Recently, we all learned a very harsh lesson about the negative ramifications of projects that prioritize short-term brownie points over long-term goals. The Terra platform tanked, and both LUNA and UST lost their entire valuation. UST, their algorithmic stablecoin, broke its peg and many people worldwide lost a large amount of money.
Qtum’s Long-Term Focus
Before we continue, it’s essential to understand that this is not a “we told you so” article. At Qtum, we want the entire decentralized ecosystem to succeed. We are aware that many people lost a lot of money and good faith due to Terra’s failure. However, this article aims to address one of the biggest criticisms that Qtum faces consistently — we are “slow” with our updates.
Qtum has its eyes set on long-term goals. As a result, the core developers and decision-makers behind Qtum have consistently refused to jump on the latest hype trains like stablecoins, centralized consensus algorithms, etc. Instead, they have taken the time to carefully build and engineer every single facet of the platform to support something truly significant in the future.
Terra’s Rush To Build A Community
Terra’s tokenomics and the UST coin only work if there is sufficient demand for stablecoin — which isn’t possible without a vibrant community. So, how do you build a “strong” community out of nowhere? Terra “solved” this by providing huge APY (~20%) to UST stakers. That’s not an organic way to grow a community since they are literally with you for the payouts. So, when the crash happened, and it was apparent that the rewards won’t be worth anything, everyone immediately cashed out their UST, which led to the depegging. The unfortunate part is that Terra genuinely had a tremendous DeFi ecosystem. At one point, it had the second-largest DeFi ecosystem by TVL. Unfortunately, all that got ruined due to the shortsightedness of the protocol creators.
We Have Been Here Before
It’s circa-2018, and we had a big scary “Ethereum killer” called EOS on the loose. It had everything going for it — a superstar co-founder Dan Larimer (of BitShares fame), a record-breaking ICO, and the promise to be significantly faster than Ethereum. And, guess what? It worked! For a bit, at least. EOS dApps actually pulled in more users than the Ethereum-based applications. However, people soon realized that to deliver super-high speeds (short-term goals), EOS had to be highly centralized. This obviously defeated the purpose of using a decentralized protocol.
Quality Over Quantity
There is a reason why it takes time to build a highly scalable, programmable, and decentralized platform — it’s really hard! We understand why Ethereum is taking so long with the merge. It is difficult to increase speed without compromising decentralization and converting your platform from PoW to PoS.
We know it because we have done the same thing. While Qtum was always PoS, we did increase our speed considerably without compromising decentralization via the Fastlane hard fork.
Plus, Qtum developers recently successfully managed to update Qtum to a Taproot-compliant blockchain that is still EVM-compatible. This is an incredible feat of engineering that we could accomplish with patience and extreme expertise. We also want to send a message to our community with this update. We didn’t rush to create algorithmic stablecoins or some other flavor of the month because we want to focus on what we believe will be correct for the long-term growth of our platform. We won’t be creating something shambolic just because some random blockchain platform suddenly grew by 1241857189271283% because of integrating some hoopla.
Everything that ever had any long-term has a process behind it. Qtum will remain loyal to its process.