Pink Panther
Jul 24, 2017 · 14 min read

Fundamental Analysis of AdEx (ADX)

By Bronson Tang for Pink Panther

July 24, 2017

AdEx Facts:

Look at who is the team

YES

http://bit.ly/2vAQkjQ

Have full time developers?

YES

http://bit.ly/2vAQkjQ

What is their business idea

Decentralized ad exchange built on Ethereum focused on video entertainment providers

What is so unique about it?

Decentralized ad exchange built on Ethereum focused on video entertainment providers

Who is their competition?

Decent, BAT, Sphre, Shift, Novusphere.io, BitTorrent, LBC, SingularDTV, Alexandria, YouTube

Do they have a working prototype?

NO

http://bit.ly/2gMobUi

What’s their roadmap

N/A

http://bit.ly/2gMobUi

Do they have strategic partnerships?

YES (WINGS, BITMAIN, STREMIO, FINTECH Blockchain Group)

https://www.adex.network/

Are they well budgeted? Did they raise enough money to survive?

YES

https://tokens.adex.network/

Innovation or Imitation?

Imitation

https://www.adex.network

Business Model? (Speculative and or Residual)

BOTH/HYBRID

http://bit.ly/2tnz6c4

What is it? Protocol/Application/Silly Coin?

Application

http://bit.ly/2tnz6c4

Contact us on website, where are they located?

NO

https://www.adex.network/

MARKET DETAILS

Main Category (Large/Mid/Small Cap)

Small Cap

http://bit.ly/2gMp7Z0

Sub-Category

What is the price currently? Room for growth or at peak?

$0.147071
0.00005344 BTC
0.00065147 ETH

http://bit.ly/2gMp7Z0

What is their market cap?

$5,882,840
2,137 BTC
26,059 ETH

http://bit.ly/2gMp7Z0

What is their coin supply?

100,000,000 ADX

http://bit.ly/2gMp7Z0

What is the circulating supply?

40,000,000 ADX

http://bit.ly/2gMp7Z0

What is the 24-hour volume?

$1,527,740
555.09 BTC
6,767 ETH

http://bit.ly/2gMp7Z0

Are they going to lock their coins in escrow?

TECHNICAL DETAILS

Do they have a GitHub where the software is checked in

YES

http://bit.ly/2tJO6gE

How often do they check their software

15 days

http://bit.ly/2tJO6gE

What is their algorithm? POW, POS, POI, or D-POS?

PoW

http://bit.ly/2tnz6c4

Go to GitHub and see charts and check in dates and how active?

YES

http://bit.ly/2tJO6gE

See developer ratings.

N/A

SOCIAL MEDIA FACTS

Do the developers/team do any YouTube video interviews?

N/A

Is their website good? Blogs updates, Twitter Updates, YouTube channel?

YES

See #22–24

How many telegram/forum users?

759

https://t.me/AdExNetwork

How many Twitter users?

3,587

http://bit.ly/2ucuQf4

How many Facebook viewers?

1,429

http://bit.ly/2tJ8MVS

How many YouTube subscribers/viewers?

N/A

Overview:

Question:

What is AdEx Network?

Answer:

AdEx is a decentralized ad exchange built on Ethereum focused on video entertainment providers

In this Analysis, I will address the following:

1. What is AdEx in depth?

2. Advantages

3. Disadvantages

4. Road Map

5. Team

6. Challenges

7. Trend Analysis

8. Conclusion

WHAT IS ADEX?

AdEx looks at tackling the advertising and publisher network space with their offering.

AdEx is an advertising networking in all the traditional senses with the exception that they are incorporating blockchain technology.

To better understand what exactly is an “advertising network” we can reference this definition,”

An online advertising network or ad network is a company that connects advertisers to web sites that want to host advertisements. The key function of an ad network is aggregation of ad space supply from publishers and matching it with advertiser demand. The phrase “ad network” by itself is media-neutral in the sense that there can be a “Television Ad Network” or a “Print Ad Network”, but is increasingly used to mean “online ad network” as the effect of aggregation of publisher ad space and sale to advertisers is most commonly seen in the online space. The fundamental difference between traditional media ad networks and online ad networks is that online ad networks use a central ad server to deliver advertisements to consumers, which enables targeting, tracking and reporting of impressions in ways not possible with analog media alternatives.1

Users of AdEx would not directly interface with AdEx themselves but in turn interact with the AdEx platform via third party relationships such as the one they have with Stremio (http://www.strem.io/). Stremio is a video content aggregator whereby you can stream all your various video content providers in on place. Georgiev and a couple other team members from AdEx are also a part of Stremio.

The above diagram and process flow are from the AdEx whitepaper.2

This is an example walk-through of the entire process of a user seeing an ad, and the

publisher receiving the ADX reward for it:

1. The publisher registers themselves, their website and the ad property in the publisher

portal.

