Lunyr: Decentralized Wikipedia on the blockchain
The Lunyr project aims to build a decentralized crowdsourced encyclopedia, on which users are rewarded for peer-reviewing and contributing information. This encyclopedia aims to be a major point for finding reliable, accurate information. In short, a decentralized Wikipedia. The long-term vision is to develop a knowledge base API that artificial intelligence, virtual reality, augmented reality and other software can use to create content and applications.
In the following, I will describe the Lunyr project and their ICO plan before stating my personal view on the project.
The basic business model of Lunyr is to leverage a decentralized Wikipedia by building an incentive-based knowledge application on top of the Ethereum blockchain. The underlying idea of the project ist to implement an advertising system. Advertising on the platform is sold using Lunyr tokens (LUN). Based on market insights from Alexa, an Amazon company that provides web traffic data and analytics, Wikipedia is the sixth most visited website in the world. Therefore, Lunyr sees the potential revenue from advertising on its platform at a very high level.
Lunyr aims to build “the next, better, and decentralized Wikipedia”, which represents a system that shall be highly accurate and fast-growing. Once the platform matures as a knowledge base, real-time contribution of multi-language data shall be made available. Via the use of a custom API, developers will be enabled to use the knowledge base for the creation of innovative applications such as AI, VR or AR.
In order to prevent centralization, censorship and inaccuracy, as it is happening on established, centralized platforms, three main steps are leveraged by the Lunyr project.
- Being build on Ethereum, the platform is decentralized and censorship-resistant.
- With help of an Ethereum-based token, an economic incentive is proposed to contributors. They are rewarded for their work and are therefore incentivized to further increase the value of the ecosystem.
- Submitted content is peer-reviewed. Therefore, content is only added to the network after being successfully reviewed. Reviewers are incentivized by token rewards.
PLATFORM & TOKEN DESIGN
The Lunyr platform is designed to align the rational behavior of network participants to benefit the whole system. Contributors add or edit information in the knowledge base in order to be eligible for rewards. Based on Ethereum, contributions cost Gas, therefore making spam and junk costly. Submissions are peer reviewed before being added to the network. Additionally, contributors have to review content submitted by other contributors. Lunyr aims to implement machine learning mechanisms to identify fitting and familiar topics for contributors. By using contributors as reviewers, their intentions to support the overall system can be ensured.
Three types of tokens are used in the Lunyr network:
- Lunyr tokens (LUN): Token that is used to buy advertising on the network. Contributors are awarded LUN in spans of two weeks.
- Contribution tokens (CBN): Used as a calculation basis to identify the amount of LUN a network participant will receive. CBN is consumed after LUN tokens are distributed (every two weeks).
- Honor tokens (HNR): Used for proposing and voting on the native dispute resolution system. Consumed after usage.
The roadmap consists of various steps. The degree of implementation will be in relation to the amount of ICO funds. In case of a minimal amount of crowdfunding (50k ETH) Lunyr will build basic functions, while in case of a maximal cap, additional features will be developed. For an overview, see page 14 in the Lunyr whitepaper.
In Q4 2017 the Beta release of the testnet is planed, followed by the beta release of the mainnet in Q1 2018. Over the course of the year 2018, Lunyr aims to finish its platform to have a full working product by the year 2019.
In the Lunyr whitepaper, the respective team is listed and after some research online, I see no reason to doubt the intentions of the team. Arnold Pham, as cofounder of the project, has a long-standing experience in the crypto ecosystem. Various other team members are also well experienced in crypto-projects.
The Lunyr token crowdsale is scheduled for March 29, 2017 at 16:00 UTC (based on an Ethereum block number). It will be performed for a maximal period of four weeks. If the minimum number of 25k ETH will not be raised, all ETH is returned to contributors.
In the crowdsale, 78% of LUN tokens will be distributed to ICO participants. The Lunyr team and its advisors will receive a total of 15% of the tokens (vetted for half a year), while 2% will be reserved for a bug bounty. 5% will be distributed for marketing and promotion.
- Minimum crowdsale target: 25,000 ETH
- Maximum crowdsale target (cap): 250,000 ETH
- LUN purchased per Ether: 44 LUN per ETH
In the whitepaper, a fund usage breakdown is listed (50.1% R&D, 13.7% sales and marketing and so on). Yet, I don’t see this graphic as a relevant chart, as the amount of investment may differ by a lot and this will likely result in different scenarios.
SHOULD I INVEST IN THE ICO?
From an investors perspective, I have to come up on what I believe the future revenue of a project will be. If I don’t believe in the feasibility of the proposed business model, it is fully irrelevant if I love a projects idea and concept. Having said that, I somehow struggle to believe in the (short term) monetization of the project. In order to gain relevant revenues from the platform, a huge network effect would have to occur. Likely, a website like Wikipedia will not cooperate with Lunyr, as their policy is strictly against advertising on their platform and Lunyr is a competitor. Users have built some sort of reputation on Wikipedia, which they are looking to keep and maintain. I doubt that the benefits of Lunyr are high enough to trigger a needed network effect. Therefore, from my current position, I will likely not participate in the ICO.
In the long run, this project could definitely become successful. I like the idea and believe that their product is needed and wanted, but I don’t believe it will attract relevant advertising revenues in a nearby future. For me, it might be an interesting option to monitor the development of the project and (once they hit the exchanges) possibly buy some tokens (below the ICO price) at some time in the future. As the general idea of Lunyr is promising, I believe that they will be able to receive enough funding to follow up on their project.
I could also see myself as a future contributor to the platform. But for this, I will most likely monitor the project for a while before starting any contribution.
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