Octopus DAO Community Call #8 — March Reports
On March 8th, the Octopus DAO conducted its eighth Community Call, during which there was an active discussion about Octopus 2.0. Although planning for Octopus 2.0 is still in progress, some crucial elements have already been developed. Octopus 2.0 has a significant goal to broaden the leasing security market by offering services to Cosmos chains. This will generate additional revenue streams and ultimately be advantageous for $OCT holders.
The Octopus core team is also working to decentralize the project’s operation. As such, the decision to launch the new appchain will be given to the Octopus DAO members. Those who wish to launch their mainnets on the Octopus Network must submit a proposal on the Octopus Forum. Currently, two teams, Frac and AridiaLabs, have submitted proposals to become appchains in the Octopus ecosystem. We invite all members of the Octopus DAO to join the forum and engage in further discussions to prepare for the vote.
Community Call #8
The Community Call is divided into two parts:
- Core Team Updates
- Open Discussion Q&A — We welcome fact-based discussions (and even challenges) from the Octopus community in both English and Chinese.
Below are reports from the Octopus Network Core Team, followed by Open Discussion Q&A.
Core Team Updates
Julian Sun, Co-founder, Chief Software Architect
- Fusotao, Myriad and Debio have completed the upgrade of version 0.9.30 of the Substrate. Correspondingly, we have also adjusted and optimized the Octopus bridge page.
- We have added token holder information to the block explorer. This requires to re-index the chaindata. At present, it will take about two weeks to complete.
- We are testing and improving beefy-go (the Go version of the beefy light client) in an environment of Substrate node, Hermes, and Gaia. We plan to conduct basic testing and a pre-release by the end of this month.
- We changed the name of project Tee-Relayer to ICP-Relayer, and implemented a beefy light client on ICP. This is a prototype of the verification proxy introduced in the Octopus Network 2.0.
- The project NEAR-IBC is still under development, and the functional development is expected to be completed by the end of Q1.
- We have completed the development of continuous integration. We will use more automated testing to cope with the reduction of development team members.
Aaron Ting, Head of Community
This month, we have maintained roughly the same number of followers across all of our social media platforms: approximately 63K on Twitter, 4.2K on Discord, 800 on Medium, and 8.2K on Telegram. While this means we have retained interest, we must continue to prioritize our objective from last month, which is to increase community engagement and cultural content. In terms of last month’s activities, we conducted the Octopus Treasure Hunt Contest, which was quite successful, and created a summary for FRAC, one of our appchain candidates. Our appchain pipeline will restart in approximately 2 or 3 months, after a new launch pad is established. However, this news is not confirmed yet, as we still need to conduct preliminary testing.
We also noted the recent earthquake in Turkey, and were able to make a donation of clothes, towels, blankets, and even some Octopus plushies to the victims. We hope to do what we can to support those affected.
$OCT is also featured as a Top 30 trending coin on Coingecko, suggesting that more and more people are becoming aware of and following us. Based on the overall activity and quality of interactions on social media, I think there has been a general improvement. So there is much to look forward to.
For the next big news, FRAC will conduct deployment of their fractionalization smart contracts on the BNB chain around March 15th. But this will be quite low key. Because the main news is that they want to be an Octopus appchain. So we will not push this up to the media. It is deliberately managed, so that when we make sure that their protocol works and there aren’t any significant problems, then we’ll be able to make a big campaign for them to launch.
Vivi Lin, Head of Media
In the past month, Media team continued to support the Octopus team and ecosystem in all major events with media PR and storytelling, including:
For appchains and appchain candidates：
We have completed production and are now promoting the storytelling video for the winners of the Octopus Accelerator 2022 Winter Star Prize: DeepMine, Frac, AridiaLabs, and BlackHistoryDAO. And both Frac and AridiaLabs have submitted proposals on the Octopus forum to become appchains in the Octopus ecosystem.
As we are giving DAO members the decision-making power to onboard appchains, you have an important role to play. So if you haven’t checked out their proposals, please review and prepare to vote.
For Octopus:
Octopus Global influence
- I recently attended ETHDenver, the biggest blockchain event, and had the opportunity to meet many important players from the NEAR ecosystem and other partners. Some of the people I met include Illia, the founder of the NEAR ecosystem; Marieke, CEO of Near Foundation, Yessin, CFO and Jack, the CMO of Near Foundation — they welcomed the Octopus 2.0 plan and said will give us very firm support in terms of BD and PR when we roll out. Oleg, founder of Sweatcoin; Sasha, founder of Humanguild; Amos, partner of MetaWeb ventures; Eugene, NEAR Social founder and chief developer of NEAR Virtual Machine, who has also won a global programming champion prize; During the event, I had in-depth discussions with them about our Octopus 2.0 strategy, the NEAR ecosystem, and the development of the entire industry. This was a great opportunity to increase our brand awareness and pave the way for the launch of Octopus 2.0.
