet Protocol and our cover solution
  • Solana, the FTX collapse and the future
  • TVL and how Amulet can help
  • What is a hack and how does Amulet decipher this?
  • EVM chains in general and cover on them
  • Stablecoin Depegs – UST and Amulets thoughts
  • The future for Amulet – what’s to come

Feel free to listen on YouTube on their channel here: https://www.youtube.com/watch?v=jp6vXe4AZ4o

We’ve captured the audio and transcript for your reference


Audio:


Transcript:

Intro  

Welcome to the Deus Ex DAO podcast

Deus Ex DAO  

Hey everybody, this is a preacher and today on another Deus Ex DAO podcast I have Rupert’s who is the project lead and/or CEO at Amulet with me. I met Rupert at Solana Breakpoint in Lisbon last year 2022 And I thought I wanted to hear his thoughts about Solana ecosystem, but also on Amulet itself. So hey, Rupert’s could you give a small introduction of yourself and what you do in crypto?

Intro  

Sure thing dude. Thank you. Well, first off, thanks very much for having me and the protocol on the podcast. We’re big fans, and we’re looking forward to hearing this come out. I probably won’t listen to it. But the certainly the rest of the army nation will see like you said the project lead over it. Amulet’s DeFi cover protocol. Essentially, we’re there to protect assets with inside the web three ecosystem starting with Solana but we are most changed solution. So we are building out on alternative chains in the in the future. And we protect in a number of different ways. Right now we’re looking at smart contract risk, which is our main and only product that we have out there at the moment got tonnes of other ones in the pipeline, which I know we’ll talk about a little bit later. And essentially, there are a number of different risks with inside. Crypto in general, principally revolves around stealing, fraud, loss, price movements, all sorts of different areas. And we look to cover everything in the future in a bigger way as we can. And we do it with the innovative technology that we’ve we’ve built in house.

Deus Ex DAO  

That’s that’s a really good summary. And we’ll dig deeper later in this this buff guys. But before we do, I would love to hear your opinion on the state of Solana after the FTX collapse. Solana lost an important backer, of course, there are still a lot of coins being held by FTX, or, you know, the United States. But it’s it left an impact not only on price, but also on the developers, although I’ve seen at breakpoint that the developer community in salon is a very strong community. What’s the sentiment in that community? And what’s your perspective on the state of the salon ecosystem?

Intro  

It’s really interesting, actually. So let me roll back a little bit and say some of the reasons why we decided to build out on Solana first rather than anywhere else. One was because it was proof of stake already. And the merge hadn’t happened at that stage. So we were looking for somewhere where it was proof of steak and validators and nodes that we could generate a yield off because that’s kind of core to our our system, which we’ll touch on later. But two is the it was incredibly fast. And it still is an incredibly fast network. And it still does exactly what Sonos is, is built to do it it transact very quickly at a very very low price. And you know, when Tony and Raj built the product, they they built it for the financial world so with defy it made total sense. Now we’ve seems to be picked up a lot with more with with NFT’s especially in the big NFT. Boom that happened in 20 to 21 integration, but it is still a from a technical standpoint, it’s exactly the same, right? It’s the the flaws that they that everybody talks about, they’ve been working on, and they are far less common. Now, the transactional rate is there, the transactions that happen on it every single day are much higher than all the other chains. In fact, I think, you know, it’s something like 5x, higher at the moment than the other ecosystem. So all of that, that is all still there. Now, the other thing that we always have to consider with inside crypto is price action and really Fudd right, so since they wanted, we came out the gate and said, Hey, we’re building out on Solana, we were either called fanboys we were called, you know, just following the herd. We were, you know, cash grabbers, you know, every kind of word you could think of was was was was fired at us. And that and that, that Fudd is still there, around, Solana never went away. And it’s just amplified. And it’s more of a bit of a, I told you, so as opposed to a I think really looking at what’s happening, which is a either the stats of of network usage and be looking at the amount of development that’s happening. So if you look at the amount of GitHub repos that are being deployed, and drawn and forked, and you know, there is a huge amount of action that’s happening in Rust, it’s happening on Solana. And that sort of stuff is often hidden by what is, you know, down to a price. Now, price is important. Don’t get me wrong, though, there comes a point and I actually don’t have the answer to this. So just in case you were going to ask, where the price gets so low that you cannot make any money out of running a validator people go away from the network, it suddenly becomes ultimately centralised or a few computers or too few validators nodes around the world. And then, you know, the blockchain falls over. That is a real risk that can happen. But we are a very, very long way away. And what I’ve been so surprised about through this period, is that yes, price dropped off a cliff Java clipper, everybody. Yes. TVL dropped Much, much heavier and higher in this Alana ecosystem defi ecosystem than, than the than the rest. But the price is pretty well held it held it around the 14 Buck. Mark 1314. That mark? Yeah, when dropped down a little bit to nine. And then it came right back up again. And over the weekend, where there was a 14%, unlock of all, Solana tokens, when you would expect the price to be dumped at that point. It didn’t. It went back up. And now it’s holding at 16. So it is a from a developer standpoint, the techs there the community is there, the the you know, everybody’s still still building. And that’s what I find. exciting about it. I find it curious about the price, but I’m not a trader. So I don’t I can’t really, you know, kind of comment too much about that. But there’s one core thing that’s different about Solana and ecosystem about Solana that I know about versus eath Aetherium and the other ecosystems out there, and that is how organised we are as a community. So what you probably know obvious is that the Solana de fie community have our own telegram channels we talk consistently if I want to talk to radium, it’s just one message away is literally there right now I can always talk to him anytime. And same with mango same with Orca, any of the major protocols with inside Solana that, you know, whilst that has a centralised element to it is incredibly useful for building businesses and incredibly useful for for sorting out problems very, very quickly. So when there is a problem with wallets, Phantom and software talk to each other like this, you know, there is not a you know, you’re trying to work out how to get hold of them. There’s trying to work out who docs people, undocks people are etc. It is just there. And that is one of the beauty of the way that the salon ecosystem has been constructed. Because the foundation, the labs, the venture side of things have all come from this very San Francisco, centralised attitude and they’re doing the big deals with Big partners like Facebook and Google and Twitter and Stripe and all the rest of them. Yeah, they are in that community. And they’ve structured themselves in that way. So our little defi community has also structured themselves in that way to also emulate and make things better and faster and work better together. The very long, long answer to the question, forgive me, but hopefully, it’s it struck a few chords.

