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Delta.Finance 'fake trading volume' block triggers debate: Did Uniswap do it wrong?

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Transaction volume suddenly jumped 450%.

On March 30th delta.finance was officially blocked by Uniswap for "non-bona fide transactions", after fuelling Uniswap's record (albeit brief and dubious) daily trading volume. But the story is not over yet.

The developers of delta. Finance argued that Uniswap had mishandled the issue, and that someone had subsequently "duplicated" Delta's approach by reintroducing a "You don't" Blacklist Delta Financial, which continued to "mess" with Uniswap's statistics -- putting Uniswap at the center of a controversy over the overuse of "centralized power."

"Trading volume" surged 450%, and Uniswap sold

On March 29, Uniswap's trading volume was unusual, surging 450% in 24 hours to $7.17 billion, compared with $1.6 billion the previous day, according to Uniswap. The previous single-day record was $2.19 billion on October 26, 2020 -- a more than threefold increase.

This is obviously very unusual.

Later, someone in the community discovered that the project responsible for the huge number of transactions was a token called Delta.Finance called Delta. Although its liquidity pool is only $16.4m, it generates $6.13bn of "trading volume", or 85 per cent.

The official team was quick to spot the anomaly. Uniswap founder Hayden Adams wrote in a tweet about the project: "Not a wash sale, but not a" real "transaction either. Uniswap. Info was quick to take the project down. In addition, he adds, Uniswap is completely decentralized, but.http://info.uniswap.org Is an analytics site that "tries to explain and show what's going on with the protocol" and is useless if it's completely unconstrained.

Delta is not the crypto derivatives trading platform that just closed a $5 million private equity round, nor is it Formula One Delta Time, the NFT racing game, nor is it Delta, the portfolio investment vehicle that was acquired by Etoro. Delta.Finance is a completely new project.

According to the authorities,Delta.FinanceIs a by providing sufficient liquidity to eliminate the etheric fang options trading volatility DeFi new projects, in order to achieve this purpose, the Delta set up the mechanism that modern currency move, a token ownership plan is activated, "10% of the total tokens will be sent to the user, while the other 90% is locked, and linear unlock within 2 weeks."

But when Delta liquidity was reset, Uniswap thought a lot of "trading volume" was generated and counted, but in reality it was just an algorithm that raised the price over time to mint the coins. Such a design looks a little like a Wash trade. According to the Securities Law of China, a Wash trade is an act of buying and selling securities by oneself without transferring ownership, thereby affecting the price or volume of securities traded (Article 71, Item 3). Can be simply interpreted as the amount of brush).

It soon became clear that Delta tokens could no longer be looked up on Uniswap.

The developers were very unhappy with the result

After the Delta team discovered that the project had been blocked by Uniswap, a developer named "@x3dev" expressed frustration on the cable group, according to Legally Blockbeats. According to him, they don't think Delta is a scam program, but that the mechanics of the program make Uniswap's statistics slightly abnormal.

"Uniswap called us a 'cheat token' in the comments, which is hard to accept." "There are a lot of scams on Uniswap and Delta is not one of them," he said. "Previous attempts to contact Hayden Adams have been ignored and have not been responded to."

Developers on the Telegraph Group expressed frustration at being blocked by Uniswap

The Delta incident sparked a heated debate in the crypto community about whether Uniswap's decision to block the project was justified, and if not, what to do about the data distortion caused by Delta's mechanism, and whether Dex needed a centralized team to intervene.

And just when everyone thought it was going to die down, it started again.

On March 30, a user "0xRevert" claiming to be a member of the project tweeted that anyone could generate $20 billion in transactions with a given token, and that "the attack will continue until Delta transaction history is restored and Uniswap apologizes for" abusing centralized power." In addition, he said he would open the source code and publicize how to do it.

In response to comments that suggested it should be blocked, 0xRevert also said: "Enjoy whack-a-mole."

A new token called "You don't Blacklist Delta Financial" was created, generating $10.96 billion in "trading volume" despite having less than $1 in actual liquidity.

Hayden Adams, however, called the threat "one of the stupidest things I've ever seen." He emphasized again that INFO is an analytics interface, not a decentralized protocol. Violence-related tweets are not tracked, just shown who they are.

Banteg, the core developer of YFI, commented that he agrees that Delta makes INFO look less useful. It's interesting to observe that. (Hayden Adams) You probably need some heuristics. Hayden Adams responded that the team is trying to explore this, but it needs to be improved. "A long list of tokens that would exclude transactions is probably the only viable solution," he said.

revelation

At least for now, the Delta project is not malintentionally messing with data, and the human intervention of Uniswap.info does not violate the decentralized spirit of blockchain.

It's just that the mechanism designed by the Delta project is causing statistical anomalies -- something that has never happened before. The authorities have tried to cover up such incidents by blocking them. Abnormal, but did not expect that the project side can not accept such a way of processing, and then the two sides intensified contradictions, evolved into the current situation.

If Uniswap had negotiated and adjusted with the Delta project party before resolving the issue, instead of blocking it directly in an arbitrary and official way, this might not have happened.

In the DEFI world, all kinds of accidents can happen at any time, which is a great test for the various actors in the ecology. Uniswap does not seem to be the winner in this case. What about Delta, which has been blacklisted?