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GAINS Associates

OpenDAO — Telegram QUIZ & AMA — October 27

On Tuesday, October 27, we had the pleasure to welcome to our Telegram chat:

Sean Qian, Operations Lead,
Moresh Kokane, Lead Architect, and
Logan Fulcher, Community Lead of OpenDAO.

We asked them questions about the development of OpenDAO.

Some sentences have been slightly edited for readability but the meaning has been conserved.

Summary

OpenDAO’s goal is to be the bridge between real-world assets and the DeFi/Crypto space at large. There is no real limitation to what can be used as a real-world asset as collateral.

Users can participate in governance simply by holding OPEN tokens.

OpenDAO’s oUSD will use a different code for maintaining its peg (same as Synthetix,) but it will be backed by real-world assets.

The Cashbox has the potential to build an exchange that addresses slippage and impermanent loss.

Introduction

Q — Alex Raffin from GAINS: What did you do before crypto, how did you get into crypto and did you have any other venture in crypto previous to being involved with OpenDAO?

A — Sean Qian from OpenDAO: Before crypto, I spent quite a bit of time working with tech startups. I ran a tech co-working space and accelerator programs where we helped the startups access funding, build MVPs, and scale.

I first got into crypto a few years ago when I finally bought my first bitcoin, after missing out at $14 and watching it shoot up after that. A few years ago, I teamed up with Moresh to add blockchain elements to his crowdfunding business, which is when we started to work in the STO space.

We had quite a few successful startups actually, and some got into other international accelerator programs such as Y Combinator and TechStars.

A — Moresh Kokane from OpenDAO: This is Moresh, and my role at OPEN DAO is as the Lead Architect. I come from a technology and finance background. I am a Computer Engineer by training but have worked in finance for 16 years (primarily in the US and Australia).

I ran a real estate equity crowdfunding platform which along with Sean morphed into an STO play and eventually led us to where we are now with OPEN DAO. I have been less of a trader and more of an academic and my first memory of Ethereum was way back when the Economist magazine published it on its cover.

It took a lot of time to understand BTC whitepaper, but Ethereum blew my mind once I figured out what it meant.

A — Logan Fulcher from OpenDAO: I’m Logan. I’m the Community Lead at OpenDAO and joined the team fairly recently. Before this, I was just very active in the crypto community and have been actively investing since 2014, but it took me a while to ‘wade in.’ I think crypto is an ongoing learning process for all of us!

During that time, I was a serial entrepreneur and also helped a few startups in Japan get off the ground, which was a great experience for what I’m doing now. I’m quite happy to have combined my ‘hobby/passion’ into my career now with crypto.

Product

Q — Alex Raffin from GAINS: What is OpenDAO in a few simple sentences?

A — Logan Fulcher from OpenDAO: OpenDAO’s goal is to be the bridge between real-world assets and the DeFi/Crypto space at large. We have a novel and seamless way of doing this, and we hope that we can level the playing field so that people anywhere, regardless of their nationality or socioeconomic status can have access to this space.

Q — Alex Raffin from GAINS: What exactly can we do thanks to OpenDAO? Could you give us some concrete examples?

A — Sean Qian from OpenDAO: To address the challenges of bridging real-world assets to DeFi, we have developed 3 protocols, which when used together, will allow real-world assets to be utilized by DeFi in a meaningful manner. These are:

  • Cash Box + Open Stake — How we provide on-chain liquidity against off-chain assets and handle off-chain enforcement.
  • OPEN USD (oUSD) — How real-world assets can serve as collateral to mint a stablecoin.
  • Open Market (OPM) — How users can lend against real-world assets for a stable and high return, and conversely, how borrowers can utilize their real-world assets as collateral.

Ultimately, these systems work together to allow real-world borrowers to utilize their assets as collateral and DeFi lenders to access a new class of assets to lend against, as well as have the solutions around off-chain enforcement.

Q — Alex Raffin from GAINS: Is there any limitation to what can be used as real-world asset collateral?

A — Moresh Kokane from OpenDAO: There is no real limitation to what can be used as the real-world asset as collateral.

