KuCoin AMA with RSK Co-Founder Diego Gutierrez Zaldivar — Creating a Decentralized Global Financial Ecosystem Based on Bitcoin
Dear KuCoin Users,
Time: June 30, 2021, 11:00-13:12 (UTC)
RSK Infrastructure Framework (RIF) is a set of open and decentralized infrastructure protocols that allow for faster, easier, and more scalable development of distributed applications (dApps) within a unified environment in order to enable mass adoption of Bitcoin and RSK. Built on top of RSK, RIF provides the building blocks to construct a fully decentralized internet to enable Decentralized Sharing Economies (DSE): collaborative marketplaces where individuals interact on a peer-to-peer basis coordinated by immutable smart contracts.
The building blocks that RIF brings to Bitcoin in order to allow mass adoption are identity, storage, communications, marketplaces, micro-payments, and gateways. RIF marketplace is where service providers connect with potential customers, and users can subscribe/consume available services.
All RIF services are designed to facilitate the interaction of the global community of developers and blockchain technology. The RIF Token allows any token holder to consume the services that are compatible with the RIF architecture.
Official Website: https://www.rifos.org
Diego Gutierrez Zaldivar — Co-Founder of RSK
Diego co-founded RSK Labs that made Bitcoin fully programmable by providing smart contracts. He has also been a pioneer of blockchain and Bitcoin development in Latin America. He co-founded the Argentine Bitcoin NGO, with over 5,000 members registered at the meetups and 30,000 members in its online community, and the first Bitcoin Center in Latin America. He is also president and co-founder of the Bitcoin Latam NGO, where he helped create a network of Bitcoin communities with presence in 9 countries in the region and the longest running Bitcoin Conference in the world: www.labitconf.com.
He has been recently inducted into the Crypto Hall of Fame, an initiative that honors outstanding business leaders and entrepreneurs who, through their work, have made a significant contribution to the crypto industry, such as Satoshi Nakamoto, Hal Finney, Nick Szabo, Vitalik Buterin and Adam Back amongst others.
Q&A from KuCoin
Diego: Hello everybody! Great pleasure to be here with all of you!
Q: RSK/RIF has a mission - to build a "new global financial ecosystem". Please introduce the project to those unfamiliar and tell us about the ideal ecosystem that RSK/RIF is aiming for.
Diego: Bitcoin set the foundations to create the financial system of the future. However, for this to become a reality, we (the RSK founders) thought it needed to expand its capabilities in a layered approach (similar to the OSI model used by the Internet).
The first layer needed was one for decentralized economic coordination. Enter the RSK blockchain, Layer 2 to Bitcoin. The first sidechain to enable smart contracts on Bitcoin. RSK, at times, managed to be the most secure smart contract platform in the world due to merged mining by more than 80% of the Bitcoin miners of the world. The RSK sidechain is the primary component that made Bitcoin fully programmable, allowing dApps to be built on top of it, enabling the transfer of all types of assets.
But decentralized blockchain networks suffer from limitations in terms of scalability, usability, and interoperability with other blockchains and legacy systems.
That's when Layer 3, RSK Infrastructure Framework (RIF), emerged.
Launched in November 2018, RIF is a suite of protocols for building truly decentralized fintech solutions on top of RSK and Bitcoin. RIF is structured around a sharing economy engine that runs on the RSK Blockchain and is fueled by the $RIF token. RIF services tackle the most important points of control on the Internet, such as identity, storage, communications, marketplaces, micro-payments, and gateways. These are the building blocks to construct a fully decentralized internet, which empowers and protects the value of individuals.
The RIF Services also enable the RSK Blockchain to scale preserving decentralization and provide applications with all the elements to operate in a fully decentralized environment while providing the same user experience user get today from neobanks and fintechs.
These 3 Layers (Bitcoin, RSK, RIF) jointly provide the foundations for DeFi solutions that will create the financial system of the future based on Bitcoin, a new financial system that will be open and inclusive by design.
Q: There’s major DeFi innovation happening across Ethereum, BSC, Polkadot, and the likes. While RSK is compatible with Ethereum and EVM, what are your plans to enable users to leverage DeFi opportunities across other networks?
Diego: At RSK, we have been sharing the vision of the Internet of Value since late 2015. We truly believe that Bitcoin started this new network of networks for the store and transfer of value. That's why interoperability has been a cornerstone of the RSK vision from the start. RSK was the first to establish a productive sidechain to Bitcoin and also created a bridge to Ethereum. We believe in offering Bitcoin’s benefits to Ethereum users and to connect these respective developer communities is a crucial step for the blockchain ecosystem antifragility as a whole. It’s our mission to provide the tools needed for individuals to transform existing closed systems into decentralized and interconnected open networks, not only for DeFi but for a more decentralized and fair internet in general.
