Development Strategy and Future Prospects of the NEST System

The NEST system is committed to popularizing and enhancing product usability to attract more participants. The financialization process of the system will have a significant impact, similar to the role played by Ethereum in its ecosystem. NEST is exploring the creation of more assets through linear operators and establishing application closed loops with these assets.

The concept of parallel assets is similar to stablecoins but differs in certain aspects. The financialization process may bring about exponential effects: users can collateralize NEST to generate PUSD, then buy more NEST and continue to collateralize, thereby continuously increasing leverage. This process will continually increase the demand for oracle calls, thereby enhancing the repurchase demand for NEST.

CoFiX2.0 will achieve automated hedging and asset allocation. Users can place their assets on-chain, and the system will automatically adjust them to the edge of the security market line through a game-theoretic approach, and conduct automatic trading based on the set risk-return parameters. This mechanism is similar to the operation of AMM.

Based on price information flow, almost any type of trading can be designed. In options trading, the DAO may play a role similar to that of Wall Street investment banks, acting as the main seller of options, acquiring NEST from the market and pushing the system into a deflationary phase.

The NEST 4.0 version plans to randomize mining and implement financialization at the system level to address the challenge of verification incentives.

Reflecting on the traditional "consensus-price-ecosystem" development path, NEST proposes a new "demand-ecosystem-consensus" model. This shift arises from the understanding that many DeFi projects are actually liabilities.

In non-cooperative game systems, if the equilibrium state fails to create new attributes and functions recognized by society, the system may degenerate into a gambling project. Therefore, it is crucial to start from demand, but directly analyzing demand is not easy.

NEST adopts an inside-out strategy, first meeting the internal needs of the system, such as the demand for quoted assets from miners, and then gradually expanding to a broader ecosystem. This approach is known as "demand not overflow" and helps to establish recognition within the DeFi community.

The essence of demand is to continuously deliver value to the game system. The true value lies in the new attributes and characteristics that the system can exhibit when it reaches equilibrium, which is exactly the goal pursued by the NEST system.