Deus Ex DAO  

Yeah, but it makes absolute sense, as we know, in crypto network is important, whether it’s a digital network or a personal network, that’s where value comes from. So if that network is, is equally strong as before, and FTX, collabs are equally strong was since when you started building, the value is still there. The only problem I see is, as you said, like TVL has gone away. Do you have a solution for that, like to get TVL back, get users back that you’ve lost? Or maybe the users are still there, but they just got, you know, wrecked on their holdings, that that could also be the case.

Intro  

Yeah, and and wrecked is kind of subjective, because obviously, one cell still equals one sol, right. And so you know, wrecked is, you know, if we’re referring back to $1. Price, that’s, if you still got 1000 soul, you still got 1000 The, but it’s just worth a lot less. Now that that’s been across the board, everybody in the last year, I mean, that we had Luna and then we had FTX, it was a shitshow. Last year, there’s no two ways around it. My personal opinion on this is trust, we have to build trust in the network, we have to show that the developers and the builders are here to build on what is a very strong and a very capable network. And once we show that we’re building on it in a strong, capable way, we’ve got to put in various layers of security and various layers of safety. Now, again, I’m slightly biassed on this because I run cover protocol. And yes, we are the only ones in operating on Solana and yes, we want to try and capture as much of that industry is as possible. But beyond my own bias, I do think it’s incredibly important to fill the gaps and fill the holes. You know, a few years ago, before smart contracts existed, nobody realised that there is a risk of hacking smart contracts have really realised cyber risk, right? cyber risk has been a an insurance product for a very long time. And, you know, hackers can add, you know, the health care services in countries and ransom them. And that was very commonplace and insurance company came up with these elaborate insurance products in order to cover those sorts of risks. smart contract risk is something that’s very new. There are multiple other types of risks out there. I mean, me personally, I’ve had all of my NFT stolen through fraud, I was one of those guys that fell for a very well put together website that was targeted very much at me, because I was part of two very good groups that would do to make a collaboration together. I expected a collaboration on the day that it was supposed to happen. I went to the wrong website, and boom, I lost everything. And so there are these holes that didn’t exist a few years ago. So we got to plug those holes, we got to plug these risks. And once we plug those holes, that’s where institutional cash starts taking a bigger, some bigger steps. And when institutional cash comes in, that’s when retail follows. And so it’s a it’s not an easy path, but it’s a step by step process of build safety, institutional retail, that’s my kind of way through this in order to grow TVL back up and as great TVL grows, of course, that also provides a little bit more trust to people. It shouldn’t, frankly, it is totally broken in the way that we view approach go, oh, it’s got loads of TVL must be safe. But you know, it’s very easy to go onto a web page and put $10 million TVL and not actually check it on the blockchain. Yeah, and people have been known to do that. So look, the point is, just because there’s a lot of money in a project doesn’t mean it’s necessarily safe. But if we go the right process of building these layers of safety, layers of protection into the network, then we can attract that capital in which will then promote more.

Deus Ex DAO  

Yes and I think this is a good approach to restoring the trust of the users and it also brings us I think to amulet and what you’re doing at amulet restoring TVL is a problem in Defi. And right now, the first product you put out with Amulet is providing a protection for the risk of decentralisation, which is often in the smart contract. Yeah. Could you tell how a user could protect themselves with it? And would Amulet for those risks?

