It has been over a year since the launch of the Umee blockchain mainnet.
Despite horrible bearish year 2022 and continuing downtrend in 2023, Umee core team with Brent Xu as CEO and community has kept its status as one of the most prestigious projects running on Cosmos Stack(Tendermint, Cosmos SDK, IBC, CosmWasm)
Cosmos Cats validator is actively involved in creating new blocks, voting in polls, maintaining Umee news bot and big transactions bot, as well as allowing members of our community to actively discuss Umee. We are inside Umee as an active member, so it gives us a chance to analyze the evolution process in detail and understand where it goes.
Before moving on to possible directions of Umee blockchain evolution, we review its greatest strengths and possible limitations that can hinder its development.
Strengths:
Validator set
One of the most solid validator sets in crypto, including tops:
Polychain , Stakefish, B-harvest, Cosmostation. etc
More impressive, though, is the active community of mid-sized and smaller validators who keep a high % uptime, participate in updates and promptly upgrade the network to the right version. Updates to the network are quick and coordinated with the validators. All recent upgrades have been completed within 10 minutes or earlier.
This means that the network is up and running with very little downtime.
Development
In just over a year, the Umee development community has integrated cross-chain lending/borrow, bringing in assets like: Atom , Polygon , Dot , Bnb , Usdc , Osmosis , etc.
Creating an oracle on the Ojo Network blockchain, Tabu wallet , IBC Rate limit that limits the withdrawal of large amounts of potential whales from the ecosystem. Different features for umee lending/borrow application. . More detailed plans and roadmap described here: https://umee.cc/blog/umee-roadmap/
Funds and Relationships
Polychain , Consensys, Coinbase ventures etc. still believe in Umee success.
Huge amount of partnerships with other IBC Cosmos networks.
Recently Consensys (creators of metamask and infura) contacted the team to discuss the business development of Umee.
Polychain is still in the top 1 on the validator network and holds the lion’s share of $umee tokens, while actively using them to vote on the network, voting 42 times out of 72. The other major players such as Stakefish, Cosmostation still hold $umee and are also actively participating in the network, voting and setting up the network.
Umee is in the Cosmos ecosystem, built with Cosmos Stack like Osmosis or BNB Chain, but since Cosmos Chains are independent and have no common level of security, it can be said that they don’t depend directly on general Cosmos conditions. This makes the project very flexible in terms of tweaks to any solutions on the market, which for example competitors Aave and Compound can not afford, because they are just applications of dApps on Ethereum and are limited in their customization.
Tokensale on coinlist as well as seed rounds allowed to raise about 43m USD, which is considered as very big investment by Cosmos standards. That’s enough money for many years of development, partnerships and marketing. There are more than 30 people in the core team.
In addition
We will not touch the other strengths of Umee, because we want to save your time. For a general understanding we were guided by the most important topics in our opinion: Validator set and community, Development, Money and partnerships.
Weaknesses:
Regulation
Sorry for our triviality , but , we believe that the lending/borrow market will be regulated not in favor of crypto communities. Restrictions could hinder the development of this decentralized service. But, so far we see that the network is decentralized enough to register it as a VASP (virtual asset service provider). For the moment it is fully legal, but the rhetoric towards web3 could change. This risk is always worth considering.
Market cycles
The weakness not only of Umee but of all lending protocols is not a strong market demand in case of a bearish cycle, which we are seeing now. However, no one is stopping you from using lending as a platform where you can short an asset. Here’s an example: if we think an asset will fall in value, we put the USDC on Umee, and we borrow the asset we think will fall in value, then sell it, buy it back if it gets cheaper.
Adoption / UX.
Umee is focusing on a space ecosystem, where you have to spend more time doing the same things as with Ethereum. Also most of the users are now in so-called «Metamask ecosystem» (the most popular wallet for EVM networks). Migration to Keplr/Cosmostation (that’s cosmos ecosystem wallets) and understanding how ecosystem works — often makes it hard to onboard new users.
Rise of Ethereum
Ethereum did move to version 2.0. The main problems with expensive transactions, speed and scalability have ALSO been solved. The users are coming back to ethereum. Not just the space, but other ecosystems are suffering as well.
But, we think this is a temporary phenomenon. Because the future is in Self Customization appchains, which unnoticed by the end-user can also work in their favorite metamask and can be very flexible in customization.
In a bear market cycle, it is important to keep the project active. This shows that the project has both the capacity and the will to act. Umee is considered not just an appchain but has the potential to roll out its own ecosystem, so it’s important that development is at a high level. Grants were paid out and teams kept building apps. And the community was actively rewarded.
Now let’s look at the medium-long term and see what we can become.
PROMISE LAND
Let’s look at the most optimal way for Umee, in our personal opinion of course.
The recent implementation of ICS in Cosmos and the successful Neutron launch as L2 are food for thought. Umee as Defi hub? Yes, you guessed it.
Imagine that Umee is the main chain in its small ecosystem. If we are talking about Defi, then apart from umee app lending/borrow it should have its AMM dex, and its oracle (Ojo Network), nft marketplace, its stabelcoin etc. A complete DEFI ecosystem. And it’s all like l2 chains around the main Umee blockchain.
Add support for different languages for writing CosmWasm or Solidity smarts, and you have access to hundreds of developers wanting to build their app.
Flexibility in customization and lots of bridges and connections will make Umee a magnet for liquidity and big market players. Umee network is properly configured and audited several times, and has a daily withdrawal limit, which would not allow for money theft overnight.
Thank you for your attention. We are Cosmos Cats.