Equilibrium AMA Recap (Part 2) Together With Alex Melikhov ( Equilibrium CEO)

The AMA Session had 3 Segments:

  • Introduction / Questions from The CryptoChainPh Team
  • Questions from Twitter
  • Live AMA

Segment 1: Introduction / Questions from The CryptoChainPh Team

Let's start the first segment.

Can you please introduce yourself again for our new members and give us an introduction about Equilibrium.

Alex Melikhov | Equilibrium (CEO):
Yeah, I guess some part of your community already knows me. For newcomers, I’m Alex, the CEO at Equilibrium, the leading cross-chain DeFi project. I’m an engineer in applied mathematics by training. Before I came into the blockchain space I was focusing on fintech — mostly payment systems and gateways. I have always been on the tech and architectural side of things.

I came to crypto when we co-founded Changelly in 2016, and it remains one of the largest instant crypto exchanges in the market today.

In 2018, my team kicked off the development of the EOS-based part of Equilibrium. We launched the first decentralized EOS-based stablecoin, called EOSDT, in April 2019. Today EOSDT is the most liquid decentralized stablecoin on EOS and the biggest DeFi project on EOS, with over $14 million of total value locked in our smart contracts, and over 1,000 user positions generated.

Now we are developing a logical extension of our project on Polkadot to obtain true cross-chain interoperability.
Equilibrium is a one-stop-shop for DeFi users — think of it as a place where you can use all the DeFi primitives from Ethereum, but in a cross-chain and risk-free manner.


Why did you choose Polkadot? What do you think is the advantage of Polkadot over Ethereum?

Alex Melikhov | Equilibrium (CEO):
Right now, over 90% of DeFi is locked on Ethereum, and while the market is currently booming, it is also experiencing problems due to the technical limitations of that protocol. An example is the experience of MakerDao this past spring, when it lost millions of dollars due to forced auctions in an adverse market, while real-time price feeds were failing due to system overload on Ethereum and lacking throughput, in combination with an unfortunate forced auction system for bad debt liquidation - leading to auctions that were practically free.

With this in mind, Polkadot’s technical innovations will offer great potential for the development of DeFi. Several DeFi projects are building on the Polkadot substrate and will occupy connected parachains.

Using Polkadot’s substrate technology to create our own blockchain, we will extend our DeFi product line to a one-stop cross-chain money market. It is designed to end market segmentation and will eventually deliver cross-chain loan instruments to the DeFi community.


Equilibrium is one of the projects participating in the OKEX Eco Carnival for the Parachain Slots Auction, how can we vote for Equilibrium?

Alex Melikhov | Equilibrium (Block me if I DM first):
Indeed, we would appreciate your support guys! To vote for Equilibrium, you need to have an OKEX account and complete the second step of their KYC.

1) Login to your OKEX account.
2) Then, visit https://www.okexcn.com/promotion/OG8KZG, tap the “register” button.
3) Scroll down to the “Vote for Polkadot Projects” section, choose Equilibrium and click “Vote”. That’s it!


Guysss. Those who have an OKEX account, please support Equilibrium! 😊😊😊

Alex Melikhov | Equilibrium (CEO):

We would appreciate it :)

You recently release the 2nd round of your Ambassador Program, how can our community members join?

Alex Melikhov | Equilibrium (CEO):
That’s true, the second round was launched on December 30. To take part, you need to do the following steps:

1) Fill out the general participation form here: https://forms.gle/zHTpW9A4peXueocy6
2) Then check small tasks here: https://gleam.io/axfr7/equilibrium-ambassador-campaign
3) Once those tasks are done, you will receive a unique code. Send your code to us using this form: https://forms.gle/iwmG9c1vGpMzEkZZ8

Feel free to read the full Ambassador Program description here: https://medium.com/equilibrium-eosdt/become-an-equilibrium-ambassador-v2-bde2ee9e4149

We invite everyone to participate in the program! 💙
By the way, we do various lotteries and giveaways for our ambassadors, so please join the dedicated chat to be up to date: https://t.me/eq_ambassadors


On Jan. 21, you will held your 2nd Community Call, and it will focus on Equilibrium Technical Development, can you give us a glimpse of what will happen on that event? Is it open for public?

Alex Melikhov | Equilibrium (CEO):
Our seсond community call will be foсused on our roadmap l and tрe upcoming Parachain Auction on Polkadot (PLO). Attendees will be able to find out how it works, our strategy, how they can participate to make us a parachain, and more. The event will start at 1:00 PM GMT on January 21.

What we will cover:
- Milestones in Equilibrium’s technical and business development roadmaps
- Mechanics of the Parachain Auction on Polkadot (PLO)
- Equilibrium’s two-phased PLO strategy
- Liquidity farming
- Earning opportunities

To get accуss, you need to sign up here: https://www.crowdcast.io/e/equilibrium-community-2

Also, all participants will be able to ask their questions via the form in advance or live during the call.

