Look at How Much Fun We're Having

DAOs, DeFi, & Crypto Fundamentals

Your daily snapshot from our OnChainFX markets dashboard.

Look at how much fun we’re having (livestreams, twitter, telegram...everywhere)

We’ve kicked our Messari livestreams back into high gear. We dropped three phenomenal episodes this past week (including my favorite to date on value investing and fundamentals in crypto), and will be recording sessions live from DevCon in Osaka next week.

Check out the gems below with Placeholder’s Chris Burniske, Maker’s Greg DiPrisco, and OpenLaw’s Aaron Wright.

You can watch via the embeds below, check out all of our live streams here and subscribe to the podcast on iTunes, Spotify, or your favorite podcast app for download during your commutes or potty breaks.

Yes, there are a zillion crypto podcasts, but ours is undeniably the best. We do these because a) they are fun, b) lots of people watch them, and c) I get to challenge the guests a bit more than the usual host because I’m a grumpy old industry dinosaur that’s seen some shit.

Speaking of which:

Despite my repeated rejections from some of the industry’s top startups six years ago (I wasn’t qualified for the positions I wanted), I’m happy to have stuck around and broken in simply from putting out good daily content. I still recommend that strategy for anyone looking to enter the market full-time, including many of you, dear readers.

Want to get noticed? Engage with us, and we’ll RT share good content you send that leverages our data and research tools.

There are a *lot* of ways to engage with our team on a regular basis. If you aren’t following the conversation on twitter, you’re missing out.

On twitter, @MessariCrypto (29k followers) is excellent for keeping up with the major releases, research insights, and breaking news in the industry. @OnChainFX (19k followers) is good for giving you regular price and momentum updates when the markets go nuts. Even little ole @MessariNews can provide a curated feed of news updates from our home page straight to your twitter stream.

On telegram, we’ve now got a conversation going with 1,400 hardcore crypto fundamentals proponents. For a big group (join here), it is insanely well moderated by our analyst Zack Voell (10k followers), and includes daily contributions from our product and research teams Eric Turner (S&P’s former crypto analyst), Qiao Wang (who will be doing the Unqualified Opinions live interviews from SF Blockchain Week), Dan McArdle (my co-founder, and a crypto historian), Florent Moulin (industry’s top expert on token supply), Wilson Withiam (recent addition from Circle Research!), and Jack Purdy (the first analyst we hired from our volunteer community; we’ve hired two more since).

Get reading, watching, listening, learning, and writing.

For those who need some easy listening and a crypto orientation, here are some foundational videos/podcasts that may help build your knowledge on crypto fundamentals, DeFi, and DAOs, three of the most important (and yes, buzziest) themes of 2019. Enjoy!

[Thank you to Voyager for sponsoring the production of these conversations. Voyager lets you search dozens of crypto exchanges to find the very best price for crypto trades instantly. The company is a licensed crypto broker with a crazy fast iOS app that gives you access to more than 20 coins today and is 100% commission-free. No bullshit: they make money while you save money on tighter cross exchange trading spreads. Head to investvoyager.com/messari and earn $25 of free Bitcoin when you download the Voyager iOS app and register.]

1) With respect to my other guests, this discussion with Chris Burniske at Placeholder Capital was my favorite to date. Chris literally wrote the book on CryptoAssets, and rung the bell for bitcoin as the first blue chip asset in a new asset class (Jan 2017). We cover mental models for crypto, how to capture value with tokens (is token economics voodoo?), why transaction fees are healthy for networks, what’s about to happen in the upcoming smart contract platform wars, missionaries vs. mercenaries and what that means for creating communities beyond bitcoin and ether, and a ton more.

2) You can’t talk about crypto in 2019 without mentioning MakerDAO and Dai, the only algorithmically managed cryptoasset with any real size right now. Maker provides the underpinning for dozens of DeFi applications these days, and may be the industry’s best shot at a non-sovereign stablecoin…aka a path to a stable currency outside the control of the global panopticon. Greg Di Prisco (BD at Maker Foundation) and I talk about how Maker works, why it isn’t be as risky as fractional reserve banking, and WHEN to expect multi-collateral Dai. It’s a must watch for the DeFi-curious. In line with our usual line of inquiry, we discuss Maker’s financial value and governance rights. (Qiao wrote about MKR valuation earlier this year.) One look at my thinking pose, and you know this one will be good.

