DXventures at ETHVC '21

Context

From July 20-22, DXdao community members attended ETHCC. With over a 1000 attendees and more than 250 speakers, ETHCC gathered experts, developers, companies, and start-ups in the blockchain ecosystem to share their latest developments.

DXdao, through its DXventures initiative, also participated in ETHVC. At ETHVC, DXventures was one of 40 funds that had access to 20 carefully selected startups that ranged from high potential, nascent projects to more mature, equally promising enterprises.

DXventures Mission

DXventures is not a traditional investment fund. Its main purpose is to collaborate with and incubate promising projects in need of seed or growth capital that solve problems DAOs and the DeFi space face.

DXdao envisions a future in which DAOs are the optimal vehicle for technologists, scientists, creatives, and industry leaders to organize through and innovate. Thus, teams that DXdao will support are developing solutions to facilitate this transition. Additionally, DXdao develops decentralized applications on the Ethereum blockchain and so naturally supports working with, and investing in, projects advancing the future of DeFi.

ETHVC Projects

@sky, @tammy, and @Arhat participated in ETHVC as representatives of DXventures. We’ve compiled our main takeaways from the ETHVC pitches, and are now seeking feedback from the DXdao community. This is not a full list of the pitches at ETHVC because some clearly fall outside of DXventure’s mission.

The information provided below is general and will not discuss specifics on ROI and mechanics of a grant. The reason for this is twofold: (1) this information is generally considered private, unless specifically cleared for public dissemination with the project; and (2) based on DXventure’s current mission, a project is more likely to receive a grant if it either solves a problem DAOs face or advances the future of DeFI, not solely whether it will be a good return on investment.

Here is the list of ETHVC projects. Shout out any projects in the comments that you think DXventures should pursue:

Gelato Network: Automated smart contract executions on Ethereum. If a user wants to schedule a trade, a token transfer or a debt refinancing at some point in the future, gelato provides a decentralized network of bots to fully automate the movement of money between different protocols on Ethereum, executing certain transactions on the user’s behalf. Twitter.

  • Pros: Direct use case for Omen to close LP pools on markets. Lots of traction and moving for a larger second round raise.

  • Cons: Gelato is not on xDai yet. Sky expressed to Hilmar, one of Gelato’s founders, interest in DXdao using Gelato and participating in funding. However, unfortunately, the current round is full. We are positioning to potentially participate in a future round of funding.

  • Status: The DXdao community can partner with Gelato for mainnet and eventually xdai for Omen when the tech is ready. Conversations are open regarding a grant to Gelato.

DFNS: Custody of digital assets requires maximal security. Don’t DIY. One simple line of code supercharges your development with a bank-grade custody infrastructure that gives the freedom to safely scale across crypto markets. There will be more custodial products with kyc serving institutional clients or just cexes following regulation, and this service will be needed. Twitter.

  • Pros: Solving an interesting problem using Multi-Party Computation. Early stage project still testing out use cases. A solution that can be used by any business with crypto custody of digital assets, VCs, startups, exchanges, banks, insurance companies. They also plan on becoming a DAO.

  • Cons: Technology is mainly being used by institutions. However. it’s very interesting if DAOs could use this product too. Could it be a way for a DAO to own a Bitcoin private key, for example? As a VC it is not a bad investment, as DXventures less so.

  • Status: Clarisse, one of the founders, is interested in figuring out a use case for DAOs, and will be in touch with Sky.

GoodGhosting: A DeFi pool that rewards regular saving. Get ghosted by other savers … and get their interest. Join a shared savings pool by depositing a fixed amount of DAI stablecoin into a smart contract (on Polygon). Add to your savings weekly to stay in the game. By making all your deposits, you earn a slice of the pool’s interest. Players that missed a deposit, still get their initial deposit back but do not earn any interest. So the more people drop out, the greater the returns for the winners.

  • Pros: Reaching the new crypto user market by gamifying savings accounts.

  • Cons: Not clear on direct benefit for DXdao. Requires KYC / AML, since they are targeting the crypto novice and plan to connect to on and off ramping tech. Not sure if this is entirely bad as the current argument for no KYC / AML in DeFi, aside from the clear non-custodial elements for much of the technology, is that on and off ramping tech should do the KYC / AML

  • Status: No open conversations. Should DXdao tie into blockchain games?

Indexed Finance: A decentralized protocol for passive portfolio management on Ethereum, using capitalization-weighted index pools designed to replicate the behavior of index funds. Each index pool has an ERC20 index token which anyone can mint by providing the underlying assets in the pool, burn to claim the underlying assets, or swap with exchanges to easily manage their exposure to specific markets. Twitter.

  • Pros: interesting economics - taking a cut from burning fees when arbitrageurs buy indexed tokens at discount on the secondary market and burn them on indexed finance to redeem the underlying tokens.

  • Cons: Similar basket-like projects out there. The team has to compete against entities like Index Coop.

  • Status: Nathan is in touch and has been discussing a good idea around a “DAO Jones Index”.