Drop your questions via the form in advance here: https://forms.gle/G9Hokfjf8CTvqSLm7

Looking forward to seeing you on our community call!


Segment 2: Questions From Twitter

Thank you for answering my questions. Let's move to the Twitter rounds.

Question #1 from @IPSAmitGoyal - There is an extraordinary risk that is expected in less than 0.1% of the cases and is protected by insurance. How is the procss to get the refund in those cases? Many insurance corporations get very tricky and refund is slow and incomplete.

Alex Melikhov | Equilibrium (CEO):
That 0.1% risk happens when bailsmen become insolvent themselves. In this case any shortfall is covered from the treasury which collects part of borrower fees to act as liquidity of last resort. In addition to that, we will most likely add extra liquidity similarly to what we did in EOS with our 14M USD stability fund.


Question #2 from @iseker1905 - Why did Equilibrium choose Quantstamp to audit key components of the Equilibrium system? What makes this company so suitable for this task? What exactly elements of the Equilibrium will be audited?

Alex Melikhov | Equilibrium (CEO):
Quantstamp has made a name for itself in the DeFi space by supporting numerous pioneering projects, e.g. Zillica, Binance, yearn.finance, Chainlink, ConsenSys on Ethereum 2.0. Notably, they helped to suggest reforms to MakerDAO after Black Thursday.

So considering that we highly value quality and consider security to be a priority, they were an obvious choice. Also, no other project on Polkadot has used them yet, and we feel that their audit of us will add a lot of value to the ecosystem for other projects too, since their are learnings to be had for everyone building on Polka’s Substrate as a common denominator. All of our business logic / products are being audited - lending, borrowing, price feeds.

Feel free to read our article about this partnership: https://medium.com/equilibrium-eosdt/quantstamp-will-audit-equilibriums-core-system-components-c2b800bdbcb3


Question #3 from @Kvindvr - What algorithm is Equilibrium used to make fair interest on loans based? How was it work and how safe are its calculation to reduce the risk ratio?

Alex Melikhov | Equilibrium (CEO):
We will sustain the system with our on-chain risk management algorithm, which:

- Monitors the liquidity of all the individual users across all of their assets and protocols in real time.
- Assesses system solvency on the basis of aggregated stats and the volatility of the underlying assets
- Adjusts the programmatic interest rate to incentivize “Bailsmen” who work for Equilibrium to inject more liquidity into the system (if needed)
The programmatic interest rate also means that - in contrast to most projects, we do not use a flat rate. Users have the option to influence their interest rates depending on the collateralization rate that they choose. This gives users a lot of flexibility.


Question #4 from @aya53855430 - What would you consider as the main challenges currently for financial institutions that are attempting to enter the decentralized finance (DeFi) space? What would you consider to be the main advantages of DeFi over traditional finance?

Alex Melikhov | Equilibrium (CEO):
For several reasons, classical financial institutions cannot really compete with the innovations which DeFi is bringing into finance. One of the reasons is that they are heavily regulated. Another reason is that they are centralized, while DeFi is going in the opposite direction - it is making much of the centralized intermediaries that were hitherto essential in classical finance obsolete.

This brings us to the second part of your question - what are in fact the advantages of DeFi

In my opinion, the main advantage of DeFi are:
- Accessibility. DeFi gives access to financial services instantly from a laptop or smartphone
- Transparency. Every transaction is publicly visible on the blockchain.
- Ownership. There is no central authority who can block your transactions or suspend your account.
- Autonomy. Blockchain technology is decentralized.
- Trustlessness: Every node has a full copy of the blockchain so they can validate transactions.

All of these factors are innovations which the classical financial institutions have to face. I believe that they realize this and are learning to take on a new role in the context of DeFi’s increasing development and influence. There are many examples of this - just think of JP Morgan’s crypto coin or the numerous governments which are adopting national cyrpto currencies.

It’s worth mentioning that there are also several industry hurdles in DeFi itself, and we are addressing these at Equilibrium. They include:

1. Market fragmentation. Before us, users needed to use several apps on different protocols.
2. Lack of interoperability. We design Equilibrium to enable asset transfers across chains & and use of different assets in lending combining them in collateral baskets.
3. Inefficient bad debt liquidations. We are introducing the bailout mechanism that will prevent situations like with MakerDAO in March this year by ensuring bailout liquidity in advance
4. Liquidity issues. Equilibrium maximizes cross-chain, non-custodial liquidity by using multiple assets from different protocols

Done :)

Question #5 from @Rodriguez71717 - Can you please elaborate the difference between Bailouts and Auctions in Equilibrium network?Which is better and profitable with the two that you can recommend to user? How does it works independently in your ecosystem?

Alex Melikhov | Equilibrium (CEO):
The bailout mechanism ensures system stability and protects your loans
Forced auction disadvantages:
- Catastrophic in adverse markets & in case of technology issues
- Instability in searching for buyers for bad debt

Equilibrium offers an alternative to forced auctions by solving bad debt by bailsmen in advance before it comes to a stressed market.