Q — Alex Raffin from GAINS: How do you ensure the transition between on-chain and off-chain? Is there some kind of certificate? How do you handle the legal side of things?

A — Moresh Kokane from OpenDAO: The mechanisms differ based on which specific asset is being dealt with. However, what we have done at OpenDAO is to split up the process in 2 parts; the on-chain side and the off-chain side.

For something to be used as collateral on-chain, it has to be represented in the form of tokens. Those tokens need to have a relationship with the actual real-world asset (either a legal or otherwise). For instance, there are physical real-world assets such as property (real estate, cars etc.) and non-physical (such as credentials, degrees, diplomas etc).

the non-physical ones are easier to port on-chain. The physical ones will usually have some sort of an SPV structure. An example is realt.co which sells property fractions for houses in the US. They handle the compliance and tech to represent the actual asset in the form of tokens. Once these assets are represented on-chain, we come into play. At that point, we say that these tokens can be used as collateral on our money market.

For instance, on Compound, you can use WBTC as collateral. With us, you can use a tokenized real estate as collateral. We have developed a solution we call the cashbox which acts as the mechanism by which liquidity is established on-chain for the real world assets so that any default liquidations can be handled seamlessly on-chain itself. In the event, there was an SPV and a legal structure off-chain that will always be done via a 3rd party partner like realt.co or centrifuge. We are a bit like a margin lending facility for tokenized real-world assets. A long explanation but it needs a bit of detail to understand what makes us different. This is a hard challenge, DeFi is about trusting the code and not the people behind the code.

We come from a securities compliance background, we have several financial services licenses and have run an equity crowdfunding platform so we understand the boundaries quite well. We have a lot of details on Medium.

Q — Twitter user @JayRayCrypt: How does OpenDAO participate in the new yield farming trend? How do you see the future of Yield Agriculture for OpenDAO?

A — Sean Qian from OpenDAO: We see yield farming as a tool, and like any tool, it should be guided to the right applications at the right time. The last thing we want is to be a flash in the pan with high-interest rates from yield farming, but no underlying value. In saying that, we do fully intend to utilize yield farming as a tool to reward those who perform the necessary actions on our protocols.

For instance, you can already earn OPEN now by participating in CashBox Staking where you’re effectively an LP to real-world assets. We will also turn on OPEN rewards for lenders/borrowers on the OPM as well.

Q — Twitter user @molestika: The token holders will eventually decide which assets can be used as collateral, but are the options only stable tokens or also other cryptocurrencies?

A — Moresh Kokane from OpenDAO: Actually, collateral is going to be primarily off-chain assets and not on-chain ones like stables and another crypto. We do have a plan to incorporate a basket which includes some on-chain assets like BTC (via the REN bridge) and also have UNISWAP LP tokens.

In the long run, the vote will be on which real-world asset to allow or rather which dealer to allow. For instance, if realt.co is allowed, they can keep sending their tokenized properties as collateral. If the centrifuge is allowed then they can present invoices.

A — Sean Qian from OpenDAO: We have access to far more tokenized assets which we haven’t yet onboarded to OpenDAO.

Q — Alex Raffin from GAINS: What’s the total value of off-chain assets “locked” in the platform for now?

A — Moresh Kokane from OpenDAO: $4.6M. We have a Melbourne based property that we have tokenized. We have a REIT structure set up to support up to $100M in assets.

Q — Alex Raffin from GAINS: Does that mean you can actually “put to work” your physical assets that are currently dormant and get some small percentage each year for that?

A — Moresh Kokane from OpenDAO: In essence, assets are simply different forms of value. Some assets are more liquid (like cash, stocks etc) while others are lumpy and illiquid like real estate etc. What we are essentially doing is making it possible for the lumpy assets to be made more liquid. Once that is done, they can be put to better use effectively which can mean more income generation for dormant assets.

Q — Alex Raffin from GAINS: What’s the barrier of entry? Are there any downsides to doing this with your house or your car?

A — Moresh Kokane from OpenDAO: To be completely honest, you can already do this by going to the bank and borrowing it. OpenDAO is a protocol that makes a global DeFi bank that lends to real-world assets possible, a better bank.

