Push fragmented liquidity and rising user requirements Defi Innovators to deliver powerful, intuitive and safe solutions. When Cross-chain functionality And the regulatory control is increasing, the race to unite digital and traditional finances has never been so more urgent.
Sergej Kunz, co-founder of 1inch, shares his insight with Beincrypto about the evolving dexaggregation, the empowerment of the users and the following jumps of the company-including Solana and Bitcoin integration.
Evolving dex aggregation and the future future
Liquidity at the moment is very fragmented. It is not only concentrated in Defi or decentralized financing – it exists in various networks such as Ethereum and Layer 2S such as Base, which is currently very popular.
Liquidity is also on other chains, such as Sui and Solana. If you zoom out outside Defi and look at the broader crypto landscape, there is a considerable liquidity in Bitcoin.
Although part of this liquidity is on centralized exchanges, a large part is simply held – without generating any passive income. However, earning passive on Bitcoin is now very feasible via Defi.
If we recognize this, we have formed our strategy to expand out, starting from Defi, to go to the wider crypto space and eventually reach to traditional finances.
Traditional financing includes a wide range of financial products that can be tokenized, and this is precisely the direction in which we are going.
We integrate one chain after the other. Today we support cross-chain swaps over 13 chains and we add another.
The 1 -inch approach
So we only started with simple swaps between these different liquidity sources. Users had to make their own transactions and accept all risks.
You mentioned MEV – Maximum extraweer value. This is when someone else can see your transaction, manipulate the liquidity pools and get value out of it.
We acknowledged that this was well known and widespread, and many people started exploiting it to extract value. If you look at my presentation from 2022, you will see that every year an enormous amount of money has been lost by users through this attack vector.
So we came up with the idea that the introduction of a new architecture could simplify the user experience and the SWAP process itself.
Why not make a swap flow where users easily express the intention, such as placing an order, and the protocol that facilitates the order, ensures that the user gets the best version? This led us to the idea of using Dutch auctions, a more technical description of this approach.
Under the hood it is relatively easy in terms of how it works. It is more complex for professional actors – such as market makers, arbitrators and traders – who actually arrange the transactions of the user. But for the user it is just a simple intention.
I tell the system: I want this – I want Ethereum for USDC with the best version – and the protocol ensures that. This has changed things considerably. We now see that other teams use a similar approach, such as Uniswap with the introduction of Uniswapx.
They also called us in the white paper-our on intention-based merger, which we call Fusion swaps. It improves the user experience and improves safety.
We invest heavily in security audits. I believe that the 1 inch foundation has spent around $ 500,000 on security for the last release of Cross-Chain Swaps, which is a considerable amount.
About 10 security companies were involved in checking the code. We all do this to ensure that it is very safe and works seamlessly for the user.
Bridging Crypto and Fiat: the 1-inch card and Real-World payments
Like many things, it started as a personal need. For example, we have introduced cross-chain swaps because of my own personal need. That is the honest truth.
But I soon realized that it was not only my needs – others were also looking for a seamless experience. I had a plan to earn passive income by investing in Tokenized real estate.
In Dubai you can already find some companies that offer this. I use a US company on the market for 20 years. They started to attack real estate about five years ago.
I receive passive income benefits in USDC every week and I want to spend them. For example, I want to buy a coffee with it, but it’s not that easy. You often have to deposit the money on Coinbase and then cash it in in euros, American dollars or dirhams.
So we thought-WHO not cooperating with someone who already offers crypto cards as a white label solution?
In this way we can collaborate with banks and regions such as the European Union and the UK. I believe that the US will follow soon and we are also looking for partners in the VAE and other areas.
On 1 inch we also have active research into AI. We are currently developing a new aggregation product that could even be launched under a sub-brand that is strongly focused on AI.
Big announcements are on the horizon – what we see now is just the beginning.
Adoption of regulations, security tools and maintaining decentralization
On 1 inch we give priority to the security and safety of users. That is why we have carried out extensive security audits from the start.
We also work together with partner security companies that support us in this effort. Moreover, we have built a product that we offer to integrators and partners to prevent scam and fraud.
This allows us to detect which wallet is connected and whether there is an assets transfer to a specific address.
We can identify whether a wallet is associated with hackers or scammers, especially if it is marked or followed.
For example, security companies such as TRM Labs can determine whether a wallet of a malicious actor is – possibly a hacker, a sanctioned person or even someone who is linked to Noord -Korea.
We take this responsibility very seriously. We have built our own API and software service around it, and this is integrated into the 1-inch wallet-a non-striking wallet-equal to our Dapp and SWAP interface.
Dao Governance and Building Community Trust
Daos are still somewhat experimental. However, various projects, such as curve, makerdao, compound and even chainlink – have strong communities.
Of course there are some challenges. Many people participate, but not all are experts. That said, the DAO model evolves.
We now see that DAOS is starting to hire professional companies that specialize in helping assets, processing applications and processing proposals – whether it is to change the protocol settings or refine the general strategy of the DAO. Improve things.
Personally, I would like to see more people actively participate in Daos so that we can continue to build and innovate.
With regard to 1 inch, the DAO offers subsidies to support the development on the 1-inch network, for example, financing projects that contribute to the growth of the network or supportors who want to work full-time on the ecosystem.
Some of them receive annual subsidies to develop specific products or subprojects.
Solana integration and the path to cross-chain liquidity
We are pleased to announce the integration of Solana – this is a piece of a much larger puzzle and an important step for us.
By adding another chain, we continue to improve the user experience, so that users can concentrate less on which network they use and more on the assets they want to exchange. The goal is seamless interoperability between networks.
We are planning to integrate more block chains, including Bitcoin, SUI, APTOS and others who are currently trading trending or actively at centralized fairs. Whether it is Bitcoin-like coins or newer protocols such as Sui and Aptos, we strive to support as many assets as possible.
Our vision is to unite liquidity between chains and to deliver a truly seamless experience for users.
Roadmap expansion: Integration of Bitcoin and more chains
Bitcoin is the following. There is an enormous amount of bitcoin that is there – it represents the largest pool of liquidity in the entire crypto space. That is why we intend to integrate Bitcoin for seamless Swaps.
Users can buy real bitcoin and receive real bitcoin, without transferring their money to a third party and just hope to get their BTC back.
It will be a confidentless, peer-to-peer program without a single point of failure. The smart contract will do exactly what it is designed to do.
After Bitcoin we will focus on integrating other well -performing block chains such as sui, aptos and more.
