The crypto economy is the Wild West right now, and it’s a long way to go before it even comes close to mirroring the complexity of our ‘conventional’ modern financial ecosystem. Olympus Labs (not to be confused with a supplement company of the same name) looks to change all that. Its goal is to become a definitive and comprehensive decentralized financial ecosystem using blockchain.
Consider the current crypto-trading strategy of ‘Buy, Hold, Pray, Sell.’ Combine this with the high volatility inherent to cryptocurrencies plus their unregulated nature, and you have yourself a massive barrier to mainstream adoption.
A more sophisticated market would allow cryptocurrency holders to give out and receive cross-currency loans, hedge volatility, and downside risk, or obtain general cryptocurrency market exposure. This could be the catalyst needed to push the crypto financial system into the mainstream.
However, because of the structure of the blockchain, the cryptocurrency asset, its settlement network, and its transaction rules are a singular entity. In a standard fiat currency, a dollar is just a representation of value, with the settlement and transaction rules determined by outside parties. In other words, unlike a cryptocurrency, the transaction and settlement rules are not inherent to a fiat currency.
This structure is what creates the challenges in creating a sophisticated crypto financial ecosystem. It’s these challenges that Olympus Labs aims to solve.
How the Olympus Labs Crypto Ecosystem Works
The first building block in the Olympus Lab infrastructure is the creation of a decentralized exchange. Previous exchanges have of course been subject to high profile hacks; however, it is important to note that while these were cryptocurrency exchanges, they were not truly decentralized.
Olympus Labs has opted to use the smart contract model as the cornerstone of its ecosystem. Specifically, it will use an upgraded variant of something called the Tier Nolan protocol that enables cross-chain exchanges.
The protocol that Olympus Labs uses has to solve the issue of how two parties from different blockchains who do not trust each other can execute a sophisticated transaction. The protocol uses a redeem condition that generates a random number, x. This random number can be revealed to the smart contract, and the other party can use it to redeem a particular asset.
Let’s use a collateralized cryptocurrency loan as a practical example.
Example: Collateralized Cryptocurrency Loan
- John generates a random number x.
- He commits the ETH loan amount to a smart contract. He can take this money out by revealing x.
- Jane transfers her BTC collateral into the transaction with the condition that it can be redeemed by revealing x. She digitally signs off on this transaction with the redeem condition.
- Once John sees that the collateral has been deposited, he signs a release into the smart contract, and the ETH is released into Jane’s Ethereum address.
- Once Jane repays the ETH loan plus interest, John now reveals x.
- The revelation of x allows John to take the loan principal and interest and also for Jane to redeem her BTC collateral.
The above steps list out the full completion of the transaction. Before John releases his ETH to Jane in Step 4, neither party is committed. At any time prior, John can reveal x, which will allow him to reclaim his loan amount and for Jane to redeem her collateral.
This is an elegant protocol, but it has yet to address two issues: partial repayment and loan period. If partial repayment forces a reveal of x, then the lender will be at a disadvantage. Similarly, the lack of a timeout protocol will mean that a loan could remain ‘in limbo’ indefinitely, with the collateral unable to be accessed by either party.
Olympus Labs has clarified that such issues will be addressed in upcoming technical documentation.
The Role of the Mount Olympus Token
Gas will power every transaction on the Olympus Labs exchange. Mount Olympus Tokens (“MOT”) will be used to purchase said gas. The price of gas will fluctuate based on the balance between the number of transactions and resources available on the network.
The first product that Olympus Labs will launch will be a borrowing and lending platform. The next product planned after that will be cryptocurrency index funds, ideal for building a more diversified cryptocurrency portfolio.
Other products that Olympus Labs have planned including products for shorting the cryptocurrency market (a significant need as there is no current way to profit in a crypto bear market), and managing volatility and value for post-ICO projects.
Olympus Labs Beta App Launch and Roadmap
Olympus Labs has recently launched the beta version of its mobile app (iOS only). You can sign up to be a beta tester, and you may win MOT. Right now, the app allows you to:
- View your cryptocurrency portfolio at a glance
- Convert between cryptocurrencies (powered by the Shapeshift)
- Intra-exchange arbitrage (powered by the Kyber Network and 0x decentralized exchanges)
- Send and receive ETH, KNC, OMG, GNT, ADX, with more incoming cryptocurrencies
- View how indices and other upcoming products will fit into the app
This beta mobile app is Olympus Lab’s Minimum Viable Product. Its release marks the end of Phase 0 of Olympus Labs’ six stage roadmap. Olympus Labs is still in a very early stage in its development. Its financial protocol is only planned to be released at the end of Phase 2 (Q2 2018), the blockchain in Phase 3 (Q3 to Q4 2018) and the final product anywhere from Q4 2018 to Q4 2019.
The Team behind Olympus Labs
At first glance, the team behind Olympus Labs appears to be of the highest pedigree. Plenty of Ivy League graduates with a host of prestigious companies in their resume – McKinsey, Google, Accenture, PIMCO, Facebook, Mozilla, Yahoo, and WeChat.
The only thing that’s troubling is that out of its 16 member team, only three of them appear to have any software engineering or development background. The rest are all concentrated in areas of business and marketing.
It’s true that Olympus Labs will need such expertise to scale itself and get buy-in from other blockchain projects. For instance, it recently partnered with Metaps Plus, a leading Korean fintech company, and mobile marketing platform developer. This is good news for Olympus Labs as it shows the potential integration with other third-party platforms, in addition to giving them access to the lucrative Korean market.
But you can’t help but wonder, especially at such an early development stage, whether the lack of software engineers may affect their odds of success.
Olympus Labs Public Token Sale – Cancelled
Olympus Labs’ pre-ICO sales were so successful that it canceled the public crowdsale. The private and pre-sale rounds were enough to generate Olympus Labs fundraising goal of 45,000 ETH (~$60 million at time of sale but ~$47 million at current prices). 40% of the total token supply of 100 million was sold. The company also reduced its fundraising goal from an initial 65,000 ETH to 45,000 ETH.
This is a positive for the company’s prospects, which stated that it would now be focusing on progressing along its technical development roadmap. The reduction in the fundraising goal is a good sign that the team is aware of just how much they need to complete the project and are not into excessive fundraising.
Where Can You Trade Mount Olympus Tokens?
OKEx is Olympus Labs’ first official exchange listing partner, and you can trade MOT there.
How has the Mount Olympus Tokens Performed?
Mount Olympus Tokens have only been trading for just over two weeks. However, after a massive spike in price following the announcement of the OKEx listing, the price took a dip and remains slightly above the ICO price. Of course, this could be due to the downturn in the cryptocurrency market as a whole.
What are the Long Term and Short Term Potential of Olympus Labs?
In the short term, as mentioned above, MOT hasn’t been doing too well. But this could be said about the crypto market as a whole, and it’s still too early to gauge its short-term potential. Right now, the fact that it is only listed on a single exchange is a limiting factor on its price.
The Olympus Labs subreddit appear to be trying to get it listed on Cobinhood, which would likely give its price some support. Other than that, Olympus Labs’ near-term potential would be determined by how well it address the technical challenges along its development roadmap and what other partnerships it can announce.
For the long-term, Olympus Labs, if successful, will be a clear game changer for the crypto economy. There is a clear need for the crypto financial system to evolve in complexity, and Olympus Labs can fill that need. But at this early stage in its development, it is far too early to tell whether or not it will be successful.
What do you think of Olympus Labs’ prospects? Can it deliver on its ambitious goals to upgrade the entire crypto financial infrastructure? Let us know your views in the comments below.