The risk is of course that you do not pay your loan and lose your asset. To be transparent, the only way to onboard tokenized assets on OPEN is via a partner like realt.co or centrifuge who will handle the off-chain legal.

Eventually, you will be able to present your house or car and access funds via OpenDAO but that is some time away.

Q — Twitter user @cryptoenr1que: What economic strategy is behind your plan to set a minimum price for OPEN tokens and allow people to bet on them at that price? What do you hope this strategy will allow you to do?

A — Moresh Kokane from OpenDAO: What we are doing is not fundamentally different from what any other platform does at launch. You would normally put up some ETH and some tokens on Uniswap or Balancer. What you put in initially is kind of your starting point. The ETH you put in is your price support. If the project is good, the price goes up. If it is bad, the price goes down, the liquidity you put in will run out and won’t be able to support the price long run. You have to stump up the initial ETH out of your pocket. What the cashbox solution does is it incentivizes others to provide the initial liquidity. If you deposit DAI or other stables in the Cashbox and stake them, you are acting as a decentralized price support provider. That way, the team saves on the upfront money needed to provide price support and can use the money to do product development rather than price support. It also rewards true believers of the project. Find out more here.

There is always a first. The tokens will exist on Uniswap as well of course but we will not try to influence the price there. However, if the price on Uniswap falls below the support price on Cashbox, there is a simple arbitrage opportunity to profit by buying on uniswap and selling on Cashbox. The price will equalize as long as there is liquidity in the boxes, we get to save money, believers get to benefit for their faith, both win. Perhaps, we set a new precedent for space decentralized price support for launches, everyone should use this model. We have the tech for it and people are welcome to use it. All open-source, 100%. It is a superior approach.

Q — Telegram user Dr Araceley: Are flashloans available on OpenDAO? What are the requirements for one to participate in farming?

A — Logan Fulcher from OpenDAO: We aren’t doing flashloans, and it’s not on the road map, but when the community takes over, the sky could be the limit!

To participate in the farming, all you need is some DAI! Just head over to stake.OpenDAO.io.

Q — Telegram user TOM TOM: Can I buy and sell in Token OpenDAO without KYC? What Is the future goal of creating Token OpenDAO?

A — Logan Fulcher from OpenDAO: No KYC necessary!

The goal for the future is passing control over OpenDAO 100% to the OPEN token holders!

Q — Telegram user 😛𝒜ภ𝔡ɹy STP: Your team has extensive experience in real estate. Are you planning to tokenize real estate or collateralized property using OpenDAO?

A — Logan Fulcher from OpenDAO: You can start earning OPEN right now at stake.OpenDAO.io! You just need some DAI!

OpenDAO doesn’t handle the tokenization itself, but rather we are more like a bank where people can come with their already tokenized assets. Indeed, you can BE PART OF THE BANK! That’s the magic of OpenDAO.

A — Sean Qian from OpenDAO: Absolutely. Our AREIT cashbox is exactly this, where you can be an LP to the real-world asset, which in this case is a fund for commercial real estate. The AREIT asset tokens can also be used as borrowing collateral on the OPM, which means lenders on the OPM will be lending against quality real estate assets.

The only requirement to lend on the OPM is to have one of the stablecoins we accept (and we accept most major ones already). opm.OpenDAO.io

Q — Telegram user Satoshi: What frameworks can OpenDAO integrate into? Do you have conversations with large companies about bringing OpenDAO technologies into everyday use?

A — Logan Fulcher from OpenDAO: We’ve been working closely with Ren Protocol and Chainlink. We also have some great backers including Signum Capital, TRG Capital, and Moonwhale Ventures who collectively know most of the other projects in the space. We’re also actively working on partnerships with existing STO platforms. We’re always looking for new projects that we can link up with!

Q — Telegram user Irina: As a DAO project, how can we participate in governance specifically? What are the entry barriers and benefits?

A — Sean Qian from OpenDAO: Simply by holding OPEN tokens, which you can earn right now by participating in the CashBox beta at stake.opendao.io. OPEN holders will share in platform fees, and of course vote on how the systems should be governed going forward.

