LoveFTSO

[Gringo]

A very interesting situation is developing with the FTSO provider known as "LoveFTSO". It is ranking on top (in rewards) in both Songbird and Flare:

Songbird:

Flare (note the "Current Reward" ratio is for 100 WFLR, not WSGB):

So, LoveFTSO is currently #1 by rewards on Songbird and #2 by rewards on Flare.

Most of the service providers on Flare and Songbird that have social network presence are currently ignoring this provider from their lists, in effect hiding this FTSO from their users. They say since this LoveFTSO provider has no social network presence or a website, that alone is some sort of "prove" that is a bad actor on the network.

I see a conflict of interest here. Songbird and Flare were not created with a system of "trusted participants" in the way Ripple is. So some FTSO's are trying to recreate this idea of "trusted" FTSO's and "non trusted" FTSO's. But the reward system means users will try to chose the FTSO that pays the most rewards. So if some FTSO's are hiding the results of a provider that is currently paying the greater rewards, that attitude can be seen as not being able to compete with the current rules (and not as trying to "protect the network from bad actors").

This are the addresses of LoveFTSO:

Songbird: 0x2602f6456287A167B0214c3dbe8b4162f0Ec5409

Flare: 0xbeC604772722fe2E7A2a7b96339fFA71CeaBF4e7

I publish them because:

 * I don't think the best thing to do is to hide parts of the complete list of FTSO's providers and their performance

* There is nothing wrong if users seek to maximice their delegating rewards.

* If there is something wrong on the FTSO system, it should be changed, but current "winners" and "losers" are the result of the current rules, so hiding them is hiding the "problem" (in case there is one). And hiding a problem is never a solution.

 

[Guest]

53 minutes ago, Gringo said:

I see a conflict of interest here. Songbird and Flare were not created with a system of "trusted participants" in the way Ripple is.

I don’t like this. This is essentially encouraging collusion and will lead to bad oracle prices. This is serious. FTSO is the underpinning of the whole thing. It absolutely needs to be accurate if Flare is going to be a multi-chain liquidity hub (which is essentially what FAsset + FTSO is, with FLR/SGB as the bridge token)

However, this does not cause challenges with consensus. Flare’s consensus is a combination XRPL’s (FBA) and Avalanche’s. Concentration of tokens does not give control over consensus in Flare. 

Also you probably already know this about XRPL but for the benefit of those who don’t understand it fully -

A single UNL is made of trusted participants. However, no one is forced to use any existing UNL or delegate their trust to someone else. They themselves can choose participants they trust and form their own UNL, ignoring anyone else if they choose. Multiple UNLs are highly recommended with the XRPL as it helps increase the decentralisation. Participation in consensus (by being part of a UNL of your choice) does not require additional investment of money.

The FTSO system does not let you choose which providers to listen to for oracle prices. You just trust the “system” to work. That is what Gringo is warning about.

Edited January 23 by Ripley

[BillyOckham]

It’s non-trivial stuff this.  A bit beyond me if I’m honest.  
 

Where is that FLR FTSO rewards page visible?

 

[ftso_au]

11 hours ago, Gringo said:

They say since this LoveFTSO provider has no social network presence or a website, that alone is some sort of "prove" that is a bad actor on the network.

That’s not the reason at all. I’m sure more will come to light in the coming days.

[Gringo]

Quote

That’s not the reason at all. I’m sure more will come to light in the coming days.

It doesn't matter. The rules of the network is how it was designed, it is a permisionless system and the censored lists are trying to create a permisioned system on the go. Ripple is such a system with the "trusted validator list", but those are the published rules.

You know how Flare/Songbird looks like at the moment? If you are "friends" with Hugo and the team, then it doesn't matter if you front-run TDE and sell FLR to cover expenses, but if you are an anonimous FTSO provider (a.k.a. you are not friend of Hugo or don't want to publish your identity) then you are a "bad actor" even if you don't violate any rule because it is supoused to be a trustless descentralized system.

Either the system is trustless or it is not.

If "LoveFTSO" can "exploit" the system as it is currently designed, then the "notable" FTSO operators too. Actually my position now is that they are doing a great service by showing the weack spots. And because of that service, they deserve a percentage of delegation from the "general public" (not conected to Hugo's friend circle).

[Guest]

Thought Experiment

The reality is that FTSOs need to sell SGB/FLR to fund hardware + network + development costs. It would be nice to see an FTSO that accepts fiat/stablecoins as funding, in exchange for 100% of the rewards (minus a small fee) and for providing accurate oracle services.

E.g. Set up a trust line on XRPL, send fiat IOUs (there are several currencies available already), receive FLR/SGB IOUs. 

Because that is what effectively happens today anyway, just indirectly. Why kill the market with the current approach?

• If this approach could be considered as "fee for services rendered", then there should not be any legal issues.
• If this approach is treated as "an investment in a common enterprise", then delegating to FTSOs is no different.

FTSO is a business and they should be comfortable running it as a formal business IMO, and the system would be more secure and decentralized. 

@ftso_au - would love to hear your thoughts on practicality of this.

Edited January 23 by Ripley

[Gringo]

Quote

more secure and decentralized

Well, Hugo acting like a judge granting FLR for "operating expenses" to some FTSO's and not to others, isn't decentralization. Also it seems fron-running the community is "not bad" when that circle of friends does it.

If the (unwritten rules) are that Hugo's circle of friends are the only FTSOs considered as "good" actors and the anonymous FTSOs are considered "bad", then the Flare/Songbird ecosystem will stay forever centralized.

If there is collusion, then the problem is on the design. Some entities capitalizing on the (bad) design are in a way contributing as an incentive to improve the design. But if the "solution" is to change from a permisionless to a permisioned network it will conspire against the stated goals of Flare.

[henne111]

14 hours ago, BillyOckham said:

Das ist nicht trivial. Etwas überfordert, wenn ich ehrlich bin.  
 

Wo ist diese FLR FTSO-Prämienseite sichtbar?

 

I hope this is the right page.
Maybe there is another side.

https://flare-ftso-monitor.flare.network/data-providers

 

[Gringo]

Quote

Maybe there is another side.

https://flare-ftso-monitor.flare.network/data-providers

On that page you need to switch off the "Listed Only" option to get the entire list. See:

Listed Only OFF:

Listed Only ON:

 

Also many providers that apear with only an adress do have provided their "name" and "logo" image, but they don't show them, so to "hide" them a bit more from the public.

Once again, the idea of creating a "trusted" providers list, defeats the idea of a trustless system. Also some of the FTSO's on the "trusted list" have participated on very cuestionable practices (ie. frontrunning the market on Bitrue).

 

Edited January 23 by Gringo