[DeFi Discussion] Decision for Adopting CosmWasm on the Hub for DeFi Modules

From deep discussion on UniFi telegram channel , we have found that the community has different ideas how to deploy major DeFi applications on the Hub, which are AMM(DeX) and ETH Peggy(Peg for Ethereum assets). One idea involves building DeFi applications on the Hub via CosmWasm smart contract, the other is to build native DeFi modules directly on the Hub. So I hope to write down detailed advantages and disadvantages of each approach, and summarize further diverged roadmaps for each implementation option. This is the most important preliminary topic to decide from the community because every actionable roadmap for GTM(Go To Market) strategies and characteristics diverges significantly for each approach. It is wise for us to decide the high level implementation option first, and progress upon decided path. Disclaimer : Below summary is written by me with unperfect knowledge on technical details, so it will be very appreciated if anyone can feedback with reply when any information is wrong or need update. • Advantages of CosmWasm smart contract DeFi on the Hub • CosmWasm framework provides us more flexible upgrade methodologies which allow us to upgrade implemented…

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bharvest:

Adoption of new contract will need audit procedure for the Hub. The difficulty and insurance of audit depends on the structural complexity of over-all mechanism, and it brings additional necessary deeper audit from very specialized inspector than native modules, who has specialty on Cosmos-SDK, CosmWasm module, Rust, Wasm, and CosmWasm smart contract.

Whilst I agree that auditing may be perhaps a bit more complex because of the additional layer yet auditing is always a requirement for all modules that are first approved by governance, then enabled in gaia. Am I wrong?

bharvest:

Security and stability issues

Innovative and disruptive solutions always bring more challenges. The concerns here are quite nebulous to say the least. I’d love to see more specific concerns - mind elaborating a bit further and add specific, detailed and technical concerns to it?

Thank you for your opinions. I would like to invite people who are more technically familiar with cosmwasm architecture on the raised questions.

1. first of all, the security risk I mentioned is about relative metric. I think anyone can agree that it should have additional complexity and risk than the native module. How much riskier cannot be quantified but a cosmwasm specialist can elaborate in detail I guess.

2. this topic is about cosmwasm on the hub. Postponing cosmwasm adoption until enough testing and debugging does not mean indefinite giving up of its potential. Many zones can adopt cosmwasm and take risk to venture the potential, and I am personally looking forward to it. Maybe after 1 or 2 years, after we’ve seen enough evidence of stability of cosmwasm, the hub also can decide its adoption too. So, please bound this discussion with specific domain, “on the hub”, “in less than 1 year”, “for dex and peggy” range.