Q — Telegram user RAMAZAN BİLİR: What kind of unique features does OpenDAO have over its competitors on the market? How do you plan to increase the demand of $OpenDAO tokens in the future?

A — Logan Fulcher from OpenDAO: When it comes to legitimate projects with strong fundamentals, it is hard to say ‘better’ or ‘worse’, but we can make some fair comparisons:

  • Compared to other projects that are tokenizing non-cryptocurrency assets, OpenDAO specializes more in off-chain assets, namely seamless access to real estate.
  • Compared to DAI, OpenDAO’s oUSD will use a different code for maintaining its peg (same as Synthetix,) but it will be backed by real-world assets.
  • The MAJOR difference between OpenDAO and other market players is that OpenDAO has figured out how to achieve enforcement against off-chain defaults seamlessly, thus truly linking real world assets with the digital — that, I believe, is our biggest value proposition.

A — Moresh Kokane from OpenDAO: Technically, via the cashboxes you can get exposure to the actual asset as well. These are not synthetics, these are real assets. oUSD is phase 2 of the project. It allows making liquidity access for the asset holder faster for a property worth several million. It can take time to book builds on the OPM money market so at a later stage once we have enough distribution and traction.

Q — Telegram user RAMAZAN BİLİR: Can anyone who owns the tokenized shares or ownership shares collateralize and borrow oUSD miner? What are the privileges of the oUSD miner?

A — Logan Fulcher from OpenDAO: I think you’re referring to our minting process, which won’t be rolled out until around the end of the year (or a little later.). The purpose of oUSD is to create an easy on-ramp for anyone with real-world assets to approach us and mint oUSD on demand (provided collateral benchmarks are met.

A — Moresh Kokane from OpenDAO: Yes. As simple as that. It will be permissionless if you have the asset that is accepted as collateral to mint oUSD or borrow now.

Q — Telegram user Sentung: How does OpenDAO bridge real-world assets with DeFi? Will it materialize quickly?

A — Logan Fulcher from OpenDAO: It’s already happening! I invite you to check out some of our Medium articles at for more information on this, also, please join our Telegram and I’d be happy to walk you through this in a little more detail later.

Q — Telegram user Jesus Freites: What is the function of IADs, CB1 and asset tokens within OpenDAO CashBox Staking 101?

A — Moresh Kokane from OpenDAO: It’s an order book style mechanism. A cashbox is a bridge between 2 tokens. Let’s say you want to sell dai and buy OPEN, you put in DAI and no one is there waiting for you to sell OPEN, so you get CB or Cashbox tokens. It is like a receipt of an order that is pending. That is the purpose of the CB token.

A — Logan Fulcher from OpenDAO: We’re in the process of simplifying this right now! We see a benefit in keeping things simple. You can expect to see these changes in our CashBox version 2 that will be rolled out shortly after our public token release.

Q — Telegram user Aleksandr: How does OpenDAO decide about the real-world assets to be used and their collateralisation ratios against the OpenUSD?

A — Sean Qian from OpenDAO: For now, the team is working with assets we are familiar with, such as real estate, because of our backgrounds. Eventually, we expect OPEN governance token holders to take on this task. For real estate, we are using standardised LVRs for lending.

Q — Telegram user Emi 💌: What are the requirements to be able to participate in the CashBox beta testing?

A — Logan Fulcher from OpenDAO: You just have to come to visit our site. If you have some DAI, you can start farming OPEN tokens (they won’t be released until the public token release about a month from now).

Q — Telegram user Nas: How is the price of tokenized stocks determined in OpenDAO liquidity mining?

A — Moresh Kokane from OpenDAO: The pricing depends on whether or not a liquid secondary market for that asset exists for a listed stock is easy. For other assets such as real estate, valuation reports are used. Again, this is not under OPEN DAOs purview, it is handled by the 3rd party that tokenizes it. Our role is a bit different as explained before

Q — Telegram user Infinite Crypto: Does OpenDAO Finance have a plan about token burn?

A — Sean Qian from OpenDAO: We already have a relatively small total supply for the asset classes we are tackling. One way to control total supply in the market is via our various staking actions such as staking OPEN to borrow or to earn transaction fees.

