AMA Recap — Portal Finance
The session of AMA ( Ask Me Anything ) with Portal Finance was conducted on 22nd October 2021 at 7:30 PM IST (2 PM UTC) and lasted for 1 hour.
ADMIN ROUND
I welcome you on behalf of Crypto players India team, hope you will enjoy today’s AMA session.
Very excited to have you with us.😊
Jonty|Host
Please tell us about yourself and the team working on Portal Finance?
George Burke
My name is George Burke, a co-founder at Portal. Our team started working on this since 2018 but I’ve been involved in bitcoin since early 2013. Always been a believer in censorship-resistant, egalitarian technologies. I built a bitcoin/altcoin exchange in 2013 which was sold. I later went on to build the first bitcoin debit card in the US called FreshPay.Prior to crypto, I launched the first “Netflix for books” subscription club. I also currently run the first-ever bitcoin meetup — Silicon Valley Bitcoin — SVBTC.org (http://svbtc.org/) — first started by Roger Ver and Andreas Antonopolous.
I’m very proud of the Allstars I get a chance to work alongside every day:
- Eric Martindale, 10 years in Bitcoin, Head of Open Source at Blockstream and Engineering at BitPay, advisor to Lemniscap, and is the inventor of Fabric.
- Chandra Duggirala, Bitcoiner and M.D. turned entrepreneur, ran two 8-figure software businesses, and is the inventor of the functional layer 2 cross-chain atomic swaps (he solved problems keeping Tier Nolan’s atomic swaps impractical until now).
- Alexey Melnichenko, 5 years architecting token & exchange design, an engineer at Phantom Cyber (acquired by Splunk), designed the exchange engine at Totle.
- Manoj Duggirala, Led a 150-engineer team at Invensense, designed the Apple M7 co-processor in phones and watches, ex-IBM Almaden. Engineering at Stanford.
- George Burke, 8 years in bitcoin, 3 exits in peer-to-peer/community startups incl. early bitcoin exchange Crypto Street created the first Bitcoin debit card and runs the world’s oldest bitcoin meetup.
- Johnny Dilley, VP of Strategy & Product at Blockstream. Conceptualized Liquid sidechains. Early VC at Pantera. 8 years in Bitcoin.
- Jack Mills, Engineering Architect of Casper Labs / RChain, and previous Director of Enterprise Platforms at Intel. Engineering at Stanford.
Here’s how we came together.
Manoj, Chandra, and I had built previous 7-figure startups and wanted to solve problems in crypto. I knew the Fabric CEO Eric Martindale for many years as a friend in the bitcoin space. He was a bitcoin god. Early at a Blockstream and early at BitPay and was one of the few human beings to understand Layer 2’s and sidechains. Eric was first a mentor and advisor to our team. Johnny and Alexey worked with him at Fabric. Later they joined us to build Portal…
Jonty|Host
What is Portal Finance? Please provide a detailed introduction.
George Burke
Our company raised ~$10M for Portal. We’re enabling DeFi built on Bitcoin. We believe financial applications should be built on the protocol that is most likely to become the base money layer. Portal makes DeFi unstoppable with anonymous, zero-knowledge swaps via the first true cross-chain DEX that’s genuinely trustless. Unlike Uniswap/others, Portal eliminates minting wrapped coins (ie wBTC, wETH) or risky staking with intermediaries. Trading across incompatible blockchains is now just 1-click, trustless and private. Fabric protocol, our layer 2 & 3 technology powering Portal, enables building censorship-resistant communications, media and one-click cross-chain swaps, all on Bitcoin (along with all its security advantages).… For some background, layer 2 is a sequence of unsettled transactions on the main chain done for a purpose. For example, Lightning Network is a layer 2 system for peer-to-peer micropayments. However, lightning transactions — until settled — are not broadcasted to the main chain. We invented layer 2 zero-knowledge swaps, which fix the Layer 1 tier Nolan atomic swap incentive problems and add speed and liquidity features. In addition, Fabric protocol (the protocol we use to build p2p ZK circuits for FHE), has been used to build peer to peer communication and other apps. Just like lightning is a layer 2 system for peer to peer micro payments, and is therefore fast because lightning transactions, until settled, are not broadcasted to the main chain. Portal is a layer two system for peer to peer cross-chain contracting. Because it’s layer 2, it’s fast. Portal is building a true cross-chain method of trust-minimized exchange without a 3rd party. But because these chains do not natively interoperate or communicate with one another, a layer must be built above the base layer for such communication. Portal is a layer 2 system for peer-to-peer cross-chain contracting. Cross-chain contracting facilitates a variety of in-demand DeFi activities, like spot-trading. Fabric, the underlying technology Portal is built on, splits contracts into “ZK Swarms” — allowing all network participants to agree to contracts on their own terms. These are “multi-party contracts”, with each peer earning Bitcoin for computing their part in the program. It does this at “layer 3”, which provides the privacy PLUS fungibility of transactions. But why zero-knowledge? Why privacy?