- On February 10th, our founder Louis was invited to attend an event on the “New Narratives of Tokenomics” hosted by Chain Teahouse. During the event, Louis delivered an insightful speech on the design philosophy of tokenomics. He believes that tokenization does not equate to Web3 and that the goal of tokenization should be to achieve “incentive compatibility”. We helped to compile this speech and have published it in both Chinese and English versions for you to read.
- As a sponsor, Octopus was invited to participate in the Cosmos Cross-chain Ecosystem Summit jointly hosted by IBCL and Token DAO on February 23rd. Our founder, Louis, also delivered a speech titled “Making IBC Adaptive by Verification Proxies”. In this speech, you will learn how we plan to design the IBC bridges to make them more adaptive and able to connect various chains, including NEAR EVM chains, etc. We are currently compiling both English and Chinese versions of the speech and will publish them soon.
Additionally, as Octopus 2.0 takes shape, the media team is also working on the branding materials for Octopus 2.0, from articles to graphics and videos. You will see them once the Octopus 2.0 plan is fully established and ready to be announced.
Louis Liu, Founder
I have been working on Octopus 2.0 planning. Actually, it’s not just pure planning activities. We have put some components in the design process, and if we reach a certain level of certainty, then they will become a part of Octopus 2.0. Once we officially announce the plan, Office 2.0 will no longer be just an idea. Some critical parts have already been developed, and we are trying to launch the fully workable Octopus 2.0 system this year. One thing that has not yet been decided is the incentive structure. Web3 is all about incentives, value creation, and creating a positive feedback loop. So, I have come up with an initial idea for the value creation and distribution of Octopus 2.0.
Octopus Network Value Creation and Distribution
From the diagram, you can see that Octopus 2.0 is an expansion of Octopus 1.0, not a replacement. Therefore, we will keep the value creation process that Octopus 1.0 is currently carrying out. Although we halted the Accelerator program, we still have some appchain projects showing interest in being launched in the Octopus ecosystem. However, we feel that the selection process carried out by the core team has some limitations. We don’t want to see another DEIP situation happen again. Although theoretically, this kind of thing is inevitable, we are trying to minimize the risk of launching unqualified appchain projects. Therefore, we urge all of our Octopus community members to join the forum, interact with potential appchain teams, challenge them, talk with them, and help them to learn more about Octopus, our value proposition, and the relationship between Octopus and appchain. All appchains that want to launch on Octopus must submit a proposal to Octopus DAO. As some of you are council members, you have the right to collectively decide which project we could go live on the Octopus Network, so please engage in this process. This is the real value creation from the Octopus community.
We will keep the Octopus 1.0 infrastructure unchanged and continuously onboard new appchains. For Octopus 2.0, we will build two new smart contracts on the NEAR blockchain. One is Restaking Base, which takes $NEAR as a staking asset and delegates them to NEAR validators, generating Layer1 staking rewards, and returning most of them to $NEAR holders. Since Octopus is the builder of the Restaking Base contract, we will collect 1% fees and put them into the Octopus treasury. This is an incentive for the Octopus community. We will also build a Octopus 2.0 relay. This one is different from the 1.0 version mainly in two ways. The first is that the new relay will take $NEAR restaking as collateral assets to provide security to appchains, and the other is that we will migrate our Octopus bridge protocol to IBC. So Octopus 2.0 interoperability will be purely IBC, and potentially it will give us a lot of opportunities to connect with other blockchains such as Cosmos chains, EVM-based blockchains, or Polkadot parachains. Octopus 2.0 relay will solely serve Cosmos appchains, so it’s a new market. In this new market, $OCT holders can still stake their tokens on Cosmos appchains and, in return, they will get 30% of appchain rewards and 1% of $NEAR rewards. 70% of appchain rewards will go to $NEAR holders to pay for their restaking security offering. You may think that $NEAR holders receive more than $OCT holders, but $NEAR holders take the risk of slashing. This means that $NEAR holders need to run Cosmos appchain nodes to carry out the appchain. If the node goes down or is misconfigured, they will get slashed. Therefore, $OCT holders will enjoy risk-free appchain rewards, even though it’s only 30%. I think it’s a remarkable level of incentive for the Octopus community to support this initiative. At the same time, you may have noticed that the Cosmos ecosystem has gained significant momentum in the crypto space, many new middleware applications are being built on CosmosSDK, which is a good thing for us.
