Zaki what outsourcing to zones were you referring to?
If majority of liquid staking tokens go outside the Hub and be placed in some insecure zone or contract, that is a significant threat to the security of the Hub.
This is why I’ve been so concerned about and hesitant towards staking derivates work, since we don’t have a clear sense of impact on security model. Maybe it’s something Gauntlet can start to help with. Of course we need it to combat exchanges but we should air on the side of risk mitigation here rather than focus too much on just enabling massive DeFi with staked atoms (which will be important but we need to roll it out responsibly).
And I totally took for granted that there would be a cap on how much of a delegation could be used for derivatives, meant to bring that up. It would certainly help with some of these concerns. So I totally agree we should start with something like ~20% and it can potentially increase over time
Also note there’s more we need to combat centralization on exchanges, like better UI/UX, accounting tools, and just over all making the experience seamless for people to stake directly vs through coinbase. Staking derivatives are just one piece of the pie.