pull down to refresh

Fuji Money AMA
13.2k sats \ 63 comments \ @fuji_money 3 Nov 2022 bitcoin
write
preview
related posts
341 sats \ 0 replies \ @parabole_douze_0h 8 Nov 2022 freebie
I subscribed to the beta but did not receive any news so far. Are you still boarding new testers ? Is the beta on main net ?
reply
192 sats \ 1 reply \ @LigerLite 3 Nov 2022 freebie
Does the smart contract have a killswitch?
reply
33 sats \ 0 replies \ @fuji_money OP 3 Nov 2022
No. There is only close or liquidation as path
reply
180 sats \ 1 reply \ @03683dfd8b 3 Nov 2022 freebie
Is the smart contract code open source?
reply
35 sats \ 0 replies \ @fuji_money OP 3 Nov 2022
Yes, check the paper published by Vulpem Ventures, it contains all the script and opcodes to replicate the Fuji protocol.
https://vulpem.com/synthetic-asset-smart-contract.pdf
reply
110 sats \ 2 replies \ @roach 3 Nov 2022
Will holders of fUSD have exposure to their loan counterpart, or towards a pool (i.e. are fUSD fungible where they all have equal underlying collateral)?
reply
43 sats \ 1 reply \ @fuji_money OP 3 Nov 2022
Good q.
There are two topics:
  1. You do not borrow from a lender, but FUSD is issued on-demand atomically when L-BTC is locked in the smart contract (either Liquid transaction or via Lightning swap)
  2. Yes FUSDs are all equal, therefore fungible to one another.
reply
2 sats \ 0 replies \ @skiff 4 Nov 2022
Can you please explain why FUSD stays pegged to the USD? Will you act as a market maker that always sells the liquidated collatoral (in LBTC) for FUSD at pegged price?
reply
145 sats \ 1 reply \ @And1 3 Nov 2022
What are the main reasons for using stablecoins over bitcoin?
reply
64 sats \ 0 replies \ @fuji_money OP 3 Nov 2022
In some jurisdictions spending bitcoin is a taxable event, using a stablecoin can help in not leaving the Bitcoin rails.
Currently you need a lender and give up custody for your Bitcoin collateral, with Fuji you can borrow on the go and you are always in control of funds (as long debt is paid back)
reply
101 sats \ 2 replies \ @BlokchainB 3 Nov 2022
Where do you see Fuji Money in the next 5 to 10 years? Is your market retail like Robinhood? Or are you offering products for the more sophisticated investor/trader like hedge funds. Lastly will Fuji money be using an app? Or will it all be desktop based
reply
184 sats \ 1 reply \ @fuji_money OP 3 Nov 2022
Yes we will start working on the mobile app soon.
Fuji USD is perfect for retail use cases: with your Bitcoin wallet, you can borrow on-the-go to spend at shops, gift cards, and/or buy virtual prepaid cards.
reply
84 sats \ 0 replies \ @fuji_money OP 3 Nov 2022
More trading-oriented use cases are in the making, eventually with different covenant designs such as automated lending pools.
reply
100 sats \ 2 replies \ @bitcointerest 3 Nov 2022
I just started learning about the Lightning Network and now you are telling me there's something called Liquid Network. What's the difference?
reply
75 sats \ 0 replies \ @timechain 4 Nov 2022
A sidechain where you lock up BTC and get L-BTC (Liquid Bitcoin). L-BTC has faster (1 minute) block times. Tokens and stablecoins can be issued on it also. The amount and asset type (Liquid Bitcoin, Liquid USDT, etc...) is confidential. It is less decentralized, and instead of being mined, blocks are signed by a federation of institutions (mostly exchanges) that require a majority.
The biggest usecase is with traders and investors, as it is really good for arbitrage because you can move your coins from one exchange to another quicker and privately, so you are not "announcing" your trade. Since it is mainly used when dealing with centralized exchanges, the fact that it is more centralized than (regular) Bitcoin is not really a problem for this use case.
It iscan open source product from Blockstream. Although it hasnt caught on much, I am happy it is a tool on Bitcoin's belt.
Heres a 3 minute video of Samson Mow explaining it: https://youtu.be/ipBSTuxMlLc
reply
0 sats \ 0 replies \ @nk1tz 3 Nov 2022
https://help.blockstream.com/hc/en-us/articles/900002016823-What-is-the-Liquid-Network-
reply
100 sats \ 1 reply \ @03dfeb4c66 3 Nov 2022
How can a person or a company become a price oracle provider?
reply
10 sats \ 0 replies \ @fuji_money OP 3 Nov 2022
Having a price feed API already live with a signature of price & timestamp. If the API is also used by other users and has a reputation of being live, would be important to let us add it to our apps.