The RSK two-way bridge to Bitcoin created in January 2018 together with RSK Network allows users to cross their BTC and use them in RSK to interact with smart contracts. On the other hand, the RSK token bridge announced in February 2020 expanded this capability to ERC20 tokens and the Ethereum dApp ecosystem by allowing users to cross RSK and Ethereum ERC20 tokens between networks.
An example use case of this is the integration of DAI to the RSK Network via the Token Bridge in October 2020. As a result of DAI’s integration with RSK, DAI is accessible for all BTC-backed DeFi solutions. Thanks to the RIF Payment services, users can send microtransactions with DAI on RSK and interact with smart contracts for services such as staking and lending in the RSK Blockchain.
RIF Payment services also enable users to operate with a single token (i.e., rDAI) without the need to have an additional cryptocurrency (i.e., ETH) to pay the fees. Imagine the potential of having instant payments of stablecoins fully integrated with Bitcoin and costing a fraction of a cent. That can create the perfect playground for fintechs all over the world and will enable competition in the financial system on a whole new level.
Q: 2020 has been a very exciting year for DeFi. Can you give us an overview of RIF's DeFi ecosystem and its features?
Diego: Decentralized Finance (DeFi) aims to create all the existing financial services in fully decentralized, trustless, and transparent protocols that run without intermediaries, but there are many challenges to that, and RIF was created to solve those challenges.
DeFi has the potential to level the playing field, allowing everyone to participate equally, regardless of where they are in the world or what their current economic situation is. DeFi can make more complex financial operations permissionless and censorship-resistant, much like Bitcoin did with the mid to long term store of value.
Since our beginnings in late 2015, our vision was always to bring DeFi to Bitcoin, and today, that's a reality. Some of the best DeFi platforms, such as Money On Chain (MOC) and the RIF Services, exist on the RSK Blockchain and are secured by the Bitcoin Network.
The DeFi ecosystem on top of Bitcoin has been growing, and here: https://www.rsk.co/openfinance, you can have a glimpse of how the RSK open finance ecosystem looks like today.
A very relevant DeFi solution for RIF is the RIF On Chain Protocol (ROC), which is based on the Money On Chain protocol used to create the first Bitcoin-backed stable asset in the world, Dollar On Chain (DOC).
ROC enables RIF holders to provide collateral to issue RIF Dollars (RDOC) and earn passive income while providing the RIF Economy with a stable asset to operate its products and services.
Other great DeFi solutions on RSK include Sovryn, RSK Swap, Kripton Market, Tropykus, Bundles Finance, Rlending, Defiant, Liquality, Babelfish, to name a few.
Our plans are to continue to move forward with building the blocks to enable a new global financial system so that developers and entrepreneurs can build the solutions that are needed for it to flourish.
Bitcoin is not only the most liquid and safer cryptocurrency but through RSK can provide transaction costs that are a fraction of those in Ethereum. Here you can find a comparison chart: https://rskgasstation.info.
Q: What are RSK’s plans in regards to the NFT opportunity on Bitcoin?
Diego: The NFTs movement is getting tremendous traction in many areas of human development that go from art to collectibles or real estate. RSK is bringing NFTs to Bitcoin, and many projects want to leverage on that.
One example is the Gibraltar NFT studio (https://newsnreleases.com/2021/03/02/coinsilium-group-to-establish-gibraltar-nft-technology-studio) that announced the starting of NFT development on RSK (https://uk.finance.yahoo.com/news/coinsilium-group-limited-nifty-labs-060008946.html). Also, we have pioneers of the NFT for Bitcoin development like Watafan that have been building NFT solutions for over 2 years on RSK. There are other projects coming that focus on Latin American Art and Real Estate, and the RIF Marketplace itself has an NFT trading engine embedded that was initially used to buy and sell RIF Name Services but will be open to use for any type of NFTs.
One of the most important focuses on NFT platforms in RSK will be in the proper curation of NFT issuance as fraud is rampant in some of the major NFT marketplaces, and RIF Identity can provide the means to sort those problems.
Q: What are your plans for 2021, and please briefly share with us what you can about RIF On Chain (ROC) tokens.
Diego: In general, the main challenges for Bitcoin and blockchain are scalability, usability and interoperability. The RSK Full Stack (RSK Blockchain and Infrastructure Services) has sorted out all these problems in the last years; during 2021, the focus will be on packaging these solutions and integrate them in fintechs and crypto wallets in Latam and Asia to provide access to the DeFi for Bitcoin ecosystem to hundreds of thousands of users.
Regarding the RIF On Chain tokens, as I mentioned before, RIF holders can stake their RIF on the protocol and get the leveraged token RIFPro to get passive income while they back the creation of stable asset (RIF Dollar) that will be highly demanded in the RIF Economy and DeFi protocols. Also, for those who want a more leveraged position, they can get the RIFX token and get 2X leverage vs. RIF.