Rupert – Amulet  

Yeah, it’s very simple. And we’re also to be clear, we’re not the only ones doing smart contract risk are those other amazing companies such as insurance, who are in the same arena, this was already kind of kicked off by the grandfather’s of our space, albeit they’re only about four years old themselves. Next is mutual, who started off the kind of insurance revolution with inside, defy and we’ve got a huge opportunity to grow. But let’s look at Defi. And let’s look at smart contract risk to start with. smart contract risk is, essentially as it sounds, it’s the risk that is based around the smart contract. And it’s the smart contract is where you lock your capital into. So when you go onto our bay, we go into compound or, or in our case, you go into Orca or Raydium, or whatever, and you stake capital in those protocols, you’re putting it into one of their smart contracts that they’ve developed. Those smart contracts have been written by developers that have been audited by firms, and they should be perfectly safe. However, there are unknown unknowns. And what we don’t know is how hackers will potentially attack these smart contracts in the future, and drain them up all the capital that is held within them. As soon as it’s outside your wallet, it’s in somebody else’s. And that is a risk. These unknown unknowns are really what we cover against, that’s what you’re looking to, to get with with smart contract risk. And you are looking to protect against the the opportunity of somebody coming in and hacking one of these smart contracts or draining everything that’s within inside it. Now the way in which you carry yourself with at least with amulet, at least, is you come to the protocol, you choose the protocol that you want to cover again. So let’s say for example, you say you click on Orca, you put in how much you want to cover, let’s say $10,000, you put in the duration that you want to cover it for So from today for the next three months. And then it will give you a premium fee, you pay that premium fee and you are covered. That is all that you need to do it is entirely noncustodial. It’s in a it’s all written into the smart contracts, and you are covered for that period of time. Now, if there is a hack on Orca, and it is a proven smart contracts, hack, and there’s lots of different types of hacks out there. And so it’s very key to read our documentation and see what we cover, because can’t cover the entire world. But we do try and cover as much as we can. And you you go on to our platform again, you submit your claim, which really is about submitting Yes, I had this amount staked in okay, you can see my transaction detail here that it was staked. I had my contracts you know I did because we’re talking from the same wallet. Can I can I get a payout? Over the course of I think our typical payout times a smart contract receives around two weeks, we process the claim and then we pay out the claim in the currency as described on the page, go straight to the wallet and away you go. So one of the things that we’re doing here with within defi insurance is speeding up the whole process. Typical insurance company would take months for them to investigate all of us. We don’t we take days, and where possible. We’re instant. And we can talk more about those in the future.

Deus Ex DAO  

Awesome. That’s a big improvement by at least gutting away some middleman but I feel there might still be some human factor in here in that somebody has to judge like, was this smart, smart contract platform really being hacked and under what conditions is this payout? Could you tell us about that process? How the judging of the hack goes or the validity of the claim?

Rupert – Amulet  

Yeah, 100% And you’re right, this is That is a huge area. And it’s something that actually in defi insurance we get quite a lot of flack for because they’re saying, Oh, you’re just a traditional insurance company insurance companies are built to not pay out. And that’s not the case. Yeah, we’re very happy. We want to keep both sides of the platform happy the people who stake into underwrites the policies and the people who get get paid out. And we’ve got a unique system of how we’re designed that helps that which I’ll touch on next. But first off, let’s look at the claims process. Let’s talk about how that gets assessed. So exploit happens, that exploit is immediately seen by our team because we’re monitoring all of our protocols anyway. So within six hours just because of timezone differences, etc, we commit to saying that we’re going to see an exploit happen. And we start to investigate what happens. At that point, the base level of funds get locked on our protocol. So let’s say we have exposure of $10,000 worth of policies on orca that are live at the time of the hat, we locked in $1,000 of our treasury that cannot be removed. So that that until that the discovery is done. That is that that’s that that capital is that in order to make the payout. We start our discovery phase, typically, that takes around three days, it’s us talking to the protocol, looking at the chain, and essentially auditing what happened in this potential hack. And, first of all, we assess it, and we make our comment and recommendation to our community. So we either agree that it’s a smart contract, risk exploit and should be paid out, or we disagree with that one or zero, right. Our community then starts to assess it. And they either agree or disagree with that. And then if there is a imbalance of decision, we bring in a third party Dow to make the final decision for us. And that is the kind of core to this is that the third party that we bring in is impartial to both sides, they don’t have any exposure to either product. And they’re built in a way to act as judge and jury on the evidence provided by both sides. If they agreed it pays out, it should be paid out if they disagreed it won’t. And that’s the final decision in the poker. So we try and make it as impartial as possible. But right now, we are required that there’s a very new industry, it’s very nascent, you need human eyes to look at it. And inevitably, those human eyes do have some levels of of bias in that. But this is the least bias we can apply to a system. Does that make sense?

