S6. Ep. 7 - Novel Funding Mechanisms W/ Skeletor & Alp

Transcript

welcome to the green pill. network podcast in September green pill will be hosted by the cartographers a high context community of individuals and teams dedicated to advancing the web 3 grants ecosystem they'll explore the web3 grants ecosystem with topics ranging from novel funding mechanisms Grant councils and governance to emerging trends like Ai and direct to contract incentives this series seeks to bridge theory and practice by examining real world examples and featuring discussions with those who are closest to the action the next voice you hear will be Sav who contributes at getcoin and founded the cartographers sa will be hosting this entire season and I think that it's going to be a great season because Sav brings deep experience in web 3 grants

and capital allocation I'm excited for you to hear some of the perspectives from him and his guests without further Ado the next voice you'll hear is Sav enjoy hey coordination welcome to another episode of the green foot podcast uh with me today I've got Skeletor from Wonderland and out from inverter and we're diving into novel funding mechanisms um really this episode is to take a look at different funding mechanisms and kind of like the idea space that we're exploring today in web 3 uh if you're listening to this episode you're very probably familiar with Grant programs and how they're running today um and we think that there's some real potential to you know program more of our our values into our

money and build different types of programs and incentives going forward that ultimately drive more impact so so I'll start off with some introductions to the guests and we'll jump into it from there I think uh maybe Skeletor I'll start with you tell us uh what you do and who you work for and uh we'll bounce it over to Alp after that awesome yeah hey hey by the way uh thanks for for the invitation I'm here uh kind of jumping in last minute uh in place of gorilla which is our our CTO he has way more context into funding mechanisms I'll do my best I have very very sharp opinions on on this specific area of web 3 uh so bear with me uh by the way I'm H skele I'm a co-founder and Lead

architect at Wonderland what we do basically uh like our URL is defy sucks we know defy sucks governance sucks funding mechanism sucks like everything kind of sucks right now right we're here like kind of to make it better as well as you guys and probably as well as all the listeners here uh so step by step we know that we can't be build everything ourselves so that's why we partner with different protocols at different teams such as gitcoin to help them kind of bring their Vision into production in the best and safest possible way um yeah I've been in the space since forever basically nice nice it all sucks but there's so much potential right spicy take I love it way to start the episode

off and for the listeners just so you know I'm wearing my Wonderland hoodie uh today in support of the team um and Al has one for inverter uh on the way I hear Al I'll turn it over to you give us your intros man thank you um yeah I I agree um we we are on a path from suck to kind of better betterment of sucks I guess um I've been in this space forever as well I would say uh prior to it I kind of have a very entangled past with Grant programs especially around Europe European Horizon grants program I was Lithuania most like trying to support funders in developing regions trying to get to Europe that was focused on mostly like food and agriculture Tech I had my also straight opinions about Grand

programs in the past I I don't I'm not really a fan of those in general I believe in skin in the game I believe in distributed ownership overall and I believe in mechanism design that incentivizes positive some games which also takes into account of like you know people's incentives and social cultural background and overall like the skill taxonomy that exists and the material taxonomy that exists within civil engineering and overall like the way to conduct Societies in a more coordinated Manner and I also in the past contributed to gitcoin so huge fan overall gitcoin and its New Direction all very supportive of it I'm the co-founder of inverta network inverta started around three three and a half years back as a research program with blog science and curve laabs and Prime

da and token engineering Commons uh so many you know like different token engineers and mechanism designers were basically asking the question of the initial research was named proposal Inver so the whole goal was actually also like how do we allocate funding in a more conditioned manner like more merits uh involved also More Design space that it enables so how could you verify I don't want to say something wrong I'm I'm scared of zaram he was the first one to write the paper at log science but uh it was basically a way to think about how can we invert the power Str structure between the funders and fun uh the the projects that get fund

funding and how can we enable open design space for those innovators to actually contribute with a very solid R&D efforts based on the merits and Milestones based fundings so Inver started as first A Primitive take take on to introducing Milestone based funding mechanisms that is more like based on distributed ownership or rather than Grant programs and from there an architecture has uh arrived where we start to focus on token economies because we realized the import of dynamic economies if you look at traditional Finance world in in the world like how the society functions it's mostly on Dynamic assets you know like uh most of the Assets in the world today has dynamically issued and issuance and Redemption logic based on

