Decentralised competition

Decentralised competition help innovators compete.

Summary

Competition is fundamental to a well functioning economy - it brings higher quality products, cheaper services, greater variety, and more innovation. Medallion supports competition, and build platforms for decentralised competition, in order to help innovators compete, and to bring the full benefit of competition to consumers. Its first platform will be a DEX where strategies compete to earn the highest yield for liquidity providers (LPs).

Introduction

Perfect competition is an economic system where consumers get the cheapest price, but at the expense of innovation because all participants produce or consume the same product, and do not earn any profits. Imperfect competition is any situation where the assumptions of perfect competition do not apply - they allow innovation and profits, but risk market failure because consumers may not get the best outcomes such as cheaper price, convenience, greater variety, and higher yields.

Decentralised competition combines the best features of perfect and imperfect competition, so that Innovators can earn profits, and consumers will get the best outcome. It has the following features:

• Low barrier to entry.

• Provide equal access to information.

• Let anyone set the price, build differentiated products, and generate profits.

Medallion

Medallion is a DEX where strategies compete to earn the highest yield for LPs. Its competition platform is a public auction where strategies bid for the right to earn all the swap fees in a liquidity pool. The platform has the following properties:

• It has low barriers to entry because anyone can earn all the swap fees at any time.

• Everyone has equal access to information because the strategy and DEX’s source code is public.

• The price is the highest bid a user is willing to pay to earn the pool’s swap fees, and anyone can set a new price at any time by placing a higher bid.

• Anyone can differentiate themselves by building a better strategy, and place a higher bid at any time so that their strategy can earn more profits.

Medallion’s public auction is therefore a platform for decentralised competition. It has better consumer outcomes because LPs receive the bids as higher yields, and has lower risk of market failure due to the platform’s intrinsic properties.

Roadmap

Medallion’s mission is to support every competition, so that every innovator have the same opportunity to generate profits, and every consumer get the best outcome. In addition to building platforms for decentralised competition, it will also build an ecosystem to increase competition, and a user base that will benefit from the competition. Medallion will begin by building a DEX where strategies compete to generate the highest yield for LPs.

Conclusion

Competition brings better consumer outcomes, and markets fail if there are insufficient competition. This is why supporting competition, and building decentralised platforms where anyone can compete, is a critical requirement for a well functioning economy. DeFi is the best place to support competition, because it has low barriers to entry, equal access to information, and provide equal opportunities to build differentiate products and to profit. Medallion’s DEX uses decentralised competition to help LPs earn higher yields, and is the first step in its goal to help all consumers get the best outcome.