Blockchain technology is already proving its potential for building a freer and fairer financial system through Advanced DeFi. However, as this technology matures there is an even greater opportunity to invest in building elegant, usable, powerful protocols that solve real world everyday problems like payments, remittances, savings and loans. This has the potential to create Web 3's First Billion Users: we are entering the Era of Everyday DeFi.
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This is the talk I gave at Consensus 2022 in Austin, Texas where we launched our Everyday DeFi vision to the world.
2. Daniel Fogg
Chief Operating Officer
I work across product, technology, marketing, and
growth teams to deliver our organisational vision.
Follow me on Twitter!
@danielfogg
3. 1. Our work at IOV Labs
a. Growing the RSK Ecosystem
b. Building with RIF on RSK
2. A Massive Global Challenge
3. The Problem with Advanced DeFi
4. The 3rd Phase of Crypto Adoption
5. The Era of Everyday DeFi
5. Internet of Value Labs.
…the creator of the Rootstock blockchain (RSK)
…the developers of the Rootstock Infrastructure
Framework (RIF)
IOV Labs is...
Our Work @ IOV Labs
6. Role 1: Grow the RSK Ecosystem
Role 2: Build a thriving RIF Economy
The work from day 1 of
Smart Labs.
Our primary focus today.
And this all has to be
consistent with our purpose!
IOV Labs has two roles
Our Work @ IOV Labs
7. Our vision is...
A safe and equitable global financial system
that enables everyone to participate and prosper.
Safety, security, stability, fair,
impartial, without judgement. Positively impacting the global financial system.
Not local, or regional. Global.
The 99%.
The underbanked.
Emerging markets.
The global population.
Inclusive, accessible,
community-oriented,
collectively owned, managed, and operated.
Our Work @ IOV Labs
9. A decentralised layer-1 blockchain.
Uses novel Bitcoin merged-mining approach to store
crytographic hashes on the Bitcoin blockchain.
An Ethereum Virtual Machine - highly compatible and
interoperable with other network.
Second-most secure blockchain (after Bitcoin) +
cryptographically the most secure smart contract
platform in the world (57% Bitcoin hashrate @ 9AM today).
What is RSK?
Growing the RSK Ecosystem
10. SECURE: Merged-mining approach cryptographically superior.
NATIVE: Bitcoin is native to RSK via 1:1 peg.
AFFORDABLE: 40x-50x cheaper gas fees than Ethereum.
FASTER: 10x faster transaction speeds than Ethereum.
SCALABLE: built to scale - zkSync layer-2 live on Testnet.
COMPATIBLE: EVM-compatible - easy to start building.
Why RSK?
Growing the RSK Ecosystem
11. 1,619days mainnet live since 2 January 2018
100percent network uptime since launch
77,000monthly transactions (Apr-2022)
3,092 X-Chain Total Value Locked (BTC) on RSK (Apr-2022)
9,959Native Total Value Locked (BTC) on RSK (Apr-2022)
RSK today
Growing the RSK Ecosystem
14. What is RIF?
A service-layer of open, decentralised protocols
that run on RSK.
RIF helps developers build scalable DeFi dApps faster
and easier.
RIF protocols are accessed and paid for using the RIF
ERC-20 Token.
You can build anything with RIF, but it was designed
for building DeFi on Bitcoin
Build with RIF on RSK
15. RIF today. RIF tomorrow.
RIF PAY: Making payments faster, cheaper, and easier.
RIF WALLET: Bringing DeFi and the RIF Economy to everyday users.
RIF IDENTITY: Building and managing on-chain identity.
RIF MARKETPLACE: Matching supply and demand in a sharing economy.
RIF GOVERN: Enabling community ownership and decision making.
RIF I.O: Feeding protocols with data and information.
RIF TOOLS: Providing developers with everything else they need.
And there is more to
come in 2022.
Build with RIF on RSK
17. A global (economic) polycrisis
long in the making.
When multiple crisis occur simultaneously
and combine to create a new, unique
additional crisis
A Massive Global Challenge
18. 2008 // QE // inflation // falling productivity // de-
globalisation // new cold wars // cost-of-living crisis //
inaction on climate emergency // rising government debt //
A Massive Global Challenge
19. This economic polycrisis is placing
unprecedented strain on everyone.
But the poor and marginalized in
emerging markets are feeling it the
most.
And most of them are underbanked.
A Massive Global Challenge
20. A social and economic
coordination challenge.
The underbanked experience the pain of these challenges everyday.
● People can’t access a safe, stable store of value.
● Transactions are expensive, complex, or impossible.
● Institutions don’t understand them or don’t want their business.
● Financial products are not designed for them.
● They don’t trust their government.
● They can’t trust their banks.
A Massive Global Challenge
21. A Massive Global Challenge
And the problem is spreading.
More people falling from the middle-class and becoming underbanked every day.
Why?
● Price inflation affecting everyone.
● Sustained, possibly entrenched cost-of-living crisis.
● Declining purchasing power in emerging markets.
● Interest rates are being raised everywhere.
