Updated Multicoin Capital ANO Pledges

Previous Updates
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ORIGINAL PLEDGES START
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-MARKETING

--Help bring Factom to the clinical trials industry

--Introductions to institutional investors

--Educating institutional investors

--Write about experiences in Factom governance publicly on the Multicoin blog

--Distribute our Factom-specific content through our social and other channels

--Advocate FCT to OTC providers and Exchanges for inclusion

--Active members in the governance of the Factom protocol

-TESTNET

--Two testnet nodes

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ORIGINAL PLEDGES END
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Relevant links:
- Forum Q+A
- Aggregated pledges
- Application
- Supporting documents
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Current Update: Updated Multicoin Capital ANO Pledges
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#1
Lots has changed in terms of our ANO structure since we last posted our pledges, so we wanted to update the community on our thoughts and where we see Multicoin providing the most value as an ANO moving forward.

First, we’d like to address a few of our previous pledges from November. Towards the end of last year we began speaking with other institutional investors, as well as OTC desks, to educate them about the Factom protocol, it’s token model that captures value, and real-world use cases that make it such an exciting project. In our discussions, they asked about the rate of organic FCT buyers (people who are buying FCT to create entry credits). Unfortunately, they didn’t perceive enough organic demand for FCT to begin providing liquidity.

However, we are confident that when there is enough organic demand for FCT, that it will be simple to convince these individuals of adoption of Factom in their lines of business. Therefore, we believe that the #1 priority for Factom at this time is to get as many enterprises using the protocol as possible. Demand for entry credits will allow us to better illustrate a visible trend in demand for FCT. At that time, we will resume our efforts with both institutions and OTC desks as we believe it will be exponentially easier to get them on board.

With all of this said, we have come to the decision that, for the time being, the biggest value add for Multicoin as an ANO is to provide infrastructure support to the Factom protocol. We believe that the decisions that are crucial to the development of the protocol are better left in the hands of those who are able to be more deeply involved on a day to day basis. Therefore, we will be upping our efficiency to 60%.

Throughout our time as an infrastructure ANO our top priorities will be to ensure that our node is running as efficiently as possible and upgraded on time. We see this shift in focus as mutually beneficial to both the Factom community and Multicoin. With our increased efficiency we will allow for more effective capital deployment within the Factom ecosystem by those who know where it’s needed most. Additionally, we will be able to focus on internal initiatives in the short term that are specific to Multicoin’s day to day operation. Then, at some undefined point in the future when the protocol has matured or market sentiment has flipped, we will reevaluate our position as a node and our potential value add in endeavors outside of node operation.
 
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#2
Thank you for the update @kylesamani

Could you speak from your expertise about what "enough organic demand for FCT" would look like?

What sort of rate of entry credit burn would that look like for you to resume your activities (even ideas about the order of magnitude youd be looking for would be useful).

What sort of difference is there to these investors and OTC desks between anonymous EC burn, and burn identifiable from specific enterprises?
 
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#3
Kyle, thank you for providing this update on Multicoin’s situation. I am quite disappointed to hear of the poor reception you received amongst institutional investors and OTC desks. I am also disappointed to see no mention of your other pledges. There was a lot of enthusiasm in the community regarding the potential value and exposure that Multicoin might bring as an ANO, particularly with regards to your large social media audience. I hope that enthusiasm will ultimately be justified.

Given the situation, you have done the right thing by raising your efficiency, for which I am grateful. Regardless of efficiency, ANOs are generally expected to still play a substantive role in governance.

Please would you clarify for me the role that Multicoin plans to play in governance during this hopefully brief period of reduced activity? You have a lot of experience and insight that I think many would agree would be invaluable for us, if only you could make your thoughts known during crucial governance discussion.
 
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#5
I'd like to echo Julian's questions above. This is an unfortunate situation and I believe it is critical we understand the level of EC usage on the mainnet we need to be gunning for, to get things rolling with the parties you have talked to @kylesamani.

