What Makes Umee Unique? Why Should You Use It?
What is Umee?
Umee is a cross chain DeFi hub that interconnects between blockchains.
As a base layer blockchain, applications and money lego primitives can be built on top of Umee to access cross chain leverage and liquidity. The Umee Blockchain facilitates interoperability for a Tendermint Proof of Stake protocol with the Cosmos ecosystem, Ethereum network, side chain architectures, layer two scaling solutions, and alternative base layer protocols. As a Cosmos SDK blockchain, the Umee Network is interoperable with blockchains including Terra, Crypto.com, Binance Chain, Osmosis, Secret Network, and 30+ other chains, plus Ethereum, from Day 1.
A new DeFi world will be created on the cross-chain DeFi hub. Imagine markets for cross chain interest rates where rates on one network are affected by the DeFi environment on another. This will also introduce cross chain staking rates, which can affect what Proof-Of-Stake consensus means to create a rate in crypto.
So what makes Umee different and unique from other DeFi projects?
It uses innovative technologies such as the IBC Protocol and Gravity Bridge. It will be the first DeFi project to provide cross-chain borrowing and lending protocol and this technology in the Cosmos ecosystem. Umee on the other hand is a cross chain defi hub. As a defi hub, it would focus more on applications in the defi space. The first major use case is under Interchain Leverage — with can be described as cross chain borrowing and lending. eg. leverage assets on Cosmos to borrow on Ethereum vice versa. Also, UMEE has a very large community. This is very important for decentralization.
The native UMEE token is also a protocol governance token used to facilitate on-chain governance for the Umee Blockchain. The governance token can be used to vote on configurations of the protocol as well as network upgrades for improving functionality of the blockchain infrastructure. The UMEE governance token will additionally govern DeFi parameters of applications that sit on top of the Umee base layer DeFi protocol.
What is Cross Chain?
Cross Chain Cross-chain technology was created as a decentralized solution. Thus, blockchains can interact and communicate with each other without the help of other intermediaries, in most cases a central party, for example an exchange or custodian wallet.
This technology avoids third party risk, offers faster transaction time, and makes it easier for people to transact across different blockchain networks at a lower transaction cost. This type of capability is defined as “interoperability” in the context of the blockchain.
What is Inter Blockchain Communication Protocol (IBC)?
The Inter-Blockchain Communication protocol (IBC) is a reliable & secure inter-module communication (interoperability) protocol that handles reliable transport, authentication, and ordering of data across different sovereign blockchains.
IBC can be used by any application which builds on top of reliable & secure inter-module communication. Example applications include cross-chain asset transfer, atomic swaps, multi-chain smart contracts (with or without mutually comprehensible VMs), and data & code sharding of various kinds.
Umee utilizes IBC, the flagship Cosmos protocol for cross chain communication, in order to facilitate fast finality transfers of tokens from one blockchain to another while eliminating the need for multiple block confirmations or excessive time delays.
Umee will be lending facility for all IBC enabled chains. Umee users can easily access the Cosmos ecosystem using the IBC protocol. You can experience this bridging method very quickly and with very low transaction fees.
What is Gravity Bridge?
The Umee network includes a Gravity Bridge integration that enables Umee to support a trusted, on-chain bidirectional token bridge that supports both Cosmos native and Ethereum ERC-20 assets.
Umee users, ERC-20 token holders on Ethereum can instantly send their ERC-20 tokens as Cosmos native assets to Umee and vice versa.
For information about Gravity Bridge and Umee bridge, you can check here.
Umee Goals:
- Users interacht with multiple networks seamlessy without relying on centralized gatekeepers
- Capital across networks will no longer exist in silos and liquidity is interconnected and accesed without borders
- DeFi protocols will interact with Proof of Stake yields while staking derivatives create novel financial paradigms
- A universal, permissionless platform open to all users and project to be part of their DeFi journeys
What’s interesting about Umee is that the protocol will allow POS assets like the Cosmos Atom and other Cosmos tokens to participate in Ethereum DeFi. We’ll see many permutations for how POS protocols can interact with money lego’s.
Team Background & Backers
Umee is built by blockchain infrastructure engineers, software architects, protocol researchers, defi strategists, TradFi apologists, and an open source network of contributors that wish to see the next generation of crypto innovation.
We see experienced names who have worked in Tendermint.
BRENT
Brent is the founder of Umee. Prior to Umee, he led Strategy at Tendermint while setting the strategic roadmap and partnerships for the Cosmos Network. Prior to Cosmos, Brent was one of the first 30 employees at ConsenSys where he managed some of the key milestones throughout blockchain history such as ecosystem meetings around the DAO hack, the original listing of Ethereum on exchanges, as well as the promotion of Ethereum to worldwide governments and Fortune 500 enterprises. Prior to crypto, Brent traded bonds on Wall Street.
ALEKS
Aleks (also known as Bez) is the lead engineer of the Umee core blockchain network. Prior to Umee, he was the lead engineer of the Cosmos SDK. Aleks has been an ecosystem contributor to Cosmos since the inception of the blockchain and he is a primary contributor to the Tendermint Core consensus protocol. Aleks specializes in peer-to-peer networks, base layer protocols, distributed systems, proof of stake, and self sovereign blockchain networks.
ZAC
Zac was an early ConsenSys employee alongside Brent during the initial launch of Ethereum. He wrote some of the original patricia merkle trie libraries of Ethereum that underpin the entire Ethereum blockchain today. Zac researched and contributed to some of the core Ethereum scalability protocols such as TrueBit, State Channels and Plasma which led to the successful development of modern day roll-ups. He also developed bridge protocols such as X-relay, which is a precursor to POA networks like xDAI.
Token Format
The main purpose of the native UMEE token is to participate in the PoS consensus mechanism to help secure the Umee blockchain and earn PoS staking yield, pay gas fees on the Umee blockchain to execute Umee’s cross chain DeFi transactions, and to be able to vote and participate in protocol governance decisions.
The main purpose of the ERC-20 UMEE token is to create a user-friendly experience for Umee to tap into the DeFi legos on Ethereum and allow people to seamlessly access the UMEE token as an ERC-20 token and hold or trade it on centralized exchanges.
Personally, I find it more advantageous to have the UMEE token on the Umee blockchain.
- Keplr is a very useful wallet. With Keplr wallet, you can easily stake your UMEE token as well as participate in community governance. Transaction fees on the Umee network are quite cheap and very fast.
- With IBC, you can easily access Cosmos chains. For example, you can have direct access to very large ecosystems such as Juno and Osmosis. There are also UMEE pools with incentives on Osmosis. So you can enjoy passive earnings while holding your UMEE tokens.
Umee Roadmap:
Lending and borrowing is currently available on Ethereum. Try it now: app.umee.cc In the coming weeks/months lending and borrowing will be available within the Cosmos ecosystem, and on many other chains. Also, before this integration takes place, a testnet platform will be created to provide users with the experience. In this way, low transaction fees, fast transactions and all chains using IBC in the Cosmos ecosystem will be able to easily access the Umee app and create a healthy position.
Conclusion
Umee is the DeFi Hub and will first enable interoperability between Cosmos & Ethereum. By long-term, it will provide interoperability with chains such as Polygon, Arbitrum, Optimisim, Solana, BSC etc. Umee will act as a cross-chain DeFi hub connecting various ecosystems and developing new financial products on the top. Umee has created a very large community in terms of decentralization and continues to develop. Users will have all kinds of opportunities to create healthy positions between chains.
