Joining Pantera

I am happy to announce that I will be joining Pantera Capital as a partner this month to co-manage their Pantera ICO Fund. This will be in addition to guiding Augur towards a successful release.

During Augur’s development, I have tried to stay deeply involved with the Ethereum and blockchain ecosystems. I am proud to say that I am an advisor to (and angel investor in) many projects in the space, many of which I shared and discussed with Paul Veradittakit, a partner at Pantera. One day, Paul and Dan Morehead invited me to a meeting with the Pantera team and explained the new hedge fund they were setting up, and asked if I was interested in working on it with them. I have always limited my involvement with other blockchain projects to advisory roles, but as I thought about it, I realized that this fund — if set up by people with an intimate knowledge of the space — could provide tremendous value to the blockchain space, and to Augur.

The #1 reason for startup failure is due to lack of product-market fit, which Augur will never achieve if it is not liquid. By partnering with Pantera, I can help make a big dent in this problem. For Augur to succeed, it needs fair prices and solid spreads. Dan Morehead at Pantera was previously CFO at Tiger Management and has managed billions of dollars in assets, so if anyone knows trading in the blockchain industry, it is him.

Once Augur is out, we can even trade on it, which will increase liquidity and be good for everyone. There are no set allocations for anything in the fund, it is all about capacity and what we can spend the money on that is the best investment/most profitable.

If a million people show up day one of Augur’s full release, then there is probably no need (or edge) for us to trade. But if it does not happen, we will trade as long as we have an edge. This is not altruism: we are not planning to lose money to attract users to Augur! However, since we have an edge even in markets like bitcoin, we will almost certainly have an edge on Augur markets for quite a while.

I imagine the edge in Augur as a trader will be significantly higher for quite a long time. And it will likely always persist for new markets — until the entire platform is as efficient as the markets for bitcoin anyway, which will be a good while.

While all hedge funds and traders should, in theory, want to market make on Augur, no one will know the platform as well as I do. Even funds that do know about it might not be able to trade on Augur either because they do not understand the space or cannot invest in tokens to begin with per their LP agreements. Augur shares are, of course, tokens themselves.

The steps remaining before Augur is ready to enter the launch process to enable all this are:

— The rest of the audits
— Fixing issues arising from the audits
— Fixing any final little quirks that come up before launch

There will be no additional features or significant architectural changes in store once the latest reporting simplifications are merged. I will still be here and involved in architectural decisions and to give my input on feature decisions, vision, and overall strategy. I will also be writing some contracts that help Augur later on (for some of the future steps in the master plan, like automatic rollovers). As Augur’s launch has drawn closer, I have been gradually stepping back from handling the day-to-day implementation of our smart contracts, and shifting to a more big-picture architectural role. We have been building out the smart contract engineering team — all of whom have more experience shipping code than I do! — and I am confident that our smart contracts are in good hands.

My original plan was to join AugmentPartners at this point in Augur’s life, which is building a bunch of things on top of Augur to help it succeed. However, it already has an extremely strong team in place, with Ron Bernstein (formerly Intrade CEO) as CEO and Kevin Day (formerly Factset) leading the tech team. I think by partnering with Pantera, I can add value to help Augur succeed in a different manner by helping to bolster the whole ecosystem. If you read the master plan you will notice it relies upon other significant developments in the ecosystem.

Vitalik is both the co-founder of Ethereum as well as a partner at Fenbushi Capital, and both ventures are not only successful in their own right but benefit from each other. Similarly, I believe that Augur will benefit from a hedge fund trading on it and helping to bolster the ecosystem overall. It may be true that great software takes ten years, but hopefully, we can speed it up by funding (and helping accurately price) other infrastructure that will accelerate Augur’s master plan!