Understanding what kind of usage would convince you to drop your efficiency back down and go back to these institutional investors and OTC desks for another pitch would be valuable information.
 
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#6
Additionally, we will be able to focus on internal initiatives in the short term that are specific to Multicoin’s day to day operation. Then, at some undefined point in the future when the protocol has matured or market sentiment has flipped, we will reevaluate our position as a node and our potential value add in endeavors outside of node operation.
Thank you for the update @kylesamani. Could you clarify the above statement? So you are shifting focus on what Multicoin can deliver for the Factom protocol as it relates to your day to day operations. I do hope this means articles specifically related to Factom, the value it provides, how it functions, investment potential etc. A big reason the community at large pushed for Multicoin to become and ANO was due to your credibility and outreach potential, and since your election Multicoin as been publicly silent about Factom.

A few months ago, after Multicoin announced they would be an EOS block producer, a member of Multicoin, I believe it was @Myles Snider, promised a Factom related article coming in the future. Do you have a timeline on when that will be delivered? What other Factom related publications or mentions can we expect to see in the next 6 months from Multicoin as it relates to this pledge: "Distribute our Factom-specific content through our social and other channels" ? Please be as specific as possible.
 
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#7
Thank you for the update @kylesamani!

While it is very disappointing to hear that when reaching out to liquidity providers and institutional investors you didn't receive a more positive feedback (something many people in the community were hoping for), I am honestly not too surprised by this and appreciate you being forthcoming and increasing your efficiency to reflect it. I think the reality is that the protocol has some way to go before it becomes an attractive prospect for very large investors.

That said, in order for us to get there as an ecosystem, I believe we need to leverage all the resources we have at hand to their full potential. With this in mind, could you also provide some updates on where you stand in regards to your other pledges?

I personally believe that there is a lot of value that Multicoin can bring to the protocol at the very least by leveraging your outreach to communicate some of the many things that have been on-going over the last 6 months:
  • Development of the tokenization protocol on top of Factom (FAT)
  • News about partnerships coming from Factom Inc, such as Vodii, SPA, Yooya and Equator
  • On-going efforts for establishing a rigorous and robust governance structure, rooted in expert legal advice
In addition to this, as I'm sure you're aware, we have a bi-weekly newsletter coming out. I think a simple thing, such as handpicking one or two things from these newsletters per month and tweeting about them would be extremely valuable and -- at least to me -- would justify Multicoin operating at a lower efficiency than the 60% you're considering changing to now.

You also mentioned in your original pledges that you will "Help bring Factom to the clinical trials industry". In the last grant round, there was one application from a startup aiming to do just that, by running the first token offering on the Factom blockchain, which leverages the FAT protocol. The grant wasn't awarded, but subsequently a number of ANOs contributed funds towards this initiative and the project will be moving forward. To an outsider, this seems like an ideal opportunity for Multicoin to follow-up on one of their original pledges. I am wondering if you are aware of the project and might help in some capacity?

I guess my main message is: I respect your decision to increase your efficiency and function as an infrastructure ANO. We are all entitled to this decision. However, at these early stages of development of the protocol, it would be much better if ANOs can contribute in a different capacity as well, and we all know that there are multiple ways in Multicoin can contribute aside from connections with liquidity providers & investors, so I would be curious to hear what you think about some of the suggestions above.
 
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#8
Thank you for the update @kylesamani

Could you speak from your expertise about what "enough organic demand for FCT" would look like?

What sort of rate of entry credit burn would that look like for you to resume your activities (even ideas about the order of magnitude youd be looking for would be useful).

What sort of difference is there to these investors and OTC desks between anonymous EC burn, and burn identifiable from specific enterprises?
"Organic demand for FCT" is in reference to market demand for the token, (usage demand and trading demand) not necessarily just EC burn. The institutions that we speak with are all motivated by making a profit by helping to facilitate market liquidity. In order for FCT to be appetizing to them, there needs to be volume on FCT markets comparable to the assets that they typically trade (BTC, ETH...other large caps). $62,996 in 24hr volume (pulled from CoinMarketCap for FCT) is not currently sufficient for these institutions to be interested.
 