23. We need to talk about...
THE PROBLEM WITH
ADVANCED DEFI
24. DeFi today is used by - and designed for:
● financially literate
● technologically advanced
● affluent Western retail users
● looking for outsized returns
● during a unique period in the global
economy.
Advanced DeFi is not for everyone.
Advanced DeFi is too
advanced for Everyone
The Problem with Advanced DeFi
25. Advanced DeFi: a complex game of competition
Source: 10 things I’ve learned designing for decentralised finance (DeFi)
What it takes to execute a DeFi
yield farming strategy on Fantom.
The Problem with Advanced DeFi
26. Usability: main barrier to widespread adoption
User-Driven Corporations
Integrated User-Centered Design
Systematic Usability Process
Managed Usability
Dedicated Usability Budget
Skunkworks Usability
Developer-Centered Usability
Hostility Towards Usability
Nielsen Usability Maturity Model
This is the…
Nielsen Usability Maturity Model
The usability of the majority of
Advanced DeFi probably sits
around here.
Source: UX Maturity Models – A Collection
The Problem with Advanced DeFi
27. “Crypto has to become invisible… I keep
saying that and I sound like a broken
record, but it has to disappear in the
background for a user who doesn't care —
honestly, my mom doesn’t care if it’s
[centralized finance] or DeFi.”
(Harold Bossé, VP for New Product Development & Innovation @ Mastercard). Source: Decrypt - “Crypto 'Has to
Become Invisible' to Reach Mainstream”
The Problem with Advanced DeFi
28. This is not how we onboard the
First Billion Users into crypto.
Advanced DeFi is not the whole
solution.
Our vision for the underbanked
demands more.
The Problem with Advanced DeFi
29. “At the grassroots level, emerging markets
are driving cryptocurrency adoption, with
users in these areas turning to the asset
class out of necessity, either to preserve
their savings in the face of currency
devaluation or to carry out remittances
they wouldn’t otherwise be able to.”
Source: Chainalysis - 2021 Geography of Cryptocurrency Report
The Problem with Advanced DeFi
30. Source: The 2021 Geography of Cryptocurrency Report, October 2021, Chainalysis
Crypto adoption is
concentrated in
emerging markets.
Source: Chainalysis Global Crypto Adoption Index 2021
Vietnam… soaring inflation, weakened currency
India… the home of demonetisation
Pakistan… price inflation, currency depreciation
Ukraine… at war with Russia since 2014
Venezuela… decades of mismanagement
Argentina… 52% inflation in 2021
And world’s six largest remittance recipients.
31. Source: Americas Market Intelligence - The Cryptocurrency Revolution in Latin American payments (April 2022)
Crypto adoption in Latin America
is driven by everyday use.
Unlike in the USA, cryptocurrency users in
Latin America are not just buying crypto as an
investment.
They are using crypto as:
● a store of value
● an inflation hedge
● a means of non-bank digital payment
● a way to make remittance transfers.
The Problem with Advanced DeFi
33. Geoffrey Moore identified five phases in
the life cycle of technology adoption
defined by five behavioural types that
adopt technology.
These phases are split in two by the
infamous “Chasm”.
All new technologies must cross the chasm
to gain mass market adoption and broad
use.
Understanding Adoption Cycles 3rd Phase of Crypto Adoption
34. We can map crypto adoption onto Moore’s
Curve.
Phase 1 (2009-2017) represented the early
cypherpunks, Bitcoin HODLers, and
technology maximalists.
Users were fanatical about the benefits of
crypto and tolerant of the enormous
usability challenges.
Crypto Adoption: Phase 1 - OGs 3rd Phase of Crypto Adoption
35. Phase 2 (2017-2021) represented the
Advanced DeFi pandemic boom, which
saw the emergence and then explosive
growth in the DeFi market.
The beginning of mass adoption of
cryptocurrencies as speculative assets in
developed markets (North America & Europe).
Crypto Adoption: Phase 2 - Advanced DeFi 3rd Phase of Crypto Adoption
36. We believe we are now entering the Third
Phase of Crypto Adoption.
This phase is dominated by emerging
market users engaged in pragmatic use
cases recognised the world over, except for
one significant difference: use of
cryptocurrencies.
Crypto Adoption: Phase 3 - Everyday DeFi 3rd Phase of Crypto Adoption
37. Phase 1: OGs
Cypherpunks, HODLers,
Maximalists.
-
Technologists and
fundamentalists globally
distributed in high-tech
economic clusters.
Phase 2: Advanced DeFi
DeGen traders, pool stakers,
SlowFi HODLers, project
token speculators.
-
DeFi in developed markets,
advanced tech-native retail
users and adventurous
institutions.
Phase 3: Everyday DeFi
Stablecoin remitters, on-chain
savers, DeFi borrowers, P2P
payers.
-
Post-Pandemic P2P
cryptocurrency users in
developing markets escaping
retail finance monopolies and
government incompetence.
Phase 4: Invisible DeFi
They don’t even know it’s
DeFi.
-
P2P in developed markets
used by retail finance users.
