Can Enigma solve the crypto liquidity problem?


#1

Those of you who have lived for years in the crypto world probably don’t notice as much anymore, the slow and convoluted process necessary to convert from one currency to another or from fiat. I do. I just bought my first crypto and it’s Eng. It involved a wire transfer, 2 exchanges and 2 wallets.
Since June, I have been trying to think of a killer Dapp to write. But there is a problem.
Let’s take for example the common example of verifying the age of an individual. This example has a user telling the contract their birth date and the contract telling the website “yes, this person is 21” without revealing the actual age. Great. The problem as I see it is that a master node or 5 need to get paid to come to that conclusion. So now the business running the website needs to go through the rigmarole that I just went through to fund a wallet full of Enigma to pay the fees as visitors come to their site. (We’re clearly going to need some kind of JavaScript library for them to use.) But the bigger problem seems to be that the company uses fiat for everything else and when the Eng account runs dry they have to do the rigmarole again. UNWIELDY!
The example above has one entity paying for all of the Enigma processing.
The next one is the real horror show.
I’d like to buy some My Little Pony figures and costumes from an unknown seller on the web and for obvious reasons I don’t want anyone to know my details. I decide to use an Enigma contract and a P.O. box. I’m sure you can imagine that this kind of contract would be hugely popular and common if it were easy to use. The problem is that once I build the Dapp, only people with Enigma can use it. Even if only one side pays, it’s still a huge pain to get Enigma and not the best place to have money sitting. (It doesn’t earn interest in a wallet.)
The biggest thing Enigma can do to make Enigma relevant and Dapps popular is to solve this problem. We need fast fast fast conversion from any currency to any crypto and back to any currency. Make it flow. Make it smooth.
With that in mind, I’ve been thinking that a single contract could be used for each pair. A Dapp would be accessible from a phone app or computer desktop and APIs would be available for other developers to integrate payments from any platform. Now, when I use the age verification contract I can give it my paypal info and it will call the conversion app and use my paypal money whenever it needs to. When I buy my pretty ponies, using a secret contract I can attach my credit card and the secret contract will convert some of my euros to enigma to pay for the processing. (regulatory issues?)
I haven’t seen anything on this and I’m wondering if this is where it’s going. Is someone doing this already? Because… it needs to be done.
Or am I completely wrong about something here that invalidates all of this. Ugh. If so, please explain where I’ve missed the boat.
Thank you
Channel
P.S. I’m not interested in building this so feel free. Also please share your thoughts.


#2

Hey @Channel, thanks for your thoughtful note.

The big problem is fiat - crypto. Abra is doing good job there. They allow you to buy crypto with your credit card or bank account and it doesn’t take (afaik) 7 days like it does in Coinbase. A dApp developer should be able to use their APIs.

Regarding earning interest, I think this is a great point and something we haven’t written much about. Enigma network works with staking. When a worker is being selected, the higher amount you stake the more likely you are to get the task and earn for your work. (check out worker selection, https://enigma.co/protocol/SubsystemArchitecture.html?highlight=worker)

We can look into creating an easy staking mechanism for the network. Maybe someone in the community would be up for this?


#3

can,
I know you all are busy, but I need a little clarification on this.
I understood there would be “Master Nodes” and they would be the “workers” from the document. The doc shows:
" 1. A worker is randomly selected to perform the task. In this release, it has no choice but to accept the computation fee proposed by the dApp user. In future releases, it will be free to decline, creating a market effect that dApp users will have to gauge in order to guess the optimal fee for their task."
You mentioned workers with the highest stake getting the work. I thought Master nodes would have a minimum. For sake of argument 10,000Eng. Are workers the same thing as Master Nodes? Is this an exclusive club of people who have set up the correct hardware/software and have sufficient stake?
If we’re talking about the worker/node with the most stake getting first dibs on work, how does that jibe with “A worker is randomly selected…” I’m not officially a Dapp developer but I might be lured into doing so by a great idea in the middle of the night tonight. It’s just important I think to understand how all of this currently works and will work in main net.

Wait. Correct me if wrong but I think I see how it all goes together. Master Node = worker.
Worker has met the threshold for becoming a Master Node by having enough Eng.
Now Worker offers to stake 1Eng to do the task and get whatever rewards are offered by the client. The stake is at risk if the job doesn’t get done in time or there is foul play discovered.
If worker 1 offers a stake of 10000 (confidence?) and worker 2 offers less than that, worker 1 gets the job.
If that’s kind of it, Is the amount of Eng at stake for each transaction equal to the threshold for getting a Master Node? In other words, if the threshold is 10000, do I risk as a worker 10000Eng every time I process a transaction?

Thanks for your patience and sorry to be a pest
Channel


#4

I have also thought about the liquidity problem in crypto that creates a barrier to adoption.

The solution is to integrate Enigma into dAPPS where the end user doesn’t necessarily need to know anything about ENG or wallets.


#5

We haven’t made any official announcement about the requirements of running a node (whether there will be a threshold and if so what it is), besides the fact that a worker should have an SGX enabled device.

If there are 2 workers both staking 10,000 ENG, their odds of getting the work is 50-50. If worker 1 is staking 1,000 and worker 2 is staking 9,000 - then worker 1 has 10% chance of getting the work

Hope this helps


#6

This is a great point about adoption actually. As Can mentioned there are projects working on this. I also know of a developer that personally created an easy fiat-crypto gateway. It’s quite possible to make this process easier.


#7

Thank you and yes it clears up a lot.


#8

Don’t you think that linear proportionality to stake makes the network easier to attack?

Shouldn’t the additional probability of getting work undergo exponential decay as the size of the stake increases?


#9

Sorry but you can’t turn soft money into hard. Any automated system for doing so will be abused indefinitely by chargebackers. Or put another way how can Paypal tell it was really a hacker that hacked your Paypal account to order ponies through Enigma. It will require massive overhaul of their systems such that they will essentially compete with Coinbase. All the ‘work’ that these middlemen are really doing (where the 1% fee goes) is fraud detection and management, all because that’s the way our shitty soft money system has always worked. If you have a regulatorily compliant way to compete, you will make an absolutely enormous amount of money. Most people find it easier to be a ‘paradigm shifter’.