BlockTalks x DIA AMA Transcript!
Hello! BlockTalkers & Blockchain Enthusiastic!
We recently hosted an AMA with DIA, on 15th July 1 PM UTC. Many of you might have participated or many of not. But we make sure no one missed out from the knowledge shared by Michael Weber, CEO at DIADATA & Samuel Brack, CTO at DIADATA. So here we are up with AMA transcript, for those who missed the live session, this blog post will be saver & feeder of knowledge for them.
Introduction Questions Asked By BlockTalks
Q1. Could you please introduce DIA to our community in layman’s term?
Ans — DIA is building a Wikipedia for financial data.
A short video from a yesterday’s Binance panel referencing us for some context why this is more crucial than ever. https://vimeo.com/438285460#t=180s
Q2. What are the advantages of DIA to other alternatives in the market?
Ans — There are many alternative data providers in the market, each with their own system of collecting, aggregating, and publishing data. What differentiates us from our competition is the transparency we provide by allowing (and obliging) community members to check, validate, challenge, and provide our data sources and methodology. We believe that this bottom-up approach can generate much more trust than any centrally managed data repository. We build a voting mechanism for all community members to decide about data sources and methodology. Also, our database is hashed regularly and can be audited even years after publication of a data point to ensure its history is unchanged.
Q3. What are the major milestones DIA achieved so far & what are in future pipeline?
Ans — For us personally growing and maintaining the team over the years, also when DeFi was not that driven by a broader user base — was the most important task and milestone. Also for the future we think key is attracting and retaining the right employees for us.
As for product we put a particular focus where it hurts (IMO) in DeFi: Compliance and Transparency — and generated first paying customers, coaptations and investment rounds.
The future will be focussed in particular on even broader data coverage, but in particular more focus on user needs and rapid roll-out of features by and for the community. This is also a core reason for the public token distribution.
Questions Asked on Twitter For DIA!
Q1. Transparency and validity of basic market information on digital assets are essential. I’m interested in your financial partners? I can only see Finoa and Multichain Asset Managers from your articles.
Ans — Since the DIA product is open-source and free, developers do not automatically have to notify us for usage. Since 2018 we already integrated in >20 FinTechs, from a major FinTech Sandbox https://f10-sandbox-portal.apps.ndgit.com/#/apis (feel free to use) to custody providers, unfortunately not everything is public.
Subsequent to the bonding curve we will also open a „DIA Labs“ (more coming in the next days) to enable dAPP building more rapid and in close feedback loops.
Q2. Similarities between governance tokens and shares can generate an intervention risk from the SEC, which might deem these tokens as securities. What is your opinion about it and how can the DIA token be impacted with future regulations?
Ans — Exactly, and this was a key focus for us — actually coordinating this with the regulator (for us Switzerland/FINMA). Our DIA Token is ruled as utility token, and we strictly adhere to a non-security regulatory framework in the context of our governance mechanisms.
Q3. DIA currently uses Ethereum as a smart contract platform but currently this network has certain limitations! Does DIA plan to change structurally in the future? Why did you choose the erc-20 network?
Ans — We use Ethereum due to the major majority of developers, tools and browser integrations being there, as well as being a robust and reliable platform. We continuously scan the landscape for new underlying technologies, but so far the DeFi ecosystem seems to settle on Ethereum.
For ERC20, we cose it because it is a simplistic standard, can be understood by many people even with limited technological background and is integrated in the ecosystem very well. We like to keep the base layers of our stack simple and avoid complexity where possible, because complexity will come at higher levels of our product where we can manage it ourselves.
Q4. DIA biggest highlight is its cross-chain support Compared to other DeFi platforms, DIA can offer collateralized loans and stablecoins to users of major crypto assets, even BTC .But at the same time so many different collateral systems in CDP, how will volatility be managed there?
Ans — Coming from the traditional financial space, I think volatility is not always a bad thing, in contrast, I think it can be a major reason for asset allocation if other assets perform flat. FYI: we also operate a Volatility Index: https://docs.diadata.org/documentation/methodology/digital-assets/cvi // As for the DeFi on top of the data, we think dAPPs trading on these inefficiencies can become very lucrative. But to come back again on this for DIA: We are really putting a focus on the underlying datasets for these tools, not so much the dAPP development — we think the community knows better what is needed there.
Q5. You said that DATA coming from COINMARKETCAP is somehow 80% overstated. Now, what is DIADATA’s solution for this?
Ans — Coinmarketcap is an example for a centralized crypto data provider. It is not entirely clear which data sources are included in what exact methodology, and thus it is hard to pinpoint the exact sources of deviation. With some behaviour which we observed and reverse-engineered in the last years, we think that a crowd-controlled approach would have prevented erratic behaviour. For example, there were exchanges using USDT but reporting USD, which was also taken into the price feed of coinmarketcap. The observed market exchange rate for USDT was close to USD 1, but not exactly there (somewhere in the range of USD 0.97–1.02). This led to slightly different price reportings.
In DIA, our crowd-driven open-source and transparent approach allows anyone to check, validate, and correct perceived issues by starting a dispute and getting a community vote on improving data quality.