Consider that the borrower in the end is the one choosing which and how many oracles he accepts to include in the contract.
reply
100 sats \ 1 reply \ @roach 3 Nov 2022
ETH uses the networks computational characteristics to allow code to run its own logic to lock/unlock funds from collateral pools. How will Fijimoney work on Liquid given that the code itself can't automatically manage keys. What is the pool security model?
reply
33 sats \ 0 replies \ @fuji_money OP 3 Nov 2022
On Liquid, you can make stateless smart contracts thanks to covenants opcodes.
Fuji assets are issued on-demand when collateral is locked (and must be burned when collateral is unlocked), there is no lender in this scheme and neither a pool.
reply
100 sats \ 1 reply \ @kr 3 Nov 2022
why haven’t synthetic stocks taken off in the same way that synthetic dollars have?
reply
95 sats \ 0 replies \ @fuji_money OP 3 Nov 2022
Trading stocks is more interesting for users living in the west, where capital markets and fintech is widespread, trading on regulated venues is less important than having bearer assets without KYC.
Stablecoins solves problem of volatility, capital gain taxes and trading long strategies.
reply
100 sats \ 2 replies \ @k00b 3 Nov 2022
What's your best argument for building financial products on Liquid vs alternatives?
reply
198 sats \ 1 reply \ @fuji_money OP 3 Nov 2022
To build trust-minimized offering that can scale globally, you need to be able to offer non-custodial services, and having a chain with covenants capabilities helps a lot.
At the moment the only alternative may be using altcoin chains or other sidechains such as RSK.
The main argument in favor of Elements (ie. Liquid) vs RSK is that is a Bitcoin Core and you are using Bitcoin tech instead of Ethereum tech like RSK
reply
283 sats \ 0 replies \ @coinselor 3 Nov 2022 freebie
Taproot enables new possibilities without sacrificing anything, it just takes time to get there. Check the Taproot block for an alien clue.
reply
12 sats \ 0 replies \ @imagaie002 6 Nov 2022 freebie
What is Fuji money all about?
reply
12 sats \ 0 replies \ @nicc9808 4 Nov 2022 freebie
The tradeoff is zero interest. I wouldn't be surprised to see some decent traction
reply
10 sats \ 14 replies \ @k00b 3 Nov 2022
Can you ELI5 how Fuji Money works under the hood?
reply
188 sats \ 13 replies \ @fuji_money OP 3 Nov 2022
  • Alice and Fuji agree on parameters such as liquidation target, collateral, and amount to issue
  • Alice decides to put $ 200 worth of Bitcoin to borrow 100 FUSD
  • In the sam transaction there is the FUSD issuance and the funding of the contract
  • Alice can close the contract to take back the BTC whenever she wants: she only needs to pay back the debt (ie. burning 100 FUSD in an OP_RETURN)
  • If Alice fails to keep collateral value above $150, Fuji can perform liquidation burning 100 FUSD and confiscating the whole collateral.
reply
105 sats \ 1 reply \ @rothbardllc 3 Nov 2022
Wait a sec, why would Fuji "confiscate the whole collateral?"
Poor liquidated Alice should get $50 of bitcoin minus reasonable fees, right?
reply
0 sats \ 0 replies \ @nk1tz 3 Nov 2022
Maybe the fee is 50% ?
reply
100 sats \ 10 replies \ @roach 3 Nov 2022
How does Fuji make money if there is no interest? Why would a user want to stake if they can't earn interest?
reply
33 sats \ 9 replies \ @fuji_money OP 3 Nov 2022
When you borrow you pay a setup contract fee which eventually can be added on closing as well.
Also, when liquidations happen the difference between the amount of confiscated collateral and burned Fuji asset is another revenue stream.
Users can only borrow: their collateral can always be taken back and the redemption is non-interactive (ie no cooperation with Fuji is needed)
To earn interest you can eventually lend the borrowed Fuji to another party or swap for USDt and lend on HodlHodl
reply
0 sats \ 8 replies \ @rothbardllc 3 Nov 2022
Also, when liquidations happen the difference between the amount of confiscated collateral and burned Fuji asset is another revenue stream.
Let's get real with this for a minute: I think you are saying that Fuji makes the ENTIRE REMAINDER when you liquidate a borrower.
In your example, you make approximately $50 on Alice's $200 loan.
If I'm reading this right, and I think I am, your business and revenue models are so flawed as to bring your entire judgment set into question.
As in: nobody in their right mind would ever use such a usurious service.
reply
43 sats \ 7 replies \ @fuji_money OP 3 Nov 2022
You can always redeem your collateral or topup before liquidation.