specific conditions and information flow so inverter is like this protocol architecture that enables connecting different pieces of web tree Primitives uh and then enable like larger complex mechanism to be simplified and applicable by projects and the newcomers without hardcore develop vment and like being able to actually Supply manage the token economies that you introduced and yeah excited to be here and thank you for having me I would say totally totally so um to jump into it you know this episode is all about novel funding mechanisms and um what do we mean by that well I think generally in web 3 novel funding mechanisms is really anything that isn't direct grants is probably the simplest way that I can put it over time though I would say that

that has expanded where we've been doing quadratic funding for a while we've been doing retroactive funding you know for a while and so I think that um in the past those were more novel funding mechanisms that are becoming more common I still wouldn't say that they're the Lion Share of the types of grants that we see distributed in the space but they're definitely a starting point to like you know some of alp's points like how do you put skin in the game um how do you start to uh look at the wisdom of crowds and kind of like democratize the process of fundraising and Grant giving um but I think as we look forward there's all kinds of potential that's starting to open up when we look at verifiable you know on chain you know data and it's something we've talked about in quite a

few of these episodes this season around some of the possibilities there and some of the places that you know some of these things are even starting so with that you know the question I have for kind of V both of our guests to start it off is like what does novel funding mechanism kind of mean to you what do you see the potential that way say in the next couple years maybe Skelly I'll start with you right you guys are actively working on building out Alo 2.1 and I know thinking a lot about you know how you build kind of this Foundation this Bedrock that people can build more funding mechanisms on top of maybe walk us through how you're thinking about that what's some of the possibilities you feel that 2.1 might unlock yeah absolutely so basically what we try to do is make it as easy as possible for

both uh developers and users to basically jump in experiment with the current mechanisms that exist today so we are uh building two things one is all the core contracts that will will kind of safely manage the interconnectivity between the different modules or like Grant strategies allocation strategies funding strategies etc etc and on the other hand we will have all these kind of already developed and tested like contracts that would act as this type of very very specific uh funding mechanisms such as as you said like quadratic voting or allocation mechanisms or distribution mechanisms etc etc so the main idea with Alo b2.1 is to improve on

the previous system which had kind of the right idea it just lacked some kind of refinement so we are kind of making everything super high quality production ready safety first uh to allow both kind of users to trust the actual implementations right and for developers to kind of be able to easily build on top of the work of kind of previous uh like researchers and Engineers that made all of that possible what does that mean to you when you when you hear that and kind of thinking about the work that inverter is doing you know how do you see that unlocking more opportunities around novel funding yeah um first of all I really appreciate the work you guys are doing on Alo overall just want to state that so inverter actually had

this very similar approach like two years back that's how we started as well like we built initially we built this protocol architecture where we from our point of view we want to optimize the way that we use proxies uh where we could enable people to do like plug-in play kind of solutions when it comes to heavy R&D like you know like Fast R&D overall like their mechanisms and ideas because we want to see more exploration exploration to happen in funding like not just funding but overall system design right which funding is a part of an overall system designed to enable like this value flows to be integrated to Circular economies and the way we did it was like we modularized our architecture to have more four main components one is like the governance like authorizing you know like uh the

second one is like the fun W so can call like an inssurance module like inssurance category or like a funding VA category I I think you guys are using in Alo then like Logics you know utilities how do you extend the utilities of the mechanism and also the distribution so then we start building like kind of complex Proxes for it in a way so for example for utilities we built something like Oracle stake and Oracle stake is a contract where you can say for example until my protocol very stupid example until my protocol goes to $100 million total value like what I want to distribute $1 million of rewards basically based on these conditions and the algorithm will basically dynamically adjust the reward rating until the goal is reached and then you can actually optimize the goal

as you go move further and you can also enable new extensions you can say hey I want to have a regional uh logic I want to do like a proof of humanity I want to do like a unfortunately like kyc or things like that so you can expand the architecture without manual development without required like to do so many different you know integration testing this and that also like audits uh so we're trying to you know it was our first goal to try to build these systems so anyone can come and just around find out you know with their mechanisms and then we realized the like we kind of went back to 2016 17s and we started to ask ourselves like what is this the most important thing that blockchain has promised in the in the past to the people and given the fact that like I'm

