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The Baking Sheet - Issue #31

The Baking Sheet - Issue #31
By Tezos Commons • Issue #31 • View online
One week left in the Testing phase for EDO

Baking Sheet 2.0
Welcome to this week’s issue of the Baking Sheet! 
We’re excited to share that the Baking Sheet will transition into a weekly newsletter covering all the latest news and insights across the Tezos ecosystem. Accordingly, we will also begin to share some of our thoughts on the latest developments and cover specific topics that we find worth discussing further within the ecosystem outside of our TezTalks series and Medium publication. 
As Tezos continues to evolve and grow, we’re beginning to witness the seeds start to get planted for higher level DeFi (Decentralized Finance) applications. Earlier this week, we dove into Bender Labs and the work they are doing to bring WRAP protocol and their vision of a fully-fledged and completely decentralized financial system on Tezos. 
The Growing DeFi Movement
It’s no secret that DeFi is becoming an important component for a smart contract platform to have, opening up the network to new assets and existing ones to move between it. My favorite analogy that best represents this ‘big picture’ view was from Daniel Masters, a little while back. 
Over time what’s going to become transparent is that these networks are going to perform a utility function for transport, a transport for all kinds of digitized assets. Those assets could be monetary, hard assets, real estate, securities, identity, and more. These networks will transport that. So, there’s this interplay between the network itself, the protocol coin, and the type of assets that move on that network.
So, if you put all of that together you’ve got an environment going forward where I believe you could look at these networks and say they are like the railroads of the 1900s. They are building transport across the internet and across the world in a similar way the railroads did. It’s a utility play and in that universe of utilities, you’ve got many contenders but its hard to find one that has this combination of sensible governance, good people and founders, a well-funded and managed foundation, and a very feature rich blockchain technology. So, when you add all of this up it becomes to me, one of the great utilities in this crypto universe.
The growth we’ve witnessed in DeFi on Ethereum throughout 2020 and present day, is beginning to paint that image clearer. That being said, I find it’s not explained enough in how we get from these building blocks that we’re currently witnessing being built on Tezos - to higher level DeFi applications such as lending platforms. I believe it’s worth painting some more light on that particular subject.  
As things currently stand, I believe that the best visualization of DeFi within Tezos was provided by Luke Youngblood and Keefer Taylor
Often times, I hear some community members saying “too little too late” or “there’s more Tezos should be doing within DeFi”. The above image, we can call it the unofficial DeFi roadmap for Tezos - shows a few things that can dispel this misunderstanding. 
Firstly, primitives (building blocks) need to be put in place first in order for succession to the next level of applications. 
These primitives are not built overnight, but the point is they need to be built in order to even begin considering moving on to a higher level application. You can think of it like a skyscraper. In order to build the skyscraper, or any building for that matter - a strong foundation needs to be put into place and gradually more additions can be made on top of that foundation. One cannot just start from the very top, as I don’t believe that needs any further explanation what would happen if you did. 
With that out of the way, we’re beginning to inch higher up the roadmap. 
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