Overthink xDai Bao Migration

I would like to bring up an uncomfortable proposal:
The transaction fees for bridging tokens with the xDai- and Omnibridge are not competitive. I thought xDai is more decentralized than BSC and therefore has a longterm advantage. I also didn’t want to recommend BSC, as I still don’t know how much control binance has on the BSC or how much “Ce” we have in their “DeFi”.

But the Cosmos SDK and in particular the Sifchain have a pegging solution that does not cost more than a normal transaction. I expect that the polkadot network might also be able to solve it like this.
Because bridging to xDai costs ~4 times as much as bridging/pegging to other chains, i think xDai is a dead end unless it can find another solution in the next months.

My proposal would be to halt the move to xDai and find a better solution. Or - if xDai soon has a solution for token bridging that is competitive - we could stay on track.

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They are competitive when compared to other actual decentralized options.

There are also plenty of exchanges that let you withdraw assets to xDAI directly without bridging.

Plenty of users will move over using the bridge.

Users who don’t can move their assets into DAI, deposit them to an exchange that lets them withdraw xDAI and then rebuy on the xDAI side.

While we will have the swap and farm franchises on other chains, the core of synths will live on xDAI because once you are there the gas is cheap.

The reality is that the costs are on the Ethereum side to move out. There is no decentralized way to avoid paying that fee when you go elsewhere.

But the Cosmos SDK and in particular the Sifchain have a pegging solution that does not cost more than a normal transaction.

We’re not going to integrate a highly speculative betanet system that uses a permissioned validator system and that currently doesn’t have destination chains we’d want to use.

Not to mention that would be an extensive rebuild of our products and only saves users fees at the cost of more centralization.

My proposal would be to halt the move to xDai and find a better solution. Or - if xDai soon has a solution for token bridging that is competitive - we could stay on track.

The migration is about 8 days away at this point and there is no compelling reason to pull the plug.

It is also optional.

If the fees cost too much for you to migrate then you can stay on the main chain and continue to farm, you just get reduced rewards. But that is entirely up to the user.

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Hello BaoMan,

thank you for the fast reply. You are right. Halting the migration 8 days before the scheduled date is a bad idea.

I hope more centralized exchanges will support and include xDai connections for cheaper transfer. But I have little faith this will happen.

I used Cosmos SDK and Sifchain as an example. Migrating to Sifchain is not an option, but I think there are plenty others.

xDai currently looks like a dead ecosystem. Let’s hope Bao can bring new life to it though.

Best regards, keep it up,

Optilon

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I hope more centralized exchanges will support and include xDai connections for cheaper transfer. But I have little faith this will happen.

A few already exist so I don’t see why you would need more to support this.

I used Cosmos SDK and Sifchain as an example. Migrating to Sifchain is not an option, but I think there are plenty others.

Not that are EVM based and decentralized.

xDai currently looks like a dead ecosystem. Let’s hope Bao can bring new life to it though.

xDAI isn’t dead, its a new ecosystem that started growing this year and has more tooling than any other trustless EVM system.

It was selected because it has a trustless, easy to use, user friendly UI, bridge that supports ANY token (including LP tokens) and has cheap gas fees once there.

No other system offers that.

All other EVM and non-EVM systems that have current bridges require you to move only specific supported tokens, build natively on their non-EVM system, or use a centralized system to transfer.

Those don’t work with the specific goals of our xDAI migration. They work ok enough for our franchise model.

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Thank you for the detailed explanation BaoMan. I now better understand why you have chosen xDai. I’m really looking forward to a bright Bao future :)

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i played around with xdaichain some month back and was baffled by it, Fast Trasaction, Super Cheap… out of fun just try a transaction with 0.001 Gwei (xdai) set… it takes indeed a bit longer but still works

the only downturn on the xdaichain was that there was no meaningful liquidity providers … all forming stuff was based on the HNY token that time … and frankly said… when i have a 10% slippage of buying ETH on xDai vs. the Mainnet… all the transactions costs arent worth it anymore…

so i am really happy that BAO is deploying their stuff on the xdaichain…
as long we still talk about DeFi and not CeFi… xdaichain is the best option we have

… imho… all DeFi Projects which dont move to xDaiChain fast will be the loosers cause the mainnet fees are unbearable and ther is no end in sight…

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Right. Just to be absolutely clear. 75% incentive goes to xDAI and 25% stays in Ethereum. So if the Ethereum pool ends up, for some reason, a quarter size of the xDAI pool, the reward that one is getting if he is farming on either should be the same, right?

Yea. BSC is probably centralised, just imagine how many validators Binance control out of the 21 validator that is used.

When you say xDai cost ~4x during bridging, how much we talking here? Can you quantify a lil based on fiat $.