from Turkey most of our you know like team is also from developing regions I personally lived in Europe and United States for a very long time so I'm also aware of the financial rails that happens within level up like Emerging Markets so that also gave us this kind of uh question where blockchains enable Dynamic information flow into a value based on the information that it holds and based on the coordination it enables based on the information that's available that is verified you know and it can introduce economic games like game theoretical games where we can design token economic systems where we could enable participants to build and coordinate around these you know postive s systems overall so we wanted to focus

heavily on like Dynamic issuance so we integrated an issuance mechanism with bonding curves actually where we started to use bonding curves as algorithmic nests where you could parameterize the issuance and Redemption logic of the whole system which kind of gave you this availability to not only design applications and products not just funding mechanisms but also a whole workflow where you can initiate where the value starts where it flows and like how it flows and how it's distributed and it's get back so you can design like whole systems and uh so inverts approaches around there like where we want to provide because we don't believe in funding mechanisms as Standalone use cases we believe that there are additions to kind of a value that the

system the C like the stakeholders of a system would like to participate in when it's required overall so that that's the way I think I would I would think about if I was to say from inot point of view right on no it's some exciting stuff for sure and some interesting you know perspectives that way in terms of like where this is going um when you think about kind of like Grant programs in the traditional sense you know we we established at the beginning of this episode that you know defi sucks Grant sucks like all the things that Skelly said right and so how do we start to address some of those things and how are you seeing like inverter the work that you're doing tying into you know funding mechanisms and this being part of kind of that overall framework what's your hope that way in terms of how we can

start to fix you know or make better some of these things that suck that this gets me excited because now I get to speak about some use cases like what really excites me is that like first of all um if you guys are familiar with economic policies and how they are done at the government level I'm I'm really interested in it like also multilateral uh organizational level as well so let's give two examples like I don't want to give World Bank example to freak people out but I'll give um Kenny ding government example so let's say kennedyan government has a goal to reach net carbon zero you know by 20150 and the go the the government itself would basically be able to say Okay I want to have this amount of cash uh to distribute for for the next four

years to let's say house owners to incentivize house owners to reduce their energy consumption how the do I do it yeah and uh what available information do I have at hand what kind of mechanisms I can build for this you know and blockchains fit to this perfectly like when you think about Grant programs only like let's think about incentive programs because grants are incentives in a way so Inver is mostly focusing on these use cases from a very like policy level how can you embed policies with incentive mechanisms so that we could build economic policies on chain because this is what's happening in the real world so let's say kennedyan government would offer you grants to implant a solar panel on top of your house yeah and they would say

you pay it now and in N9 months we will pay you 70% cash back but what happens is okay uh I'm not incentivized because I have spent money today and then I'm getting that back from the government in nine months where I could have just like you know maybe buy some stocks and do this and do that and get some yield on top of it so how do we incentivize those people and like blockchain comes there perfectly because you can like use Virtual Supply you can use Community funding to a pool and then you use that as an insurance kind of a factoring where people can take cash out money when directly from the pool to their bank account with a premium then the premium will be distributed to the you know LPS in the pool so those kind of funding mechanisms like they drive me

madly perfectly like I'm really excited about those and seeing them to be a representation in asset classes like for example I was talking to as well like the other day we are building like this new primitive called public wood staking where for example what we're trying to do super inspired by glow dollar like what if you would have ethereum a native yield bearing ethereum like let's say PG eat like a public goods eat where by just by holding it the yield that you generate automatically 10% of it you could send it to let's say like a gitcoin vault that does like you know like match funding in cell Grant programs you know like let's given an example in in Africa so like these kind of Primitives are not possible in in the real world you have like very specific

fund structures you have to do all this bureaucracy regulations that and this you have to go through in in on chain it's like one workflow templat where you create and people holds and it's like a direct benefit you can visualize you know um so those kind of things excite me a lot about the potential of you know cryptocurrency applications and real world funding mechanisms overall oh like yeah tying the incentives more of the outcomes and being able to to verify those you know for sure and do that in a much more efficient way you know Skelly as as the one who started off the episode telling us you know all these things suck um how do you see that today right and like what are some of the ways that you know Wonderland you guys are working on aloe and some other things to

help address that yeah absolutely I mean I completely agree with kind of the main benefit is removing bureaucracy from the equation right like all of these processes that can uh either allow or deny people entry to different either Financial or other type of mechanisms that will give them some benefit all right and that will eventually be a positive SU game for the whole ecosystem just because it's either too expensive to address or or to kind of give these services to to people with I know less income or in different regions or etc etc then of crypto removes all of that and it's like hey yeah you are just a zerox whatever hash number uh if you have the assets you can deposit the

