👋 Hello all present and future Swingby community members,
We hope you are doing well in this exciting year for crypto. With the rise of multi-chain DeFi, NFT bull markets and institutional adoption of cryptocurrencies, 2021 has been an interesting year for crypto.
Over the last 3 quarters, the Swingby team has had our heads down building products while observing the shifts in the cryptosphere closely. As a team, we’ve been typically less vocal about our progress, achievements and thoughts about the space, but this is about to change. This is because the recent developments in crypto make us really excited about our vision of the multi-chain world, our upcoming roadmap and our role to play.
Hence, we believe this is the right time to share with you (our community):
Where we’re at now (i.e. the Past) - Our vision, history and progress so far
How the cryptosphere is evolving (i.e. the Present) - A multi-chain world with more Bitcoin adoption, L1/L2 landgrabs and regulatory scrutiny on CEXes
Where we’re headed (i.e. the Future) - SkyPools
1. Where we’re at
Where we began - A vision of a free & multi-chain world
In early 2018, a team of cryptography enthusiasts saw the rise of different Layer 1 chains and envisioned a multi-chain future - one where different chains enabled different use cases, one where users would swap between these chains regularly.
The world we envision is a multi-chain universe where there is free movement of users, assets and liquidity between different worlds. This freedom can only be achieved when the power to swap across chains are taken from the middlemen gatekeepers and returned to the common man.
In this new world, swaps should be:
Easy or even invisible, such that anyone can do it by themselves
Non-custodial, such that no one else ever has custody of your assets at any time
Ubiquitous, such that everyone can do whatever, wherever, however, you want
Our first product - SkyBridge
In February 2018, a couple of us from Binance, Bitfinex, Tether came together to create Swingby Network - a non-custodial cross-chain bridge using Multi-Party Computation-based Threshold Signature Scheme as well as a network of Metanodes.
To us, it was important for Swingby to be
Simple to use ✨
First, to ensure that Swingby was truly trustless, we had to minimise the need for our users to trust our software, code and Metanodes in blind faith. Using TSS MPC, we ensured the power to access your funds is as distributed as it can be so that no 1 entity can influence the signing and do evil during a swap. Furthermore, we designed the Metanode bonding system to ensure that it is more costly to be bad actors than good stewards of the Swingby Network. On the cryptography front, we also used well-audited open source TSS technology (see audits here). Finally, when swaps are completed, we avoided minting a new asset class that you needed to trust, relying on the gold standards of each ecosystem, BTC, WBTC and BTCB instead.
On every level, anyone using Swingby does not need to trust us or what we say, but the way the Swingby cryptography, network and Metanodes has been designed.
Simple to use
Next, for the common man to be able to do swaps themselves without middlemen 'help', our solution needed to be so simple that anyone can use it. Hence, we designed the Skybridge to be as simple as sending your BTC to an address and receiving it on the other side. Unlike other solutions, there's no need to go through multiple steps and do complex smart contract calls. Also, since it's just sending BTC to an address, any user using any wallet in any country can do a swap themselves easily.
Finally, our last focus was to make sure that all community members can have ownership and participation in the Swingby network via running a Metanode. We strived to lower any barriers to entry for running a Metanode both financially and technically. As long as have a hosted server with some basic requirements (see below for ETH Bridge requirements) and 50,000 Swingby tokens, you can run a Metanode. We even built a Telegram bot for Metanode deployment, so you can start sharing the 0.20% swap fees without doing complex DevOps.
As a principle, we wanted to share swap revenues with our community through Metanodes because we want our community to own & share the success of Swingby together with us. We do not want to become a private company providing software and earning revenue from our ‘customers’. Instead, we want to ensure our incentives are aligned with yours and our product is used, owned and loved by the community.
Our progress so far
After months of hard work, we launched SkyBridge on Chaos Mainnet on 30 December 2020 to swap between Bitcoin and Wrapped Bitcoin. Shortly after, we also launched the Bitcoin to BTCB (BEP20) Bridge on 1 April 2021.
As a team, Swingby is rarely vocal about our progress and achievements, but we have managed to achieve some key milestones over the past 3 quarters.