Deus Ex DAO  

It does make sense. And I always say about bias. Well, it’s just a preference that’s in the judgement. So even if you put it in code, there is a bias in the code. And that’s made by humans. So whether you have a group of humans judging it, or you write it up in a code, there is always some bias. It’s like some people say like, if you write it up, if it’s by machines, there isn’t any bias. Now, that’s not true. So it makes sense, and especially about very complex problems, and especially about parameters you haven’t looked into yet, because I think that’s one of the cases with these hacks is, if you have a hack, it’s probably on an attack factor you haven’t really thought about yet, or like the project hasn’t thought about them. So it’s also hard to secure or you as amulet build metrics for so you need to judge like, What metric is this or what really happened? And, you know, of course, your rights, smart contracts you you might be pull data from the blockchain. That’s undisputable. But how to interpret interpret that data. I think that’s a human factor in, you know, very hard to automate in these cases. So make sense, and especially that you try to in a way decentralise that with a community that’s responsible for judging this too. And, you know, if you disagree as parties, you can bring in another community. How do you incentivize the community to get on board with this, this process and start judging the hack themselves?

Intro  

That’s a very good question, actually. So we’ve got about 80,000 users in our community and it’s been growing massively. And they all part of our, our ammunition, and they help us do a number of different things, but essentially, to Do actions, if you do an action with inside the community, you are rewarded through NFT three points. And in the future, you will be rewarded through tokens as well, although we haven’t launched our AMT token just yet, it is coming at the right time. So every action is is rewarded throughout the community, we have a hugely dedicated community and it’s gonna shout out to them nationwide here because you’re so important to everything that we do at the businesses. In fact, they are the business. So every action is is incentivized with inside the community. That is not to say that the community are biassed, then in order to be able to say, Oh, we must pay out or we must not pay out on this, we try and keep that element balanced as much as possible. And at the end of the day, if if I mean it doesn’t exist, because we’re seen to be biassed and we never power on, on claims and the and there is no trust that we operate properly as a cover provider, then we are in a you know there is no future and there is no rewards for them. So it is in their best interest to act as as impartial as possible. In a day, we are in a cover protocol. It’s not exactly like we’re the most exciting thing we’ve got a certain type of, of community members that that like to follow us. So yeah, that’s how we do community. Before we go too much further, I wanted to touch on one critical thing makes it amulet very, very different to all of the other defy cover providers out there. And that is really core to our structure. And if you remember right at the top, we talked about Solana and proof of stake and how there was Ultra necessary to what we build. And this enables us to have less of a concern about doing payouts in the way that we’re structured. So the key thing to remember about with amulet is that when you stake into the protocol, you’re risking your yield, and not your principal, you stake $100. It’s everything that you make on top of the $100 that is risked, and not the $100 itself. Now, the reason why that’s really important is because the majority of the elements are all the other ones. It’s everything, right, it’s $100 plus your yield, you’re risking that against the potential of a claim on the other side. Now the way that we have designed the protocols, you stake into a lot of proof of stake validator that generates a yield and it’s the yield from that we can use to pay out our claims. And so that is really very different to how everything else operates. And it means that we as a protocol don’t have the concern is much to say, hey, we can pay this out, because we’re not taking all of our stake as cash. Yeah, they know that they’re majority protected. And it is that that top layer yield. And the way in which our metrics are designed, are to is for us to be able to have a certain amount of payouts expected, you know, there there is, you know, if we are your advertising, generating a 14 20% yield on our staking pool, which is very achievable as an example. We are not advertising 14 20% to the pre payout where we are we’ve we’ve expected actually our yields gonna be much higher than this. And the payouts are going to come out from that, that that on top of that. So we’ve taken as many steps as we can to be able to pay out on these these claims without having bias to one side or the other from our point of view, and educate our community in the same way.

Deus Ex DAO  

I think that’s one of the features Amulet that made me interested and actually asked you on this podcast, because I love the idea that you are securing the blockchain itself by letting the user stake their soul. But also by doing that, they provide security for the ecosystem on top of that, so there isn’t any risk of yield. That’s from the ecosystem itself. You know, you could use one smart contract platform to security otter, but you know, then you just double down on risk. But here you use that base layer as absolute security and then provide security to the projects on top of that, so I think that’s a 30 win win for the ecosystem. And and one question that comes to mind and even though you’re focused on rust ecosystems, is that with Etherium, moving into the Shanghai update, would something like this be possible to on Etherium? Or other EVM chains?

Rupert – Amulet  

In the short answer is yes. So, yeah, we will be on EVM chains in the future. I don’t know what that future and timeline looks like. But we will definitely be on on EVM chains, that the reason why we are a multi chain approach, we just don’t believe in a single chain strategy, they, we kind of look at chains like cloud service providers, yeah, AWS biggest cloud service provider out there, then about 33% of the market, but you still got Google Cloud, you still got most of the joy, you still got Rackspace, you still got X, Y, and Z. You know, there are hundreds of cloud service providers out there. But there are some clear winners. And so we obviously want to be on the clear winners. And you know, we do believe that Solana and the way it’s structured is is a potential clear winner. Obviously, when they were building AWS, they didn’t have the same crypto markets to contend with. But it’s a slightly different world for us. And so we were in the distinct belief that there, you know, this will be a multi chain future, but products will have to be slightly different, depending on how those chains are built. You know, I don’t know enough about the Shanghai update to be able to say whether or not it’s gonna work in the identical fashion. But what I do know about our own roadmap and our own capabilities, and what we’re going to grow into, is the we will be multi chain, we will be probably the largest insurance or cover provider in the the industry. And that’s, that’s entirely what we’re here to do, we’re here to take over that corner of the market and start protecting it from this point. It is frankly, it is it is great that there is a bear market, because there is less of an area to cover for us and allows us to grow with it, as opposed to trying to get away in at the peak.

