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Very few people know the @katana origin story so this is a great opportunity to share it. I'll also point out what is right and wrong in the thread to ensure future content from @DefiIgnas and other content creators is accurate. TLDR; • Agglayer needed a chain with deep liquidity, which required specialization that Polygon PoS (as with every other general purpose chain) could not provide. • Katana started being incubated more than 12 months ago, and the idea of VaultBridge came from that incubation. • VaultBridge was proposed to be used for Polygon PoS but was rejected. Now, at least 10 teams are being onboarded to use VaultBridge as a highly desirable product. • Katana has start strong with $170M after the public learned about his chain only 3 weeks ago. • Polygon PoS is focused on payments and RWAs with massive growth in stablecoins every month, consistent onboarding of new payment and RWA use cases across the globe and technical change that is leading to over 5,000 TPS in capacity this year alone. Katana Origin and Tied to Agglayer and PoS Turning to the origin story of Katana and its necessary connection to Agglayer. It began being incubated at Polygon more than a year ago. It started with two important realizations: (1) Agglayer needed a deep liquidity hub to ensure all chains on Agglayer could tap into liquidity easily and efficiently, and (2) general purpose blockspace had become commoditized. To provide deep liquidity on Agglayer, we knew a new chain was needed. This is because a chain focused on creating deep liquidity needs to be highly specialized and opinionated like Katana. Polygon PoS could not serve that purpose (just see the Katana architecture vs the Polygon PoS architecture). As a result, Katana needed to come to life. It turns out that once we started thinking about deep liquidity from first principles, we realized that to achieve that deep liquidity in a permissionless way, we'd also need to create sustainably higher yields to incentivize on a continuous basis that deeper liquidity. We also realized that a partner with deep expertise in liquidity provisioning would be important, which is when GSR joined to incubate Katana with Polygon Labs. As we went down the road of exploring yields for Katana, the idea of VaultBridge came about. It had not yet been named that way. It became clear quickly that it was a product that could be available not just to Katana, but to many chains, including Polygon PoS. The Polygon PoS community rejected using it. Now, at least 10 teams are being onboarded to use VaultBridge as a highly desirable product from Polygon. As part of the process for deciding core apps on Katana, we approached the teams we thought could be most successful in their category, which includes, for lending, Aave and Morpho. After months of discussions and aggressive bids from both of them, we chose to work with Morpho. This understandably upset Aave. We chose for the chain that was intended to have the deepest liquidity in all of crypto to use their biggest threat, Morpho. A month later, a proposal was made to use VaultBridge (again not named this at the time) for Polygon PoS. Aave decided to use this proposal as a way to counter-attack the incubation of Katana that excluded them. This resulted in Aave choosing to leave Polygon PoS entirely. However, that did not happen. Aave had not put effort into growing on Polygon PoS. for years. This continued that trend with more focus on withdrawing assets out of Polygon PoS. Thankfully, great teams like Morpho and Fluid came to build on PoS and started attracting significant TVL. Now, Katana has launched pre-deposits with over $170M after only 3 weeks of its public reveal. It is a good start, attracting valuable DeFi assets and continuing an upward trajectory. But where does that leave Polygon PoS? Going back to our realization that general purpose blockspace had become commoditized, Polygon PoS was no different. When we analyzed where Polygon PoS was strongest, we realized that it was already a leader in payments and RWAs. We also realized that we could build blockspace more valuable for payments and RWAs if we focused only on that. This also allows us to focus on building tooling and other things around the chain for those use cases. This has been one of our better strategic moves. It has allowed us to focus engineering resources on specific areas that need to improve and human resources on those use cases as well. It has increased velocity in these areas around business deals getting done too. This now leave Polygon positioned to dominate payments and RWAs with a chain focused on it with all value accruing back to POL holders. Katana gives a deep liquidity hug for Agglayer that attracts new chains but also feeds all existing chains. This'll drive significant cross-chain volumes tapping into the Katana liquidity, which will drive significant fees that will accrue back to POL holders. It also resulted in the