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How To Become A Local On The Cross-Chain Streets
Disclaimer: This piece is based on one (non-trust) assumption: if you’re here reading this newsletter about bridges and the multi-chain ecosystem, you’re not a crypto tourist – you’re here even when the numbers are going down weekly because you’re actually in it for the tech (am I right or am I right?).
With that out of the way, let’s dive in.
Locals vs. Tourists: A Framework
In crypto, there are two types of users:
Tourists: These are seasonal visitors. They’re here for a good time, not a long time. When the excitement fades, they leave.
Locals: These are the residents of a certain vertical (dApp, protocol, blockchain, idea). They believe in the ethos of DeFi and are in it for the long haul – they plan to stay regardless of conditions.
For example, when it comes to new chains, tourists are the ones who are just here to make the most of the hype around a new VC-backed chain while it’s valuable. They don’t plan on staying for long and will relocate to a hot new chain to hop onto the next narrative play. Locals are those who have read the whitepaper, understand and vibe with the chain’s value proposition, and plan to contribute to its growth by using and/or building on top of it.
This is a general framework that can be applied to any niche in the crypto ecosystem:
DeFi yield generation opportunities – Before aping into a pool, it’s worth considering if you’re a tourist or a local: are you locking your funds in the pool to generate a modest and sustainable yield over a long time frame, or are you aping into the pool to make the most of the liquidity incentives and plan to exit when they begin to dry out?
New applications like bridges – Evaluate why you’re using a bridge: are you simply airdrop farming, or do you genuinely need to use a bridge, and you’re using this specific one because you like what it has to offer in terms of security, routes, costs, and UX? (sidenote: users who have a genuine need and desire to use a specific bridge naturally receive larger airdrops if and when a bridge launches its token).
Becoming a tourist is fairly straightforward in most conditions: you make the most of the opportunity and move on to the next destination when something new starts trending. However, it might not be the best approach for everyone as it requires users to time everything perfectly, which is never easy when it comes to crypto. On the other hand, becoming a local is a long-term and well-thought-out process. It requires patience and a genuine willingness to learn and explore.
Extending this framework, let’s dig deeper into how one can become a local on the cross-chain streets:
1. Learn: To become a local, you must develop a better understanding of how cross-chain infrastructure works and what different blockchain ecosystems offer. You must go beyond the names of bridges and the teams behind them. Learn about how they work and what trade-offs they’ve made.
How can you learn more about bridges? I’m so glad you asked (kek). At LI.FI, we’ve spent the last 10 months researching and writing about bridges, attempting to make bridges and interop easier for everyone to understand. So if you’re eager to learn beyond each bridge’s marketing material, here’s what you should do:
Start with the bridge basics through these articles:
Beginners guide to bridges by Ethereum.org (powered by yours truly, LI.FI)
Get an overview of the bridge ecosystem by:
go through the OG article on bridges by Dmitriy Berenzon: Blockchain Bridges: Building Networks of Cryptonetworks
read about the current state of bridging through LI.FI’s Bridge Stack (2022), A snapshot of the bridging ecosystem in Q3 2022.
Dive deep into the rabbit hole of bridges and learn more about the finer details of bridge design + trade-offs by reading:
Note: you can also check out LI.FI’s Declassified Bridge Survival Guide, aka The Bridge Resource Cheat Sheet by Kram, to learn more about bridges.
2. Explore: Don’t just use one bridge or stick to one ecosystem because you’re too lazy to learn more about other bridges and chains. Explore, follow your inspiration and curiosity to go deep and experience the cross-chain streets first hand to form an informed perspective.
For instance, if you’re a user on Ethereum Mainnet and want to bridge away to another EVM chain, here’s how you can go about it to explore like a local:
Learn more about the different EVM-chain ecosystems you can explore. For example, there are rollups like Arbitrum and Optimism, sidechains like Polygon, or alternate L1s like Avalanche and BNB Chain. Analyze these different types of chains and narrow down your choice based on metrics such as: 1) security trade-offs, 2) transaction costs and speed, 3) applications within these ecosystems that you’d be interested in using (ex: if you want to trade derivatives on-chain, you would prefer Arbitrum as it hosts GMX or Optimism as it has Perpetual Protocol)
Once you’ve decided which chain to explore, it’s time to learn more about which bridges support it. For example, if you choose a rollup like Arbitrum, you have a plethora of options such as: 1) Arbitrum’s native bridge, 2) locally verified liquidity networks like Hop and Connext, 3) externally verified third-party bridges like Multichain and cBridge, 4) bridge aggregators like LI.FI, which picks the best route for you and offers bridge-swap functionality (i.e., swapping any token on Ethereum Mainnet for any other token on Arbitrum).
Dive deep into the rabbit hole of how these bridges work through the list of resources provided in the “Learn” section, and then pick two or three that fulfill your requirements and then try them out (which you can do easily via transferto.xyz).
3. Become part of a community – Being an active community member is perhaps the most effective way of becoming a local in the cross-chain streets. It allows you to meet other locals with similar interests, learn and explore together, and often even contribute to the projects and the ecosystem overall.
Typically, here’s how you can join a community (in the context of LI.FI):
Contribute to the project meaningfully – If you add value to a project, you’re automatically considered an OG of the community. There’s nothing more that projects appreciate than community members who use their products and are genuinely interested in spreading awareness about them. A few ways of contributing meaningfully include:
Become a beta tester. Example – LI.FI’s Beta Tester role is for members who actively help us test out new features and give feedback, enabling us to improve our product.
Help other users by solving their support queries. Example – LI.FI’s Helper role is for members who actively use our product and have now become proficient enough to support other users who are facing difficulties using the product.
Translate content into different languages. Example – LI.FI has community members who actively help us translate content into their native language. This helps us spread awareness of our product in different languages and cater to diverse communities. (we appreciate you mosheng and master1rick [Chinese], bertramcoins [Russian])
Participate in tasks and win rewards + entry into the community. Example – LI.FI community spearheadoors are actively introducing tasks that the community can participate in and win bounties. These activities offer users direct entry into the Lizard DAO. For instance, in LI.FI’s most recent task, users had to design the next Lizard DAO NFT. In addition to entry into the DAO, you can also win cool NFTs like this one:
Key Takeaway: There’s nothing wrong with either approach (being a tourist or a local); one might work for some, while some might feel comfortable adopting a different approach. However, it’s crucial to recognize upfront the type of user you are, so you can make a more informed decision when required.
PS. if you want to become a local in the cross-chain streets, join the Lizard Family, and let’s explore together 🦎
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