Sundae Swap Summary
From Chef Theo's What's Cooking Twitter Space 1/23/22
To start the show, Chef briefly recapped the Cardano journey:
2017- Charles white board video
2020- Shelly Launch
2021- NFTs and Native Tokens
2022- Sundae first Cardano Dex
Chef went on to mention that slower transactions and failed transactions are okay right now as we are in the scaling phase of Cardano’s development. Sundae is implemented and parameter updates are coming on a regular schedule.
PI and Matt from Sundae Swap dropped by the Chef Twitter Space to talk about the launch of Sundae, the current status of things, future plans and an exciting new program to benefit the single stake pool operators. PI started by explaining that the purpose of the ISO model was to generate a voting population of Sundae token holders and community members - creating a community with a strong, vested interest in Sundae’s success.
While they understand the community's concerns about decentralization, they do not believe that the impact of the ISPO model is an existential threat to Cardano. The primary goal of decentralization is to prevent a 51% attack and a takeover by distrusted or dishonest power sources. Sundae prevented this by choosing scoopers who are trusted community members. These people are invested in the Cardano community and are motivated for it to succeed.
That said, the Sundae Swap team is aware of decentralization concerns. They are announcing a new program to help support small SPOs. They now have 40 million ADA locked in smart contracts which is not delegated currently. They have designed their protocol to allow these funds to be delegated among stake pools. The Scoopers are not eligible for this delegation. Eventually the pools that receive the delegation will be determined by Sundae Swap token holders who will vote as members of the DAO and the staking rewards will go into the Sundae Treasury. PI sees this as an opportunity to help smaller SPOs. Sundae will be releasing more details on that in the coming weeks. Today they just were excited to get the news to the community. They have heard the community’s concerns about the impact on the small SPOs and are committed to support healthy growth in the Cardano community as well as in Sundae itself.
In the question and answer session Matt reiterated that they allowed the community to vote on the ISO and scoopers. That has worked well because they are a trusted group and now that they are past the original implementation they can add to their scoopers. Originally the idea was to only allow a single pool per scooper; however they ended up balancing efficiency and diversity. They made the best choice based on the information they had at the time.
In regard to liquidity tokens, Matt explained that some pools marked liquidity farming available and tokens are specific to a pool. The Sundae swap protocol owns a fair amount of liquidity tokens. They are not pursuing NFT initiatives at this time.
The $Charlz Token team dropped by with some questions about how often Sundae is updated in regard to tokens. Matt responded that while the dex is updated every thirty minutes, Sundae does not control the registry itself. Sundae Swap protocol is permissionless but they don't control the registry.
In response to a question from Pride pool, Matt assured the community that they would make announcements at the end of the ISPO period to make sure that the Cardano community was aware. Matt also said that while talks were ongoing with the Djed team, nothing had been finalized at this time.
Bullish Dumpling dropped by to congratulate the Sundae team on their launch and to request that they consider delegating a smaller amount to the SPOs so that they can help 20-30 pools not 5-10. Dumpling also thanked Blade and the other Scoopers that did not spin up a second pool. She also mentioned the lack of communication from Sundae about the start date of the ISPO which caused some people to move early and cost the pools some stake. Matt responded that the date was always a bit fluid as they needed time to work with the scoopers and troubleshoot errors that arose prior to launch. They did their best to convey as much information as possible.
Ray with Grow Pool popped in to talk about how much he has enjoyed his role as a scooper so far. He stated that the entire Sundae team has been working around the clock to answer questions and make sure the process runs smoothly.
In regard to some of the congestion and delays, Matt explained that every block can hold up to 72k. Smart contracts eat up blocks and cause delays until upgrades are implemented. A single transaction that includes smart contracts is up to 16k. While there were some issues with the software, on the whole things are running pretty well. Some of the delays are related to slippage and the changes in the price while a transaction waits in line to be processed. It was difficult to estimate up front how fast the price and slippage would change. When this happens a transaction stays in line but won’t be processed until the price is back in range.
While all of the scoopers use consistent algorithms, every pool has its own independent que. They are discreet pools. This means that some tokens will be processed faster than others. The algorithm finds longest lines - then processes as many as possible. It reserves some space for round robin allocation and tries for fairness. Basically the algorithm is constantly balancing the pools and trying to help congested pools without ignoring all other pools.
In regard to Scoopers, there is always to some degree of competition against each other. That way one scooper's downtime does not impact the entire dex. Matt pointed out that a working dex will help Cardano address scaling concerns as it updates parameters. Because Sundae is up and running, Cardano developers can see a protocol in motion and to better understand parameter changes and their impact.
Some questions were asked about the Cardstarter / Sundae Swap marketing agreement. The best source of information at this moment is an official communication released by the Sundae Swap team which you can find here.
Matt ended the conversation by stating that things were going really well and that the team was pleased with the roll out so far. They anticipate that the chain congestion will gradually be resolved as Cardano parameter updates and other upgrades are implemented. They are quite pleased with the initial roll out and will continue making improvements and adding enhancements for the foreseeable future.
By Traveler Jo | CardanoArmy.io
You can find Traveler Jo somewhere close to the sea. She loves Cardano, kayaking and food - not necessarily in that order. She's busy exploring the world, always in the company of her husband, tired dog and indignant felines.