Questions Asked by our BlockTalks Community Members during live Session for DIA team!
Q1. What are your plans to educate and raise awareness and adoption among the community to make more people understand DIA Token and its technology?
Ans — We plan on publishing articles and tutorials on how to use DIA and extend our documentation on https://docs.diadata.org
We want as many people as possible to be able to contribute to DIA, so that the community is strong to provide reliable data.
Q2. Vast majority of DeFi applications and oracle provider do not publish sources or methodologies that are the backbone of the smart contracts holding hundreds of millions of capital. This lack of transparency has create several doubts about DeFi. How does DIA (Decentralised Information Asset) aim to bring transparency back into Defi with it technology?
Ans — Thanks for the question. I think the DeFi space can also use bigger competition in the data space — since in comparison to traditional finance to e.g. a flash crash on Dow Jones, you can’t pull the plug on DeFi transactions. We tackle this with a radical open approach, from sourcing to publication of data vs. another blackbox that sells API keys.
Q3. What are your plans to educate and raise awareness and adoption among the community to make more people understand DIA Token and its technology?
Ans — We are launching DIA Labs in August, a place for community driven education, awareness and Hackathons. Besides this, we have a few confidential project with major actors in DeFi and traditional Finance for a top-down awareness approach. Stay tuned!
Q4. How does DIA ensure the highest security for our products?
Ans — We fully believe in open source software to provide secure products. Anyone spotting bugs can help to improve them, and the community will be able to see what is happening at all times. Our database is also open, so that all derived products (e.g. Defi applications) can audit what data is used, where it was sourced and processed.
We also use state-of-the-art token security mechanism, such as Shamir secret sharing wallets to ensure security and business continuity of our operations.
Q5. One of your twitter post talks about Liquidity since you are dealing with DeFi liquidity is very important in DeFi. So,
1) Is DIA can solve the problems of Liquidity and make it more solid for DeFi developments?
We know that ORACLES have big benefit to DeFi
2) How will DIA make this ORACLES more beneficial to DeFi?
Ans — Oracles are the achilles heel of DeFi — with numerous attacks and flash crashed going on. BTW, this happens regularly in traditional finance (https://www.fnlondon.com/articles/french-markets-regulator-hits-morgan-stanley-with-e20m-fine-20191210). As for liquidity we provide, in our view, the best tool to build dAPPs where arbitrage on liquidity actually goes to the projects, as for the Oracle solution we provide an auditable feed that can answer the question “How did you come up with this number” — on chain.
Q6. What mechanism Do You use to verify the Quality of Data?
Ans — There are several columns for that: 1. Our dispute system. If a community member spots errors or abnormities in an existing data source, they can report it and the community will vote about how to proceed using our governance tokens. This ensures that no hostile attacker suddenly provides wring data on purpose. 2. To protect against erroneus data that was just the product of technical glitches, we use mechanisms to clean outliers and report suspicious data values for review. 3. To ensure that the database was not changed, we build a hashing mechanism that can be used to prove the data has been unchangted since it was recorded by us.
Q7. While going through the details on DIA Bonding Curve Offering, I discovered that only 30M DIA Tokens will ever be in circulation which account for about 15% of total DIA supply. Could you tell us what’s going to happen to Non-sold tokens?
Ans — Yes, clear answer and commitment from us here: Non-sold tokens will be burned. A full report including etherscan validations will be posted after the bonding curve end.
Q8. Blockchain has many disadvantages, so I would like to know, what do you have planned to merge blockchain and a technology that increases security in it?
Ans — Thanks for this excellent question, raising concerns about the ecosystem in general. We see the blockchain as a solution to very specific problems: Bringing trust to a trustless “wild west” ecosystem. But there is the danger of inefficiencies, which is why we believe only selected processes should be done on-chain. For instance, all our aggregation and outlier cleaning happens off-chain (still open-siource and auditable), only the publishing of the final value is done on-chain in an oracle. This design approach is followed everywhere, so that we ensure transparency and auditability by building in an on-chain component, but implementing the computation intensive tasks off-chain in our hybrid model.
Q9. Can you explain more about your Continuous Stakeholder Distribution Mechanism (CSDM) and how will the Distribution of DIA Governance Tokens be carried out?
Ans — We think for a product that proclaims decentralisation (I mean us) it is also critical that we don’t have only inhouse stakeholders with a similar mindset — but actually a community that helps us improve the product. For this objective we implement a stakeholder mechanism for using our Oracles, data feeds, enabling staking of tokens for long-term incentivation. This is also a method where we look for tokenholder feedback and participation on the incentivation of further use cases.
Q10. Who can Build the Defi Products on your data & Oracles? Can You tell me main long- term Benefit of DIA token Holder?
Ans — Anyone can build Defi products upon DIA. We provide verifiable and transparent data, and this data can be used to build derivative financial products not only by banks but by anyone. In our opinion, this democratisation of the financial market is crucial in bringing back power to the community and away from centralized corporations. This is also why we are a Swiss association and not a company. The long-term benefit for a token holder is the ability to vote onproposals and disputes, as well as governance of the ecosystem.