assets and that's it right uh and you can see and track everything perfectly and you don't know that you are getting yeah screwed over uh I also come from Argentina which is like a a nice country but but it has it has his its issues especially with like monetary policy and the banks Etc uh to name a few so yeah I mean completely agree uh and as I said like if I sucks everything sucks but probably like the government sucks even more so I think we're on the right path here yeah I mean absolutely uh just to to Circle back to your question there are a lot of things that we're doing kind of on on different front Al was

mentioning also oracles which are kind of a big part of all of these right there is a lot of information specifically if you want to fund things of chain right or if you want to fund things on chain that might have an impact that it's basically not available on chain or it's going to be extremely expensive or complicated to to just kind of bring it over that plus also governance which is basically the mechanism that would allow coordination around all of these different uh systems is is one of our like kind of key interest points we are trying to do a lot of work on all of these areas we're a big team 50 plus people right now so yeah I mean super happy to be here and Al yeah 100% agree with everything yourself we've talked a lot in this

episode about you know really system design right and kind of like how funding mechanisms fit into that and that's very applicable to programs right and so from a grant program perspective you can start to move from using you know direct grants subjective human decision making funding on outcomes that you hope happen not being able to tie the funding you gave to what happened even if you know what outcomes you want like all those types of things and that could be a big level up for programs what changes for builders in kind of like this this new paradigm right like if I'm a a builder if I'm someone who's working actively in the space today maybe I'm pursuing grants um maybe I'd like to pursue grants but every time I've tried I've had a bad experience um

you know all these types of things you know when you think about kind of these these new system and approaches how do you see that changing for the Builder Community right like maybe Skelly I'll turn it over to you for for that question first yeah absolutely I mean that's a great question because most teams don't have kind of let's say a buffer of money to really say hey I'm going to bet into building public goods I'm going to bet into maybe as you said as up said getting some cash back from the government or this da in nine months right like they need to pay their bills and if they have like a job offer in to let's say evil Corp they will say okay yeah I really need to to get some money I will do so development for evil Corp rather than building Noble mechanis on

chain or building this public good or helping here or so that's definitely a big issue I mean there's a lot of work being done specifically on our pgf I think it's nowhere near where it should be right but I mean there is a lot of people and there is a lot of money there also which also attracts a lot of eyes and a lot of kind of experimentation around that and I mean right now optimism is kind of spearheading kind of that area hopefully more projects jump into this into the boat and run their own R pgf programs that would also allow like kind of more parallel experimentations which even can fund the same projects right like most of the projects that get funded on optimism are not solely kind of benefiting the

optimism ecosystem they are benefiting that kind of the the whole ecosystem so that's one of the issues I mean we are trying to make development as I said as easy as possible just to try to lower like kind of our uh part of the kind of of the entry barrier as much as we can I think the getcoin team and specifically Aoki one of the the key metrics is I help people do this in a hackathon right in a weekend in a weekend you should be able to say hey I have this idea I need to implement it this this that you have the UI you have the kind of all the backend indexing services and you have all the smart contracts running that's it right then obviously you will need to audit etc etc if you're like doing

something crazy but if not should be pretty straightforward I mean that's the goal then on the other hand yeah I mean there is still a lot of work more on the research side of things or maybe as well like on on this same Noel uh kind of capital allocation mechanisms that people will create can kind of tackle these let's say emerging uh developers that are trying to get into the the ecosystem don't have yeah kind of a backbone to kind of help them kind of yeah survive over over those months where they get they get not funding for example at Wonderland we have 10% of all our uh time devoted to building public goods we kind of we build and we um

support a lot of public goods from the development side because we can right but if we like when we started we we we just did that because we didn't have any other things to do and we're like yeah okay this is super fun and this is also something that and kind of give back to the community and most of the public goods even not I would say that even all of the public goods that we build we use uh so it's like a win-win for us right and we don't even care about our pgf uh but most teams will do like most developers that are just joining the ecosystem will like see this and should be able to see this as a like steady and stable uh kind of income flow obviously if you if they are doing valuable work

