Demand-Driven Development of the NEST System

The NEST system is actively promoting the simplification and usability of its products to attract more users to participate in mining and usage. At the same time, financialization is also an important direction, which can be inspired by the development history of Ethereum. Ethereum has evolved from its initial GAS payment function to ICO fundraising tools, and then to DeFi liquidity mining, gradually forming strong financial attributes.

The NEST team is exploring the production of more assets through linear operators and establishing an application closed loop with NEST. This process is similar to stablecoins but differs in some aspects. Financialization may bring exponential effects, such as generating PUSD by collateralizing NEST, then purchasing NEST again and continuing to collateralize, thereby continuously increasing leverage. This not only increases the demand for oracle calls but also raises the demand for repurchasing NEST.

In CoFiX 2.0, hedging and asset allocation will be automated. Users can place assets on the chain and automatically adjust to the edge of the capital market line through a game-theoretic approach, executing automatic trades based on the set risk-return profile. This process is similar to AMM and can automatically generate or offset leverage, further strengthening buyback demand.

Based on price information flow, various trades can be designed, including options. The key lies in finding the right counterpart. If the NEST system is compared to Wall Street, then the DAO is equivalent to Goldman Sachs, serving as the absolute seller of options, earning time value, and entering a deflationary phase by repurchasing NEST.

The NEST 4.0 version plans to randomize mining and financialize the system layer to address the challenge of verification incentives. At the same time, the new idea of decentralized risk management will also bring new challenges, such as determining the overall collateral rate of the system and which assets can truly achieve valuable fragmentation.

The NEST team reflected on the traditional blockchain development path (consensus-price-ecosystem) and proposed a new development model: demand-ecosystem-consensus. This approach places greater emphasis on actual demand, avoiding the formation of debt-type projects. The team believes that only by creating new attributes and functions recognized by society can projects avoid becoming gambling-related.

The strategy of NEST is to start from internal demand and gradually expand to a broader ecosystem. For example, by meeting the needs of miners through parallel assets and conducting dynamic asset management. This "demand not overflowing" strategy helps to build recognition in the DeFi community.

Overall, the direction of the NEST system's development is to continuously deliver value to the gaming system, creating new attributes and characteristics when reaching a state of equilibrium, which is precisely the key difference between NEST and other projects.