Deus Ex DAO  

Yeah, and I think that’s, you know, a good way to start develop your product on a chain that’s that you you trust the know, well get a community around you. And finally, when you have that fit, start going to another chain, otherwise you’ll just be spread out in your development and especially business development because I think that business development is super important. For a protocol like like amulet,

Rupert – Amulet  

you’re entirely correct. Yeah, the actually, just to touch on that when they you know, the way I’ve been looking at potentially structuring this is you have to have a separate business development team for each chain that you operate on. Because each chain has its own nuances, they have their own ecosystem and yes, there are crossovers but they you really do need to be embedded in the avalanche system or in the our system or in the system or whatever it is, you need to be embedded in those communities in order to to gain the credibility and the trust from the protocols.

Deus Ex DAO  

Yeah, good point. I think I would like to see how you could further expand your your features or product suite on Solana, we’ve talked about the smart contracts, direct risk, but there are many risks in the crypto ecosystem and one of them is like the deep back risks of stable coins. It’s not a feature that’s life yet but I know you’re developing that could you you know, expand a little bit on what the risks there are with a stable coin backing and how users could potentially protect themselves from that.

Rupert – Amulet  

Absolutely like in my opinion, stable coin deeper cover is an absolute necessity in the industry. It is the biggest risk that we have in the industry its biggest risk to me personally you know the I get paid in USD or USDT you know, depending on where we’re working with. And the and so my income and my the livelihood of my house and hold and my children and all the rest of it is is tied back to a token that is supposed to be backed by the US dollar and is a big worry. To me that is that deep eggs then it’s not just our industry that goes, it is also my head much close to home to me. So it’s an absolute necessity for stable coins to be to be insured, and actually probably ensure that I base level. So how are we approaching it? Well, first off, we are working on a product at the moment that we hope to, to get out within the next couple of quarters. I’m got a, an exact timeline on that. And it’s an innovative approach to how cover products are done right now. And it puts a lot of the control of that product into the hands of the people that created the the actual stable coins themselves. So for example, let’s, let’s say I created a stable coin root coin, and it’s one to $1. But, you know, the actual the dollars underneath it are backed by a whole basket of different things. This is similar to dye right. And I wanted to get more usage of my token, how would I incentivize users to show that, okay, if it was to do deepfake, you’ve got I got your back, well, I would be able to create this this product that me that we’re working on, and essentially back my own product with my own insurance product. And, and secure a different currency into this smart contract. That then users can can buy policies against the know that they are actually getting a product, if this particular stable coin went down. This product is there to protect and I’m payout an instant payout my my add if that, that that stable coin does the peg for the parameters that we’ve put into the to the peg and typically that looks like something like if it the pegs continuously over or rolling they average for 10 days, then then pay it out. So it would happen. And that’s that’s a pretty common policy. We’ve seen that happen with unslashed we saw that with insurace, when the UST depegged, both of their policies were built on very similar principles. And yeah, that’s that’s what we want to do. But, but rather than utilising the structure that we built already, that works very well for smart contract risk on Solana, we want to trial, this new way of doing it and see what the appetite is, there are similar products out there on the market. But the way in which we’re approaching it is again, unique. It should be super user friendly, and and hopefully will will solve a big problem around that. Now that’s just the product itself, the product, one thing, how do we get this out there into the market, that’s that’s the biggest thing. And that’s where we want to be seeing this built into wallets, we want to be seeing this built into exchanges so that it’s provided at source. As soon as you convert into that stable coin is covered. And that’s the the core of this, it’s much, much broader, much further beyond any type of insurance product that we’ve we’ve seen so far. But we’re going to start with small apples, we’re going to start you know, where we, where we know, we can gain traction. And that’s the product that I kind of alluded to that described Okay, I can’t give too much away. But yeah, it’s coming.

Deus Ex DAO  

It’s already a good insight into what you’re doing because it is different from what I’ve seen from these protocols. Like some of them have a specific strike price and then you put your you know, your ETH or whatever other token in the contract and when it hits the strike price you lose to the other side so it’s more of an options or you know, it feels like really dejenne product where he just bets on the stable coin not the backing or the backing. And there is just you know, some statistics from the last few months on how much it can be back. So so that’s that’s even something that that is different from from that protocol. They judge like how much it should be back and once a coin the backs like the strike gets even wider, and it becomes a is a another risk for the platform itself, because then you expose yourself a lot to Oracle risk to like an exploit, just, you know, to exploit a single data point to push that strike price over and basically take the whole pool. So it’s it’s weird that if you are building a security platform or actually an insurance platform, that you’re you yourself are a very big risk and having a rolling window, having maybe a community or some governance on top of that to judge that removes that risk. So that’s, that’s what I’m getting here from what you’re telling me,

Rupert – Amulet  

it’s, it’s kind of an evolution away from from I think I know the political, you’re referring back to that. And it’s, I actually, I really like what they’ve done in particular. In fact, we think it’s y2k. Is that what are you referring to? Yeah, yeah, that’s what I’m referring

Deus Ex DAO  

There are some copycats. So you know, we all take the same group.