Liquidation can theoretically never happen in the contract lifecycle.
reply
33 sats \ 5 replies \ @fuji_money OP 3 Nov 2022
That being said the liquidation is very important because rebalance the system. To perform timely liquidations Fuji must have capital allocated for each contract.
reply
33 sats \ 4 replies \ @rothbardllc 3 Nov 2022
Sorry to be such a downer on all your hard work to this point, but if you are absolutely clear with potential borrowers about this complete loss of bitcoin on liquidation, your chances of success with this product are essentially zero.
It's an enormous penalty, Outrageous, even. Again, brings into question all of your thinking on this project for you to think this would work in the real world.
view replies
0 sats \ 0 replies \ @rothbardllc 3 Nov 2022
Sorry, naive. And I say this as somebody who has been liquidated. In a volatile market, you can go from completely safe to liquidated in just a few minutes.
reply
10 sats \ 1 reply \ @k00b 3 Nov 2022
What's the biggest misconception people have about Liquid?
reply
309 sats \ 0 replies \ @fuji_money OP 3 Nov 2022
The main one is that to peg out you need to perform KYC: at the moment no Liquid member is asking for personally identifiable information and more-over with submarine swap providers such as Boltz and PeerSwap you can atomic swap L-BTC for BTC.
reply
0 sats \ 1 reply \ @skiff 4 Nov 2022
Fuji Money revenue is mainly liquidated collatoral if I understand correctly?
Thanks
reply
0 sats \ 0 replies \ @fuji_money OP 4 Nov 2022
A setup contract fee and eventually a redemption fee. Also yes, we keep the confiscated collateral
reply
0 sats \ 0 replies \ @skiff 4 Nov 2022
What can I do with FUSD?
reply
0 sats \ 1 reply \ @skiff 4 Nov 2022
Who's the oracle? Any plans to decentralize the oracle role with a quorum-based approach? Are there any incentives for the oracle to publish price?
reply
0 sats \ 0 replies \ @fuji_money OP 4 Nov 2022
Oracles will mostly be exchanges and other price APIs, they already have free APIs to fetch price, they can simply add a signature to being able to be used as blinded oracles (ie. Exchange does not even know about a contract is in place).
We working with BFX & Blockstream Data
Yes the plan is to add an average quoroun directly on chain to avoid API bugs
reply
0 sats \ 1 reply \ @skiff 4 Nov 2022
What's the reason the peg between fUSD and USD is 1:1.5 instead of 1:1?
Thank you
reply
0 sats \ 0 replies \ @fuji_money OP 4 Nov 2022
Since the bitcoin value is volatile, the 50% extra collateral is needed to account for fast crashes to be able to sell the collateral in time
reply
0 sats \ 0 replies \ @muzz 28 May 2023
Yo. We just did an interview with Marco.
reply
0 sats \ 1 reply \ @skiff 4 Nov 2022
In the description it says it's possible to deposit via LN using submarine swaps. Would it be also possible to withdraw to LN or to a Bitcoin wallet?
Thank you
reply
0 sats \ 0 replies \ @fuji_money OP 4 Nov 2022
Yes, you can deposit or withdraw with any LN wallet. LNURL will be available
reply
0 sats \ 0 replies \ @Misha_Dany 4 Nov 2022
What's new? Margin mechanism + Bitcoin. Please, no.
reply
0 sats \ 1 reply \ @nk1tz 3 Nov 2022
Sweet idea. Very creative. I'm curious if Liquid settlement risk is part of your internal risk assessment?
reply
0 sats \ 0 replies \ @fuji_money OP 4 Nov 2022
Yes, in a scenarion where Liquid is not producing blocks we can migrate to other Elements based sidechains
reply
0 sats \ 5 replies \ @kilianbuhn 3 Nov 2022
Isn't liquid dead🤔 because everybody agreed on lightning ⚡
reply
63 sats \ 4 replies \ @fuji_money OP 3 Nov 2022
You can deposit and withdraw from the smart contract using Lightning!
All Lightning applications are custodial services anyway that ask you to deposit/withdraw.
reply
50 sats \ 1 reply \ @kilianbuhn 3 Nov 2022
That sounds pretty cool, I'm a big fan of interoperability, it's a big thing if we need solid infrastructure in the Bitcoin world
But I'm allergic to the words "smart contract" 🤮
reply
38 sats \ 0 replies \ @fuji_money OP 3 Nov 2022
Fair enough. Smart contracts on Liquid (and eventually on bitcoin) are stateless and are not Turing complete.
Liquid has covenants already which allow very powerful use cases
reply
0 sats \ 1 reply \ @skiff 4 Nov 2022
That means there is no non-custodial way to get sats from LN to Liquid (not with submarine swaps)?
reply
0 sats \ 0 replies \ @fuji_money OP 4 Nov 2022
Submarine swaps are non-custodial.
Pegin can be done trustlessly sending to federation multisig, instead for pegout currently you need cooperation with a Liquid Member (there almost 150 of them)
In future pegout could be done trustlessly too, now is a security measure
reply