Agreed. Without context a statement like that creates FUD.

Agreed. Without context a statement like that creates FUD

Sorry, didn’t send a picture. The cost is ~3-4.

I don’t want to create FUD. I just wondered how xDai can play a noticeable role in the future if this issue is not solved. Maybe once we have a multichain crypto environment and xDai has bridges or pegging to other chains, it will thrive.

Yea. BSC is probably centralised, just imagine how many validators Binance control out of the 21 validator that is used.

I think xDai has 7 validators instead of 21. More important is the pegging/bridging solution, which is centralized on BSC as far as I have been informed.

That one has been solved quickly: https://bsc-to-xdai-omnibridge.web.app
Binance Smart Chain Omnibridge - xDai STAKE
Nice to have a BSC-xDai Bridge. Forgive me the ruckus.

Nice image of the breakdown, did you make it yourself?

$4 - $5 of going in and out of the bridge seems reasonable if you compare to what we are enduring now, I also presume one doesn’t need to go on and off chain often as the utility part is mostly done on xDAI, but I could be wrong. The bigger question is what happens when xDAI do a 10x, does that mean we will then be paying $40 - $50?

Btw, what does the 150 / 10 / 1 gas fee mean for Ethreum, BNB and xDAI? I might be missing something plain and simple here.

Yes, I made this table one or two weeks ago (but adjust for current average gas fee).

$4 - 5 of going in and out of the bridge seems reasonable if you compare to what we are enduring now From ETH to BSC it is 6 for sending ETH, when gas fee is set to 150 gwei. Sending an ERC20 Token to BSC costs 15$.

Bridging Dai from ETH to xDai (receive xDai, = 1 Dai) costs 23$. Bridging an ERC20 Token costs ~ 47$. Gas needed for bridging can be 120k oder 200k, I took the average of 160k.

Btw, what does the 150 / 10 / 1 gas fee mean for Ethreum, BNB and xDAI? I might be missing something plain and simple here.

Gas Fee on Eth is paid with Eth, on BSC with BNB and on xDai with xDai. On eth gas price is ~150 gwei, sometimes you still get it for 100 gwei, but can also be as high as 400 gwei. On BSC gas price is set to 10 gwei. On xDai 1 gwei is sufficient at the moment.

The BSC-xDai bridge does partly solve this issue for token that can be bridged from ETH to BSC (not every token). They can then be bridged to xDai very cheap. But the BSC-xDai bridge is still in beta.

I have all my BAO on my ledger. I got hung up trying to use the OmniBridge. This is supposed to allow you to take BAO on Ethereum and move it to xDai right? First I have to Unlock to set the spend-limit. I connected my ledger to meta mask, opened Ethereum app, made sure contract data was set to allow, added BAO contract to the OmniBridge. My BAO balance showed up and I clicked “MAX” and then UNLOCK. It sat there pending and I couldn’t find a transaction on etherscan for it. Finally I gave up and reconnect the ledger to metamask and saw that the transaction has failed and said:

Approve BAO spend limit FAILED - omni.xdaichain.com ERROR:Transaction found as “approved” during boot - possibly struck during signing."

So I figure the problem was metamask or whatever didn’t send the transaction to my Ledger so I could also approve it on the physical ledger device. Does anyone know what I am talking about, has experienced this, or know a solution? I am trying to get ready for March 1st staking on xDai but can’t even move my BAO. I am hesitant to keep trying b/c I’m eating the gas fees on the failures.

Finally I am following, and dare I say it looks expensive. I guess BSC is cheap because Binance’s CZ is “sponsoring” it.

Are you saying one way is to move the tokens from Ethereum to BSC and from BSC to xDAI cos this way it’s cheaper?

I got hung up trying to use the OmniBridge.

This is not related to “Overthink xDai Bao Migration”, is it? Please ask in Support threads. I don’t know the answer.

Finally I am following, and dare I say it looks expensive. I guess BSC is cheap because Binance’s CZ is “sponsoring” it.

Yes and no. CZ is currently sponsoring the transaction fees when bridging from ETH to BSC. But this are only ~10ct. So I wouldn’t mind to pay those. Far cheaper than other bridges.

As far as fees are concerned, Binance Bridge charges zero conversion fees . You’ll only need to pay network transaction fees on the blockchains that you are converting between.

Are you saying one way is to move the tokens from Ethereum to BSC and from BSC to xDAI cos this way it’s cheaper?

Migrating LP’s and BAO’s to BSC is currently not supported, but could be deployed. For already supported Tokens, it is cheaper to got ETH-BSC-xDai than direct ETH-xDai, yes. But BSC-xDai-Bridge is still beta.

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