Rupert – Amulet  

I really, you know, I like what they’ve done. I’m not a fan of the UX in the slightest. But the In short, I do appreciate, you know, the approach they’ve taken to, but that, to me is not an insurance product, like that is a betting product. And there is elements to it that operates somewhat like an insurance product. There’s huge amounts of risk with inside stablecoin depeg. That’s huge. And I don’t think it’s the right place for a cover or an insurance protocol to be providing a straight by this get cover right now. I don’t, I think those days are gone. I think they were opportunistic. And I think they were also hopeful that that things like Luna wouldn’t happen. But actually, it’s happened to Luna, it’s happened to a whole bunch of other things. You know, I always in the days when it did happen to Tether like the the I saw tether, the the peg, and the whole market panic. And, you know, thankfully, it repaid. But it repaid based on news articles and Twitter and just saying, Oh, no, here’s all the documentation that you need to share, show that it’s, it’s at your back to one one to one. But it it can be set such a small thing that can send the market into panic. That, you know, I was of the opinion that Luna couldn’t happen, that you know, the UST can happen, because Luna was so strong, and it was so over collateralized. But I was entirely wrong. Because they were able to shock the hell out of it create the market panic as intended and break ust you know that the people that did that made a fortune. I would hope if they were good people, they put some of that money back into the ecosystem of people got damaged and hurt by that many, many people got hurt and lost all of their their savings. I also hopeful that having a protocol that says a 20% yield for your savings doesn’t happen again. But anchor I believe is still up. And it’s still reporting as such, I don’t think it’s a perfect thing. But anyway, that’s that’s that’s that is crypto in that respect, we will get better, it will end up being regulated and it will be cleaner. Unfortunately, the yields will come down to because with regulation comes tighter controls which cost a lot more, which means there’s less yield. And this is exactly what happened to the banking industry, right? Yeah, we will, we will see a lot of that happening. And there will still be the the underlying layer of people who are doing it still doing it illegally without the regulation, but you’ll have all the same risks. So you can’t have one without the other. Unfortunately, it would be nice to have none of the risks and all of the yield and I think there are efficiencies to be made with inside the overall system. So I’ve gone off so slightly down a bit of a tangent here, but you can see what I’m saying like there has to be trade offs in order to get to the point I think we want ourselves to get to which is control of our own capital in a safe environment where it’s not entirely all on me to you know Do your own research so to speak, there’s only so much research you can do. You don’t know what the thoughts of the people behind this are. And, you know, and it, as we’ve seen time and time again, there are so many different ways to exploit people of their cash. And people will always go for the easiest option.

Deus Ex DAO  

It’s always a delicate balance between risk and reward, I think one of my favourite sayings about the market is you get paid for the risks, others don’t want to take, but it also works the other way. So you take extra risk, and you can lose more. And I think for real adoption, bigger parties to come in, they have less risk at risk appetite, then, you know, your average degen, which is much higher, so they are fine with lower yields, as long as it’s, you know, you know, doesn’t have let does have less risk. There. It’s more predictable, which is also a factor like if it’s unpredictable, there’s probably more risk. So it’s needed for that adaption. And you know, there will still be coins that give those big yields. You always have to question, what’s the real yields? Who’s paying for that yield? And that’s what we’ve seen in the last year is that most of the deal is actually not yield. It’s, you know, either otter users paying for it, or early users just receiving it because they’re early. So it’s logical that yield will go come down. Yeah. And then for other, like risks we have, I think we’ve come to the part where you have to open your book, like what are all the other features that are coming? What’s coming like, we, you know, we want to know, like, there are so many risks, you can do shorts, but feel free to talk about, well running we are developing.

