1. Home
  2. Sergej Kunz

Sergej Kunz

Korea Blockchain Week, Aug. 8: First-day takeaways from the Cointelegraph team

The first day of the main stage event included a keynote presentation from Ethereum's Vitalik Buterin, 1inch Network's Sergej Kunz, and Klaytn Foundation's Sam Seo.

The fifth annual Korea Blockchain Week kicked off on Aug. 8, with more than 7,000 people attending Asia's largest blockchain event of 2022. 

The Seoul-based event is set to run its main-stage sessions on Aug. 8 and 9, while side events such as music festivals and nonfungible token (NFT) art galleries will go through until Friday, Aug. 12.

This year Korea Blockchain Week features presentations from more than 120 figures in the blockchain space, including prominent names such as Ethereum co-founder Vitalik Buterin, Binance CEO Changpeng Zhao, Animoca Brands chair Yat Siu and Polygon co-founder Sandeep Nailwal.

The event is hosted by FactBlock and Hashed (co-host) and is sponsored by Solana, Klaytn, and Wemade. Key focus topics will include decentralized finance, NFTs, gaming, the Metaverse, Web3 technology and crypto.

If you missed the action, here’s a literary highlight reel of all the most important moments from the first day of the event, brought to you by the Cointelegraph team currently on the ground in Seoul.

Vitalik: Layer-2 scaling will make crypto payments 'make sense' again

Ethereum (ETH) co-founder Vitalik Buterin has argued that crypto payments will once again “make sense” as transaction costs will soon fall to fractions of a cent due to layer-2 rollups.

He pointed to “solid work happening” with roll-ups at the moment, such as Optimism’s layer-2 scaling solution for Ethereum, which has worked to get the size and cost of data in blockchain transactions down by introducing zero byte compression.

Related: 60 million NFTs could be minted in a single transaction: StarkWare founder

“So today with roll-ups, transaction fees are generally somewhere between $0.25, sometimes $0.10, and in the future with roll-ups with all of the improvements to efficiency that I talked about. The transaction costs could go down to $0.05, or even maybe as low as $0.02. So much cheaper, much more affordable, and a complete game changer.”

Web2 adoption key to Metaverse success, says Klaytn Foundation direct

Sam Seo, the director of the metaverse and blockchain ecosystem Klaytn Foundation, thinks that the widespread adoption of the Metaverse will be “easier” if Web2 companies integrate the tech with their products and services.

Related: Major crypto exchange announces its arrival in the metaverse

Speaking with Cointelegraph during the Korea Blockchain Week (KBW), Seo suggested that Web3 Metaverse projects generally have issues attracting a mainstream audience, as people often have a hesitancy to use new technology from companies that they have never heard of.

“If new ideas are combined with Web2 platforms like [local social media app] Kakao, especially in South Korea, I mean, there's accessibility to these new ideas for new services that couldn't be easier than just starting from scratch.”
Pictured: Klaytn Foundation director Sam Seo at Korea Blockchain Week 2022

DeFi market has room for growth in Korea: 1inch co-founder

Decentralized finance (DeFi) aggregator 1inch Network has revealed plans to expand within the Asian market, according to its co-founder Sergej Kunz.

Speaking to Cointelegraph, Kunz said that despite the DeFi market being relatively small in Korea and Asia, there are a number of Asia-based Web3 companies that 1inch is looking to partner with.

Related: Wirex partners with 1inch to enable wallet-based token swaps

However, Kunz also added that the biggest barrier to entry appears to be a lack of understanding about DeFi and how to use crypto wallets:

“As soon as people understand that they can [yield] farm, they can swap, they can exchange and get easy access to cryptocurrencies on Ethereum with a few simple EVM-compatible networks, the market will grow a lot.”

Crypto.com hits key regulatory milestone in South Korea

Crypto exchange Crypto.com has announced a key regulatory milestone in South Korea after acquiring two local companies, giving it access to crypto and payments registration in the country.

The announcement came during Korea Blockchain Week 2022 after the company acquired  payment service provider 'PnLink Co. Ltd.' and virtual asset service provider 'OK-BIT Co. Ltd.'

Related: Crypto.com scores regulatory approval from Cyprus SEC

The move means they have now secured Electronic Financial Transaction Act and Virtual Asset Service Provider Registration in South Korea. However, the company did not disclose whether this means it can offer its full-suite of crypto trading services in the country.