right so if you're generating an impact if you're doing valuable work you should get rewarded I don't think there is a mechanism yet that fulfill kind of this specific Niche which I think is one of the most important because I think probably there is where you will see like crazy experimentation and probably cool things appearing right so yeah that's mytic I love the the commitment to building you know in public goods I think the the 10% commitment that you described there is one of our more ancient funding mechanisms which is tithing you know and so it's good to hear that you guys are definitely committed that way for sure um Al what does that look like to you right like I'm a builder I remember you know the early days of inverter looking at that as something that could really enable builders in a big way where you know

they would be able to have almost a common app type experience where they could submit their profile their application like all these things the things that they're good at right and find you know different programs that they could help to fulfill on versus like a different siloed experience as I you know applied all these different Grant programs and so I know that that was something that inverter was thinking about early on how has that changed over time you know as you kind of look at that um that opportunity absolutely so one of the reasons why it changed is that like uh first we came from so again like my past is with gitcoin as you know and prior to that as well like in the past I I worked with European grants Horizon grants program and everything so I kind of always I approached grants

with skepticism a lot like with cell as well like this and that like all the time it was such a skepticism for me because like it's it's very hard to like first of all like you're trying to aim for an outcome with full trust optimistic outcomes which is I I love it like I think that's the good part of the grant programs for me but not having a skin in the game like man like the value comes in when people fights for it like when you have a problem Point like it's not about the grants for you like you want to solve that problem like and I want to fun the people that wants to solve a problem because like when when it comes to Grants and I had this chat yesterday with a research Group which I love like very respect I'm I'm not going to name it but they came up

with like this two three uh you know like month of research program like very like system level of approach like taxonomies this and that you know to understand uh by the way yeah just avalanch and cell I think also they are doing their public goods uh retroact public goods program now they they just announced AAL lanch did like is doing now like $40 million worth of retro 9,000 they call it so like people are coming up could also to optimism for enabling that even though they're kind of going back from it I guess a bit but like uh those kind of things like it has like the the reason that it's a retro I feel like it is to Target people that recognizes a paino and doesn't have a barrier to build for that you know like

that's why I always believe like invertor also started with that and still has that like we at least 20 30% of our job is like to make sure that we build for public goods we build for our country like we build for our people in general and uh like we do a lot of things for Turkish Community overall like uh under the C like nobody knows it's just like the you know we don't also like talking about it because it's our culture that you don't brag about the public goods that you do like it's kind of FR upon like let's say in t culture and if you donate for example like you don't mention you don't mention the amount you don't give your name it's like it's under the hood like kind of thing and uh one thing is that like with Grant programs that I see that's why I want to

also quadratic accelerator check it out like it's one of the first initiatives that tries to tackle participatory economy over grants let's say you know and that's because like if a team team wants to solve a problem they don't really need tons of money to solve that problem if they're passionate and ambitious about it the kickart will come naturally like they will always like go through like the struggle of having to have another job maybe like do this and do that which we all went through you know like in our early days the things that I was so passionate about I didn't get paid when I was just like I just did it for free on the side I was working on multiple other things you know like just to get myself going but that there was a passion and that's why inverta ended up being inverta as well because like I had

that passion my co-founders had that passion and we didn't care about the money at that point you know we just fought for it we were like we have a vision we need to implement this and let's do that and Inver has an incubation program as well like we we support a lot of projects and the first thing we look at funders is like okay like what's the passion like what you fighting for and uh I think the web tree ethos like from especially like 2016 17 18 like when we were talking about programmable institutions when we were talking about you know like censorship resistance immutability and everything like not even like positive some games at that point like just the organizational taxonomies and how people could coordinate the centrally to make sure that you know like we're not being interfered when we try to maintain

sovereignity like those topics were are still so important that we should kind of maintain our funding streams accordingly not try to get people to build on my shitty like infrastructure that I claim uh it's the best because it's not a competition we're trying to improve human life here like it's not about you know who makes more money who makes more satisfied it's about like how many problems am I allowing my ecosystem Network to solve for me yeah like Grant programs should stop calling themselves Grand programs it's like focus on the problem that you want your purposeful technology to focus on solving and get the people and direct the people right like because also in the grand programs you see like I want this idea I want that idea I have all these like uh

