My fellow retards,
“I gets by with a little help from my Phrens”
Yesterday’s pheverdream focused on how a dex could be built within the phonon construct. Under the hood it will not be identical to the automated market makers (AMMs) such as Uniswap that we are all familiar with, but the user could have a very similar experience which is all that matters. Plus, providing perfect privacy for every transaction and scaling with the speed of the internet seem to more than make up for global pooling of liquidity.
To reiterate, a phonon dex looks like a bulletin board. Users post assets they would take for their phonons and the rates they would accept. Since phonons are atomic (cannot be broken down further) finding a perfect match for sell offers is challenging, thus we have the invention of changemaker.
What is a changemaker? Well the phonon system becomes more powerful when you’re able to get the specific sized units you want. You may only have a 1 btc utxo existing on your card, but you need a .75 btc utxo to fill an offer for someone selling a rare pepe nft in the phononscape. Rather than trying to initiate new onchian transactions to generate a .75 btc utxo phonon, you can hit up your friendly goblin. They will provide a service wherein you atomically swap your 1 btc utxo for their .75 btc utxo and a .25 btc utxo, less some fee. Perhaps they’ll just want you to post a $2 usdc phonon as the fee. This is all negotiable. The point is that there are service providers that can and will exist to help facilitate the smooth flow of transactions in the phononscape.
It is not economically feasible to bring back a $1 usdc phonon to the Ethereum chain. The gas fees post phonon destruction and moving to a new address make it a fool’s errand. If gas costs are say ~$10 to make a simple erc20 transfer, then in all likelihood that $1 usdc phonon will always be a phonon. There are some intelligent ideas such as changemakers who create very small denominations on popular Ethereum-based L2s, that way they can facilitate down to the penny and the cost to bring it back to the L2 is zero. That is one neat workaround. The other is the realization that these low value phonons should never go back to the chain. They provide an exceptional service in phononscape, so let’s keep them there.
If after a few days of yoloing out on the phonon dex, or getting payment for routing traffic through the phonon incentivized tor system you end up with 20 phonons which equate to 1 eth. You wouldn’t want to have to claim all 20 of them on chain because the fees would not be friendly. This is where you would again hit up your goblin brethren. You’ll swap your 20 phonons for say .995 phonon of ETH. Now your on chain redemption is only a single transfer. You save a bunch of money, the change maker makes a few shekels, and the phonon system retains a large amount of phonons that can continue to fulfill a necessary service.
The phonon dao should run a changemaker service. It will be lucrative long term, plus it keeps more small denomination phonons in the system which is a benefit. If the dao doesn’t want to run this system, any enterprising goat herder could, since it’s a no brainer to be a net-positive venture.
That’s how the goblin changemakers work. Silly geese coming around talking about how phonon is no bueno because you can’t atomically split them refuse to think outside the box to find a solution. We have all the shapes rotated, we build, we generate value, and we enshrine the phonon protocol as the layer 0 of choice for the entire cryptoverse.
Join the Discord and start building today.
Targets for the marketcap of PHONON DAO remain:
$1b by Q2 2022, $12b by EOY.
On the high end, $300b marketcap in 3 years