George Harrap on building asset management for Solana

0:01i'm ashton addison from block west capital for investmentpitch media in the crypto coin show and today on blockchain interviews we have george harrop once again co-founder of step finance back on the show george welcome back it's great to have you here thank you so much for having me again ashton it's great to be back you're very welcome uh last time we

0:20spoke step was working on a lot of different things in the solana ecosystem and it's been almost half a year since then and i know your team has done an incredible amount of new things as well and it seems like the industry although there's been a slight dip in the market it just continues to explode with innovation and it looks like uh your step is totally unfazed by this and just

0:43continuing to grow so amazing work so far i would love to for the people who didn't see our first interview just get a recap on what is step finance all about and then we'll dive into the new details absolutely sounds good yeah i think the last time we spoke it was a middle of last year and uh step was uh i guess geez that sounds like years ago to me

1:07now but um yeah you know we were just sort of getting started so i guess to take a step back you know what what we are um step is a portfolio manager on solana for defy apps so essentially we say we're the front page of solana and what that really means is we're one page that can display your portfolio your positions across all of these different d5 protocols as well as having a bunch

1:29of useful features uh which might add value to you in different ways this might be yield farming this might be nfts might be transactional history but generally if you're involved in defy you often need a platform like step to keep track of everything because there's so much stuff going on you know since we last spoke uh you know solana's done i think a couple hackathons at least some

1:51of those hackathons had like 10 000 participants each it uh it created and spawned like hundreds of different projects um so i guess for us uh ever since then we've been you know every single wednesday basically we've been deploying new stuff and we're one of the few teams that are deploying every single week we have like a whole bunch of new things that we're

2:11doing and that's just because there's so many things uh happening and new protocols popping up that we have to be aware of and all this kind of stuff so yeah i guess as a brief overview you know with kind of the one place to be for uh you know all of your your d5 uh shenanigans that might be happening on solana definitely great great uh introduction

2:30and yeah you're right uh seeing those solana hackathons there's so many new projects that are popping up without step finance how would you even keep track of like hundreds of projects you know it's like uh it's a struggle to keep up um and i've noticed a lot of them being towards uh leaning towards a game five metaverse a lot of nft stuff as well and there is still a lot of other

2:53defy liquidity protocols and and cross chain solutions that are starting to come out um where to start with all of this because there's so many different faucets of you know what step is following where are you seeing the most innovation and growth since our last discussion yeah well i guess you've got some pillars of the defy economy right so most defy uh uh

3:16projects or l1 blockchains will need you'll need your amms you'll need your yield farms your lenders in the case of solana there's probably like five different am ms now there's about five different lenders all with tbls sort of you know eight nine digits and so on um uh they're the sort of base functionality which you have right so we've seen more of them pop up

3:40but we also have a lot of the the nft space really growing so now there's maybe about three or four different marketplaces which are doing sort of anywhere between i think it's like 20 to 30 percent of open sea volume um which is pretty significant i think you know given uh you know where we are and you know solana being a an alternate l1 chain but i do think that um that's

4:03going to continue to grow and that's certainly one space which we're seeing quite a lot of uptick on is like if you want to buy a 2 nft we're going to do that like you can't do that on openc because it's going to cost you 50 bucks to go and mint the nft in the first place right so and then in the case of axi like you had them basically build out a whole new chain you know the whole

4:23ronin thing um to uh to support their game so actually solana is attracting quite a lot of these games uh to to the blockchain and it's kind of interesting to see how they're going to grow like they're going to integrate nfts in different ways um you know and they're going to be able to put them on the decks and you can use them as lone collateral and all sorts of different

4:42things we've seen we've seen that um you know quite a few different games uh coming up and i think solana maybe even launched a fund for that as well uh but we're also seeing i guess on the financial product side as well some more complex things so uh you're seeing quite a few of the the options protocols coming along um and uh you know there's these the what is it

5:03the ssob single state uh or single stake vaults basically for options uh so yes so we're seeing a few of those so there are like a lot of these things swirling around um and you never really know where the next phase is gonna gonna come from um i guess for us you know our problem is it's kind of a continuous hamster wheel because there are a lot of things we

5:27can't spend all of our days just integrating new things right otherwise we'll do nothing else um so we've got to kind of vet and validate a lot more of these projects than we did in the past perhaps because it might be the case that we're spending a lot of time integrating things which you know maybe 20 users care about when we could have been spending time on something which 10

5:47000 people care about um so it's kind of for us i guess this year it's it's going to be a bit of a balancing act you know there's there's there's coverage which we can have of the entire ecosystem um but then there's like new features that we could build on step that people are asking for you know transaction history more analytics uh for many of their you