Intro  

Now I will well, thanks. And so the the two biggest requested products by our community are stable coin, de peg and NFT cover. And those are the two that we’re working on hard to make sure that we cover off along with making our multi chain solution operational throughout 2023. So there are a few things that we’re working on, we’ve only got a limited size team, and there’s only so much we can do. But if at risk stablecoin, the pack, those are the two that are our primary focus. To us. We’re also looking at a wallet cover product, we’ve got some very interesting conversations going on with a few partners on that at the moment. And we’d love to be able to bring that to market in the very near future. And that is essentially to protect against what happened to slope. If you remember, further back in this year, the slope attack drained 3 million wallets or something like that I forget the number, but it was a lot. And and so that can’t happen. And we want to provide cover to everybody for that. That is not dissimilar to custodian risk, which is again, another product that we’ve been been working on for the right, custodians out there. And beyond that, and what I see in the future and where this is really something that was very key to the Solana choice, actually about transactional speed, game fire risk. So gain fi I still believe is our biggest opportunity over the next 567 years. The you know, the reason why I look at that as I look at myself, and I look at my kids so myself, if I could have sat as a teenager playing GTA all day and got a decent wage, I probably never would have got a job. You know, the there was no reason for me to go out and do that. Now. Of course, industry has moved on so much more since then. We’ve got leagues we’ve got competitions, but streaming, all of those things didn’t exist for me. They’re also not in my kind of wheelhouse. I’m an entrepreneur, right. So if I could have set up a shop inside GTA and I could have sold products and I could have converted those the yield from that money from that back to real money. I probably would have done that. But there was a you know, whilst people are kind of doing that nowadays, it’s still a bit obfuscated. It’s not a priority of the of the system and I think, dare I say Metaverse and game fi kind of colliding and creating these worlds where people do want to spend a huge amount more time. There are going to be economic sight to that, and that’s where gain Fi is, the big explosion is still yet to happen. And we’re not talking about axing and, and that kind of stuff over there that is just, you know, people utilising a game to, you know, generate yield. This is a game finance economy. This is a whole new economic system that has been built, you’ve got Trad phi d phi game phi. And that is the real excitement to me, in order for us to be able to be involved in that, that ecosystem that we have to operate at the speed of which those systems operate. So when you’re getting buying weapons, when you’re buying spacecraft, whatever it is, and it can be stolen in the beginning, they can be broken and they can be hit. And miss these things are costly, real money, and there is real loss. That is where we come in. So you spent five bucks on on something you won’t cover that five bucks, you tick the box saying I’ve got cover, the pay the premium inside the game, that’s game five is really where we need to be in the future. But we’re not there just yet. The attraction, isn’t there in that that industry demand isn’t there in that industry, there’s still a huge amount of FUD from gaming world back towards crypto world. And there’s a lot of hurdles to overcome. So I’m gonna get that. That’s, that’s that’s the big, big next thing.

Deus Ex DAO  

Yeah, so it’s further down the roadmap, but surely something you could take a look at. And for example, nfts are already there. So it might be a smaller step, working from an NFT Cover products to GamiFy. Yeah. How would such NFT cover product look like?

Rupert – Amulet  

It’s a very good question. So there’s a number of ways so there’s a number of issues around him. And at ease in general, I mentioned that the topic of podcasts is the our I was defrauded of all of my NF T’s. And that’s a really common one, right? Where somebody gains access to, you know, creating our fragment page or whatever it is, and, and steals all your, your NFT’s inside your wallet, because you you’ve the typical ways you have improved them to do so to go into your wallet, do the transaction your prove them to go in? Because you were so desperate to get this this product or entity job or whatever it is. That’s exactly what happened to me. And what the product we want to do is to try and stop that. So how do you try and stop it, it’s probably and it’s not fully developed out yet. And it is a little bit late for that. And it probably looks like a way of adding multisig to your chosen wallet, or adding a third party verification service to say look, just take a beat, let’s let’s just have a look at what you’re trying to do over here. And let us verify that this person is real and not the, the, you’re not trying to steal things from me. So look, we’re looking at higher value NFT’s to start with, because there’s less transactions around that. And they are very, very valuable. And then we want to build out a product that actually does it all in real time. And it can be done very much quicker. So essentially, amulet is the verifier for the purchase for the seller to verify that the purchaser or the person you’re interacting with is real.

Deus Ex DAO  

Yeah, that sounds logical, because a lot of these hacks are mostly socially engineering hacks. So it’s presenting an interface trying to hide some transaction data or the wallet or transacting to it going to show our own podcast, we had a interview with pocket universe who is trying to make transactions more readable for users. So it’s an extension where you can check what the transaction is so so those ideas, making transactions readable, verifying whether you’re transacting with a real person or not a blacklisted wallet, features like that are needed to make basically, not only the UX for NFT transactions, but UX for crypto. So yeah,

