We proudly announce that Everstake has become a partner of Sommelier Protocol, a crypto portfolio management product.
Everstake CEO Sergey Vasylchuk and Sommelier Protocol co-founder Zaki Manian recently had an engaging talk on Twitter Spaces about the background knowledge they needed to create fintech companies, the technologies that stand behind their vision, and the problems they face.
Here is a recap of their chat.
An Unknown Story Behind Everstake
Sergey shared that he had a software development background before creating Everstake, and he was a long-time fan of decentralized systems. He spent a lot of time in e-commerce, banking, and payment services and gained vast financial knowledge.
Sergey Vasylchuk knew that legacy banking systems were not designed for the best performance. Seeing that, he learned about Bitcoin’s concepts and decentralized payments. He then changed his niche and started working with blockchain products.
“Initially, Everstake wasn’t supposed to be a company. It was created out of curiosity to find out how to make decentralized networks faster.”
EOS was the fastest network at that time, so Sergey and his team jumped in as a validator and later became also a block producer, baker, and guardian serving more than 60 networks globally.
As Sergey mentioned, “Everstake is very similar to mining pools, but for proof of stake blockchains and projects. Single users usually cannot mine and support the network because their key holding is too small. So, they join together and back someone who provides the whole infrastructure for validating, block producing, and guarding. Every time the block is produced, all backers are rewarded. The administrator takes some fee to cover the cost of operation. Everstake is providing this service for multiple blockchains.”
Meet Zaki – the Visionary Behind Sommelier Protocol
It took almost two years after the Cosmos Whitepaper was finished for Zaki Manian to come up with the idea of connecting seller applications and validators directly to the strategy writers in Sommelier Protocol.
Zaki has been building blockchains since 2013 and has worked with different blockchains like the Cosmos ecosystem with validators onboarding.
“There wasn’t very much deep integration between the validator and the application, so one of the things Sommelier has really pursued is that the seller application requires the validators to connect directly to the strategy writers,” mentioned Zaki.
Zaki clarified that “Sommelier is a protocol for running actively managed DeFi strategies, so you can think about trading strategy, and you’re actually going to buy and sell assets, a strategy in which you’re gonna move between five protocols or change with the asset you hold in the DeFI protocol.”
This idea topped up the DeFi and moved Sommelier Protocol to the top of seller creators to run the ecosystem.
Sommelier Protocol and Everstake’s Learning Curve
A constant learner, Sergey mentioned that the reason he sees behind this partnership is learning. Learning from the best and the most valuable partners in Web3.
“There is no university for validators or validator engineers, and to be honest, there is no university for blockchain developers either, so the only way to learn things is to participate in the testnet to play with the code, to play with the stock and be sure that we know the network from the inside. We know its potential problems. We have to solve them. We know the requirements, so our strategy at Everstake is quite simple to be useful,” mentioned Sergey.
Zaki sees the partnership as a milestone in their strategy of attracting active validators—he and the team had been thinking about the incentive to attract responsible validators, and the strategy they came across eventually worked.
Sommelier Protocol’s Teaser on Upcoming Launches
Sommelier recently onboarded a strategy provider entity called ClearGate. It has developed two intriguing strategies:
- Momentum Trading.
- Trend Following Strategy.
Zaki mentioned that these strategies are supposed to incentivize holders not just to hold but also to see the results of trading and investing.
Moreover, Sommelier Protocol is launching a new token to be available on decentralized exchanges and later on other exchanges. The team believes this token will perform better long-term than ETH and Bitcoin. Sommelier will release two new tokens, BTC Mom and BTC Trend.
“Users want to be involved in daily trading to earn on token fluctuations, so ClearGate allows automatic trading and returning financial outcomes, optimizing the ability to take advantage of future appreciation of ETH and Bitcoin,” said Zaki.
What the Bridges Are, What Risks They Bear and How to Fix Them
Formerly an engineer, Sergey clearly described what bridges are: “A bridge is an intermediary for transferring tokens between different chains, so you basically send a token to one chain, and as if by magic, it appears on the other.”
However, bridges are risky intermediates, so there is always the problem of hackers. There is a real chance of them stealing assets from bridges as this sphere is in an early stage, and recently there have been cases of Wormhole and Mango. So what Everstake is trying to focus on is reducing the possibility of failure on the RPC layer.
“We’re building extrnode, a next generation gateway which would allow us to avoid the risk and make a transaction happen, even if a single team, data center, or infrastructure suddenly disappears or is destroyed. So we’re trying to make an unstoppable infrastructure to empower unstoppable DeFi and blockchain operations. We hope that such a product will help Web3 to be safe in the near future.”
Zaki continued that the Sommelier Protocol has its own bridge but doesn’t wrap tokens. It takes the best from the blockchains it works with and leverages the strengths of the two completely different blockchains. It delivers user experiences and applications that neither blockchain as a single system could build.
Sommelier Protocol and Everstake’s Vision of Perfect Bridges
Zaki believes there will be protocols capable of standing a permission to be deployed between chains and that there won’t be one single bridge protocol to rule them all. He believes we need a system or a language to build bridges with.
Sergey added that the community needs extra time to figure out the essential infrastructure for building bridges. He believes it will strengthen the bridges and avoid having a centralized point of attack.
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