How can a decentralized exchange layer be truly censorship-resistant if traders are known and addresses can be traced? So, Fabric technology enables ZK circuit creation which, when implemented, opens the door to a whole host of new methods of obfuscating transactions without losing verifiability. For Bitcoin to become money, we need a censorship-resistant, peer-to-peer trading system that crosses blockchains.
Jonty|Host
What types of problems have Portal Finance fixed which other project fails to do.
George Burke
The problems we’re solving that will give Portal a huge leap over today’s DeFi and DEXs are:
1) High gas fees:
we utilize layer 2 for cross-chain swaps by which nodes can communicate hundreds or thousands of messages/transactions prior to settling on the main chain.
2) Poor UX:
We agree the user experience for DEX trading has been awful so far. We have a beautiful non-custodial wallet that is as easy to use as Coinbase but self-sovereign and trust-minimized, where you can store coins and trade from within the same interface. We’ve worked years on developing this.
3) Asset locking & asset replication:
The wrapping and locking of funds onto other chains by these so-called “cross-chain” DEXes are neither trustless nor decentralized, nor are they even cross-chain! BitGo custody the majority of the billions of locked up BTC. As we saw with the recent $600M hack, these DEXes are honeypots waiting to happen. Atomic swaps solve this. Wrapping tokens becomes a thing of the past since coins of incompatible chains can be traded natively and without a risky middle-man. Each party’s funds are only locked during trade execution and not re-bonded or replicated onto other chains for eternity…
Jonty|Host
What accomplishments Portal Finance has made so far? Also share your upcoming plans?
George Burke
Before the roadmap, let’s start with accomplishments so far: We invented zero-knowledge swaps, which fix the Layer 1 “Tier Nolan” atomic swap problems. In addition, our CEO invented the Fabric protocol (the protocol Portal uses to build p2p ZK circuits for Fully Homomorphic Encryption) and has been used to build peer-to-peer communications and decentralized other apps. With the atomic swaps integrated into Fabric, we are rebuilding the Web from a client-server model to an uncensorable, decentralized architecture. As for the roadmap, we can announce that in only a couple of weeks we are launching our public sale on one of the most prestigious launchpads in the world, Republic, and unlike most other high profile projects, we are allowing investors from the US. If you’d like to participate, you’ll first need to be on the whitelist, available at https://PortalDeFi.com. We will also be announcing a number of partnerships with other tiers 1 blockchain issuers over the coming weeks. On the regulatory front, we have been seeing SEC lawsuits to various token projects for raising unregistered security; potentially fraud. This can be as little as a fine of millions or as bad as going to jail. Any issuer who promises an investor tokens is irreparably tethering the network token to the fundraise and will forever make that token a security. We will see any tokens deemed securities to be banned from trading on non-brokerage exchanges (which is pretty much all of them). Our fundraiser is specifically designed to preserve the non-security nature of a digital asset that runs on the decentralized network and therefore is never sold, given away, airdropped, etc. This way it can always be as freely transferrable as BTC itself. Last, with regard to the roadmap, Portal is a completely community-driven development. The community will determine the roadmap and features post-launch. We’re excited to see where the community drives the project as they push the bitcoin interoperability ecosystem forward. Portaldefi (https://portaldefi.com/)
DeFi on Bitcoin.
natz®
How will you solve the crosschain problems?
