Hey everyone, this is am important proposal that I encourage everyone to vote “Yes” on.
In 2022, I spent months putting myself in the shoes of the Cosmos Hub, researching ways to accrue value, and proposing a path toward achieving that value accrual. Lending ATOM is a key step along that path.
Hydro so far has been a proof of concept to prove whether there is demand to borrow ATOM for a fee. The answer is a resounding “YES!” given how quickly each of the two rounds have sold out.
Given the success of Hydro, it is in the Hub’s best interest to double down on Hydro not just in terms of increasing the amount of ATOM lent via Hydro, but to also upgrade Hydro from a PoC to sustainable product by adding features and increasing automation. These features and automations won’t build themselves.
While Hydro is currently able to surface the intent of the Hub to direct liquidity to various places, Hydro relies on a multisig to get the liquidity from point A to B. This multisig is a reasonable compromise for a PoC to accelerate go-to-market with a small budget, but it is not a long-term sustainable solution as deals get more complex, happen more often, and get larger.
My team at Timewave has been hard at work on Valence, which is a cross-chain execution environment that could automate Hydro. I hope that the community will recognize the value of Hydro and support its further development.