Segment 3: Live AMA

From Alana Cole:
Can you share with us some of the future plans, such as the marketing development plan and recent activity plan for the Equilibrium team?

Alex Melikhov | Equilibrium (CEO):
This is a great question, because we in fact have some exciting events coming up. We will soon be launching our fundraising for the PLO - Parachain Lease Offering in Polkadot.

Polkadot works on a system of parachains - projects building on Polkadot’s common substrate platform connect via these parachains, so that the entire community can use all of the resources which Polkadot and the other projects offer.

Parachains will be leased in an auction that Polkadot will host. Equilibrium intends to bid for and become a parachain and thereby a full-fledged part of the Polkadot ecosystem.

Soon, we will offer a token swap of our EQ tokens for your DOT tokens. The DOT gathered in this swap will be used to bid for a parachain. This will be a risk free mechanism which will offer a lot of boni and opportunities to earn. We will soon release details on the swap and our parachain strategy, so please stay tuned in our social media to find out how to participate.

Telegram announcement channel: https://t.me/equilibrium_news_feed
Telegram chat: https://t.me/equilibrium_eosdt_official
Twitter: https://twitter.com/EquilibriumDeFi
Medium: https://medium.com/equilibrium-eosdt

From A Nice Day:
Most of the current Defi projects are dependent on a centralized oracle for data delivery. So Equilibrium has not been like that? The solution that Equilibrium offers?

Alex Melikhov | Equilibrium (CEO):
In fact we are using several oracle providers for data feeds, since this is a central part of our solutions, which depend on reliable, real-time information from off-chain. We are working with Chainlink, Bluzelle, and soon to come, several other oracle providers.

The reason that this technology is so central to our products: We use price feeds for the multiple cryptocurrencies that we enable on our lending platform. They need to be current and reliable, in order to enable continual, aggregate liquidity monitoring and supply on Equilibrium - which is a unique feature that we have. This sets us apart from other projects and also manages risk effectively, avoiding the kind of situation that Maker DAO experienced on Black Thursday this year.

From Christy Snow:
why did you and your team use the name Equilibrium? Is there anything special about that name?

Alex Melikhov | Equilibrium (CEO):
According to Oxford English Dictionary Equilibrium means a state in which opposing forces are balanced. This is the exact system of checks and balances that we are bringing into the DeFi space.

Equilibrium is contributing “balance” to the DeFi equation. Equilibrium’s namesake comes in - to be valuable, assets must be “balanced” and sustainable liquidity ensured. This works through the project’s unique risk management and bailsmen mechanisms.

From Cryptoooo GRINDDDD:
Most of investors just focus on the price of token in short term instead of real value of project. Can you tell us the motivation and benefits for investors to your own token long term?

Alex Melikhov | Equilibrium (Block me if I DM first):
The EQ utility token has a few special features which make it really unique. Among these, it can be used for collateral and for bailouts. To put this in context, you need to understand that bailouts on Equilibrium work differently than on other projects: We do not use forced auctions to liquidate bad debt, since we have seen often enough that this is inefficient and risky. Instead, we have a Bailsman function. Bailsmen ensure liquidity on Equilibrium on a continual basis because it offers them the opportunity to earn well. This is a win-win situation. There is a bailout pool that ensures system solubility.

Since our lending platform offers multi-asset collateral across blockchains, we essentially expand the available DeFi market beyond the current predominance of Ethereum.
Equilibrium is enabling the growth of the DeFi market to unite all major crypto currencies. When you consider that our utility token EQ is the enabling denomination here, you will understand its potential to grow in value.

From DK:
Security & User Interface are the Most Important Aspect that Users see on a platform. How has Your Project worked on this? Is Platform suitable for Newbies in the crypto world?

Alex Melikhov | Equilibrium (CEO):
In fact we have recently introduced our new user interface (UI). One of the things that makes it so great is that it is very intuitive and user friendly -- well suited to crypto newbies. You can use it to monitor all your accounts across different platforms, so that you can see your assets in one place at all times - very convenient. Please feel free to have a closer look at and test it in our Testnet environment. You can see how to do that in these articles by following the instructions and screen shots:

https://app.equilibrium.io/gateway/en/portfolio/. Read details in this article: https://medium.com/equilibrium-eosdt/get-your-hands-on-our-new-and-intuitive-defi-user-interface-e4d8be587917

If you have any feedback re the UI or project in general, don’t hesitate to share it in our Telegram group: https://t.me/equilibrium_news_feed

End of AMA……

About Equilibrium

The first decentralized interoperable money market that combines pooled lending with synthetic asset generation and trading. Get access to cross-chain liquidity.

Website | Twitter | Telegram |Facebook |Whitepaper | Github | LinkedIn | Medium | Equilibrium dApp



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