2. The advertiser registers themselves and the advertising campaign in the advertiser portal.

3. The advertiser places their bid for 1 executed conversion goal (for the sake of simplicity,

only 1; in the actual platform, this value will be set to 10–1000 conversion goals).

4. The publisher accepts the bid.

5. The user goes to the website and triggers the SDK.

6. The SDK initializes, pulls data from the AdEx Core smart contracts, the publisher and the

advertiser; it then finds out that the publisher accepted one bid, and the 1 conversion goal is

not yet realized; it pulls data from IPFS to display the ad, and broadcasts it, meanwhile

logging a “Load” and “Impression” to the hyperlog database.

7. The user clicks on the ad (logging “Click” on the hyperlog) and signs up for the advertised

product, therefore triggering a confirmation from the advertiser side that the conversion goal

is met.

8. Since the bid should now be executed, the publisher calls the AdEx Core to confirm with

the aggregated data of executing the bid; the advertiser confirms this and the AdEx Core

(ADXExchange in particular) unlocks the ADX reward and transfers it to the publisher.

Understanding advertising networks, I wanted to know what makes AdEx different from Basic Attention Token or Sphre?

It seems the main difference in lament terms is the process that each business goes about interacting with the main parties: Advertiser, Publisher, and User.

BAT and Sphre have created their own environment, BAT in the form of a browser and Sphre in the form of a decentralized marketplace. AdEx is going the route of a sort of license/reseller model whereby third parties use the AdEx platform and then serve up content and recruit advertisers to join their “marketplace”. These third parties or “publishers” have the unenviable duty of both growing their advertising network and their user base. Both challenges tasks in and of themselves.

According to Ivo Georgiev, co-found of AdEx,

Most importantly AdEx is cross platform and cross device without requiring anything to be installed on the user side while services like, BAT requires their code to run on the user side as well which implies either that it runs only in the brave browser or that other browsers have to implement it as well.

AdEx is made to plug into the existing industry, while BAT is a total re-imagining of it, so AdEx is built to be adopted as easily as possible with BAT it’s required that there will be a wallet on the browser side this means either using the BRave browser or Google/Mozilla agreeing to integrate BAT in their browsers which is very unrealistic. We think that the important difference though, is that we have a team which is already working full speed and will deliver first.”

What’s the goal of AdEx? And how AdEx will use blockchain technology as an advantage against existing technologies?

Ivo Georgiev, stated,

The important thing is the transparency and the way a consensus is made it significantly reduces the ability to cheat the system. Also, AdEx is very modular and open, so it’s essentially like a do-it-yourself ad network, but since the core will be common, you will be able to plug into an existing network of publishers and advertisers while still being able to tweak your repotting, ad selection and others depending on your needs

It appears that your stated goals appear to be like the goals of your blockchain competitors, because blockchain means transparency and lack ability to cheat is relatively common amongst them all. So, what is the main difference execution? Are there any other significant differences that you want to spotlight?

Ivo Georgiev,

Modularity, cross-device and ease of adoption, but most importantly existing partnership with Stremio, a big publisher, I wanted to cover the advertising sector and achieve it via AdEx, I might be wrong and it might be that AdEx isn’t the winner.

ADVANTAGES

1) The AdEx Profile, every user, to whom AdEx serves ads, will have their own profile

where they can be as precise as they want to outline their interests and preferences.

This profile will ensure that consumers only see ads that are relevant to them.

2) Blockchain ensures anonymous use of big data

3) A decentralized exchange that can be audited

4) Unified real-time reporting

5) The AdEx anti-fraud mechanisms, AdEx will equip advertisers with technical mechanisms

to trace and prevent fraud and invalid ad traffic.

6) Clever, meaningful ads that people want to see

7) User-powered governance

DISADVANTAGES

1) Technically not first to market

2) Execution in achieving mass user adoption

3) Execution in achieving mass advertising adoption, however if #2 is successfully achieved

then mass advertising adoption can perhaps be easier.

4) A centralized decentralized environment. Although the basis of AdEx is blockchain

technology they are creating silos, environments where users will go to consume

content and advertisers will go to serve up ads in a centralized environment such as

Stremio.

ROAD MAP

The AdEx team has published a page detailing their road map for 2017 which can be found at the following link: http://bit.ly/2gMobUi

Stage 1: Research [Completed]

June 2016 — June 2017

During this stage, we researched the feasibility of the vision to create a decentralized and transparent ad network. We worked closely with the WINGS Foundation and other advisors in the fields of blockchain, ad tech and crypto to arrive at the current concept and assemble a suitable team.

Once the team was put in place, we began working on AdEx.

Stage 2: Token Crowdsale [Completed]

June 2017 — July 2017

This stage marks the deployment of the first AdEx smart contract and the announcement of ADX token. The ADX token will launch with the help of WINGS.