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#9
Kyle, thank you for providing this update on Multicoin’s situation. I am quite disappointed to hear of the poor reception you received amongst institutional investors and OTC desks. I am also disappointed to see no mention of your other pledges. There was a lot of enthusiasm in the community regarding the potential value and exposure that Multicoin might bring as an ANO, particularly with regards to your large social media audience. I hope that enthusiasm will ultimately be justified.

Given the situation, you have done the right thing by raising your efficiency, for which I am grateful. Regardless of efficiency, ANOs are generally expected to still play a substantive role in governance.

Please would you clarify for me the role that Multicoin plans to play in governance during this hopefully brief period of reduced activity? You have a lot of experience and insight that I think many would agree would be invaluable for us, if only you could make your thoughts known during crucial governance discussion.
Although we may not be active on every governance discussion, we intend to remain active on governance referendums.
 
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#10
Thank you for the update @kylesamani. Could you clarify the above statement? So you are shifting focus on what Multicoin can deliver for the Factom protocol as it relates to your day to day operations. I do hope this means articles specifically related to Factom, the value it provides, how it functions, investment potential etc. A big reason the community at large pushed for Multicoin to become and ANO was due to your credibility and outreach potential, and since your election Multicoin as been publicly silent about Factom.

A few months ago, after Multicoin announced they would be an EOS block producer, a member of Multicoin, I believe it was @Myles Snider, promised a Factom related article coming in the future. Do you have a timeline on when that will be delivered? What other Factom related publications or mentions can we expect to see in the next 6 months from Multicoin as it relates to this pledge: "Distribute our Factom-specific content through our social and other channels" ? Please be as specific as possible.
With respect to your first question, no we will not be shifting focus on what MC can deliver to Factom. We will be shifting focus to other internal Multicoin initiatives for the foreseeable future.

As for a Factom specific article, we do not have plans for one currently. If/when there is substantial developments in the market or protocol to warrant an article, we will reassess at that time.
 
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#11
Thank you for the update @kylesamani!

While it is very disappointing to hear that when reaching out to liquidity providers and institutional investors you didn't receive a more positive feedback (something many people in the community were hoping for), I am honestly not too surprised by this and appreciate you being forthcoming and increasing your efficiency to reflect it. I think the reality is that the protocol has some way to go before it becomes an attractive prospect for very large investors.

That said, in order for us to get there as an ecosystem, I believe we need to leverage all the resources we have at hand to their full potential. With this in mind, could you also provide some updates on where you stand in regards to your other pledges?

I personally believe that there is a lot of value that Multicoin can bring to the protocol at the very least by leveraging your outreach to communicate some of the many things that have been on-going over the last 6 months:
  • Development of the tokenization protocol on top of Factom (FAT)
  • News about partnerships coming from Factom Inc, such as Vodii, SPA, Yooya and Equator
  • On-going efforts for establishing a rigorous and robust governance structure, rooted in expert legal advice
In addition to this, as I'm sure you're aware, we have a bi-weekly newsletter coming out. I think a simple thing, such as handpicking one or two things from these newsletters per month and tweeting about them would be extremely valuable and -- at least to me -- would justify Multicoin operating at a lower efficiency than the 60% you're considering changing to now.

You also mentioned in your original pledges that you will "Help bring Factom to the clinical trials industry". In the last grant round, there was one application from a startup aiming to do just that, by running the first token offering on the Factom blockchain, which leverages the FAT protocol. The grant wasn't awarded, but subsequently a number of ANOs contributed funds towards this initiative and the project will be moving forward. To an outsider, this seems like an ideal opportunity for Multicoin to follow-up on one of their original pledges. I am wondering if you are aware of the project and might help in some capacity?