friends of mine uh I don't want to say anything but wrong but like all these people that when you start running a grand program we should also talk about human psychology when it comes to it if when you build centralized you know systems the problem is not the system itself and it can be corrupted this problem also the human touch of it because the humans lose like forget where they come from like it's ridiculous the ego that you seen sometimes when during these Grant programs you know like I'm giving that money to that person I'm allowing these ideas to flourish this is this isn't how it should go like let people recognize the pain point and solve it and support it as much as you can with direct me Mech isms you know like and it may be funding it may be engineering power it

may be recognition marketing uh helping with VC money like I hear also a lot of like this VC money but I agree to a certain extent obviously but you can be smart about it create buyback programs this and that and also like when you talk about like when a Weston Builder tells me VC money is terrible after raising 20 million on this and to a developing country person I'm like bro I'm from Turkey like a 20 million I'll buy a city with it you know like what are you talking about and uh so these I think like we need to always keep in mind that like the world has around like eight billion nine people billion population around plus 6.5 billion is from developing regions um 195 countries in the world you know like uh 98% of them are developing regions these are

where the problems you know that we need to solve and uh these are the way that we need to onboard to the space and this was the vision in the past but it's changing now a bit I I feel so that's that's for me the main take on from the grant programs overall like I think it's kind of missing the point now that we have to give investor reports overall about what we're enabling with our grant Point yeah the when I first got into the grant space you know my my background and how I kind of got here was like got involved with a nonprofit Food Bank learned a lot about grants in the traditional sense through that process um bull market was ripping last time around um saw these Grant programs launching and just said surely someone's tracking those and I realized really no

one was and as some who had never been a researcher admittedly I'm like a high school dropout I'm like probably not the person that should be researching anything I was like I'm going to start writing about these and keep a list of them you know I'm like here I am right but why I referenc that is the first article I wrote which like please don't go read it it's not very good it has a part in there where I kind of talk about the vitalic Tweet like I don't know if you guys remember it but it's whenever the total market cap hit half half a trillion I think and viik put out this tweet that basically said we just hit half a trillion have we accomplished any of these things right and like we're at what like two trillion now some days like 1.7 depending on like

the day and what's happening around the world but you go back and look at that tweet and like we still haven't really accomplished any of those things the only thing that mentioned in that tweet if I remember right was really we've driven up tvl you know and when you look at that that's still the metric that we fixate on right because like we can measure that and when I look at like Grant programs they're they're in a difficult spot like I've seen this before where we want to drive impact well how do we measure impact well it's these metrics that we all agree on are important that Bots can gain tvl active users whatever and so as a program I'm giving out grants asking for I mean hopefully if I'm like looking at it from

a milestone perspective I'd like to see these Milestones by these dates and I need to see it drive these metrics you know and to your point out that doesn't always get to like how do you address the novel ideas you know and how do you address kind of like the the great ideas that maybe sit outside of I can drive tvl and I can drive daily active users and oh by the way if I can't do that for just that ecosystem that I'm submitting a grant for I'm probably not going to stand a great chance and so there's not a whole lot of opportunities out there for kind of like how do we improve how do we go back to the vital tweet and how do we improve kind of web 3 in these systems overall right so I'm definitely seeing that one place that i' you know

as we kind of like start to close the episode I had a an episode yesterday with Noma and Juan bug on go grants and governance and we got into a really interesting topic that I'm anxious to hear both of your thoughts on it's like today the the Dows that have given out the most and incentives and have Drive driven the most in activity metrics tvl daily active users all these things that I mentioned have also seen the biggest drops in their native token price right I mean at the end of the day these are treasuries that are high weighted on their native token what can they do with those treasuries incentives grants incentives to drive these metrics right like help

pay contributor salaries like whatever it might be like there's only so many things you can do and so every time you're giving those incentives out you're creating cell pressure and I think that there's some programs that are starting to think through what are ways that we can change that they're um you know optimism is one that has a lockup period they're trying to delegate more to governance and you know from a grantees perspective that can be hard because how can I build the thing I want if I don't get paid for it until a year later like there's there's some inherent challenges in these systems right um you know Skelly I'd be curious first your thoughts and jump over to Alp like when you look at that Dynamic where it's like we're giving out grants we give out the grants in the native token it drop

drives down the token price but we may drive up the metrics that we want how do you think some of the things we've talked about here novel like more novel funding mechanisms different approaches better systems may be able to help address that in the future yeah that that's a good conversation to have I mean the the problem here is Simplicity right like the the thing that we have right now is I will give you this token uh you will have to definitely sell that token because that you need to basically pay for for which basically and those tokens also don't have like a lot of kind of liquidity in some markets so maybe a like small amount of people even if the treasury is like huge a small