George Burke
For some background, layer 2 is a sequence of unsettled transactions on the main chain done for a purpose. For example, Lightning Network is a layer 2 system for peer-to-peer micropayments. However, lightning transactions — until settled — are not broadcasted to the main chain. Our Layer 2 is enabled by Fabric Protocol (https://fabric.pub) and was invented by Portal’s CEO Eric Martindale. Because the transactions take place in layer 2, you get a speed, similar to a lightning network. Also, because of the ZK Swarm structure, partial fills enable aggregating liquidity just like centralized exchanges. Portal is building a true cross-chain method of trust-minimized exchange without a 3rd party. But because these chains do not natively interoperate or communicate with one another, a layer must be built above the base layer for such communication. Portal is a layer 2 system for peer-to-peer cross-chain contracting. Cross-chain contracting facilitates a variety of in-demand DeFi activities, like spot-trading, options, peer-to-peer lending, etc. Another layer 2 platforms on bitcoin require a secondary token which changes the economic incentives. dApp with app coins, built on such layer 2s, would require 3 tokens! BTC, L2 coin, and the app coin! CRAZY. Instead, Fabric’s only token is and ALWAYS WILL BE… BTC.
natz®
The most frustrating part of current dex especially is fee no doubt, but the approval fee plus the buy/sell fee .. if you stake .. fee again.. claim fee , withdrawal fee .. cant we solve this all with a simple one fee solution?
moreover the buy/sell order placement.. are we going to solve those too?
George Burke
That’s right. Since Uniswap only works on Ethereum, it can take 4 transactions to swap from one non-ERC20 asset to another non-ERC20 asset through the wrapping, swapping, and unwrapping process. Atomic swaps are truly cross-chain, in that they allow for the native assets of different chains to be swapped in just one quick transaction.
TWITTER ROUND
You mentioned that your product is not simply a cross chain atomic swap DEX but also is a “Trading wallet”. So are you saying that users can trade on multiple exchanges with this wallet? Can you name some? Also, once the atomic swaps goes live,how will this benefit the users?
Something I forgot to mention earlier in our roadmap is the product is not just the cross-chain atomic swaps DEX, but also a non-custodial multi-coin “trading wallet”. The software is in private alpha and allows users to trade on centralized exchanges such as Binance, Coinbase, and even DEXs like UniSwap in 1-click, right from within the wallet. It helps find the path of best execution (exchange with the best price and liquidity), sends your coins to the exchange from your wallet, executes the order, and withdraws back to the safety of your Portal wallet right after execution… all this in just 1 click. This is a huge draw to adoption. Why? Because once atomic swaps go live, the wallet can choose Portal as the best path of execution. For users of the wallet, instant adoption. Oh, and it’s the only app in the Apple App Store approved for atomic swaps. Here’s a future application of zero-knowledge atomic swaps technology at scale:
Imagine the ability to go anonymous with your payments on bitcoin. Coinjoin-like transaction obfuscation services, but much cheaper, quicker, and actually anonymous because it operates at layer 2 and layer 3 instead of several layer 1 burdensome transactions. Any coinjoin transaction is well-recognized by just looking at the wallet, and could be flagged. Instead, any layer 2/layer 3 obfuscation looks simply like a Lightning transaction despite maybe dozens of participants. Several blockchains are looking for bridges to swap between their token and bitcoin, but these don’t trustlessly exist (yet). We have a few blockchains wanting integration for near trustless swapping and bonding between their token and bitcoin (or other tokens of incompatible blockchains). This interoperability is the holy grail of the crypto space. One partner we can name is Aeternity, another is about to be named on Monday, and we will continue to name the other partners over time. Something cool that Fabric’s tech and Portal’s non-custodial atomic swaps wallet will enable is the ability to make a payment in one asset but the receiver receives a different asset, where it was automatically swapped in the same send transaction. Imagine only holding Chainlink but wanting to send someone Solana. Or only holding DOT and wanting to send someone BTC. Portal will enable this in the future. Can’t wait.
Portal Finance is a “Financial Internet based on Bitcoin”. I assume this is because of the almost immutable security this network offers. However, is there any other reason why Portal Finance bases their network and platform on the Bitcoin protocol and not any other protocol?
