"Blockchain technology isn't just a more efficient way to settle securities. It will fundamentally change market structures and maybe even the architecture of the Internet itself" - Abigail Johnson, CEO of Fidelity Investments

Speaking with Avril DuThiel of Neutron in the Cosmos Ecosystem

In the latest episode of Crypto Sapiens, Season 8, Episode 9, the host, Rachel, delves into the world of Web 3 with Avril DuThiel, CEO and co-founder of Neutron in the Cosmos Ecosystem. This article breaks down their insightful conversation, highlighting Neutron's mission, challenges faced, and contributions to the decentralized finance (DeFi) space.

Rediscovering Crypto

During high school, Avril DuThiel's journey into the world of Web 3 began with concerns about web privacy and a distrust of traditional financial systems. This led to the exploration of cryptocurrencies like Bitcoin and Ethereum. The fascination with decentralized finance during the "DeFi summer" reignited DuThiel's interest in crypto.

Scaling DeFi Protocols

Neutron faced challenges in scaling its DeFi protocol, identifying security, alignment, and the right technology as key hurdles. Adopting replicated security, aligned with the Cosmos Hub ecosystem, provided the foundation for Neutron to thrive. The platform utilizes the Inter-Blockchain Communication (IBC) protocol, ensuring a high level of security for users.

Neutron's Purpose

Neutron emerges as a secure cross-chain contracting platform, simplifying the deployment of applications across multiple chains. The ultimate goal is to facilitate business scalability, making it easier for enterprises to expand their services across various chains.

Shared Security Technology

The launch of Neutron's replicated security technology marked a significant milestone for Cosmos. This shared security approach has contributed to Neutron's success, positioning it as one of the top seven chains in the Cosmos network.

Governance and Transparency

DuThiel emphasizes the importance of improving the governance structure on the Cosmos blockchain. Neutron utilizes smart contract modules to enhance granularity and versatility in its system. The Agora, the top layer of the system, allows for voting on crucial decisions, while a multi-system governed by the DAO offers different selection mechanisms.

Programs and Partnerships

Neutron actively engages with various programs and partnerships within the Cosmos ecosystem, including liquidity mining, grants, and audit sponsorships. Avril encourages community involvement through forums and proposal suggestions, emphasizing the need to address the liquidity and value challenges in Cosmos DeFi.

Challenges for DAOs

The discussion highlights challenges faced by DAOs, emphasizing the importance of a solid business model, incentives, and treasury management for sustainable growth in the crypto industry. Avril DuThiel discusses the challenges that DAOs (deployable tokens) face in the cryptocurrency ecosystem. One of the biggest disadvantages is the waiting period before actions can happen in the market, which allows the market to front-run them and make money off their back. To address this issue, Neutron is building tools that allow DAOs and other blockchains to participate in the economy and make deals with each other, such as doing a token swap and providing liquidity to an exchange. During the Bull Run, many projects failed because they did not take into account financial sustainability, risk assessment, and treasury management. Having a solid business model is important for Web 3 projects, as it ensures that they have a market around their code and can attract and retain users. The success of a project also depends on incentives, which need to provide something valuable to investors and ensure continuous improvement. Incentives without a long-term plan can disappear into thin air. DuThiel also mentions the importance of a treasury in a project's native token and the risks that come with it. Having a stable liquidity pool ensures that the project can operate independently and develop over time. The case of LIDO, which successfully diversified its treasury by using a buyer's offer on a public ledger, shows how structural disadvantages can affect a project's ability to participate in the economy.

Stay Connected: Final Thoughts and Resources

Neutron's journey into Web 3 reflects a commitment to addressing challenges and contributing to the growth of decentralized finance. As the Cosmos ecosystem evolves, Neutron plays a vital role in enhancing security, governance, and scalability for businesses in the ever-expanding multi-chain industry.

Multi-Chain Nature and Sovereignty in Blockchain Governance

As the crypto industry trends towards multi-chain development, DuThiel advocates for protocol architectures that allow seamless interaction with all blockchains. The key is to develop applications that aren't restricted by the specific blockchain technology, aiming for efficiency and positive user experiences.

DuThiel stresses the importance of sovereignty in blockchain governance applications, with Neutron acting as a connecting force for different applications and projects within the broader blockchain space.