Maya: the solution for the multi-chain future of blockchain

With Maya you will have the opportunity to buy and sell assets without intermediaries.

18 de abril del 2022

5 min

Let’s face it, Crypto has flaws.

Much has changed since Satoshi Nakamoto’s innovation; what was born as a solution for peer-to-peer transactions, now seeks to completely detach itself from intermediaries. Although today there are more than 10 thousand cryptocurrencies, 95% of the exchanges are carried out in CEX (centralized exchanges). With this, we lose the essence of Crypto: authorities controlling our economy are once again emerging.

If there is one thing we agree on is that DEX (decentralized exchanges) are essential for users to have complete custody over their assets, but, despite being a viable solution, prices are still regulated by an oracle. Not only that, we must also consider that within the world of cryptocurrencies, liquidity is a problem.

Liquidity Pools ensure that we can always buy or sell an asset regardless of its value, and so far so good; the problem lies in a broader symptom: the lack of available assets to exchange in individual crypto markets and the impossibility of exchanging native currencies from different blockchains (e.g., Bitcoin for Ether). Daily $10 billion in cryptocurrencies are transacted, indicating that the market as a whole is liquid but fragmented, unbalanced, and inefficient. The mission is to consolidate it, the solution is Maya.

Origin of innovation

A couple of years ago began the creation of THORChain, a revolutionary protocol that is distinguished by stabilizing liquidity. Its great innovation is the continuous liquidity pools, from which it is not necessary to look for a buyer or seller of assets, anyone can provide liquidity and earn rewards, or swap from one asset to another and pay a fee. Swappers, who deposit tokens, can link two pools in one transaction, placing one token and receiving any other token on the network. This way swap fees are dynamically adjusted depending on the size of the transaction, and investment is incentivized and unrestricted.

Maya, like the Vikings, seeks to facilitate the exchange between cryptocurrencies from different blockchains. The market is quite large, THORChain is the first of its kind, and there will come a time when it cannot fully cover it. We will be their backup.

Today, Maya seeks to consolidate the philosophy of economic independence and provide security and liquidity in the wallet of any user without the need to peg assets. But let’s back up a bit; what is Maya?

An introduction to Maya

No, we are not talking about the civilization, but the project’s name is inspired by the legacy built by pre-Hispanic culture. Maya is a decentralized liquidity protocol forked from THORChain, a Cosmos SDK-powered replicated state machine that coordinates asset movement, the process of transactions, stakes, and more, without the need for an oracle. Here you can exchange cryptocurrencies (from BTC to ETH, for example) instantly, cheaply, and without trusting a central authority. It is also open-source, so it is in the hands of the community and protected by code.

Within the system, liquidity pools are matched by the same asset: Cacao. As mentioned above, liquidity today is fragmented and diluted as a result. Maya uses Cacao as the value reference for each asset, allowing only one liquidity pool per cryptocurrency. If you want to exchange BTC for ETH, the following happens:

  1. All assets are deposited in liquidity pools shared with the Cacao token, capital provided by liquidity providers.
  2. A swapper sends BTC to Maya with the instruction that it wants ETH. Maya exchanges BTC for Cacao in a pool.
  3. Maya trades Cacao for ETH in another pool and sends it to the address indicated by the swapper.

From this we generate scalability, for a thousand coins we only need a thousand pools. As they remain consolidated, they become deeper and, consequently, trading becomes cheaper and more stable.

Cacao not only works as a value reference, it is also an asset that appreciates as liquidity increases in the system. At the same time, it provides security since the node operators, who are in charge of protecting the code, must provide at least 800,000 Cacao as a guarantee (Proof of Bond) to operate in the system.

The supply of this asset is finite (100 million), no more.

Main roles: Liquidity Providers and Node Operators

There are two essential roles within Maya: liquidity providers and node operators. The firsts are the guests of honor; Maya is in charge of protecting their interests by avoiding losses and maximizing profits. By committing an amount of their capital in liquidity pools, they receive two types of rewards: the user exchange fee and Cacao. Each day they obtain a percentage point of insurance against impermanent loss; if they maintain liquidity for 100 days, they will be fully insured. This concept is an existing problem in all DEXs that only THORChain and Maya have solved and eliminated.

There will be times when there is a lot of capital in the liquidity pools, others where there is a lot of money bonded by the nodes, but the system balances itself automatically. An incentive pendulum maintains equilibrium in the system, increases rewards for nodes, and lowers tips for providers when the system is insecure and vice versa when it is inefficient.

The node operators are the protectors who keep the exchange network secure: they monitor, validate, and transmit transactions in Maya and other chains in exchange for rewards. They must keep moving to mix pools and avoid captures. Therefore they are anonymous and cycle every three days, it allows to maximize decentralization but also to expel malicious nodes. They also monitor code updates to protect their bond and, as a result, secure the protocol.

The backend of the crypto economy

There are two opposite postures. Some affirm that at the end of the road, there will only be one currency that prevails over the others, a somewhat maximalist belief; others maintain that there will continue to be an infinity of currencies to satisfy different needs. The reality is that the data tells us that no single one can dominate. They need to complement each other, and we need to facilitate their exchange; by transacting between different chains, we connect the benefit of each currency in particular and blockchain in general. THORChain and Maya will work in harmony to achieve a multi-chain future with greater liquidity, performance, and security, offering decentralized possibilities for exchange between blockchains for all types of applications.

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