Crystal Blockchain Study Reveals $16.7 Billion in Crypto Assets Stolen Since 2011

Dex Aggregator 1inch Network Raises $175 Million in Series B Funding Round

Dex Aggregator 1inch Network Raises 5 Million in Series B Funding Round1inch Network, the decentralized exchange (dex) aggregation project, has announced the company has raised $175 million in a Series B financing round. According to the announcement, the fresh new capital will be leveraged to scale the team, foster additional 1inch token utilities, and build new protocols. 1inch Raises $175 Million From Strategic Investors Over the […]

Crystal Blockchain Study Reveals $16.7 Billion in Crypto Assets Stolen Since 2011

Bitpay Implements 1inch Network Support — Wallet Users Can Access Defi, Dex Aggregation

Bitpay Implements 1inch Network Support — Wallet Users Can Access Defi, Dex AggregationOn August 31, the Atlanta-based cryptocurrency payments services provider Bitpay announced that the Bitpay wallet has integrated the decentralized exchange (dex) aggregator 1inch Network. Bitpay wallet users can utilize 1inch protocol to swap ether or the myriad of ERC20 tokens. The Bitpay Wallet Supports 1inch Decentralized finance (defi) has grown exponentially according to statistics as […]

Crystal Blockchain Study Reveals $16.7 Billion in Crypto Assets Stolen Since 2011

Dex Aggregator 1inch to Utilize Ethereum Scaling Solution Optimism

Dex Aggregator 1inch to Utilize Ethereum Scaling Solution OptimismOn August 17, the decentralized exchange (dex) aggregator 1inch announced the platform will leverage the Layer 2 solution called optimistic rollups provided by the project Optimism. The collaboration with Optimism aims to “substantially increase transaction speeds and lower gas fees for 1inch users.” 1inch to Use the L2 Solution Optimistic Rollups via Optimism Gateway Ever […]

Crystal Blockchain Study Reveals $16.7 Billion in Crypto Assets Stolen Since 2011

Uniswap are friends but they fear 1inch, says DEX aggregator co-founder

1inch’s co-founder speaks on friendly Uniswap rivalry, the DeFi Pulse debacle and Ethereum being both the paint point and savior of DeFi.

It really doesn’t seem like the decentralized finance sector is planning to slow down its development in 2020. Interest in the sector is still growing despite high Ethereum transaction fees, and the total value locked in the space continues to break all-time highs, recently reaching $51 billion.

1inch is a decentralized exchange, or DEX, aggregator that came onto the DeFi scene in the later part of 2020. The platform’s algorithm searches for the cheapest exchange rates among the DEXes that are integrated into its ecosystem. 1inch also runs the Mooniswap automated market maker.

According to data, January was the biggest month ever for DEXes, and 1inch played a role in achieving that milestone. It currently stands second in terms of the number of traders, behind Uniswap.

To ascertain how 1inch packs such a punch, Cointelegraph spoke with Sergej Kunz, co-founder of the platform. The interview is available on Cointelegraph’s YouTube channel.

How did it all begin?

Cointelegraph: How exactly did you get into crypto, and at what point did you realize that the industry needs a DEX aggregator such as 1inch?

Sergej Kunz: Back to the roots where we started, the initial idea was actually from [1inch co-founder] Anton, who suggested to build it at a hackathon in 2019 — to build one place to list all the different exchanges, and then you can just select one where you can swap for the best price.

But I also had the idea to improve that by splitting into small pieces the amount that we are going to swap and exchanging it on multiple sources at the same time to reduce the price leverage because price impact was the biggest problem in the DeFi space at the time.

“At the hackathon, I spoke with Vitalik Buterin and Hayden Adams from Uniswap, and I shot the idea at both of them. They said, ‘Yeah, do it. It all sounds great.’”

Actually, we built it for us. Anton was swapping all the time. He needed the best rate, and I was playing around with arbitrage bots before that. Somehow, it was really helpful for other people. At the hackathon, we didn't win any huge prizes, only the small prize: 300 bucks. So, I was able to pay for my tickets for the airplane.

CT: So, how long did it take to put everything together? One worry in the DeFi industry is that protocols get built quickly and then people get burned because of mistakes.

SK: Anton and I, together we have 16 to 17 years of professional experience in software engineering and architecture. Anton had much more experience in cryptocurrency and algorithms. We actually built it over two nights. And one day before I went to sleep, I built most of the front end, the app. Anton wrote the algorithm and the smart contracts, and we put it together and just worked without any sleep over two nights.

“We started in December 2018 in Singapore. We built a project over one night that got some sponsor prizes. So, we had no expectations.”

We just started to build. We have built other things before, and here, we just wanted to solve our own problem. And at the end, we got this huge traction because it has just solved a huge problem in the DeFi space.

In comes the token

On Dec. 24, 2020, the 1inch Foundation deployed and distributed the platform’s native governance and utility token. Overall 90 million INCH tokens were distributed to those who met certain criteria established by the platform.

CT: The project really came to light after you released the 1INCH token. You don't see the token as an investment vehicle, yet people are still going to be speculating on it, and eventually, some may get burned. Did you consider this aspect?

SK: Yeah, we got a lot of negative feedback from the community — from the people who bought at the beginning on the release day. Actually, the 1inch Foundation issued the token and started the distribution. The idea behind the distribution was to make the token more decentralized.

“We don't see any financial value behind the token. So, one 1INCH is equal to one 1INCH, nothing else. Actually, we didn't even start with the tokenomics. The idea of owning the 1INCH token in the first place right now is to participate in the governance.”

