DeFi Users: How do you establish trust in a new protocol/platform?
Quick background: I'm a dev trying to build and launch a new Ethereum-based decentralized exchange. Think along the lines of Uniswap, Sushi or Bancor. I really believe that the product will offer some truly new technology that will add value to the users. But my conundrum is building enough trust with the DeFi community, where early users will feel confident to trust their hard earned money.
That's why I'd like to hear from you. The subreddit here is filled with a lot of bright, knowledgeable people, who are often on the cutting edge of DeFi. Your perspective would be super valuable for our team. What are the major things you look for in a new DeFi protocol before you trust it with your money? And how do you approach the problem of deciding to trust something new? Are there common red flags that you look out for? Vice versa, are there things a project can do that will get your attention and trust?
Do you care about audits? If so, are there certain auditors that you trust more than others? (This is a big one for us, as we've found certain audit companies are significantly more expensive than other.) Do bug bounty programs matter to you? If so, is there a certain minimum size in the pot that you prefer to see?
How about the dev team personally? Are there things they can do to help build trust? Dox themselves? Have big name investors? Be active on social media?
Are there certain tools or third party evaluation sites that you rely on? I'd like to hear and all that you use. (I know rugdoc.io is often popular, and we're already trying to work with them.)
Is there a certain threshold of TVL that you like to see on the platform first? Will you be more likely to try a new project if there’s say $10 million TVL instead of $100k?
The above are just discussion points. Please respond with anything and everything that you use to establish trust. Even if you think it’s weird, it always amazes how many ingenious off-the-wall solutions exist in this space. (Tangentially, I’d love to hear any general advice anyone has I’m general about building an early user base.)
I genuinely think we’re building a good project that can potentially add a lot of value to the ecosystem. But to do so, we can’t just launch and have no one show up. We’re engineers, not marketers, so any feedback you can offer is super helpful and illuminating. Thanks I’m advance for all the great responses.
Posted Aug 9, 2021, 9:45 PM UTC
Probably the best thing you can do is have a comprehensive white paper that really gets specific about your technology.
Great point about the white paper. Up until now, it's something that we've neglected. We've been so busy building the code, and the engineering team has the mental model in their head. But you are absolutely right, great white paper and docs is critical to communicating trust. Thanks!