creation of VaultBridge, which is a product that has increased interest in Agglayer even more. And then Katana itself will be independently successful as KAT holders drive value to themselves using vKAT, while also airdropping 15% of the supply to KAT holders. What @DefiIgnas gets right ✅ Katana is an opinionated DeFi chain that optimizes for yield and liquidity ✅ Katana has a set of core protocols that allow for a concentration of liquidity in them ✅ Katana has a token named KAT with a voting token named vKAT that allows for directing emissions to protocold and earn fees from them This dynamic allows KAT/vKAT tokens to be used for bribery ✅ Katana deposits (though not closed yet) are over $170M after the public learned about his chain only 3 weeks ago ✅ Katana is part of the trend of "Vaultization" that allows for isolating risk in a simpler code base with no monolithic governance. What @DefiIgnas gets wrong ❌ Katana is an L2, not an L3 ❌ Katana did not launch because the Polygon PoS proposal was rejected. It is mostly the opposite, which is that Katana led to the creation of VaultBridge that was proposed for Polygon PoS. ❌ Aave has not left Polygon. But Morpho and Fluid are growing much faster there. ❌ Katana is not a compromise or second-best option. As laid out in the reasons for Katana existing, it is actually a necessity. More details on the transformation of Polygon and origin of Katana:

Very few people know the @katana origin story so this is a great opportunity to share it. I'll also point out what is right and wrong in the thread to ensure future content from @DefiIgnas and other content creators is accurate. TLDR; • Agglayer needed a chain with deep liquidity, which required specialization that Polygon PoS (as with every other general purpose chain) could not provide. • Katana started being incubated more than 12 months ago, and the idea of VaultBridge came from that incubation. • VaultBridge was proposed to be used for Polygon PoS but was rejected. Now, at least 10 teams are being onboarded to use VaultBridge as a highly desirable product. • Katana has start strong with $170M after the public learned about his chain only 3 weeks ago. • Polygon PoS is focused on payments and RWAs with massive growth in stablecoins every month, consistent onboarding of new payment and RWA use cases across the globe and technical change that is leading to over 5,000 TPS in capacity this year alone. Katana Origin and Tied to Agglayer and PoS Turning to the origin story of Katana and its necessary connection to Agglayer. It began being incubated at Polygon more than a year ago. It started with two important realizations: (1) Agglayer needed a deep liquidity hub to ensure all chains on Agglayer could tap into liquidity easily and efficiently, and (2) general purpose blockspace had become commoditized. To provide deep liquidity on Agglayer, we knew a new chain was needed. This is because a chain focused on creating deep liquidity needs to be highly specialized and opinionated like Katana. Polygon PoS could not serve that purpose (just see the Katana architecture vs the Polygon PoS architecture). As a result, Katana needed to come to life. It turns out that once we started thinking about deep liquidity from first principles, we realized that to achieve that deep liquidity in a permissionless way, we'd also need to create sustainably higher yields to incentivize on a continuous basis that deeper liquidity. We also realized that a partner with deep expertise in liquidity provisioning would be important, which is when GSR joined to incubate Katana with Polygon Labs. As we went down the road of exploring yields for Katana, the idea of VaultBridge came about. It had not yet been named that way. It became clear quickly that it was a product that could be available not just to Katana, but to many chains, including Polygon PoS. The Polygon PoS community rejected using it. Now, at least 10 teams are being onboarded to use VaultBridge as a highly desirable product from Polygon. As part of the process for deciding core apps on Katana, we approached the teams we thought could be most successful in their category, which includes, for lending, Aave and Morpho. After months of discussions and aggressive bids from both of them, we chose to work with Morpho. This understandably upset Aave. We chose for the chain that was intended to have the deepest liquidity in all of crypto to use their biggest threat, Morpho. A month later, a proposal was made to use VaultBridge (again not named this at the time) for Polygon PoS. Aave decided to use this proposal as a way to counter-attack the incubation of Katana that excluded them. This resulted in Aave choosing to leave Polygon PoS entirely. However, that did not happen. Aave had not put effort into growing on Polygon PoS. for years. This continued that trend with more focus on withdrawing assets out of Polygon PoS. Thankfully, great teams like Morpho and Fluid came to build on PoS and started attracting significant