amount of of Grant uh money will really drive the price down right because you don't have like the other the counterparty liquidity backing up that that price at that specific price point so maybe and as you said like in most of the cases they are trying kind of different kind of to put different type of say stones and and sticks on the road and on the wheel like to just not allow kind of teams or people to dump the tokens I mean most of the projects that we do we do for tokens like we really really believe in the projects that we have as partners we make our money uh on the token incentives right so we are deeply incentivized to not dump and kill the project or kill kill the tokens as

would a f found er do right or or a good founder do let's say so one of the things is probably we need more complex ways to allow people to either redeem or to allow to I think Al mentioned this before which is you might have a secondary pool of LPS that really don't care about like the current like they they see this as a yield opportunity right and they will say yeah okay I will give you some die for your lock op tokens or whatever for a premium right and then those teams don't necessarily need to go to the market to them the tokens they can go to these Ops that are saying hey okay yeah I really trust on

these projects that got funded through rpgfan system I'm putting my money here right and if those teams really need the money really need the die they can come up into the lp pool pay a premium get the money out and I will hold the tokens for them and there you you can have whatever sort of mechanism that you want to allow those LPS to eventually WR sell those tokens but those LPS are incentivized as the family team members or etc etc to hold and to kind of have this buyback mechanism right rather than just saying oh yeah we have this like huge treasury that we minted right out of the thin air and it's not necessarily

kind of in the market we just have this locked so it's a very weird type of scenario in which you definitely if you release all of that you will end up with the token price at zero right there is no liquidity in any of these projects to back that price up so two things here one we should defy all of these type of like there is a lot of interesting Primitives in the defi world that are not being kind of Applied into the rant ecosystem either because of just complexity and like not having the right framework to build this on top of which we are tackling and the other thing is like f launching or fa token launching mechanisms that would allow these treasuries or or these systems to have a way more healthy kind of grant program

because I know let's say optimism for whatever reason I know all the management and all the team changes and now it's a very very shitty project or a very very evil project or whatever like why do they still have like all of those tokens there right like they shouldn't have like they shouldn't be able to distribute all of those tokens if they aren't actually generating enough Revenue to do that kind sustainable over a long period of time right it's even counterproductive to give out incentives if you are really killing the project in the process so most of these programs the first thing that they need to be is self sustainable if they are not self-sustainable they're just like you're just you you got money somewhere probably from people buy buying the

token and you're just like moving that money into other projects and keeping some from yourself so that's in my mind not not a good thing to do um yeah I think that's it what do you think on that out by question yeah yeah amazing amazing statements I agree with everything you said the the only thing I I want to compliment I wrote in the chat like this I think the the Simplicity of ux is super important but the complexity of mechanism you know that lives uh behind it's also super important because like uh if you for example the government like man I'm learning so so much these days like especially researching like Financial assets of you know like the government issued bonds like especially on credit markets this

and that like carbon credit markets as well super interesting tax deductible assets very interesting it's super complex such a Ponzi like it's beautiful ponies all of them like incredibly welld designed and all you do is like you buy it you just see the asset like you're like okay this fund looks good you know like you just buy it you put your money in it you get your like whatever the yield is it and uh yeah then in the back end like a lot that liquidity is used so many different places and that that turns me on so much these days because we can do that not based on ponies but based on real value that is generated on blockchain because we can actually tie the real value generated as a reserve to the assets that you issue on top of it which is like yeah it gets me excited of

it and it's like that's also kind of ties up to our approach with inv where we're try trying to form primary issuance markets what we call in general it's basically like we're trying to leverage issuance and Redemption curves and set up economies such as that uh an asset would be issued against another asset or another value or multi assets Etc based on the conditions that have been set for the economy so if so like the main goal the objective is to prevent value leakage from token economies so that we can enable communities of those token economies to capture that leaked value that otherwise would go to market makers and investors because like if anyone researches you