Mangrove: Mangrove is an on-chain orderbook where offers are not provisioned. Offers can be arbitrary code and only have to source liquidity when matched. This immediately

gives capital efficiency (no opportunity cost, as capital still earns while the offer is resting on the book), and as a side-effect the code gets a last look opportunity and can (for a fee) renege on its promise if the price isn’t to its liking anymore.

  • Pros: Blackbox for order matching not competing with Cowswap. It’s complimentary. Can be used by all DEXs and could be useful for Swapr.

  • Cons: No clear issues, needs more review.

  • Status: Need technical review of the proposal.

Shutter Network: Solution to prevent any dApp from frontrunning and MEV. Target audience are DEXs and governance mechanism projects, especially on L2. Twitter.

  • Pros: Targets areas of interest to DXdao – DEXs / governance and on xdai, mainnet, and moving to L2s.

  • Cons: Existing competitors in the space, like Chainlink.

  • Status: Need to contact regarding funding and interest. Needs technical review.

TruCol: Automated smart contract test bounties using AI. TruCol aims to improve market efficiency and developer autonomy by decentralisation and automation of test driven development. Employers publish a smart contract with a bounty for verifiable development tasks. Developers complete these tasks and get rewarded when the smart contract is fulfilled. The protocol removes the middleman and costly fees.

  • Pros: A very early stage, pre-seed round project that has a specific expertise in AI technology. Interested in doing a test case with Omen to determine which markets should receive more liquidity rewards for token launch.

  • Cons: Similar to Hats, but has this element of AI that may or may not be useful. Would need a dev with more expertise to assist in reviewing documentation and have a meeting with the founders.

  • Status: Tammy in talks with Akke, one of the founders. Mostly interested in doing a test with Omen, but could be an interesting project to incubate. Very early stage. Needs technical review of pitchdeck and documents.

Not Presenters at ETHVC, But in Conversations

Ceramic Network: decentralized, open-source platform for creating, hosting, and sharing streams of data. Ceramic provides computation, state transformations, and consensus for all types of data structures stored on the decentralized web. Ceramic’s stream processing enables developers to build with dynamic information without trusted database servers to create powerful, secure, trustless, censorship-resistant applications.

Advancements in other Web3 protocols have already achieved success in decentralized file storage (IPFS). As a storage disk, durable persistence networks (such as Filecoin, Arweave, and Sia) ensure that the content represented in IPFS files are persisted and kept available. This stack of Web3 protocols performs well for storing static files, but on its own lacks the computation and state management capacity for more advanced database-like features such as mutability, version control, access control, and programmable logic. These are required to enable developers to build fully-featured decentralized applications. Twitter.

  • Pros: Ceramic is highly talked about and is solving a need in the DAO space. The idea of taking funding from its users and community was interesting to Ceramic. This is an opportunity that DXdao should stay on top of.

  • Cons: Not actively seeking funding.

  • Status: In passive conversations to to find an area of collaboration and / or grant.

Atlantis World: A 2d vintage darkmode metaverse for DAOs, DEXs, and other dApps to cohabitate. It’s a metaverse where cyberpunks can live, access the Ethereum Bank, Developer School, other dApps, and where DAOs can create a home. Currently in development and incubated by Charged Particles and Polygon.

  • Pros: Currently has crypto punks as partners to create their metaverse home. Interesting idea to create a home not only for DXdao to interact through, but to create a metaverse location for our products. Imagine Crypto Punk avatars accessing Omen through this metaverse. Early stage, and still in development. Looking for DAOs to use and build homes.

  • Cons: Only on Polygon, but will eventually expand to other chains. Similar to Meetspace.

  • Status: Tammy is in contact with the project. They are looking for projects to build use cases for, but are only focusing on Polygon at the moment.

Closing

There were many interesting projects and possibilities for collaboration. There were also a couple projects with some focus on DAOs, but they were not the focus of ETHVC. Moving forward, DXventures will need to be more proactive with grants and bounties that incentivize talent to plant seeds and incubate projects.

Looking forward to hearing which projects interest you!

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Today we had an interesting conversation with a promising startup that we ended up inviting to do a presentation for us on our next weekly biz dev call. Here is some information, so you can familiarize yourselves with it in advance.

They are leveraging existing infrastructure and utilizing a social oracle layer with a solution that acts as a bridge between social media and the blockchain, in order to make community management in DeFi more efficient. From bots managing roles within token-gated communities, to incentivizing followers with achievement-based badges for desired activities, it allows organizations to increase their online presence, while rewarding their biggest community supporters. Their social oracle facilitates the execution of decentralized performance-based financial contracts, between social token holders and DAOs. This will enable DAO token holders to earn rewards for fulfilling social media commitments.

They are looking to collaborate with DAOs as strategic allies, in order to advance social token governance with innovative tools for social engagement and governance participation. DXdao has a chance to invest at an early stage and become a member of their DAO, and also participate in their governance. With a total supply of 3.68m and an annual emmission of 40k, their DAO will be taking profit from liquidity provision, so users will be able to stake the token, in order to support other social tokens of choice, and thus they are interested in partnering with multi-chain AMMs like Swapr. Furthermore, their business model also opens the door for a possible strategic collaboration with Aqua as they seek partnership with social token issuer platforms and NFT fractionalisation platforms.

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