ICO Breakdown : MASS

praneeth mendu
Jul 22, 2017 · 4 min read

| Website || Whitepaper |

Despite being a newbie miner I have to admit that I find Pow rather wasteful. I hate the currently profitable currencies (Zcash and its litter) and exchange them asap. I am titillated by my hardware paying for itself, but it is only a matter of time before it stops being feasible.

But proof of stake is no place for broke devs like me. It is very capital and tech intensive. So when i read the ICO’s tagline ‘masternode and skaking service’ I was drooling all over the keyboard.

Basically it will use the collected money to stake currencies using Pos, also taking care of all the operating and security it requires.

The numbers

The actual structure of the fund is more complicated but here is a simplification (Assuming pre-sale and ICO are sold out, and 1 ETH = 250$):

totally 50,000 ETH (12.4 million) will be collected,
12% of that is retained by the company and the rest, 43,673 ETH (10.9 million) is for the pool.

61 million tokens represent the pool and the company’s intellectual property,
7.23 million tokens (12%) are reserved for the company and the rest is what’s being sold.

Bonuses are almost always misleading so here is a better way to look at things :

the ETH in the pool you are entitled to for every 1 ETH spent on tokens

The peculiarities

Token can exist in either of two states: staked (locked), where you are eligible for block rewards (dividends) and unstaked (unlocked), when you can transfer / trade your tokens but your rewards are returned to the pool. This may have been done for technical reasons but it will result in fewer sell orders in exchanges, especially sell walls, and higher demand than supply.

In year one: the company’s share of ETH (about 1.5 million) will pay all the bills : development, equipment, operation costs. The company’s MASS(10%) will be locked but all rewards will be put back into the pool. Henceforth: The MASS is now generating rewards for the company which will be used to pay all the bills. This means that the pool is never shaved off and it only grows. There is two ways to look at this, Optimistically the company is confident of success and it is a much better deal for us than a direct 22% cut, But it also says dont expect returns in the first year.

Risks and Concerns

Their team of highly skilled tier-1 professionals can be summarized as follows :
Clinton McLeay : sysadmin with business experience
Kris Borodiansky : sysadmin involved in blockchain projects
Dennis Klungler : sysadmin
Kurt Knudsen : mostly sysadmin
The teams seems to disregard marketing or any business administration (I am yet to see any paid adds). I really dig that and the team is a snug fit as most of the work is operating and securing nodes. But seeing the pace at which the pre-sale is moving, I strongly believe the current visibility is not enough.

There seems to be no criteria for coins to stake. Currently the team seems qualified to make those decisions. My concern is the voting system in the pipeline, that would let token holders choose coins, that is in the pipeline. This feels transparent and democratic but the average crypto investor is pretty stupid. This seems like the perfect formula to buy into hyped coins and ignore the underdogs with good potential.

Proof of stake is still very young and the structure of the pool being exclusively for staking may not be future proof. For example Dash and NEM both have the most innovative interpretations of staking but they were not on the list of potential coins, and many like them will not be, because they require more computational resources than can not be supported by the company’s share of earnings alone. The pool that only grows looks very good on paper but it also means lot of missed opportunities.

tl;dr

This company has gone to great lengths to appeal to the cautious investor. But consequently it is powerless to take any bold decisions, which is especially sad because the team seems capable. In the crypto world, where flash prevails over substance, this may not get too much attention till we start seeing those returns.

P.S. This is my first article and my main aim of doing this is to interact with other investors, so don’t be shy to start a conversation. All suggestions are welcome. I am not sure about writing on medium, this may be temporary, but twitter will always be active @meta_token.

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