Phase 5: Your Grandparents
…
Everyday DeFi is the Third Phase of Crypto Adoption
39. EVERYDAY.DeFi
A new phase of cryptocurrency adoption is beginning.
It will driven by people trapped by weak local currencies, with declining purchasing power, and a desire to
protect their financial interests during a period of extraordinary global economic turmoil.
It will be defined by normal people using blockchain technology to do simple, everyday financial tasks.
It will take place in the tower blocks of Mumbai, the markets of Jakarta, and the villas of Buenos Aires.
This phase will not be built by traditional banks, but by the long-tail blockchain neo-banks of the future.
This is the biggest market opportunity cryptocurrencies have ever seen.
This new phase is everything the crypto enthusiasts have promised, everything blockchains were designed for.
All of this can be built with RIF on RSK.
40. Source: Gartner Hype Cycle for Blockchain, July 2021
Innovation Trigger
A potential technology
breakthrough kicks things off.
Early proof-of-concept stories and
media interest trigger significant
publicity.
Peak of Inflated Expectations
Early publicity produces a number
of success stories — often
accompanied by scores of
failures.
Trough of Disillusionment
Interest wanes as experiments
and implementations fail to
deliver. Producers of the
technology shake out or fail.
Slope of Enlightenment
More instances of how the
technology can benefit the
enterprise start to crystallize and
become more widely understood.
Plateau of Productivity
Mainstream adoption starts to
take off. Criteria for assessing
provider viability are more clearly
defined.
Plateau will be reached…
> 2 years
2-5 years
5-10 years
>10 years
There are a critical mass of
blockchain technology trends
coalescing at the right phase
in the Hype Cycle to start
building Everyday DeFi
services.
Gartner Blockchain Hype Cycle (July-2021)
Everyday DeFi is enabled by coalescing technology trends
41. 4.3mn. Advanced DeFi user wallets
All major DeFi protocols (over-estimations). Source: On-chain data via Dune Analytics.
City of Suzhou (China), Panama, Mauritania.
1.8bn. unbanked & underbanked
Source: World Bank global estimate.
$540bn. remittance flows
2022 global flows. Source: World Bank (May 2021).
Everyday DeFi is a massive global market opportunity
42. ● Trust in banks and governments is low.
● People are exploited by predatory intermediaries.
● Regulation does not enable innovative neo-banks.
● Incumbent banks defend their oligopoly through state capture.
Everyday DeFi will emerge where...
Vietnam. India. Pakistan. Ukraine. Kenya.
Nigeria. Venezuela. Argentina. Colombia.
Thailand. China. Brazil. Philippines.
South Africa. Ghana. Tanzania.
The Era of Everyday DeFi
43. Everyday DeFi is a mass market opportunity.
Everyday DeFi is characterised by underbanked or
financially excluded users, using decentralised
technology, to fulfill an everyday need:
● paying bills
● saving with return
● borrowing at reasonable rates
● sending money to family
Defining Everyday DeFi
The Era of Everyday DeFi
44. simple UX, intuitive UI,
indistinguishable from Web 2.0
EASY TO USE
ACCESSIBLE
FAST ENOUGH
CHEAP ENOUGH so cost of using the service is not a
barrier (low fees, stable assets)
by everyone, everywhere (mobile-
first, simple on/off ramps)
to make on-the-spot payments.
What makes a service Everyday DeFi
The Era of Everyday DeFi
45. SAVE in USD with safe, low-risk, stable-stablecoins.
BORROW with uncollateralised community-supported loans.
SEND remittances anywhere with local currency cash on/off ramps.
PAYutility bills and receive salary with crypto.
Services Everyday DeFi users need
The Era of Everyday DeFi
46. Share information to help users make the
right decisions.
EDUCATE
SAFEGUARD
SIMPLIFY
ADAPT
Terminology, language, interactions to
make it indistinguishable from web 2.0
Protect users from high-risk investments,
predatory actors, and big mistakes.
The product experience - from on-ramps
and KYC to addresses and keys
Principles for Everyday DeFi Builders
The Era of Everyday DeFi
48. BUILDING
PARTNERING
PROMOTING
INVESTING
Open-source protocols on RIF that help developers create secure,
trusted, lasting Everyday DeFi services.
With innovative teams serving Everyday DeFi users in emerging
markets, and integrating the RIF Economy with the real-world economy.
Use cases that show the real-world value our Everyday DeFi partners
are creating for the underbanked.
Capital in Everyday DeFi projects and bringing important capabilities to
RSK to expand the reach of the RSK Ecosystem and RIF Economy.
Everyday DeFi @ IOV Labs
Our Work @ IOV Labs
49. In summary, we want to make...
EVERYDAY DEFI,
AN EVERYDAY REALITY
50. ● We believe Everyday DeFi is how to on-board the First Billion Users into crypto.
● This mass market opportunity for crypto exist today, but we must build for it.
● We think Everyday DeFi builders should:
○ Simplify all aspects of the product experience
○ Educate users on the risks and opportunities
○ Safeguard users from predatory actors and big mistakes
● We know all of this can be built with RIF on RSK.
We are making Everyday DeFi an everyday reality.