- Building a secure layer 1 system is incredibly hard. We don’t want to do that; Fabric uses the layer 1 system that already exists and therefore we use Bitcoin as OUR layer 1. In Portal, the contracts don’t depend on anything other than Bitcoin’s and Ethereum’s securities. We are harnessing the security of Bitcoin and ETH, the atomic swap contracts are minimal. Independently audited and tested to the max by a truly decentralized network before going live over the course of the past 5 years. Unlike wrappers and bridges, these coins are not re-bonded into Portal and are not honeypots. The community treasury does not contain exposed user’s funds. The exposure is limited only to the token which is being traded — NOT what is bonded. This is the main difference between the Portal project and other so-called false “cross-chain DEX” projects. The flaw in bonding/wrapping is double the exposure for a breach in security; be it theft, risk, hacking. It’s like making a duplicate -or a triplicate- of your house key. The Portal project is designed to protect your key- the reliance on simple and native atomic swaps means there isn’t anything to expose. This is possible through the use of Fabric Protocol technology, which is an internet built on the layer 1 blockchain of bitcoin — the time chain itself.
2) Bitcoin provides the security; no need to implement a new system and attempt to garner superior adoption. Bitcoin is the most decentralized and secure system and we think it is the monetary layer. If you want to build functionality, financial contracts, and beyond, it makes sense to build it on top of the monetary layer vs any other layer. More importantly, layers of functionality enable bitcoin to capture the value, but not the risk of a failure of a layer 2 system.
DeFi Portal recently announced its acquisition of a strategic investment from #OKE. My question is, what will these funds focus on and how will it help Portal DeFi explore high quality projects with great potential?What impact will #OKEx has Portal DeFi thanks to this investment?
OKEx Blockdream Ventures, along with Coinbase Ventures and Gate.io — but they’re just normal VC funds. As you can see, they are exchanges. Without disclosing why I think you can imagine the benefit to Portal for having high profile exchanges on the cap table. But how does Portal’s technology benefit centralized exchanges??? We can’t disclose strategic partnership details, but again, use your imagination and see how a CEX — with all their regulatory burdens, laws, and custodial responsibility for users’ funds — can benefit from a completely anonymous, secure, truly cross-chain with no 3rd party risk. Hmmmmm 🙂
COMMUNITY ROUND
forid ahmed
Do You have any plan to support more blochchains in the future? what are your cross chain integration plans to gain mass adoption?
George Burke
Several blockchains are looking for bridges to swap between their token and bitcoin, but these don’t trustlessly exist (yet). We have a few blockchains wanting integration for near trustless swapping and bonding between their token and bitcoin (or other tokens of incompatible blockchains). This interoperability is the holy grail of the crypto space. One partner we can name is Aeternity, another is Ankr, which we will officially announce tomorrow, and we will continue to name the other partners over time.
Kasham
I want to invest to your project. Where i buy your token? Is it available on any exchange?
George Burke
We cannot discuss tokens or token prices. Why? On the regulatory front, we have been seeing SEC lawsuits to various token projects for raising on unregistered security; potentially fraud. This can be as little as a fine of millions or as bad as going to jail. Any issuer who promises an investor tokens is irreparably tethering the network token to the fundraise and will forever make that token a security. We will see any tokens deemed securities to be banned from trading on non-brokerage exchanges (which is pretty much all of them). Instead, Portal’s fundraise — happening IN A FEW WEEKS through a compliant securities offering on the best launchpad in the world, Republic — is specifically designed to preserve the non-security nature of a digital asset that runs on the decentralized network, and therefore is never sold, given away, airdropped, etc. This way it can always be as freely transferrable as BTC itself. We are also under embargo from discussing anything about exchange listings. All I am allowed to say is that there are a number of top exchanges that invested in Portal, including OKEx and Coinbase. We’re excited to have close relationships with them and that they believe in Portal. Take that for what it’s worth. For more info on this, see the writeup we did on this compliant fundraise model here: https://blog.portaldefi.com/no-ico. Compound and Chia used a similar mechanism.