Our partner Vivi had great communication with the NEAR Foundation in the past few days about Octopus 2.0. Since this new design will help the $NEAR token capture value through restaking, in the words of CEO of NEAR Foundation, Marieke, she thinks this is huge. I agree that it could be huge, and I think restaking security will be the major security source for upcoming appchains. You may have also noticed that EigenLayer is the hottest project in the primary market and also at ETHDenver event. It provides security in a flexible and cost-effective way, and we learned a lot from EigenLayer, which was the inspiration for Octopus 2.0. But in another way, Octopus is the pioneer of shared security. We share economic security through interoperability protocols to new appchains from day one of the Octopus Network, which has been around for one and a half years. As far as I know, there are no other living networks that do the same thing. But we need to catch up and use our experience to expand our market share and create more value for the Octopus community.
Open Discussion Q&A
Please note: The Octopus Network Forum is now open at forum.oct.network. You are welcome to register, express your views, and discuss community improvement suggestions.
Question 1:
What will be the logic behind the increase of $OCT?
Louis:
First of all, price increases and value appreciation do not necessarily happen at the same time. When the market is good, the prices of various cryptocurrencies will skyrocket. When the market is not good, digital assets such as Bitcoin and Ethereum will also plummet. As the core team, our main focus is to increase the value of the token. $OCT token is mainly a revenue-sharing token, although it is also a governance token, it currently has little value in terms of governance. For revenue-sharing tokens, the core of value appreciation lies in creating more revenue streams. For $OCT, each appchain is a source of revenue stream. Therefore, currently, the Substrate appchains on the Octopus Network are our revenue streams. However, our current limitation is that there are not many new Substrate-based application chains, and the overall adoption rate of Substrate is also somewhat hindered, and some teams are also turning to using CosmosSDK. Therefore, a key focus of Octopus 2.0 is to cover the Cosmos appchain market, which is a larger and faster-growing market.
If we go to serve the Cosmos appchains, we can still use the Octopus 1.0 model, but now the industry has changed. We used to be the only economically sharing security offering, that is, enabling the security sharing between two chains with different consensus and sharing economic security through interoperability protocols, which is very lightweight and flexible. But now EigenLayer has emerged. It uses $ETH for restaking, making restaking the standard for sharing security. Because using a new small token for staking is far inferior to using a high-value token with a large number of holders for restaking, as its marginal cost is very low. Therefore, we must also keep up with this trend, which is why we no longer use the $OCT as collateral assets in Octopus 2.0, but use NEAR for restaking.
However, Octopus Network must create value for $OCT holders, so $OCT stakers will share 30% of the Cosmos appchain awards. We will give 70% of the rewards to $NEAR stakers and we hope to get more support from the NEAR Foundation. Because this does create value for NEAR in a way that other projects cannot provide. We do keep in close communication with the NEAR Foundation and have received very positive feedback. We will leverage the power of the NEAR ecosystem to attract more prominent Cosmos appchains and middleware chains to join the Octopus Network, thus obtaining a 30% reward from each new Cosmos chain. Therefore, as long as we continue to create new revenue streams that are long-term and constantly increasing in value, the value of $OCT will continue to rise.
Question 2:
Could you please explain what happens if an appchain rewards 1,000 tokens per day and how the rewards are distributed among $OCT and $NEAR holders who choose to stake in the appchain?
Louis:
Assuming that the appchain provides 1,000 tokens per day to stakers, all $NEAR holders who stake in this appchain will share 700 tokens, while all $OCT holders who stake in this appchain will share the remaining 300 tokens.
Question 3:
From Fusotao team: When can we use the IBC bridge on Substrate chains?
Louis:
The Substrate-IBC grants consist of seven milestones, and the first six have been accepted by ICF. The final milestone depends on the beefy-go light client on the Cosmos chain. Initially, the assumption was that the Composable Finance team would deliver the beefy-go light client. However, they stopped working on this item for some reason. Consequently, we decided to build the beefy-go light client by ourselves, which caused delays in the project. The current plan is to finish integration testing by the end of this month. So Fusotao team can begin testing the Substrate-IBC bridge towards other Cosmos chains from next month. And also Octopus team will deliver the Astar-IBC Bridge, which will be the first IBC bridge between the Cosmos and Polkadot.
Question 4:
When Cosmos appchains can be run on Octopus?
Louis:
It’s not gonna be easy since it depends on NEAR-IBC. We need to transplant the whole IBC framework to NEAR. And it’s not only for restaking, it’s also for a more progressive interoperability from NEAR to other blockchains. We tried to enable IBC functionality on NEAR mainnet by the middle of this year and based on that we will reimplement our leasing security logic on IBC protocol. I hope Cosmos appchains can be run on Octopus in Q3 this year but there might be some delay.
