Sifchain has kind of been overlooked by many of late, with a slowly declining TVL on its exchange and a token price that has dropped down to around $0.14. But a turnaround may be on the horizon, with signs starting to appear that the worst could be over for this DeFi project with a unique position in the market.
As many would know, the airdrop program that Sifchain implemented became a problem child for the project, with delays, confusion and complexities causing some drama's in the community. The good news is that things seem to have settled down on this front for now, with the weekly drops occurring, and a requirement that each week's allocation gets added to LP's to stay in the weekly program. Sifchain allows asymmetric LP adding, and people need to put at least 95% of their airdrop into a pool each week, or they forfeit the remaining weeks drops.
To read more about some strategies around this, see this post I wrote a month or so ago. Personally, I have been splitting my airdrop each week into the ROWAN/cETH and ROWAN/cRUNE pools, and will continue with this plan for the remaining airdrop program.
Two bonus programs were implemented in an attempt to build up usage and support for the network. A Validator subsidy and Liquidity Mining program. These, like the airdrop, were complex setups, and suffered delays and it took a while for people to actually be able to see what rewards they were qualified for. However, the information is much clearer now, and rewards can be claimed and get payed out on a weekly basis. The program is closed now, but those that are in it continue to accumulate rewards for a bit longer.
The difficulties meant these programs didn't really capture peoples imagination, and became confusing. Other DeFi platforms with a much clearer and simpler form of liquidity mining likely left Sifchain looking confusing and not worth the effort. With this program winding down, we are awaiting the start of block rewards which will make staking and LPing APR's much clearer and easier to understand.
This, in my opinion, will be the biggest catalyst driving a turnaround for Sifchain. They team reaffirmed confidence in a mid July upgrade to enable the IBC protocol on Sifchain, and link it in to the Cosmos eco-system. The unique thing for Sifchain is that it already is linked to Ethereum, with a Peg bridge and pegged ERC's being the tokens currently available on Sifchain. The only way to buy ROWAN currently (the platform token for Sifchain) is by buying an eROWAN on Uniswap, and then bridging it over to Sifchain - an expensive process with ETH's high gas. ROWAN isn't really available anywhere else, and either buying it on Uniswap, or pegging other ERC's onto Sifchain and then buying there are the only options. This has limited the appeal of buying ROWAN, and high peg/unpeg fees are hurting adoption.
IBC fixes this. Once IBC is enabled, ROWAN can then be easily added to other Dex's, like Osmosis or the upcoming Gravity Dex, and also eventually Thorchain (once they enable IBC). This alone makes ROWAN more accessible, and should improve the experience of people wanting to buy ROWAN. We have witnessed the hugely successful launch of Osmosis, and it has captured vastly more TVL in a much shorter timeframe than Sifchain has. This shows the power and demand for IBC, and I think a lot of Cosmos based chains will be reviewing their IBC plans and looking to speed up their timetable.
IBC would allow all the tokens that are on Osmosis currently, to also find a home on Sifchain. The big deal here is being able to trade from Cosmos tokens to Ethereum tokens (in pegged form anyway) on one Dex. Sifchain is currently unique in this regard, although Gravity bridge is coming which will have its own system for bringing ETH tokens into the Cosmos.
Overall, I see the IBC upgrade as being the most important catalyst for a turnaround for Sifchain. Currently with a small TVL of just $6 million, Sifchain has been left behind to a large degree by Osmosis, and IBC is its best chance to regain ground as I see it.
An upgrade being worked on for Sifchain's Peg system will enable it to connect to any EVM chain. This means, not just Ethereum itself, but Binance Smart Chain, and all the other options out there, notably Polygon (MATIC) included. This will drastically improve Sifchain's position as an "Omni-chain" Dex, and make it an attractive place to move assets between the different eco-systems. This should drive trading volumes, if it can capture significant TVL to ensure trades don't encounter high slippage.
This Medium post from the team goes into all the detail of Peggy 2.0 and outlines the vision for the Peg system and benefits it will bring to Sifchain.
Overall, the recent updates from Sifchain, including their latest Weekly Update feel like the worst is over, the team has learnt from some of the poor implementation and timelines given. Managing expectations is a surprisingly important part of building up a new protocol, and I think Sifchain has learned its lessons and is doing a much better job in this regard. Hopefully, better days are ahead for this ambitious project.
Thanks for reading, for more information check these links:
Sifchain's medium blog
Cheers,
JK.
@d-company