BOSS LARA
Current NFT is a hot topic, but are NFT not just for art. Does your project think that more real world use cases will emerge for NFTs as time goes on, why should we take NFTs seriously?
George Burke
Yes, NFTs are hot. I already see incompatible siloes being problematic because an NFT on one chain cannot be accessed through smart contracts on another chain. Since Portal is all about cross-chain, trustless interoperability, I can see a future where we may be able to bridge the gaps between siloed NFT platforms. I also see a future where a single NFT can be bonded with several FUNGIBLE tokens being minted for fractionated ownership. Fabric’s technology would enable Portal to build both of these awesome NFT-features… HOWEVER, our roadmap is community driven and they will be the ones to direct the development team down that path. We shall see!
D K🇺🇲🇺🇲🇺🇲
Is this your project only for elite investors, how about others with small funds, is it open to everyone?. Thanks
George Burke
Unlike most public sales in the crypto space, we are not blocking US investors. This is rare. Our team is mostly located in the US and we’ve gone through great regulatory lengths to allow US investors compliantly. That said, because investors will still need to pass KYC. Republic, the launchpad hosting the public sale, will handle this for us. If you wish to participate you’ll need to first be on the whitelist here: go.portaldefi.com/whitelist.
M B
Can you list the features that your project have and other similar projects don’t and Can you convince me to invest in your project as compared to others which are similar to yours?
George Burke
Well… we’re building ON BITCOIN… Why Bitcoin?
There are a few answers to why we’re working on Bitcoin as opposed to other chains or building our own Layer 1 chain: Bitcoin provides the security; no need to implement a new system and attempt to garner superior adoption. Bitcoin is the most decentralized and secure system and we think it is the monetary layer. If you want to build functionality, financial contracts, and beyond, it makes sense to build it on top of the monetary layer vs any other layer. More importantly, layers of functionality enable bitcoin to capture the value, but not the risk of a failure of a layer 2 system. For Bitcoin to become money, we need a censorship-resistant, peer to peer trading system that crosses blockchains. That’s why we are building DeFi using cross-chain atomic swaps. BItcoin is strengthened by building many layers of functionality. When trillions of dollars of financial contracts are running on crypto chains, it creates an entire economy that politicians wouldn’t dare over-regulate for fear of collapse. DeFi, when finally applied to Bitcoin, is how we will protect Bitcoin from nation-state attacks.
Why Fabric?
FABRIC — https://fabric.pub — is the protocol for peer to peer message passing and contracting using bitcoin as the security layer. All of the layered networks built using Fabric can use a portal to exchange into Bitcoin and other assets. It is a natural fit for what we are doing. Portal improves Fabric protocol and Fabric is needed for Portal. I knew the Fabric CEO Eric Martindale for many years as a friend in the bitcoin space. He was a bitcoin god. Early at a Blockstream and early at BitPay and was one of the few human beings to understand Layer 2’s and sidechains. Eric was first a mentor and advisor to our team. Later he joined us to build Portal. What Eric invented for Fabric is the protocol built ON BITCOIN for peer-to-peer message passing and contracting using bitcoin as the security layer. All of the layered networks and DAPPs built using Fabric can utilize Portal to exchange into Bitcoin and other assets. It is a natural fit to have our teams unified and aligned.
Cậu Vàng
How can users stay updated with this project? Are there channels, including local communities where users can get the latest updates??
George Burke
The Portal network WILL BE decentralized, but first is being built by our core team, and soon become open-source prior to network launch. Fabric protocol is already open source and anyone can contribute. We welcome you to join us. Check it out: https://github.com/FabricLabs With regard to the roadmap, Portal AND Fabric will be both completely community-driven development. The community will determine the roadmap and features post-launch. We’re excited to see where the community drives the project as they push the bitcoin interoperability ecosystem forward. We just created a new ambassador program. You’ll need to email marketing@getportal.co and we’ll send you the details. Our Telegram just crossed 50,000 users: t.me/portalgroupchat. And our Twitter just crossed 77,000 followers! twitter.com/portal_finance.
The AMA recorded many great questions from the Crypto Players India community, as well as meticulous answers from our guest George Burke from Portal Finance. AMA Concluded at 8:30 pm IST.