know how these uh beautiful op tokens or other tokens are being you know like kind of circulated in centralized exchanges how the market making deals go how the VC deals go you know like uh with this kind of taking the staking rewards dumping them continuously or like uh giving C options to market makers and uh setting prices on you know like against your community overall without transparency so this happens to all tokens today uh you know and what we're trying to do with primary isance Market is like how can we make that transparent you like how can we build mechanisms where the issuance and Redemption curve of the primary issuance Market is very see transparent everyone sees it they cannot front run it because like there is a treasury management but

implemented within the mechanism and then you could route the assets from primary issuance markets to secondary markets and value capture because the price will be different between two markets primary issuance is the curve and then you have the secondary Market you know which is the liquidity lives so the price will be different so instead of making the Tex is the main stabilization area for you know Arbitrage you would enable your smart contracts to do those operations so that you could capture the you know the value leakage from your token economy to stabilize the sustainability of the token and while doing that you can actually enable your community to provide the cash that is needed for this you know treasury management strategies and then can return the yield to them

directly or you could potentially do your Grant programs or like whatever investment programs you want based on those values as well but I agree 100% with Skelly like you have to you have to be sustainable yourself and you have to have a very good financial analysis to be able to say okay I will use this amount of money to distribute for these specific goods and I don't think every project should do very ground like a gr generalized Grant programs they should focus on one region or like they should focus on one problem you know like it's kind of daro model everyone should hold their space you know like when you go to a spiritual realm of reality you're like I'm I'm going hold my space like this and everyone their space so that the interaction happens in a more symbiotic manner I would say that's also missing

because of the greed in web tree especially greed and information symmetry like we praise the projects we always forget what they've done I'm not going to name one company but like for example one blockchain three years back this Stone chain everyone can see claimed the real world use cases and like started to do Insane amount of grand programs which uh was again like it was amazing but they didn't count was the so they gave all their tokens you know like I'm going to Africa get this money get that money like all these marketing initiatives this are the beautiful and then the when the lock ups started to happen token went down from like let's say four to5 to like $1 60 Cent to 40 cents and all these projects

right in Africa especially like they were very strong in Africa so like all these projects they were like the is happening like I don't have money anymore I have to kill the project so many projects I know and especially good projects one of them is like was in Caribbean island they settled like incredible connections with the locals they had like this education environment physical education environment that they were teaching kids and everything and their livelihood was dependent on this grant money it was a large grant money around two million and by the end of the day when it started to unlock it was $380,000 yeah all they planning like who who who pays for it what happens there yeah like and and it's just like okay now we change all of our strategy as a blockchain we go something else and uh then they raise another one like now

it's Justified so yeah like I agree 100% securly And that's the most important thing that we should do as well as participants as will diserve the space first not call out but call in we should definitely call in projects uh we should warn the builders to not depend on grant money grant money doesn't exist if you have passion to solve a problem solve the problem and don't depend on the grant Solly depend on Builders like yourself depend on Founders because Founders will support they know the struggle and just ask for help this is open source and try not to do double work I would say like I really want to also see like how we can you know like align more with the AL allo General as well because like we have so many parts together that we can complement with you guys with what you're building and

create like these different mechanisms that's what we that give it and yeah like we just put we we should just put our powers together and create value to distribute the value like not distribute value that doesn't exist but it's you know fascinating conversation this is exactly why wanted to have you two on the show um and dive into some of these topics you know to kind of in the show like on your point there Al you know I hear a Common Thread around like bet on the people right like at the end of the day like you want to find the right people that can execute and if you can support those people you know in the right ways then good things will happen and um there was actually a recent article that Joel John wrote decentralized doco like probably my favorite blog in all of crypto uh people

not Pitch decks I think is what it called and he talked through this idea of like you want to bet on the people you know and I think that if we can start to look at more aspects of you know like how does onchain enable that well there's aspects of reputation right there's aspects of this onchain you know verifiability like I keep talking about that you know as a Common Thread in these shows and I think that's really the potential that we have that new types of funding mechanisms could help to support you know for sure so it's been a fascinating conversation guys um for the listeners I'm going to drop in the chat or in the uh the show notes alp's profile Skeletor profile um the organizations they work with I'll drop the vitalic tweet in the the show notes as well go back and look at that it's

telling I don't remember when it was written but it was written long enough ago that we should have made more progress against all the things that he named other than drive up TBL um so yeah you know thanks for the time guys it was definitely great to have this conversation I appreciate you man thanks so much for having me I guess and nice to meet you Skelly again it was a pleasure same thank you s thank you all was great [Music] he