So, you have a kind of ticket, and with this ticket, you get access to change some settings in the protocol. Of course, those people can also participate in the discussions on the governance forum, for example, and make suggestions.

Financial windfall

Upon the distribution of the tokens, one lucky 1inch user received almost 10 million 1INCH, which came to around 11% of the total supply and was worth around $27 million at the time.

Kunz told Cointelegraph: ”This guy communicated with us. He suggested a lot, gave support and introduced us to other projects. He came to us to help us improve our community, and so on.”

The gas effect

CT: How do Ethereum gas prices affect you currently as a platform? Given the recent news regarding the integration with Near Protocol, will you be looking to diversify further, or do you plan to stay loyal to the Ethereum ecosystem?

SK: So, if you see that people are still swapping, it’s because they have to swap. Some people have loans somewhere, and they have to repay them. Huge gas prices, I would say, are bad for the whole space.

“I have to say that something better than Ethereum can only be Ethereum. We are waiting for Eth2, but for sure, they have to scale.”

We announced a collaboration with Near Protocol because we are friends with them and the Rainbow Bridge allows us to move funds from Ethereum to Near Protocol. We also announced a collaboration with Tron. For sure, a lot of people think it’s a scam and so on, and that it’s a copy of Ethereum. For us, it’s important because people need it and there are people who use it. We also see DEXes there on the platform, and so if you have DEXes, we can aggregate.

Binance Smart Chain

On Feb. 25, it was announced that 1inch would roll out on Binance Smart Chain and that the platform would even run a BSC validator node. Both 1inch’s Aggregation Protocol and its Liquidity Protocol will be available.

SK: It's similar to Ethereum. We are able to deploy the whole 1inch Network to BSC, and you can interact with their bridge and move 1INCH tokens from Ethereum to Binance Smart Chain.

If you move from Ethereum, you lock your tokens in Binance’s bridge on one side, and the same amount is unlocked on BSC. So, this allows us to fulfill the needs of the users. We have gotten a lot of requests from people because there's a lot of money on Binance Chain.

CT: What are your relationships with other firms in DeFi, like Uniswap? And what’s the latest on your conflict with DeFi Pulse?

SK: About DeFi Pulse: Yes, we had a conflict. We still have a conflict with the founder of DeFi Pulse because they just used our smart contracts without asking. It was copyrighted right from the beginning, even before we started the 1inch protocol. All we wanted was that they just mention us in the source code when they published our pieces of code. And there were some miscommunications with them and some bad jokes also from my side.

But we try to stay friends with most of the projects, or with all the projects. I gave him [Scott Lewis, founder of DeFi Pulse] my hand, you know? I gave my hand and said, “Let's clear all this,” and they just declined that. That's fine for me.

But DeFi Pulse, they actually acknowledged our request to get us listed, at least on the test platform, and maybe already on the main one. [DeFi Pulse listed 1inch on Feb. 27] l So yeah, that's great. But we needed to put pressure, social pressure. That's why we published this tweet — because we tried first with emails, and only social pressure helps.

“About other projects like Uniswap, I would say we are friends, but we talk like once a year. For sure, they have, from my point of view, a little bit of fear because we introduced our own liquidity protocol.”

It's much more efficient than Uniswap because we charge a fixed amount of fees. We don't see them as some kind of competition — we have integrated them, we use them and we send a fair volume to everyone. So, that's just math.

CT: Let’s discuss the 1inch team. Do they own any of the 1INCH tokens?

SK: If you see our distribution of the token, we have allocated about 22.5% to the team members. They're locked for one year, and we have them unlocked in seven steps over the next three years. So, in total, we have four years of vesting. Right now, no one on our team — including myself — has any tokens in their pocket. Tokens are right now frozen on the multisig. Of course, everyone on the team gets a specific amount of a share of the tokens, to get the right commitment.

We see it as that they don't have to work for someone, like for a company. They work for themselves because they have these tokens, and they will give their best over the four years. We have a great performance from the team. Most of them are hackers, and they work by themselves like 12, 14, 16 hours a day sometimes just to deliver a specific feature, like right now we have with the finance matching deployment.

CT: And just zoom out now into the DeFi space in general. What do you think will happen to DeFi in 2021?

SK: I see a huge pain point right now, which is the gas price. It's not possible to onboard new people right to Ethereum because they’ll have to pay a lot of money. We will see a solution to these problems with layer-two solutions or improving this issue by seeing people moving to other chains like Binance Smart Chain, for example.

“Optimistic rollups are going to be released really soon, from what I understood. For sure, we will participate in this movement, and we are waiting for Eth2. So, we need to move fast.”

Also, the amount of transactions that can be covered by the miners. When we have better throughput and lower gas costs, then we can build much better products with a better user experience.

This interview was edited and shortened for clarity. To see the video interview please visit the Cointelegraph YouTube channel.

Crystal Blockchain Study Reveals $16.7 Billion in Crypto Assets Stolen Since 2011