Last weekend, Resolv's USR uncoupling was nothing short of a big joke in DeFi. The attacker printed 80 million USR out of thin air and ran away, leaving a $80 million hole and a mess everywhere. The worst is not over; a secondary panic was triggered on-chain: because everyone's leveraged positions on Morpho were completely exposed, liquidation bots pounced like sharks smelling blood, causing hundreds of millions of dollars in TVL to suffer as well.
This fatal point caused by 'fully naked on-chain' makes me once again delve into the underlying logic of @MidnightNetwork . On traditional public chains, you are not only fighting hackers but also competing against all the world's monitors; your bottom cards, hedging positions, and liquidation prices are all public. Once something goes wrong, there is no room for recovery.
This is why I am optimistic about the 'rational privacy' architecture like Midnight. According to its white paper's design, the DUST generated by your $NIGHT can drive shielded transactions, keeping your arbitrage strategies and hedging positions in a default 'invisible' state, avoiding attacks from malicious bots. More hardcore is that it is not the kind of 'black box' that prevents you from proving your innocence, but supports selective disclosure. In extreme market conditions like Resolv, you can protect your commercial positions from public scrutiny while accurately proving your solvency to regulatory bodies.
The lesson from Resolv teaches us: DeFi without privacy protection is just 'naked running' across the grass; only infrastructure like Midnight that clarifies privacy and compliance can help us survive gracefully in the next crisis. Don’t wait until you’ve lost everything to think about defense; holding some profitable assets is the real preparation in advance.
#night $NIGHT
This fatal point caused by 'fully naked on-chain' makes me once again delve into the underlying logic of @MidnightNetwork . On traditional public chains, you are not only fighting hackers but also competing against all the world's monitors; your bottom cards, hedging positions, and liquidation prices are all public. Once something goes wrong, there is no room for recovery.
This is why I am optimistic about the 'rational privacy' architecture like Midnight. According to its white paper's design, the DUST generated by your $NIGHT can drive shielded transactions, keeping your arbitrage strategies and hedging positions in a default 'invisible' state, avoiding attacks from malicious bots. More hardcore is that it is not the kind of 'black box' that prevents you from proving your innocence, but supports selective disclosure. In extreme market conditions like Resolv, you can protect your commercial positions from public scrutiny while accurately proving your solvency to regulatory bodies.
The lesson from Resolv teaches us: DeFi without privacy protection is just 'naked running' across the grass; only infrastructure like Midnight that clarifies privacy and compliance can help us survive gracefully in the next crisis. Don’t wait until you’ve lost everything to think about defense; holding some profitable assets is the real preparation in advance.
#night $NIGHT