Built a distributed team of engineers 🛠
Built a community of 38,000 Twitter followers, 1,400 Discord members 👋
Launched Bitcoin to WBTC and Bitcoin to BTCB bridge 🚀
Launched sbBTC yield farming 🚜
Updated Swingby functionality for EIP-1559 🛠
Swapped 1670 BTCs or $81M worth of Bitcoins into DeFi 📈
P.S.: To read up on our monthly dev updates, you can check out this link here
2. How crypto is evolving
While we've had relative success with SkyBridge, we're far from done. In fact, as the team looks across the cryptosphere, we see a lot of tailwinds that give us confidence in our vision of the world and our upcoming product roadmap. Namely, they are:
1. Increasing adoption of Bitcoin 🏦
2. The Layer 1 & 2s Landgrab 🧑🌾
3. Regulatory scrutiny on CEXes 🔨
Increasing adoption of Bitcoin
Firstly, with the rising tides of institutional recognition of Bitcoin around the world, we've started to see more countries consider Bitcoin as legal tender - with El Salvador and Brazil as some examples This introduces Bitcoin to a whole new group of users. To these users, Bitcoin is not just a financial asset in their portfolio, but an alternative to a banking and financial system that did not work for them. We believe that this class of Bitcoin holders are going to start looking for creative ways to tap into the DeFi ecosystem, looking for yields on their Bitcoin. This is great for Swingby as a cross-chain swap solution that is reliable, cheap and easy to use.
Regardless, sitting at a $900B market cap today, Bitcoin still remains a relatively untouched asset class when it comes to DeFi with only 1 to 2 % of Bitcoin are in wrapped and swapped forms. We are truly in the early innings of the game.
The Layer 1 & 2s Landgrab
Next, Layer 1 solutions such as Polygon, Avalance, Fantom and Solana have been launching their own DeFi products (AMM, farming, lending, etc.) as well as 8 to 9-digit DeFi funds. This landgrab has started to incentivise developers, users and liquidity to flow to different chains respectively. Like explorers going on new voyages and exploring new lands, the multi-chain future slowly coalescing in front of our eyes. As these new cross-chain voyages start to take off between the EVM-compatible chains, we are well-positioned to facilitate this migration of users, assets and liquidity across chains
Of course, the fun does not stop on Layer 1s competing with Ethereum. Even within the Ethereum 2.0 space, upcoming Layer 2 solutions such as Arbitrum and Optimism have started to bring in more chain-hopping as well. For instance, Arbitrum has already consistently been hitting $1.2B TVL, despite being only launched recently. With this new age of cross-chain migration, there will be another gold rush of Degens and DeFi farmers looking for yield and opportunities across chains and we can’t be more excited to play a part here 🧑🌾
Regulatory scrutiny on CEXes
Finally, most cross-chain swaps today are still being done by centralised exchanges. This has worked well so far, but the tide is turning on centralised exchanges as regulators start to scrutinise the CEX industry.
Generally, this is great news for everything decentralised as more users are gradually moving their assets and investment strategies towards DeFi solutions like Sushiswap and Uniswap. With increased awareness and familiarity with using trustless and permissionless products, we believe that users will gradually turn their attention towards using trustless bridges as well. After all, isn’t it a red flag if you are doing everything permissionless, but when bridging your funds, you let a centralised entity handle that? We believe this awareness will spread and it’ll be another tailwind for Swingby.
In any case, if you are still using centralised bridges, you need to be aware of the looming risk of shutdown or service disruption when there are any regulatory mishaps ⚠️
3. Where we’re headed ✨
With the above tailwinds, we are really excited to see how the vision of a multi-chain world in 2018 becomes more real today. Launching SkyBridge and swapping over $81M in Bitcoin to DeFi has been great, but we are not done yet.
We want to do more and that’s why we have been working hard and building SkyPools. Beyond just swapping between BTC variants across chains, SkyPools is an upgrade to SkyBridge to interact with smart contracts.
To kick things off, the first use case would be to swap any asset to any asset across different chains, building on the same Swingby stack of ultra-minimised trust, an easy-to-use interface and community ownership. We are on track for a testnet launch by Q4 2021, where you will be able to swap your Bitcoins into any ERC-20 tokens 🚀
Ahead of the launch, we will be kicking off an article series on SkyPools to tell you more about the product, technology and why we are stoked to bring SkyPools to you. Subscribe to our Substack for the latest updates from the Swingby team and community!
If you found this interesting and have any questions, feedback or comments, come on to our Discord and talk to us! Also, we’re planning to refresh our Discord and have more activities there, so hope to see you join us on Discord 👋 🔥