6:07know existing investments and so on um or there could be different tokenomics mechanisms as well so it's kind of like three core things but you can't have all of them at once so you have to pick two so therefore which two are gonna pick and that's the balancing act really yeah that's the blockchain trilemma there's always so many things and you're right about uh

6:29making you know balancing the amount of integrations and and i think as you continue to add more projects and more functionality into step you also need to manage that there's not too many things that it's like how do you manage the usability and especially you know people that aren't technically savvy to try to get them involved without overwhelming them with

6:49too many things in you know in the first second absolutely yeah so we're also trying to reach out a bit more to uh i don't know if you call them normies but certainly you know d fire newbies uh because i think we've kind of reached a sec saturation in d5 where uh you know a lot of the people that are familiar in d fire sort of moving between different

7:11different ecosystems um but you're maybe not attracting new people in um so i guess we've got to be able to build that kind of bridge uh for for people that might be interested in these things but don't know where to begin um so we're working on a few like educational pieces like some videos as well uh on that front to try and sort of just be this educator and be this place like we do

7:35stay with the front page of solana so we kind of need to be that kind of educator as well at the same time but um yeah i guess uh for us you know i guess one area that is lacking though is the data area um and you know we might be able to talk a little bit about that but uh we recently started uh kicked off a five million dollar fund for others projects which uh want to build

7:59data tools on solana um and for us this is pretty critical because a if i want to know the status of my wallet let's say february the 23rd at 8 26 a.m there is no easy way for me to get that data um and a lot of people are trying different ways to do things no one's quite nailed it yet but you know that's an example of a use case which uh which we should be able to get to we should be

8:26able to get to that point where we know the state of the wallet um so uh so yeah so we're looking to fund these kind of projects and um really sort of increase the amount of data tools that are available um like you think of things like nansen in ethereum land as well like whale tracking and these sorts of things people are gonna go out there and do it we don't have the time to do it um

8:46but we would love to integrate some of those tools uh for other people that are keen on doing it and maybe funding them along the way definitely yeah and i was reading into that about the uh the five million dollar um and for data providers so you're right it's about you know with all of these projects coming out and all the information going into the blockchain

9:05how do you analyze it properly how do you take that data and turn it into information to make it something useful right and step is doing a great job and bringing the steps to bring those projects to people but finding a way to categorize it make analytics out of it so you can take actionable steps and try to reduce noise as well so what is the useful information you know

9:32i think is going to be very important what kind of are you just looking overall in the solano ecosystem on anything that can really take data and bring value to it or bring specific solutions to people that are searching for something yeah i guess there's got to be some sort of overlap with what we're doing at step already right so it might start with

9:55portfolio data it might start with blockchain data um i guess displaying information about your particular circumstance is more important than uh something which is like the general blockchain as a whole right now um so for us we just want to be able to show people more information about you know their pnls their wallet histories these sorts of things to be able to track that

10:15over time um and then yeah maybe that might branch into uh different tracking and and whale wallet stuff you know in the wider blockchain world later on uh we'll see how we go on that front but uh yeah i guess for now we just want to focus on that um and uh yeah you know so so that's certainly one big thing that's happening uh we're also sort of very interested in

10:38the emergence of a lot of these alternate ways of incentivization um so we're the the first ones to pioneer what we're calling reward options so if you're familiar with yield farming uh or you know the audience is you know generally you put some money into a pool and then they give you tokens and then your tokens are the yield right and then you can go and do what you want with

11:00those tokens maybe you dump them maybe you hold them whatever restake them um this has been a tried and tested thing to attract liquidity and but the problem is that you're kind of you're kind of sealing a death warrant and doing it because you're you're just handing out coins to people uh all the time constantly and people there's lots of advanced traders which will just take

11:22this they'll hedge it they'll go and dump it uh and it's just like a farm and dump basically and move on so it think of it like a customer acquisition cost like you in many cases you're paying tremendous sums to acquire customers who are not sticky and are not going to stick around and you probably would have been better off just using google ads you know to attract these users right

11:42and just paying them that way um so uh so we're we're sort of looking we're the first to do this uh this thing called a reward option where essentially if you use the amm and you do a swap and you pay a fee uh then we will pro prorata give you a what's called a call option uh on on step so it's in your interest to you know use our product and our amm to pay a fee uh

12:06in order to exercise the option like the token value has to go up uh in order to exercise it you have to also pay step as well um which if we were just handing out coins you know obviously that doesn't happen uh and with that money then we're able to reinvest back to the stakers and put a floor price on things so actually i think just in general as an incentivization model people should