There will be a crowdsale, in which 80% of the ADX token will be offered to the general public, and the rest will be distributed to the team, advisors, bounty program and WINGS DAO.

The crowdsale is necessary to fund the development of the prototype and the business development required to drive initial adoption.

Stage 3: Prototype

July 2017 — February 2018

The first AdEx prototype will be delivered as early as February 2018, and it will include a basic ad bidding system with a front-end for advertisers and a front-end for publishers, as well as an SDK for publishers.

This prototype will focus on native and display advertising.

It will be completely open-source and independently audited.

Stage 4: Adoption and Improvement

February 2018 — January 2019

This stage will include business development and marketing of the AdEx platform. The software development will be driven by the market needs and feedback as we strive the adoption of the AdEx system.

During this stage, we will implement massive improvements to the user targeting and reporting.

We also plan to enhance the user experience — most importantly, we will work towards making the integration of the publisher SDK as easy as possible.

Additionally, we will bring other forms of advertising during this stage, such as video advertising.

Stage 5 : — AdEx v.2+

Starting January 2019

AdEx V2 will be a technological re-vamp to focus on scalability, as AdEx is adopted by more and more publishers and advertisers.

This stage involves bringing AdEx to other blockchains, for example RSK and aeternity.

TEAM

Ivo Georgiev, CO-FOUNDER

Ivo has extensive experience as a software engineer with a particular interest in the video-on-demand industry. Since 2012, he has been heading Stremio, a video entertainment startup. Well-versed in cryptography and crypto currencies.

Dimo Stoyanov, CO-FOUNDER

Dimo comes from a background in UX and UI design, and front-end development. Together with Ivo Georgiev, he runs the VoD entertainment hub Stremio. Dimo is experienced in project management, product design, and brand strategy.

Vanina Ivanova, MARKETING & AD TECH

Vanina has more than 12 years of experience in advertising, and online marketing, as well as in ad tech. She has ran and managed huge digital marketing projects in the fintech industry, and has been a part of the team of a major cloud storage provider.

Shteryana Shopova, SECURITY EXPERT

Shteryana is a well-seasoned software engineer and software architect. Throughout her career, she gained noteworthy experience in cybersecurity. For the past 10 years, Shteryana has been contributing to the FreeBSD project as a committer.

Alexandru Branza, DEVELOPER

Alexandru is a software / web developer with more than 8 years of experience specializing in: video players, p2p, blockchains and web services. A strong believer and contributor to open source communities and part of the Stremio Team.

Ivo Paunov, DEVELOPER

Ivo is a software developer with experience in the following fields: mobile and web development, and JavaScript. He is part of the Stremio team and helps develop the company’s video entertainment hub.

Allesya Ivanova, GRAPHIC DESIGNER

Allesya is a creative graphic designer who has been contributing to the Stremio project where she is responsible for UI and UX. She holds educational degrees in graphic and product design and has more than 10 years of experience behind her back.

Jihan Wu, STRATEGY ADVISOR

Jihan is one of the founders of BITMAIN Technologies, one of the most recognized and valuable bitcoin mining hardware provider. Wu is a supporter of Bitcoin Unlimited, a solution to solve bitcoin’s scalability issue.

Stas Oskin, TECH ADVISOR

Stas has over 10 years of experience in engineering, development and management of software, cloud, healthcare, cryptocurrency, social products and services. He is an entrepreneur, crypto-enthusiast and a life hacker.

Sebastian Stupurac, STRATEGY ADVISOR

Sebastian is an entrepreneur, visionary and a husband. He’s a big believer in crypto and blockchain technology, in which he has been involved since 2013. Sebastian has vast experience in information systems and product management.

Lior Zysman, LEGAL ADVISOR

Lior is a corporate lawyer advising startups and investors on crowdfunding and cryptocurrencies, and working on decentralized autonomous non-profit organizations (Runner-up at Consensus 2016 Hackathon with a Charity DAO).

Guy Corem, STRATEGY ADVISOR

Guy has a versatile professional experience — he has worked for major companies like Intel, Boxee and Voltaire. Along with that, he has background in funding startups, cybersecurity and cryptocurrencies/bitcoin.

Dominik Zynis, MARKETING ADVISOR

Dominik has been involved in the cryptocurrency scene since 2012. His background includes top sales rep for Oracle Corp., cofounder of State Software known for discovering JSON, and Head of Comm’s & Bizdev at Mastercoin (Omni) Foundation. He leads PR and comm’s at WINGS Foundation.

Nikola Stojanow, BIZDEV ADVISOR

Nikola is a Business Development executive with experience in Germany, Eastern Europe, MENA and Asia Pacific. During the past 10 years, he has developed and consulted a number of international projects, including the Aeternity blockchain platform.