Free-Ask from KuCoin Community
Q: This is very important. Most of the projects nowadays are often left in the middle of the operation and often abandoned due to lack of sustainability and incapability to support growth with the market crazily fluctuating. In what efficient way will you be able to go along with market fluctuation?
Diego: This question was asked multiple times. Both Sergio Lerner and I have been in the Bitcoin space for more than 9 years, of which the last 5 we fully devoted to the RSK Ecosystem. So we have full commitment to take this project to its destination and a reputation to protect. The organization we lead has the resources to continue our work for more than 10 years, but the protocols are already built, and now the main challenge is how to turn these protocols into products and services to reach hundreds of millions of users.
Q: How do you plan to spread awareness about your project in countries/regions where English is not spoken well, like Indonesia, Vietnam, India, Bangladesh, and Iran? Do you have local communities for them to make them better understand your project?
Diego: Currently, all our content is localized to English, Spanish, Portuguese, Chinese, Korean, Japanese, and Russian, and we plan to extend that this year to also address the needs of users in Vietnam, the Philippines, and Indonesia. As our target countries expand, we will also expand community and documentation support as our objective is to build an open and fair financial system that can provide services to a billion users currently not served or underserved by the legacy financial system.
Q: Bitcoin is viewed as an important but outdated blockchain as there are many limitations to it and other blockchains available which overcome those limitations. What made you choose Bitcoin as the blockchain to build the layer 2/3 solution on top of it? Will RSK eventually lead to the Bitcoin network overcoming all of its shortcomings?
Diego: In our view, Bitcoin is not outdated; it is designed for maximum security. Decentralized blockchain networks respond to a trilemma between security, scalability, and functionality. To have maximum security/decentralization, you need to sacrifice scalability and functionality. Blockchains that do thousands of transactions per second grow at terabytes per year of information; therefore, they become centralized very fast. Blockchains that have more functionality offer an extended surface of attack; therefore, they sacrifice security.
In RSK, we follow the layered architecture principle much like the OSI model, and we think each layer needs to excel at what is best: Bitcoin -> Store of Value, RSK Blockchain -> Economic Coordination, RSK Infrastructure Services -> Scalability, Usability, and Interoperability.
Having this full stack protected by the Bitcoin network, the biggest decentralized security infrastructure, and built on the most broadly accepted crypto asset in the world (Bitcoin) was a conscious decision we made because we are building a financial system for decades to come.
Q: Why do we actually need #RIF? What is the main role of $RIF in your project? What will be the benefits of holding $RIF? How did your project prevent early investors from selling their tokens, and what benefits do you give them? What are your token revenue and tokenomics? Can you explain the burn system of $RIF?
Diego: RIF and RIF-backed stable assets are the tokens used to buy, sell, and stake in all services of the RIF Economy. The RIF Economy is structured around a P2P sharing economy engine called the RIF Marketplace, where users can provide and consume RIF Services and Products.
Given the RIF supply is fixed (1 billion tokens), as the RIF Economy grows, the value of RIF needs to adapt accordingly. Early RIF buyers already have full control of their tokens, and the only locked tokens are the ones from the founders and IOVLabs, which still have a 2- to 3-year lockup for part of the supply.
Part of the core vision of RIF is around interoperability, so although the project started in the RSK Blockchain, it will, later on, serve any smart contract enabled crypto economy like Ethereum; therefore, RIF needed to be a separate token from the native RSK Blockchain token that is Bitcoin (RBTC).
Q: El Salvador made Bitcoin a legal tender. Is it possible for other LatAm countries to make this happen as well? And how can RSK Infrastructure Framework be helpful with such adoption?
Diego: I think eventually, other countries that have dollarized economies will choose to make Bitcoin a legal tender. We are helping government officials in El Salvador understand Bitcoin, and we are helping the RSK Ecosystem bring DeFi and RIF Solutions to the 6 million Salvadoreans because we think this is a great opportunity to demonstrate how the RSK Blockchain and RIF Services can operate on a massive scale.
This is fully in line with our growth strategy for the ecosystem where we package the RIF and RSK DeFi Services into products that are integrated into fintechs and crypto wallets in the regions we are targeting (currently Latin America and Southeast Asia). We have been building robust protocols for many years, and this year is the year when those protocols will reach users on a massive scale.
Diego: Thank you very much! Sorry for the length of my replies!
It was a great pleasure, and the community brought awesome questions!
KuCoin and the RSK Infrastructure Framework have prepared a total of 13,400 RIF giveaway to AMA participants.
1. Free-ask section: 500 RIF
2. AMA activity: 12,900 RIF
Activity 1 — Quiz: 9,000 RIF
Activity 2 — Price Guess: 1,800 RIF
Participation Rewards: 2,100 RIF
. . .
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