Binance and Eosfinex join EOS DeFi protocol to handle smart contract updates

 

Equilibrium, an EOS-based decentralized finance project (DeFi) similar to MakerDAO (MKR), is adding four block producers to its governance system, in particular Binance.

Other members are Eosfinex, a decentralised EOS exchange affiliated with Bitfinex, as well as the independent block producers EOS Nation and EOS Cannon.

The group of four will act as „governance overseers“ of the system. Their main purpose is to sign the Equilibrium smart contract updates.

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As Alex Melikhov, the CEO of Equilibrium told Cointelegraph, this takes advantage of a distinctive feature of EOS:

„One of the main advantages of the EOS is the intelligent upgradeable contract code. In other words, you can migrate to new versions of your application seamlessly and without stopping the whole system.

This approach is different from that of the close to the launch, yoichi hirai stepped down, went to jail, active in the blockchain space, fidelity digital asset services, cryptocurrency fund llp, did receive a $50,000 fine, announced a deal, digital certificates for diamonds, potentially controlling portion, where new iterations of the DeFi protocols often require a complex migration procedure. Old versions can eventually be closed down to avoid security risks, as was the case with Maker’s single collateral Dai, or they can be left to their own devices, as with Uniswap V1.

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Reputation-based decentralization

Supervisors hold portions of a multi-signature key that is used to authorize ecosystem improvements. They are chosen from „the best known and most trusted ecosystem participants who could put their reputation on the line for the integrity and relevance of smart contract updates,“ Melikhov said. The decision to include new entities rests with all existing board members, not just Equilibrium, he said.

This approach is an interesting middle ground in the world of DeFi. In many Ethereum-based projects, the protocol’s founders have management keys that give them special rights to the contract, a practice that the community disapproves of. This is usually done with the promise of destroying those keys once the protocol is mature enough.

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In contrast, the Equilibrium government is „already decentralized,“ Melikhov said, although he admitted that it is not a totally distrustful process that is guaranteed by economic incentives or algorithms.

The project opted for an alternative approach of „creating an authority testing framework consisting of trusted counterparts who are independent according to their backgrounds,“ he explained. There are no plans to destroy these upgrade keys, as that would mean losing the added possibilities of EOS.

This approach fits into the broader context of EOS governance, which is based on agreements between specific stakeholders.

Binance wants more uses for BNB

A representative of Binance told Cointelegraph that the exchange considers EOS a „promising blockchain for the development of DeFi“, especially for its cross-chain capabilities. Since EOSDT recently integrated Bitcoin (BTC) as a form of warranty, the company sees a place for the exchange’s token as well:

„We hope to see our BNB token as an integrated asset in more DeFi applications, and we believe it can be introduced as a new type of warranty for the EOSDT stablecoin at some point.

The addition of Binance as a supervisor does not require ownership of the Equilibrium NUT governance token, as the spokesman explained. However, the exchange seems to be encouraged to see the project succeed.