EthCC 2: Marc Zeller

so we don't start you have time to read this light so I'm working with Kono's which is a crit to asset broker and obviously we sell tokens so I think that this disclaimer was useful and when I say I own some of the token I will talk about as an user I'm other people who as a person who try out stuff but I'm not that rich I don't have that much of influence and obviously don't expect random people random person into your conference giving you investment advice so let's dive into it with some context I see your market is dead it's truly dead last month they raised on a bit less than 15 project around 22 million dollars which is a lot less than last year on the February 8 months and we see a true concentration of the fund raised into a very few project right now most ICO raised nothing and when you see what happened at the SEC are the conference at the meter ICO a tableau no nobody are talking about raising funds through iTunes and the market moved on on other stuff the reason why on 2018 on over the top 15 ICO fund raising the top 15 100% of a current market valuation below the ICO price valuation and the committee for Siddons this is I dig up on reddit reddit post from April 2017 which is quite interesting because April 2017 was the kickstart of what I call the ICO mania and this guy just say well thousands of project thousands of dabs will issue some kind of tokens and that's gonna add some true friction who's gonna buy some dad coins used that that that guns and that's that doesn't make any economic sense and obviously I want to thanks Julian prelate who did a dive into the economics of pay tokens and is talk is gonna talk today actually in this room at five and I invite all of you to you follow where East when I say it's going to be the same talk that this one so Mill spoiler is here but what can be salvaged are also can useless this is like the title of my presentation well utility tokens as pay tokens will probably as adding friction will fade away that's going to be for call and there's already a few project within the ecosystem pretty legit one that fork out the talkin and the emergence of stable kind when you assist on the talks at least see everybody is talking about maker Dow and the die and obviously the future of 2019 2020 experience with died with the apps will be using some kind of stable currents because it just makes sense for the end users so what can we salvage there's a new form of fundraising a new form or using tokens within the ecosystem and we're gonna do together a small tour or what is happening right now so whoo in the room add about Eunice WAP almost everybody and thanks to Paul we do understand a bit more about bonding occurs but don't lick the curves are very very complex stuff and I think most of the people using this web doesn't understand the risk associated with bringing liquidity within about a burning curve because owning a unit swap talking like a representation of a liquidity pool is kinda a pretty arc or derivative you have a 50/50 position on the token pair so if one of your token is died you can say okay I have something that looks like a constant and something that is variable so why not but if you do like the second biggest pool is it and maker so and when you look at the tokens and add the crypto asset markets well most of the talking are highly correlated together so usually when the price goes up both go up and when the price goes down both crash so this is like IRS this is not aging you also have a spread risk reward on the utilization of the dab but it's not risky at all this shiny graph explained the optimistic probabilities what you see in that blue is when you lose money so if you don't have enough volume within the token pair you lose money if you have too much variation if the price goes up too quickly you lose money if the price goes down too quickly you also lose money so I think most people don't understand that and there's not enough education about this kind of stuff so another model a that was kind of a pipe the past few months is okay I see also dead let's do it sto a security token offering and the thing is regulators are still acting as they are intended the rules are the same you can do your fundraising in fancy form a security is still a security and you fall below the security item of 1933 and the thing this is factor a or five I don't know if you can read it not that much yeah so if you want to participate in a security token you have to be an accredited investor so yeah decentralization please have more than $1,000,000 please have more than 2-hundred Tyson of revenue over the past two previous years and sign some contracts and the sto asked the air design right now with the current regulation are just more complex that regular and tradition and firm raising you just add layers of complexity on something that already borders from and or and difficult that costly and if you're a CEO is not the actual IPO of your project you're just creating a watcher something that you can exchange maybe on some condition to an actual share an actual bound an actual security and one thing we know but derivative is that the derivative price is not the underlying asset price and many bad things can happen so why bother with the rest you let's do it Eden security model we're gonna do fancy trick with the money supply of the token and there's several project doing that right now in the ecosystem so there's good and ultimately good ones like maker or Kay in the cable network staff and there's ugly ones so it's defiantly the narrative is pretty simple part of all of the revenue of the DAP will be used to buy back token on the markets and to destroy those tokens or the supplies go towards zero so you can maybe expect that the token price will go up over time if the DAP is successful but one thing I know about regulators is that they may be slow but they are not them and you can expect some kind of reaction along the way so let's look at maker maker did like ten talks on the HCC so I will not spend too much time on it but what we can understand from the the maker tour token is that it's pretty audio T table you can actually know what is happening on chain it's pretty transparent the the smart contract quite clear about it and the distribution of the maker token was quite fair it was distributed distributed within the community at pretty low price in the beginning this treaty to early investors they didn't didn't I see you and and make her you have a skin in the game it's an actual governance token you vote you probably vote too much because you have will vote every other week with them about the stability fields like for for time in the past three months but it's a good design because you have skin in a game incentive to stay active and you do share some risk you also have bad designs the BnB token violence well who is like aware of this almost everyone yeah so this is less transparent model so no the supply will not go towards zero we gonna we promise we pledge on the Internet and obviously we can be confident of things written on the Internet by exchange and and say we're gonna take 20% of revenue that nobody audits we just declare it and buy back not on the market I didn't witness that there the only thing you can win this on chain is that one address holding a lot of B&B it's sending it through another address which is some kind of burner and and B&B was highly distributed through an ICU and the the by names compiled is advertising about the investment of BnB so not a chair of balance lack of long-term plans what happened when we reach 50% of the supply and every summarization and it's not even a year see 20 and things like that so obviously regulator will react but I think there's some scenario better than older but you TT tokens are not dead you can still design utility tokens