@TylerEther thanks for the thoughtful reply. If I can try and summarize your points, I’d boil them down to these questions:
- Is the proposed burn rate sustainable and does Wallfacer’s existing work justify the current budget?
- TrueFi has lost much of its traction and in the current regulatory environment, aiming for aggressive growth is not wise.
- The proposal ignores the most pressing issue at TrueFi: lack of cash flow. This lack of cash flow is not due to a lack of decentralization, market makers, or analytics dashboards, but rather a lack of loans.
These are fair points and questions, and I’ll try to address them.
First, you point out a key thing – there is no silver bullet for finding traction.
But what’s the solution? If we stop building, we become irrelevant. We say TrueFi should adapt and iterate.
Even though the regulatory environment is tough, the “narrative” and broader market attention towards “on-chain” credit has never been stronger. There have been lots of industry reports covering credit/RWA protocols in recent months and more hype on twitter than I’ve seen before.
To us at Wallfacer, it’s clear that no protocol has “won” DeFi credit yet and even though TrueFi has been in a period of stagnation, we are very much still in the race.
Which competitors exactly? Today within credit/RWA, no one has “grown their cash flows”.
- Maple is in a similar position to TrueFi, w/ similar loans out. Their core market (and ours) of lending to MMs has evaporated. The same goes for Clearpool, Atlendis, and Ribbon Lend.
- Centrifuge only recently began to charge fees (more detail covering this in our post here) and even then, fees won’t apply to their existing pools (so, still no cash flow).
- Goldfinch TVL growth stalled and it’s on the cusp of running out of token incentives
- Credix has good growth, but also no token and no governance.
- Ondo is doing well, but as far as I can tell, all revenues go back to Ondo Company (not the protocol).
There isn’t a clear winner here. TrueFi has a chance and this is why we want to push. We want to do more than we’ve been capable of as just 5 contributors, and I’ll outline our strategy at Wallfacer below…
I think we could have done a better job making this clear in our initial post, but our objective for 2023 is to land a small number of “killer” use cases that define TrueFi as a leader in the space.
The honest answer is that today, WE DON’T KNOW WHAT THESE WILL BE. Thus, we’re going to try a bunch of different things through the end of the year. Sure, It’s not obvious that “cross-chain expansion” will be the thing that makes TrueFi win. But, most all managers we talk to today want or require KYC’d lenders, and maybe expanding to Base will actually unlock Coinbase’s KYC’d users? Maybe Avalanche’s subnets will. We don’t know, but we’re going to keep exploring until we feel confident in something.
We’re talking with lenders / managers / borrowers across crypto and RWA today, and learning → building → iterating fast to find what gets traction. Asset vaults are an example of this, and we’ve taken them from idea to a beta on testnet in just a few weeks.