A Noble Opportunity

Polkachu Team | 2023-09-25

Noble: Possessing outstanding qualities. -Merriam Webster

A radical view is that stablecoin is the only crypto product with product-market fit. Taking the view to its natural conclusion, I would argue that any crypto ecosystem will have difficulty experimenting with new financial products without a native stablecoin.

The Cosmos Ecosystem thrived and crashed with the rise and fall of Luna/UST in the last bull run. While many are still licking the wounds, I think that it is time to seek a new Noble opportunity.

Why Native Stablecoin?

While degens are comfortable holding volatile crypto assets, normies retreat to stablecoin at the first sight of long red candles. For normies, the value stability is a feature, not a defect. A typical American might not be able to appreciate this because they can hold fiat dollars easily. But crypto is a world-wide movement and many normies are from high-inflation countries with strict currency control. For them, dollar stablecoin is the best financial product imaginable.

Currently, normies are hesitant to enter the Cosmos ecosystem because all existing stablecoins carry bridging risks. Moreover, these bridged stablecoins are not fully fungible with each other despite the stableswap pools. Finally, all the prefixes of axlUSDC and grvUSDC are just confusing. Just give them the real one!

Bank As App Chain

Now we have Noble native USDC. It is the "real" one because Circle is fully behind the project. When a Noble USDC circulates through the Interchain economy, my understanding is that it always routes through Noble Chain using IBC. In other words, if an IBC-ed native USDC on Chain A needs to go to Chain B, it goes through Noble with 2 hops instead of a direct trip.

This makes Noble Chain a "bank" in the sense that it intermediates important financial transactions just like a real-world bank. People will probably park spare native USDC on Noble Chain. It also means that Noble Chain is in a privileged position to curate a list of applications that people can use with 1-click without realizing they are interacting with another app-chain.

If you think about it, a real-world bank is essentially a homebase for stable fiat assets plus a curated list of financial applications: typically savings account, CD, credit card, mortgage, and sometimes brokerage, but not payday loan or personal unsecured loan or venture investment. In a sense, bank is a king-maker in terms of what products receive wide distribution and what remain a niche. There lies the opportunity for Noble.

A Noble Opportunity

Noble Chain will be a king maker. Whenever applications that Noble Chain curates will become the default applications for users who use Noble Chain as their homebase. For example, if Noble Chain builds out a frontend that ingrates with Stargaze instead of Starmaze with 1-click NFT purchase using USDC and directly displays the the purchased NFT, then Stargaze immediately gets wide distribution and Starmaze is probably NGMI.

And Noble Chain should be a king maker. The Interchain ecosystem is way more fractured today than a normie will tolerate. Implicitly, we have been seeking a unified frontend since CosmosHub was named "Hub". All previous attempts lacked success because they were not a homebase for people's stable assets. Noble solves this issue by default.

While many obsess over whether Noble should be a stand-alone chain or an ICS chain, I say that's irrelevant. If the Noble USDC is an $20B asset opportunity, does it make a difference if it is secured by a hub with $2B market cap?

The real prize is the wider adoption of crypto for people who are not yet in crypto. For them, Noble presents a unique opportunity to offer a safe homebase for stable assets and a unified UI to interact with the curated list of app-chains without complexity. If we achieve this, we all win.

Up only.