Vladislav Dramaliev, COMMUNITY ADVISOR

Vladislav is a digital marketing analyst & Bitcoin entrepreneur. He is the founder of BitHope.org, CryptoCrowd.org and the Bitcoin/Blockchain meetup in Sofia, Bulgaria. Vladislav is also co-founder of the Bulgarian Bitcoin Association.

Vincent Zhou, Strategy Advisor — China

Vincent is the general manager and founding partner of Fintech Blockchain Group. He has a successful career in high tech and blockchain companies, and is considered to be one of the most influential blockchain venture capitalists in China.

CHALLENGES

There are two major challenges one immediate and another medium/long term:

1. Mass user adoption

2. Mass advertiser adoption

Mass User Adoption

It is unclear how AdEx plans on attracting both end users and advertisers. These two elements are critical to their success. I have reached out to the co-founder Ivo and I have yet to hear back.

As Stremio is relatively unknown and AdEx is a new platform, my only suspicion is that they will attempt to strategically align themselves with more successful and well-known entities to garner more exposure. This, of course, is pure speculation and I have no supporting information to back up this claim. So, for now, it is unknown what AdEx’s marketing strategy is. Gaining more users will be an important part but equally important is the advertisers.

Mass Advertiser Adoption

Again, without being redundant, it is unclear as to their strategy, however it appears that they are relying heavily on their relationship/partnership with Stremio and Wings as well.3

1. General Stats

a. Created: 2016–2017

b. Sofia, Bulgaria

i. Sofia, Bulgaria

c. Mission:

i. Decentralized, open-source content creation & publishing protocol/marketplace

ii. Coins Supply

1. 100,000,000 ADX

iii. Circulating Supply

iv. 40,000,000 ADX

d. Market share price as of July 24, 2017

i. $0.147071

0.00005344 BTC

0.00065147 ETH

ii. Market cap as of July 24, 2017

1. $5,882,840

2,137 BTC

26,059 ETH

2. Ranked 202

2. Who is the customer base?

a. Content publishers, advertisers, technology enthusiasts, internet consumers

3. Strategy to Gain Adoption

i. Go to market strategy is, in short, to start with Stremio was the first publisher (already has a few million users).Then get adopted by most blockchain related medias and startups which will be easier because the industry is very interconnected.

Token Distribution

  • 80% are allocated for purchase by the public over time
  • 10% will go to the AdEx Team and will be locked for 12 months
  • 6% will go to the AdEx advisors and will be locked for 12 months
  • 2% will go to WINGS DAO — discovery, valuation, social promotion
  • 2% will be set aside for a bounty program
  • NOTE: Because of the 40,000 ETH hard cap, not all of the 80% tokens are going to be sold in this contribution campaign. The rest will be kept in an AdEx fund address, vested for 24 months with a 6 months cliff, and used within the AdEx dapps themselves to provide easy means of purchasing ADX for easy onboarding of new advertisers.

TREND ANALYSIS

This statistic provides data on the global advertising revenue of social networks in 2014 as well as a forecast thereof until 2017. The source estimated that in 2017, the revenue would amount to 41 billion U.S. dollars, up from 17.85 billion in 2014. A different source estimated that mobile social ad spend would amount to 23.39 billion U.S. dollars worldwide in 2017, where desktop social to 8.63 billion. According to a 2016 estimate, Facebook and Twitter together hold nearly three quarter of the social media ad market.

Social network advertising revenue from 2014 to 2017 (in billion U.S. dollars)

The graph presents the social media advertising spending in the United States in 2011 and 2012 and a forecast until 2018. BIA/Kelsey projected that 10 billion dollars would be spent on social media advertising in 2015.

Social media advertising spending in the United States from 2011 to 2018 (in billion U.S. dollars)

CONCLUSION

In conclusion, the AdEx, is positioning themselves to tackle the unenviable sector of advertising and publishing while attempting to be relevant to the users with the multitude of options out there from LBC, Decent, Shift, BAT, and Sphre just to name a few.

This sector is extremely competitive and unforgiving.

AdEx will need to position themselves to the thought and visionary leader in a field already saturated with highly talented and gifted teams.

It is unclear as to how they plan on gaining mass user/advertising adoption which are the two crucial pieces to the winning formula.

On the flipside, they have a decent (no pun intended) team but their connection to Stremio and the hopes that the video aggregating platform will succeed are just that, hopes.

Other than researching this project, I had not heard of Stremio, however my opinion is not the opinion, and it is quite possible that Stremio has an okay rating on Alexa at 49,749 http://www.alexa.com/siteinfo/strem.io

With a large following from Brazil:

Time will tell as to how well the team at AdEx can execute on their unknown marketing strategy to gain mass adoption.

1 https://en.wikipedia.org/wiki/Advertising_network

2 https://www.adex.network/adex/AdEx-Whitepaper-v1.4.pdf

3 http://bit.ly/2httGT8

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