A — Moresh Kokane from OpenDAO: There will be no token burn, but token holders can vote on a revenue pass through.

Q — Telegram user ♛ Sonia: 50% of the total supply of OpenDAO coins are allocated to the system participants. Please describe the roles in the OpenDAO ecosystem that can qualify for a reward?

A — Sean Qian from OpenDAO: We will be rewording various actions on OpenDAO with OPEN. Currently, you can participate in the beta cashbox to earn OPEN at stake.opendao.io

Soon we’ll turn rewards back on for lending/borrowing on the OPM money market as well.

Q — Telegram user TsumaniX: What sort of problems do you see within AMMs currently (i.e. on Uniswap & Balancer)?

A — Moresh Kokane from OpenDAO: To be fair, we are not a competitor to Uniswap or Balancer but there are issues like slippage, impermanent loss etc.

The cashbox has the potential to build an exchange that addresses slippage and impermanent loss. Find out more here.

Q — Telegram user Nilanga | UniWorld: On moving forward through your roadmap, what are your most important next priorities/Milestone? Does the team have enough fundamentals (Funds, Community, etc.) to achieve those milestones?

A — Sean Qian from OpenDAO: Product development, Traction, and Community building are our current priorities. We have the resources and capability to execute these.

Team

Q — Alex Raffin from GAINS: How many people are in the team? For how long have you been working on OpenDAO?

A — Sean Qian from OpenDAO: There are currently 8 of us on the team. Made up mostly by our smart contract and “normie” developers. Moresh and I have been working on OpenDAO in various iterations for nearly 5 years now if you count the STO work we did together.

Officially, we brought everything under the OpenDAO banner about half a year ago, but bits and pieces of the tech and architecture have been in development for much longer under other guises.

Finance

Q — Alex Raffin from GAINS: Did you raise funds so far? If so, how did you handle them? Are you planning to do any future raises?

A — Sean Qian from OpenDAO: We did a small private round in September, mainly supported by some crypto funds such as Signum who we’ve had a great relationship with over the years, and of course awesome community groups such as GAINS.

Our round was unique in that we mainly wanted it subscribed by community groups because ultimately, we want our tokens in as many hands as possible. We’re not planning to do any raises for now. Currently, our efforts are around gaining traction and preparing for the upcoming crowd release of the governance tokens.

Business Development

Q — Alex Raffin from GAINS: What stage is the project/product at?

A — Logan Fulcher from OpenDAO: Our OPM Open Market is up and running, so opm.OpenDAO.io is open for business (pun intended) and you can deploy a wide variety of stable coins for a healthy APY. You can also try out our cashbox system!

Our public token release is coming up, depending on market conditions, likely in late November. Between now and then, we are expanding our OPM to include even more tokens.

We are also preparing to update to CashBox version 2 that will allow for a more straightforward and user-friendly process. Additionally, we are turning up the heat on our public outreach and gradually ramping up as we get closer to our public token release. Around the turn of the year, we’re going to be releasing our oUSD stable coin as well! A lot is going on, and please stay tuned for updates, which are happening pretty much daily.

We also made a rap video. Check it out here.

Q — Alex Raffin from GAINS: Are there any other mechanisms you’ve implemented or plan to implement for the token that can influence supply & demand?

A — Sean Qian from OpenDAO: Ultimately, those who hold OPEN control and govern OpenDAO and all of its various dApps. Things such as revenue proceeds, voting rights will be given to OPEN holders. We’ll also be allowing OPEN to be used as borrowing collateral on OPM, Cashboxes and oUSD in future.

We’re also about to announce some exciting news around unsecured personal lending. More to come. Find out more about our liquidity mining here. Find out more about our Crowdsale Launch here.

Thanks for all the answers guys, really appreciate it. Is there anything else you’d like to say? — Alexandre Raffin from GAINS

The questions were really good quality. These were the better questions, very thoughtful and displayed an understanding of what we are about. 100%. The best AMA I’ve seen. Find out more here: Website, Medium, Try out our Cashbox!, Lend on the OPM, Telegram, Discord, Twitter, GitHub and YouTube. — Moresh Kokane from OpenDAO

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