Interoperability: the ability of computer systems or software to exchange and make use of information.
Interoperability has been the Achilles’ heel of cryptocurrencies throughout. In the upcoming layer of DeFi, as we build it, needs to be more interconnected. Many projects have attempted or are working on solutions for this macro crypto problem.
As of May 27th, 2020, the Ren Team has successfully deployed the RenVM code to mainnet. This accomplishment is a massive leap forward for the DeFi space as we know it.
Never in the cryptocurrency ecosystem have we been able to use a custodian with such features as: trust-less, backed securely in value 1:1, linearly scale-able, decentralized – all packed together in one.
- enables universal interoperability between blockchains: anyone can use RenVM to send any asset to any application on any chain in any quantity.
- Has robust security: large bonds, enormous shard sizes, and continuous shuffling make RenVM difficult to attack, even for irrational adversaries. In the unlikely event of a successful attack, RenVM can restore lost funds.
- is scalable: as more assets are locked into the custody of RenVM, the algorithmic adjustment of fees allows RenVM to automatically scale its capacity to meet demand.
- provides an optimal user experience: users can interact with multiple assets, applications, and chains with only one transaction.
Elaborating further, you could imagine some possibilities for the average crypto user and eventually the layman. Say you want to sell your Bitcoin for $10,000 worth of DAI, but how do we expect the layman to do that? A simple web GUI where you send your Bitcoin to an address, and input a receive address. On the front end, simple as that!
Lock BTC in RenVM, then mint renBTC on Ethereum.
Under the hood, it is much more complex than that. The RenVM plays a critical role in becoming one of the most widely used bridges in the increasingly interconnected DeFi system.
This is just one example. The capability of RenVM’s will be ever increasing. There may be inconceivable bridges that have not been constructed and Ren will indubitably be a key player. The potential upside for what the Ren Protocol is actively achieving is categorically immense.
Speaking of potential upside, let’s talk about the price of the Ren coin and how much the nodes currently yield in profit, along with projected estimates reaching out a few years.
TL;DR – Taking into account a plethora of variables; actual statistics, others purely speculative – we can conclude a current market value for the Ren Protocol coin. alongside current, we can also speculate future values of what Ren might be worth on the low side, the high-side, and how much a Darknode might generate in passive rewards. Low side estimates speculated to be around $2.47, inversely, high side estimates could push upwards of $8.00-$10.00 per coin. At those prices we would be peak bull-market, and we’re assuming Ren protocol has captured 7.5% of total transaction volume over 3 years. A more detailed analysis here.
It really boils down to how much value users put on the underlying technology and what it allows us to achieve. Volume will increase over time as use cases & adoption increase. More integrations, more volume, more Darknodes, more Darknode rewards, higher the Ren coin price.
Current and Projected Annual Transaction Volumes (USD Billions)
Ren Darknodes generate very little rewards, hardly enough to cover the hosting cost itself. The reason for this is that mainnet just launched and only $2.8 million worth of volume has flowed through the Darknodes. As time goes on, like the image suggests below, we should see more and more volume as adoption of Ren continues, and with that, yearly Darknode reward increases.
Year 0 estimates are minimal, but shortly thereafter, during year 1 and 2 look much more promising. We will most definitely see increased volume over the coming years, and with that, a much heftier reward being paid out to Darknodes and increased functionality across the board.
Regardless of if you want to speculate on the price increase of Ren, or invest in a Darknode, it’s clear to me the revolutionary tech that the Ren Protocol brings to the table. Ren is currently highly undervalued at just $0.11.
Congratulations to the Ren team for all of their hard work and for a successful mainnet launch – onwards and upwards!
Disclaimer: I love Ren, I am invested in Ren, do your own research and come to your own conclusions.