Q11. What solutions does DIA provide to the problems that some decentralized applications have?
Ans — We provide reliable, verifiable and auditable financial data. Our main solution includes access to oracles that can be used by anyone to build financial products with our data.
Q12. While everyone is saying DeFi is the new frontier, and so on, I see you are combining DeFi and Oracle, so can DeFi and Oracle work hand in hand? What’s the Similarities between DeFi and Oracles?
Ans — Many Defi applications need reliable oracles to inform them about off-chain events, such as prices or corporate actions. This is where our data stream comes in.
Q13. I am an Ethical Hacker and experienced Developer, do you have plans for Hackathon or Bug Bounty so as to check the security of your ecosytem periodically and also invite developers to build.
Ans — Our system is fully open source and we are very happy to receive pull requests for any of our systems. And in the future we consider bug bounty programs to be an important building block in maintaining secure operations.
Q14. I see DIA also focused on DATA , also considering about user data. How will DIA platform secure user data?
Ans — DIA is focused on financial data, user data is not our product. We don’t see any defi products so far that would need access to personally identifiable data, and it would be near impossible to use personal data on any public blockchain and still remain in the scope of data protection laws.
Q15. Could the Covid-19 pandemic and economic problems in many nations be the cause of the change from the current financial system to DeFi? DIA is ready to change the world?
Ans — Covid19 is pushing digitisation quite rapidly, from telecom to financial processes suddenly enables digitally (I recently send a pdf scan to a german Ministory, which would have been impossible 1 year ago). While this is good for us, we see an uptick in interest, and remote work is nothing new to us — I am also concerned about the bigger macroeconomic effects that are just kicking off. But as for our mission: If you look of info nowadays you probably go to Wikipedia. With DIA we are on good track to become the Wiki for Finance, with solid interest from traditional and DeFi players.
Q16. Q. How did DIA handle the attacks? Historically, which projects did DIA handle attacks for?
Ans — Check this one out as an example of an attack mitigated: https://medium.com/swlh/deribit-flash-crash-1-3-mn-good-reasons-for-dia-data-704be91d2a3a
Q17. The target of DIA is to bring together data analysts, data providers and data users. This sounds interesting and amazing, could you tell us the methodology DIA adopts in making this actually possible in reality?
Ans — We use Github and the Bounties network to bring together data analysts and data providers. There, anyone interested in a data source can fund its inclusion and in the end, a production-ready oracle will be deployed. Data users are free to use our oracles and API to build Defi products upon our stack.
Q18. How will DIA solve the scaling problem? And how will it overcome the threat of centralization?
Ans — Our approach to scaling issues is to design a hybrid model. Anything that can be done off-chain is done off-chain, and only security-proof related transactions are done on-chain. This ensures low costs of computation and auditability, which are both important factors for a functioning ecosystem.
Q19. How to keep motivation to hold DIA tokens in the long term? How will it uses for?
Ans — The DIA token is a governance token and can be used in dispute settlement votes, votes about new data sources and other governance related votings.
Q20. What are the solutions for $DIA once the extreme volatility hits in crypto market how do you protect your investors?
Ans — We will offer a yield smart contract where you can send tokens and gain a DIA interest, have a clean Token history, so no big surprise in terms of supply driving vola is coming up, Team is locked up for 7 months. So I think the inital price volatility is also one that might be driven be the investors, and one that helps to find a clean supply/demand price.
Q21. What part of finance are you trying to distrupt using your project? and How are you going to do that?
Ans — Financial data providers. I worked, used and saw pretty much all of the relevant ones. All are using public data, selling it off with massive premiums, and are limiting the access (who of you has a Bloomberg Terminal). It is time to change this, for cryptos, but also traditional financial data.
Q22. DeFi is very popular nowadays. What is interesting about the DeFi DIA platform compared to other Defi projects?
Ans — Our approach differs from our competition in the way we provide transparency. We believe it is important to be able to have a completely transparent and auditable data delivery, because this data is used as the main building block in smart contracts. The main problem we solve is the trustworthiness of oracles with financial data. We also provide a proof of immutability for our database on-chain, so that anyone can check that our database has not been changed since some data was recorded. This historical data can then be used as a verified input.
Q23. Can you share with us the decentralized approach/solution by DIAdata_org to make DeFi world & trading platform secured and also, preventing similar case from happening in the future?
Ans — The decentralised approach ensures that the community has the final say about data delivery. Our vision is a wikipedia-style collaboration, where users and community members dispute and vote out low-quality data sources. This curation process will lead to high quality data feeds, and together with a transparent open source implementation process we can be sure that any error or maliciously inserted malfunction can be detected early and before any major impact is generated.
Q24. What are the strengthens of DIA that make different for it competition? Why should I invest in DIA?
Ans — Our core strength lies in transparency and auditability, differentiating us from centralised solutions where you access a black-box. But I also think the more assets flow into DeFi product, the more crucial it will become to integrate multiple Oracle feeds with risk monitoring triggers for security. For ours you can always drill down the rabbit hole “How was this number calculated” to the primary source.
Here are some important links of DIADATA 👇