Intro  

I mean, I hate the fact how yes, we’ve got block explorers, which is great and I love you know, going down a rabbit hole of like, oh, where’s this transaction gone and did that. But you can get lost extremely quickly you can. And it’s still extremely confusing because you’ve got umpteen different. Word has just escaped me. Numeric numbers of like, well ashes? Well, there we go thank you, you got loads of different hashes, it’s not just about the hash of the where the wallets gone from the transaction has gone, where and T. It’s also the transaction itself. It’s also all of the information with inside that, that everything’s hashed. And so bloody confusing to look at this stuff and being able to track it. And so I think that’s a hugely important thing, I think, what we’re doing to make that a bit easier. And one of the things we haven’t released is coming up. next quarter is our dashboard, right? So you can see how we’re doing as a protocol. And actually, all the transactions are on chain, because we look at all of our own transactions, and all of the smart contracts that we’ve sold, to create our metrics from which we provide that back to the community. But one of the projects is doing it that extremely well, right now if you look at insurer ace, look at the data page on their their app, you can see each individual insurance product. So you can see on which network it is you can see how much capital they got backing all of that. And these are all key things like taking a step back for the moment and trade fi world. If we talk about trying to buy insurance, you go you buy insurance policy, and you have to trust that they have got the money to pay out when you when the worst happens. And people have found time and time again, that actually doesn’t happen. So Katrina is a great example of this. tonnes of insurance companies went bust because they didn’t have the money to to pay out and they were on the hook to these these customers. And he got screwed. In the end, it was people who lost their houses that that found out they actually weren’t insured. That is the people who really lost out in those scenarios. So we have to be better than that. So step one, we can only sell the insurance that we have cover for how do we demonstrate we show that we’re doing that it’s all locked on the blockchain? Well, yes, it’s all locked on the blockchain. But if you can’t see it, you know, how, if you’re not an expert in chain, like, how are you going to do this? So we’ve got to create a layer on top of that, to make it viewable make it easy to digest make it easy to to take in to say, Okay, I got $100,000 policy with this company, they have $200,000 locked in their smart contract, I know I’m safe for the duration of my policy, it is there. And that is so important. So so important. So looking at forgive me, I can’t remember the name of the firm you mentioned on the previous podcast. But coming them doing that for the rest of the blockchain and making the transactions easy to understand is, is an incredibly valuable tool.

Deus Ex DAO  

Yeah, this is also one of my personal interests, like we have a huge database and a public database called blockchain. And it has a lot of like raw data that’s either not really easily readable or a well aggregated. Also, the interpretation of that data is is not always easy, and people can disagree on, you know, what’s what. So I think we need abstractions, like data abstractions on top of that, with good, where we can derive these insights easily from, you know, we can create dashboards or we can create other tools to you know, let the non programmer or the non data analyst Look at this. And we’re getting better at that, of course, you know, we have platforms like June or Flipside. But still there, there needs to be some code that’s being written. And so I think that’s definitely something to watch for the next few years. And I think it’s also something protocols, as you are doing right now should do like create these insights about what they’re actually doing on chain and where funds are going and make it easily readable and insightful for their community or external validators of the platform. I think, you know, that was what I wanted to ask you, but is there maybe some final feature you want to mention about amulet? or do you have like a general message for the audience? The ammunition, or the Solana community that you want to share?

Rupert – Amulet  

So I’m gonna go with the general message, point of view, which is, don’t be afraid of Solana. Solana is a internal network is built. It’s got an incredible network of builders currently operating on it. And we are building for the, for the future. Yeah, let’s take taking price out of it for the moment. Yeah, it regardless, I think, yeah, I think it’s an incredible buy. Personally, that’s not financial advice. It’s my personal opinion on to me. Because I do think it has legs in the future. Look at the stuff that’s being built, look at the developers that are on the chain and look at how they’re put together, look at how those businesses are operating, and the sort of connections that they have. It is designed to be a very financially centric financial first product, it will probably end up being a fairly boring ecosystem. But it is where the big companies of tomorrow are being built. And so if you want to be part of that evolution, you’ve got to be in part of the Solana ecosystem. And that’s not just one big shell that obviously there are others out there. There’s plenty of other stuff to operate on. Just use your noggin look at look at what’s happening. Look at how they’re that they’re developing our we’re developing. And it becomes fairly pretty obvious in my my tiny opinion. For what it’s worth, feel free to, to message me on Twitter on how much you disapprove of my Yeah, my message but thank you very much to the nation. Thank you very much to the huge support the salon ecosystem, and come and support amulet, stake in Amulet and be part of our evolution too.

awesome, and you mentioned that we can find you on Twitter. What’s your DAC on Twitter?

Rupert – Amulet  

I’m MetaBear Twitter and being extremely difficult about that we I use sort of A’s I use fours so a’s 

Deus Ex DAO  

We will drop a link in the description if you end up on a Twitter page with a nice word arts metal bear on top. That’s the right one. And also physics. Org Yeah, and make make make make sure to also check Amulet of org or to documentation if you want to read more about the protocol. Thank you, Rupert for for coming on to our podcast. It was a delightful conversation. So thanks for giving us some insights into Solana.

Intro  

Thank you very much. Pleasure to be here. And yeah, I look forward to coming on and giving you guys an update and and and turbulence and I know perhaps,

Deus Ex DAO  

great, we would love that. And for our listeners, make sure to like and subscribe to today’s podcast, so we can keep inviting all these great guests in the future. See you in our next podcast.

Intro  

Thanks for tuning in to the Deus Ex style podcast, a place where some of the most progressive and innovative builders thought leaders and traders in the crypto space come together to discuss all areas of the crypto industry. Whether you’re into d phi layer ones layer, twos, NFTS or anything in between, we’ve got you covered. And as a reminder, nothing said on this podcast should be construed as financial advice or as a solicitation to buy or sell any digital asset or security. The comments views and opinions expressed by the hosts or guests on the podcast are their own. As always, you’ll need to do your own research

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