I guess my main message is: I respect your decision to increase your efficiency and function as an infrastructure ANO. We are all entitled to this decision. However, at these early stages of development of the protocol, it would be much better if ANOs can contribute in a different capacity as well, and we all know that there are multiple ways in Multicoin can contribute aside from connections with liquidity providers & investors, so I would be curious to hear what you think about some of the suggestions above.
We will absolutely be keeping an eye on the updates from the bi-weekly newsletter, however will not be committing to a particular metric such as "handpicking one or two things" to publicize at this time.

With respect to Triall, we were not aware of this project. I will look into it further.
 
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#13
Thanks for the response. I was referring directly to Kyle's usage of the term "organic demand".

In our discussions, they asked about the rate of organic FCT buyers (people who are buying FCT to create entry credits). Unfortunately, they didn’t perceive enough organic demand for FCT to begin providing liquidity.
Do you have any insights on how organic usage as described by Kyle affects the decision of institutional investors and OTC desks to be involved with FCT, or any project for that matter. Thank you.
 
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#15
"Organic demand for FCT" is in reference to market demand for the token, (usage demand and trading demand) not necessarily just EC burn. The institutions that we speak with are all motivated by making a profit by helping to facilitate market liquidity. In order for FCT to be appetizing to them, there needs to be volume on FCT markets comparable to the assets that they typically trade (BTC, ETH...other large caps). $62,996 in 24hr volume (pulled from CoinMarketCap for FCT) is not currently sufficient for these institutions to be interested.
It is odd to me that in the months leading up to Multicoin making these pledges the volume was largely the same as it is now. I understand that institutional investors have their own interests to look out for, and that is fine. But the amount of liquidity is not related to what Multicoin pledged to provide internally, i.e. Factom related articles and social media posts. To abandon those pledges now is very short sighted in my opinion. Multicoin should reconsider this stance in the short term because it is clear to see how helping build liquidity through your outreach is mutually beneficial for the protocol and Multicoin.
 
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#16
I have some questions that I think would be good to have answered:

1. Taken from your original pledges:

--Write about experiences in Factom governance publicly on the Multicoin blog
--Distribute our Factom-specific content through our social and other channels
What proved to be the reason that these original pledges did not work out? They don’t come across as particularly difficult to implement, so the effort>impact ratio would have been helpful. Instead, from what I can tell you haven’t even tried. What should the community take from this when viewed in light of the quote below?

On Sep 19, 2018, you wrote on Discord:
We do plan to push content regarding our Factom ANO experience, but our goal was to detail the governance process of Factom after having been onboarded and actively participating.
What prevented you from doing this write-up?



2. In your updated pledges, you write:
With all of this said, we have come to the decision that, for the time being, the biggest value add for Multicoin as an ANO is to provide infrastructure support to the Factom protocol.
I have several issues with this. For one, I am missing a bit more clarification why you would think that being infrastructure support is your biggest value add. We have clearly identified a problem in the lack of organic demand / interest for FCT, and so I would instead argue that at this juncture your biggest value add is to drive interest, particularly because:
  • That is why you were selected.
  • You have the means to do so.
  • Those means can be deployed in a low-effort way.
Do you agree that the problem you identify with low organic demand for FCT is something you can help remedy by increasing awareness through your social channels? If yes, why didn't you?


3. On Feb 23, 2019, you wrote:
Nothing at the moment with respect to blogs, but we are working on other initiatives and will have updated pledges posted by the end of next week.
On Mar 2, 2019, you U-turned and the updated pledges say there will be no new initiatives going forward. What triggered this change in direction within that week?


4. Pledges can fail for a number of reasons, but I’m having a hard time figuring out what made yours in particular so difficult to achieve. Considering all the above, do you think it is fair that you were awarded your current ANO position over other applicants, when this decision was based on your initial pledges?

5. How would you respond to the below quote about how you might be perceived in the Factom community?

MC hasn't even tried to fulfill their pledges, which makes it look like the pledges were just a means to getting an ANO spot and that they had no intention to execute on them. I can think of scenarios where that's not the case but that's the optics of the situation.
 
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