and read some funds with a wizard and ICO what you cannot do anymore is use less utility tokens the Pater canst use my lemon coins to use to to interact with my dad so let let's talk about life beer like spear is like talking right now I think in another room it's a great project kind of interesting and their distribution was brilliant so they told and says okay we cannot do an IC o---- anymore but we have rent to pay so we need to do some kind of fundraisings so let's do a fair distribution every single address on the Italian Network having a balance over 0.18 so many many people's will get the same amount of EB LPT token 2.44 and then we just gonna sell a chunk of the supply through private investors so we can add a runway for a few months or years they are saying years why not and just implement within all kind of protocol or adapt a rule a very simple rule is that 50% of all LPT tokens shall be stake within the top if not if there's less than 50% we're just gonna trigger a simple function within the contract allowing inflation so inactive orders are deleted this is a fantastic things because the inflation will be heavily collected by the early community so obviously the team obviously the early investor but also the early active community anybody can like use their airdrop tokens and stake it and collect part of the inflation no IC o---- still money when you look at the figures it works the participation rates go up we are not at 50 yet but it's steadily rising and when you look at the surprise people get diluted so the current market cap of light period run ten millions dollars when you look at what the team are well you pretty sure they have enough runway to deliver an actual project and the current supplied the current inflation since they launched the token it's plus twenty percent so every in every concentration of the LPT token with interactive community this is an inactive reward of being involved in the project but not that bad they are partly wasted on their LPT token so they are related to they cannot access to everything the careful design move forward the the community and when you go into there this code is pretty active and sorry about that it's an actual condom to launch a project before we reach the zero inflation because if there is no traction if there is no actual user for the DAP when there will be no more talking issue well that's going to be a bad thing me Cathy for the token so it's a victimless system nobody cuts come nobody except the private investor who else it's almost nobody except the private investor lose can lose money in that system the incentive are quite good and it's money without an IC o---- but I see you at tableau but you can still do it if you days design it properly and I will talk about Claro's clears this talk in this room today and several talk they are pretty well known about the dispute reservoir I will say right now so pmk is another token that it obviously and they have these two tokens token Amex a crypto economics so if you want to attack their system you have to buy pnk because you have to take them to have a decision within the dispute resolution and obviously buying a lot of pn k and then destroying clearers will you will end up with a bag of valueless token and if they are chosen to just let's take it well if Clara's die eat areum will be just fine so the the value of the it use for the attack without another token we did not move so the value of the attack it's much much higher with another target so it's a good design it's designed also to reward active altars that they called jurors and so if you take majority decision you take the pnk stake of the people that did the minority decision and you paid with it probably die soon and they add some result this is the biggest created TCO of it aryan with the torchon try itself and the end user the actual people creating the dispute they don't use PMK so it's a seamless you act for UX for them so I'm gonna talk about the ICO for the question because we ran out of time but I want to end up with a call to action we talked about several utility tokens and they are very different between each other uranium is a new treaty token pnk is a beauty okay LPG also but they are very very different things we need new classification of assets we need more economic work we we are getting traction with developers around the ecosystem but we maybe it's time to bring lawyers and economists the ecosystem because regulators right now are clueless in France we are voting the lower backs we are regulating the ico and their understanding of the ACO are the paid tokens they have absolutely no clue of what they are doing so if you want to be part of it let's launch an initiative together we can talk after this and thank you for your time with him two questions sir can do that was just a question about you you are talking about the issue of economy concerning token design and why not cryptocurrency design I cannot hear you sorry okay so yeah you are you are putting at the fact that economic parameter is key for the new design of new tokens in the ecosystem why not cryptocurrency the historical ecosystem was based on goodwill video for approach and goodwill approach and today there any real economic token created based on cash flow because at the end a financial asset is bado Wow are you going to pay as dividends and what is your abt at the end or you are net result do you think there is a new view on this and so talking really based on cash flow so the more user you have the more your new your tap have the more value will go to your token something like that a comes in token in a way yeah so the closest we got is this Clary but why we don't have more and more specific stuff because if you do that well you here and you have a lot of stuff happening so regulators maybe we need something from the regulator's to say okay this is a legal framework we can do that but today there is no project like this in financial ecosystem based on the economic cash flow so we have to design so we have to design it yeah so yeah let's work together yeah sure oh just following well upon the excitement I'm a DM head of crypto economics at Tabuchi and we're a company in which were centralized today we raise money and we have a cap table but obviously i sir i cannot hear you i'm can you hear me now ok so I'm saying I'm a head of a crypto economics at Tabuchi and what we want to set out to do is to become decentralized right we have a cap table today we raise money from VCS but at down further down the line we do cyber insurance so we want to become decentralized and for us what we did is we came up with the model called credo which is exactly that other slide the end slide that you had of no utility token not introducing more tokens because dye is just great for the end user but rather finding another capture value mechanism for investors in which they can align their interests with the other participants of the economy and extract value just like for example block producers extract value by producing blocks and earning transaction fees so they would be able to delegate their nevermind it's a whole model but it's called credit and I look forward to seeing more ideas like ferment which showed yesterday in order to really discuss how we can have like a open source sustainability and not affect our economic models so it's just it's not a question about more like echoing what you're saying thank you yeah what I understand when I talk about people interest in like you in this kind of stuff is that there's a true desire within the community to have better tools through propose and the thing is developers are not are called economies some of them are like the micro cars are quite good but the thing is we need to build an initiative together so let's talk sure it's done thank you for your time [Applause]