balajis on Warpcast

balajis pfp

Something I’ve been thinking about is using onchain reputation to regulate decentralized exchanges. For example, you only allow a wallet to even *place* a limit order if they link a yourname.eth with enough reputation. Trade with Farcaster/Interface users only?

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balajis pfp

Yes, using reputation in this way as a gate would reduce liquidity. But you give up some short-term money (less liquidity) in order to protect users and make more long-term money for all (less fraud). And you can decide how stringent you’re going to be. Maybe just a registered ENS name, maybe much more.

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Rob Sanchez pfp

seems like you could create a liquidity pool limited to e.g. farcaster users on top of uniswap v4 w/ hooks wouldn’t prevent users from going to other pools but could split up liquidity between ‘pools with reputable users’ and ‘pools with potentially fraudulent users’

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binji 🔴 pfp

There’s multiple methods like this ongoing within Optimism. A multitude of attestation methods building atop the open source attestation station web. Would be keen to chat and pick your brain. I know all teams would love to hear from you, and we can do a focus group.

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Robin A. pfp

Introduction accountability always comes with drawbacks, some of these drawbacks we would have to accept for broader adoption.

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humpty pfp

How do you imagine reputation being earned? Would it be single or multi source trust scoring? RE: NFTs signaling trusted account, I’ve found through my work at Orange Protocol last year that SBTs were a better approach as “reputation” then can’t be sold.

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binji 🔴 pfp

you can also use optimistic oracles to ensure exchanges report fairly and users can challenge their numbers. Being built rn

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Jordan Messina pfp

I think a single classifier turns into a game of cat and mouse, and it's hard to create a one size fits all model for protocols. Small composable classifiers are the way to go imo. As a dev, I can choose the onchain criteria for actors, e.g., deposited to Coinbase, has a Farcaster account, and claimed the ENS airdrop.

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raz pfp

Or even better: only wallets with a track record of providing liquidity to other similar protocols can participate in this new one. We've been experimenting with this for a while (ex.: you could only mint if you are eligible to xyz on guild.xyz)

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Jon Hargreaves pfp

I think this model could potentially utilise a credibility score tied to other behaviours such as sustainability credentials

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Charles Logan pfp

I've been working on a DEX called Six Degrees of Balaji, which comprises six degrees of trading permissions and limits based on their proximity to you

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artlu 🎩 pfp

unintended side effect: some of the extractable value shifts and gets captured in the reputation container (e.g., Farcaster id) like buying KYC'd accounts

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ツ pfp

Good thing @pentacle.eth and frens are building up blossomland_.twitter for this kind of extra use cases

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Eric Kuhn pfp

It doesn’t have to only be onchain. Take a look at Centre’s Verite project that uses Verifiable Credentials validated by smart contracts for a permissioned dex as one example https://www.centre.io/verite

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Ian L. pfp

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Bayram pfp

Cool stuff. What do you think of a undercollateralized lending protocol leveraging onchain reputation? We’ve built this on ETHGlobal Lisbon: https://ethglobal.com/showcase/cryptobureau-u1389

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aron pfp

Interesting. We’re trying to figure out a legit verification method as well for our decentralised App Store. Right now thinking an aggregation of different services to create a unified score.

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avi pfp

great idea. the “permissionless maxi” counterpoint would be that it opens up the room for governance attacks if regulations can be changed with proposals

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