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Handshake is a decentralized domain name registration, authentication, transaction, and resolution protocol, which is currently connected to the Ethereum network. Even though DeFi has made great developments this year, users can use decentralized financial services more smoothly, but they are still accessed through centralized domain names and gateways. Handshake is to solve this problem and make the entire user process truly Decentralization.
But popularizing this protocol itself is also difficult. Either users actively use it or require users' widely used browsers to accept this protocol, and behind the browser is a centralized organization. If there is a relevant token mechanism to drive users to spontaneously create a usage agreement, it can really give it value.
There was an immature idea : the domain name itself is a tradable just-needed virtual asset that can be charged according to the holding time, and its marginal cost is 0, that is, its gross profit can be close to 100%. Then it is very suitable to build a multi-level distribution system for promotion, so that participating users can get three kinds of income possibilities: static income from promotion, domain name value-added income, and token value-added income, which may accelerate popularization.
Less than a year after the development of Handshake, the market realized the advantages of decentralized networks, where anyone can have their own namespace without worrying about gateways and supervision. In a parallel manner, Ethereum's decentralized financial protocol has evolved from experimentation to maturity.
The opportunities for cross-chain collaboration are huge, and DeFi and DWeb are complementary revolutions. Handshake and Ethereum are still in the embryonic stage of symbiosis, and its value is worth studying.
Earlier, I talked about how the Handshake namespace can enhance the decentralized financial system by ensuring front-end security through encryption.
The DeFi movement competes to provide an open and unlicensed market system. But DeFi cannot operate in a vacuum. In fact, decentralized protocols are still supported by centralized front-end websites and applications. Until the entire process is decentralized, decentralization will be truly realized .
Now let us explore the other side of this relationship, how the DeFi mechanism enhances the economic mechanism of the Handshake namespace. Decentralized exchanges have brought more liquidity to HNS. At the same time, smart contracts introduce openness and programmability into the Handshake registrar. Both aspects make Handshake a usable tool on Ethereum.
HNS on Ethereum
HNS is Handshake's token and the "money" in the Handshake economic system. In order to realize this value, HNS needs a highly liquid market. Liquidity can find prices, and the price discovery process brings investment investment, all of which are necessary to maintain the public chain.
Closed in its own chain system, it is necessary to provide liquidity by guiding users to platform investment and market makers. Although Namebase is a well-known interface for buying and trading HNS, all centralized exchanges are plagued by regulations and user experience friction; and are facing the classic chicken and egg problem, that is, the user base of new startups needs to grow. Large-scale centralized exchanges will not even list HNS because of insufficient liquidity. Price discovery will be hindered by the need for its own exchange.
On the other hand, decentralized exchanges on Ethereum such as Uniswap are very suitable for providing liquidity for new crypto assets. Centralized supervision and order books are replaced by open liquidity pools with incentives. Ethereum assets can be traded anywhere and by anyone. Wrapped and untrusted HNS are two ERC-20 implementations of Handshake. Both versions behave similarly to the HNS file format, allowing the Ethereum network to recognize them. HNS, which is easily recognized by Ethereum, can use the existing DeFi infrastructure to become a more liquid token. We saw this early stage because the first HNS was just packaged through Wrapply this week.
Namespaces on Ethereum
The Internet makes everyone a publisher. Ethereum makes everyone an investor. Now, Handshake also enables everyone to become a namespace registrant.
For the first time, anyone can have their own top-level domain and allocate subdomain space as they wish. First, it is worth considering the namespace pattern that appears on Handshake. Top-level domains can represent market categories, specific networks, or individual brands. Therefore, some TLDs will open subdomains to the public, some TLDs will allocate their subdomains to users of their networks, while others will reserve subdomains for themselves.
The free market of TLD has destroyed ICANN's monopoly, which in itself is a feat of decentralization. However, we can go further. The tools provided by Ethereum will eliminate "statutory" registrars. The smart contract registrar (the Handshake TLD that manages the subdomain market on Ethereum) is transparent, autonomous, and programmable.
Consider that part of a tokenized T-shirt can be resold on Foundation, and the salesperson and manufacturer will get the correct profit distribution. But I can't get the name of the person who wants the T-shirt on the top social networks, let alone believe that they will ship it after receiving my payment.
The narrowing of the gap between the currency and the crypto market requires the UX fluency of crypto applications to attract more consumers.
Smart contract registrants can also escrow domain name payments without trust. With this more secure foundation, registrars can increase complexity. Registrars with dynamic pricing can sell subdomains based on factors such as character length or domain registration order. Or the top-level domain name can provide users with a domain name deletion service to declare it as a permanent and unauthorized domain name.
Ethereum can not only iterate the way registrars sell subdomains, it can also completely change the structure of registrars. TLD ownership can be fragmented, while the domain name (and the right to subdomain renewal fees) is owned by the user community . Just as distributing management tokens means decentralizing the ownership of the network, domain name tokens can be distributed similarly to decentralize the ownership of the front end of the network. RealtyDAO is a project that involves the possibility of fusing the tokenized namespace with the programmability of Ethereum.
We have a deeper understanding of the value of namespaces (domain names). Domain names are not only network readable, but also a symbol of social status, identity and brand sense. We have not been able to realize this value and these ideas in a meaningful way. The interaction between Handshake and Ethereum opens up endless possibilities.
Symbiosis agreement
Handshake and Ethereum are a symbiotic relationship, but more specifically a mutually beneficial relationship. Both protocols benefit, the decentralized namespace on Handshake benefits DeFi on Ethereum, and vice versa.
This article is published by OpenWrite , an operating tool platform such as blog group posting and multi- posting