12:27be looking for alternate ways to attract people to their different projects and their platforms and this is just one way but i think the general trend is that the days of just having a yield farm and they see a later million percent apis um kind of behind us perhaps and people are maybe looking for for these other ways where you have to have at least some

12:49skin in the game to be able to get a reward which i think is just more healthier for the whole ecosystem really definitely and i really like that george uh having the option you know because you're right about yield farming and then just creating a token out of thin air and providing that token as the yield um i was caught in that trap years ago in the beginning of defy when

13:13and it gets so exciting because the apy's so high and then the whales or something happens to the token because everyone's getting it for free they just dump it on everybody else and you're right that doesn't create sustainable customers and that project that i'm that i was looking at is now dead and gone it was it was very short-lived so i really do like

13:32that call option functionality that you're talking about and i've i've been speaking to a lot of projects who are also working on different kind of options and derivatives on the solana ecosystem um get more ways for people to trade not just on the coins um so i think that's really valuable is that already live in the platform right now uh yes so it'll be the contracts are

13:56live uh but it's not live on our ui just yet that should be in the next week or two but yeah we've been testing it it's uh it's it's super exciting and um i think this will certainly be the first instance of this on solana it's kind of inspired a little bit by what uh andre cronier was saying from yearn uh he made a blog post on this back in august about

14:16about reward options and these sorts of things so we're kind of adapting a little bit of what what he was said there to uh to our particular situation um but i think it would also create like let's say it's a bull market or a bear market projects could use these kind of strategies for making sure that their coin doesn't inflate during a bear market which just kind of makes the

14:36situation worse you know if you have these big apys during a bear market and the tokens going down as well you know there's even more incentive for people to go well i'm just going to dump this because i think it's going to be down tomorrow and then you know that makes the apys work and it's kind of like a death spiral so uh with it with a call option uh you don't increase the supply

14:55unless the token price actually goes up so um so yeah so there's there's that kind of metric to it but yeah i just in general like i i've been thinking a lot about these these different strategies over the last six months so yeah there's gonna be more of them i think next year very cool and yeah we talked about a bunch of things i'm curious if there's

15:14anything we might have left out for and you're working on so many things throughout 2022 but you just mentioned three or four really good ones is there anything else that you want to hint at for what may be coming for the step finance users this year um i think for us like we we still have to like at our core we're a portfolio manager so we do have to build out some

15:37of that but i do want to have more of the the data plays available so um so yeah being able to give people more info insights on their their p l of their different positions at any one time that's certainly one um you know more tooling um so uh yeah there's there's some sort of internal stuff with solana that maybe we can help people do if they're managing their wallets and that sort of

15:59thing but i guess for us um yeah it's about providing useful things that people care about um and uh and to keep you know that that attention um and if and if we're able to do that then you know we're gonna be successful as long as we we're able to do that so um yeah i guess for us it's uh it's call options it's the uh we're gonna have uh locking kind of like the the curve situation as

16:23well um so we're going to sort of have a little bit of those mechanics um but also for us uh we did build out an nft marketplace late last year but we never launched it because it was a saturated market at the time and actually a lot of what we already have in our nft gallery uh was kind of uh you know repeating that so well so for us we kind of want more insights on

16:48what's going to happen with nfts which ones are trending which ones are are people you know apping into right now what's what's the uh you know what's the ability for creators to be able to create these nfts can you just log on to a website press a button and then mint a thousand nfts like right now that's not possible um so for step we want to bring

17:08a lot of those things you know to the four as well for creators um so yeah some of those functions of being able to create uh maybe an entire collection and be able to put them out there you know we want step to be that location for that as well and we think that's a good use case of we don't want to play in the the marketplace market like there's a lot of people doing that

17:26already um we just want to be like that that data place you know the place where people get this information and you know play people where they can you know create uh their collections on steps so um so yeah that's sort of the position that that we want to see ourselves in the next six months amazing looking forward to that especially with the nfts

17:47for the viewers that are looking to follow along with these updates to figure out how they can get involved as it comes out and to get involved with the step community as well what is the best way for them to learn more absolutely well every wednesday we have our weekly deployment so check out our twitter we always highlight it then um but you can always see us on

18:06step.finance uh we have our discord links there twitter and um you know a blog as well so um so yeah check out step.finance or just follow us on twitter and join the discord most most welcome everyone amazing thank you so much for taking the time george all the best with step and let's follow up in the near future thanks so much ashton great to be here

18:29see you later