Question 5:
In Octopus 2.0, both $reNEAR and $OCT will be used as collateral assets. $re$NEAR holders will receive 70% of the rewards, while $OCT holders will receive 30% of the rewards. Is that correct?
Louis:
Actually we have eliminated the concept of $reNEAR because it is a concept from liquid staking, and we found that liquid staking and restaking are not compatible with each other. To implement liquid staking, you need to keep the fungibility of the two assets, pool all the assets together, and select qualified validators through a governance process. We feel that this is a heavyweight governance practice.
As we expect other decentralized networks to also use $NEAR staking as a security source, and we believe they do not need our permission to do so, Octopus DAO will not control the Restaking Base smart contract. Essentially, we try to make the Restaking Base a zero-governance and zero-maintenance protocol. This protocol will serve as a public good for the entire NEAR ecosystem.
In our design, $NEAR holders who stake in the Restaking Base will choose validators themselves, and they will take on the risk of slashing. Once they do that, they will have the privilege to opt into the Cosmos appchains. They need to run an appchain validator node and will receive a 70% share of the appchain rewards in return. For $OCT holders, they can lock their $OCT on the Cosmos appchain and share in the remaining 30% revenue without the need to run a validation node or bear the risk of slashing. So it’s only revenue sharing. What’s more, anyone who locks $OCT on the Cosmos appchain will get governance rights in Octopus DAO.
Question 6:
How about the old version, i mean v1.0, will appchain continue to develop?
Louis:
Yes, we will continue to maintain and upgrade Octopus 1.0 and keep onboard new high-quality Substrate appchains onto the network.
Question 7:
The provision of $NEAR restaking will reduce the benefit of $OCT holders, right?
Louis:
The Octopus Network will consist of two parts: Octopus 1.0 and Octopus 2.0. Octopus 1.0 will remain unchanged and continue to create value for $OCT holders through operation and upgrades. For Octopus 2.0, the security offering for appchains will allow for $NEAR restaking, which is that $NEAR holders will need to run a validation node for the Cosmos appchain, and $OCT holders can lock their $OCT tokens on Cosmos appchains to share revenue. Therefore, I do not believe that the restaking mechanism will reduce the benefits of $OCT holders since it is a new market and an expansion of the Octopus Network. By aligning incentives with the NEAR Foundation and the entire NEAR ecosystem, we can expect to receive help from them. By working together, we can onboard more high-quality Cosmos appchains to our network and create new revenue streams for $OCT holders.
Question 8:
How about the requirement to run a validator on CosmosSDK based chains, i mean how many $OCT or near or atom needed?
Louis:
To run a validator on Cosmos appchains, you need to restake $NEAR tokens. We have not yet decided on the exact number, but the threshold will not be too low. It is likely that you will need around 7,000 NEAR tokens to qualify as a validator.
Question 9:
In Octopus 2.0,$OCT can only be used for delegation, right?
Louis:
$OCT will be used for locking instead of delegation. Delegation requires selecting a validator, whereas for locking, you only need to choose an appchain and lock your $OCT on it. You won’t share the risk with any validator, but you can still receive 30% of the appchain rewards. There’s no extra work, and no additional risk. This is a privilege for $OCT holders.
Question 10:
I have a proposal. I wish to support login to the Octopus forum by NEAR wallet or appchain wallet.
Louis:
We tried to enable NEAR wallet login, but it seems not as easy as we expected. Due to limited developer resources, we have decided to give up this work.
Community Call #9 — April 8, 2023
Octopus Network will transfer decision-making power to the Octopus DAO in a planned and structured manner through on-chain governance.
Validators and delegators who have not joined the Community Call private channel, please join as soon as possible so that you do not miss the opportunity to jointly build and govern the Octopus DAO.
Do not miss the next Community Call, April 8th–13:00 GMT +8
To join:
- Open the link: https://discord.gg/BEQrN4Ya7C
- Enter the Discord channel and follow the prompts to verify your identity with your NEAR wallet.
Follow Octopus Network!
- Website: https://oct.network/
- Twitter: https://twitter.com/oct_network
- Discord: https://discord.gg/6GTJBkZA9Q
- Octopus DAO: https://forum.oct.network/
- Medium: https://medium.com/oct-network
- Telegram: https://t.me/octopusnetwork
- Youtube: https://youtube.com/channel/UCkMYDmXdgjCBTBggSEAy0ZQ
- Accelerator Program: https://accelerator.oct.network/
- Github: https://github.com/octopus-network
- Docs: https://docs.oct.network/
Octopus DAO March 2023 was originally published in Octopus Network on Medium, where people are continuing the conversation by highlighting and responding to this story.