3) DAOs, decentralized autonomous organizations, have been bandied about for many, many years, even pre-ethereum. The most DAO has been “The DAO” (I know, it’s confusing), which collapsed in 2016 and almost took Ethereum with it. The DAO led to a $60mm loss of funds, a controversial network wide roll-back of those losses, and a hard fork that led to the creation of Ethereum Classic (note: I know what some of you are thinking…don’t be that guy). But crypto protocols are a bit more secure (barely) than they were 3.5 years ago, and some of the industry’s heavy hitters are throwing weight behind DAOs once again. Vitalik and ConsenSys have backed Ameen Soleimani’s MolochDAO (I interviewed Ameen as well, but Epicenter’s was better); Ryan Zurrer of Polychain and Web3 Foundation pedigree launched a new DAO proposal; and of course, Aaron Wright of OpenLaw joined me to talk about what it would take to make one of these things, ya know, legal in the no-fun zone (United States).

Seriously, watch/listen to this video/podcast.

I mean, look at how much fun we’re having.


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Messari Compression Algorithm

Content and thoughts from around the web as summarized by the Messari team.

🔐 [Analysis] Proof of Stake’s security model is being dramatically misunderstood - Viktor Bunin

Since Proof-of-Work (PoW) is the more understood model for securing blockchain networks, its security characteristics are often compared to Proof-of-Stake (PoS) systems. However, Viktor Bunin argues that PoS networks face dramatically different security threats compared to PoW, and “assuming PoW attack vectors are rational in PoS prevents us from seeing the real risks and attack vectors.” Bunin evaluates the attack costs of both PoW and PoS and, in the process, questions the practicality of acquiring a large token set to attack a PoS network while managing to realize a profit.

Bunin recognizes PoS designs aren’t perfect and takes the time to outline the more pressing challenges facing staking-based security models, such as increased theft incentives, “slashing sabotage”, governments taxing PoS tokens and staking those proceeds, and network centralization. It is important to note that some of these risks, especially network centralization, may increase “with on-chain, token-weighed governance because it risks becoming a plutocracy.” (share or read more)

Quick Bits (Don't read that, I read it for you)

Choke Points (Exchange News)

  • 🏛 Founders Bank in Malta, scheduled to open in 2020, is a crypto-friendly bank that raised $10 million so far and is looking to raise $30 million more in the near future, reports CoinDesk's Leigh Cuen. Malta-native and co-founder Paula Pandolfino told CoinDesk:

    “Crypto will take over the world, and we need full banking services. We want to be that pillar of banking for the ecosystem to support how it gets done. If anything, [we’re learning] how to wean off traditional banking and getting crypto to be that platform.”

    Two of the banks leading investors are Binance, the largest crypto exchange by volume, and Polychain Capital, a crypto hedge fund. In a press statement, Binance CEO Changpeng Zhao said his company will be one of the bank’s first clients as soon as it opens. (share or read more)

  • ➕ Binance has added support for TRON staking to its recently launched staking platform, the exchange announced on Monday. On October 1, Binance users with $TRX on the exchange will begin receiving their share of the block rewards produced by Super Representatives on the TRON network. Binance has also apparently de facto voted itself into a Super Representative position, with over 59% of votes, according to data from Tronscan. (share or read more)

Startup Signals (ICOs, Cryptos, and Startups)

  • 🚀 The Telegram Open Network (TON) core team informed investors via email that the long-anticipated TON blockchain is on track for its planned launch later this month. In addition, the email, authenticated by Mitja Goroshevsky, CTO of TON Labs, and CoinDesk, clarifies how investors can claim their purchased Grams tokens and provides a link to the source code for TON, which is now publicly available. (share or read more)

  • 💰 Broadridge Financial, a $15 billion publicly-traded company providing investor communications tools has acquired Shadow Financial Systems, a fintech firm offering post-trade processing solutions across multiple asset classes including cryptocurrencies.

    Head of capital markets at Broadridge, Justin Llewellyn-Jones stated:

    “There are not that many [firms] that want to settle and clear Coinbase trades. If we have those capabilities it opens up an interesting arc for us to go forward.”

    (share or read more)

  • 💵 Decentralized finance (DeFi) lending portal InstaDApp has raised $2.4 million in seed funding according to an announcement from the project's founders. The round was led by Pantera Capital, with participation from Naval Ravikant, Balaji Srinivasan, Coinbase Ventures, IDEO Colab, and Robot Ventures, among others. (share or read more)

  • Ethereum scaling project SKALE Network has raised $17.1 million in new funding according to an announcement from the project. Participants in the round include SKALE Labs and ventures funds Winklevoss Capital, Arrington XRP Capital, Blockchange, ConsenSys Labs and Multicoin Capital, Hashed, HashKey, and Recruit Holdings. SKALE Labs CEO Jack O’Holleran said the funds will be used to speed up the launch of SKALE's mainnet which will be ready for launch some time in the fourth quarter. (share or read more)

Did I miss something?

Send me the link, your twitter handle and your best imitation compression algorithm write up. If I like it, I’ll include your bit next issue (with attribution).

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