TVL. Now, Katana has launched pre-deposits with over $170M after only 3 weeks of its public reveal. It is a good start, attracting valuable DeFi assets and continuing an upward trajectory. But where does that leave Polygon PoS? Going back to our realization that general purpose blockspace had become commoditized, Polygon PoS was no different. When we analyzed where Polygon PoS was strongest, we realized that it was already a leader in payments and RWAs. We also realized that we could build blockspace more valuable for payments and RWAs if we focused only on that. This also allows us to focus on building tooling and other things around the chain for those use cases. This has been one of our better strategic moves. It has allowed us to focus engineering resources on specific areas that need to improve and human resources on those use cases as well. It has increased velocity in these areas around business deals getting done too. This now leave Polygon positioned to dominate payments and RWAs with a chain focused on it with all value accruing back to POL holders. Katana gives a deep liquidity hug for Agglayer that attracts new chains but also feeds all existing chains. This'll drive significant cross-chain volumes tapping into the Katana liquidity, which will drive significant fees that will accrue back to POL holders. It also resulted in the creation of VaultBridge, which is a product that has increased interest in Agglayer even more. And then Katana itself will be independently successful as KAT holders drive value to themselves using vKAT, while also airdropping 15% of the supply to KAT holders. What @DefiIgnas gets right ✅ Katana is an opinionated DeFi chain that optimizes for yield and liquidity ✅ Katana has a set of core protocols that allow for a concentration of liquidity in them ✅ Katana has a token named KAT with a voting token named vKAT that allows for directing emissions to protocold and earn fees from them This dynamic allows KAT/vKAT tokens to be used for bribery ✅ Katana deposits (though not closed yet) are over $170M after the public learned about his chain only 3 weeks ago ✅ Katana is part of the trend of "Vaultization" that allows for isolating risk in a simpler code base with no monolithic governance. What @DefiIgnas gets wrong ❌ Katana is an L2, not an L3 ❌ Katana did not launch because the Polygon PoS proposal was rejected. It is mostly the opposite, which is that Katana led to the creation of VaultBridge that was proposed for Polygon PoS. ❌ Aave has not left Polygon. But Morpho and Fluid are growing much faster there. ❌ Katana is not a compromise or second-best option. As laid out in the reasons for Katana existing, it is actually a necessity. More details on the transformation of Polygon and origin of Katana:

Wait, so Katana launching because a proposal to use assets idly sitting on the Polygon bridge failed due to backlash? Instead, Polygon incubates Katana as an L2 on Polygon (making Katana an L3?). The proposal to use bridge funds caused Aave to abandon Polygon altogether as it would: 1) deposit assets to a competitor Morpho 2) pose significant risks to bridgoooors Katana is a compromise or a second-best option. But it makes sense as Polygon's bridge funds won't be touched. And $POL stakers will get 15% of the KAT airdrop. Neet. Interestingly, Katana is an Opinionated DeFi chain and will decide on where the funds will flow to optimize for yield and liquidity. It's opposite to all other L1s/L2s that seek neutrality. Three pre selected protocols are: - Morpho - Sushi - Vertex This dynamic allows KAT/vKAT tokens to be used for bribery: not just for voting on KAT emissions to boost liquidity but also for protocols seeking preferential treatment. It requires one key thing: liquidity. As TVL grows, Katana becomes more attractive for new protocols to receive preferential treatment. Pre-deposits closed with $170M in TVL. Not bad, especially since it will initially focus on just three protocols, and the GSR market maker will deposit liquidity where needed. ----- I see Katana in light of the new emerging trend in DeFi: "Vaultization" As DeFi gets more complex and number of protocols increase, users are having hard time managing their own assets. Instead, multiple vault protocols (Upshift, Veda...) are emerging as active managers to do the hard work for you. It changes the game. Vault protocols become user-facing platforms with the discretion to decide where to deposit assets. As a result, DeFi protocols no longer chase users directly but instead partner with vault managers to attract TVL. Katana goes a one step further by having a new chain with a token to control for emissions.

Another way of saying this is: of course, people who benefit from vaporware pumping will hate to see that stop. As long as no long-term value is created for our industry through those manic phases, the money is merely extracted, and we are otherwise left in the same place, just poorer and less attractive to investors in the next round.