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GAINS Associates

Reef Finance — Telegram QUIZ & AMA — October 06

On Tuesday, October 6, we had the pleasure to welcome to our Telegram chat:

Denko Mancheski, CEO and Founder.

We asked him questions about the development of Reef Finance.

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

Summary

Reef is a DeFi operating system — a permission-less smart liquidity aggregator and yield engine where any financial hub can integrate into.

Users state their risk appetite and a composition of tokens and DeFi activities are proposed based on their choice. Funds are then routed to those activities/instruments with 1 click.

Reef gives access to the DeFi landscape and tokens and additionally augments the decision-making process based on the user’s risk levels.

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 Reef Finance?

A — Denko from Reef Finance: My name is Denko. I am the CEO of Reef. I have a tech background. I started development in high school with C++ (did algorithmic competitions for a few years), then moved into the enterprise world where I worked for 2 ERP providers (built some modules and some mobile apps which are still used to this day). A few years later, I moved to one of the biggest healthcare platform providers in Europe. I worked there for over two and a half years and in the last 6 months, I was leading a team (we were building a complex app for healthcare data modeling around the OpenEHR standard). Five and a half years ago, I got into crypto and started blockchain development myself. My first experience was with NXT (Ardor), and I have also been doing a lot of Solidity (Ethereum), Steem as well as EOS.

One of the people who kept competing also won a bronze medal at the World Olympics and is part of Reef’s team now. I moved into commercial software.

Q — Alex Raffin from GAINS: You have a lot of tech experience, both in the traditional and crypto worlds. Do you also know the business side of things?

A — Denko from Reef Finance: Well, I’ve been involved with validating ideas. I’ve been helping with structuring budgets as well as selling (especially around the ERP system). I would say I have experience in the business world, but it’s a never-ending learning experience.

Product

Q — Alex Raffin from GAINS: What’s your role at Reef Finance and what is the project about in a few simple sentences?

A — Denko from Reef Finance: I am the CEO of Reef. Reef is a DeFi operating system — a permission-less smart liquidity aggregator and yield engine where any financial hub can integrate into. Powered by Polkadot, it shares its security model with the ecosystem and enables cross-chain integrations across top DeFi protocols. Reef gives the retail investor access to the DeFi landscape with a very low technical barrier of entry as well as tailored exposure based on their risk level.

Q — Alex Raffin from GAINS: Do you just put some funds on the Reef platform and it will allocate your capital in some financial products for you?

A — Denko from Reef Finance: As a user, you will come and choose your risk appetite. Based on that, we will propose a composition of tokens and DeFi activities as well as their historic performance. You can choose the amount that you want to allocate and with 1 click, we will route your funds to those activities/instruments.

Q — Alex Raffin from GAINS: When will that be live?

A — Denko from Reef Finance: The initial version will be available in November. It’s in process of being audited at the moment. We are aiming for early November.

Q — Alex Raffin from GAINS: Don’t you care about the US elections?

A — Denko from Reef Finance: I hope it doesn’t affect the markets badly.

Q — Telegram user Adelle Stanton: How did you get the name Reef?

A — Denko from Reef Finance: A lot of ocean animals are meeting around the Reef. The name came from the fact that we are aggregating a lot of things and providing access to different activities + different types of users. Find out more here.

Q — Alex Raffin from GAINS: Can you tell us about your analytics projects and how it’s linked to Reef?

A — Denko from Reef Finance: Last year, we were mostly working on the analytics engine. What happens in the background is the following:

  • We collect 3 data streams (exchange data, social media, and blockchain traffic).
  • We create different hypotheses of how we match different data stream types to create certain metrics. (eg: risk).
  • The system is monitoring and getting new data 24/7 and those metrics are recalibrated based on the new insights.
  • These hypotheses, if they turn out to be valid (with a certain confidence level) + backtested, are turned into models that are constantly updating certain metrics.
  • This engine is currently being fully adapted for DeFi, so we can monitor all the activities (staking, lending, direct token exposure).
  • When the user comes and they calibrate their risk level, this engine is offering them a composition suitable for them.

This is just one strategy for the Reef baskets. We will be adding more soon, as well as eventually allow the DAO to approve certain 3rd parties to add their strategy.

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

A — Denko from Reef Finance: Well, any kind of software is always in-progress. The initial version is planned for November. There was a short roadmap floating around, but we are preparing a more detailed roadmap.

Q — Alex Raffin from GAINS: What is the token use case? How did you make sure it captures the value of the ecosystem you’re building?

A — Denko from Reef Finance: To understand the token usages, understanding the income streams are equally important, so I will split this answer into 2.

  • Income Streams — Reef currently has 3 income streams: Basket engine, protocol fees, and interest paid by power users who borrow tokens from the Reef pool to increase their voting power. All the 3 income streams are currently flowing in the Reef pool. In the future, through voting, we plan to introduce Reef Treasury which will be the recipient of the income streams, and the DAO can further decide how to allocate the funds (eg: grants, buybacks, etc.)
  • Token usage The reef token is a governance token, so the users will be able to vote on different proposals (releasing new features, readjusting certain parameters in the system, etc.). Besides governance, the token is powering our infrastructure, so you can pay the protocols fees with it. It can also be used to stake into the Reef pool and get RPTs (Reef Pool Tokens), but it’s also going to be used in the yield distribution mechanism (customizable payout ratio for the yield that the basket generated), which will allow the user to farm the Reef token and directly stake it into the pool.

Q — Alex Raffin from GAINS: Do you have an estimate of the ROI if you stake the Reef token?

A — Denko from Reef Finance: Reef does not guarantee nor promise ROI. It captures the market’s average based on the volatility (eg: Fresh pools offer high APY but are more risky. Small market cap tokens are less liquid and are more volatile). Additionally, the basket is diversified into more than 1 activity to hedge against a certain new pool/token going -80%

Q — Twitter user @Winterkom: The Reef ecosystem is very wide, especially the DeFi projects. Are they all active within Reef?

A — Denko from Reef Finance: Currently, we’ve implemented most of the leading DeFi protocols. To make things even more scalable we will be releasing a way for other projects to be able to integrate with us as well. In this case, the integration strategy will be both pull and push.

Q — Twitter user @alicewonder1202: How easy is Reef to use for non-crypto users?

A — Denko from Reef Finance: Reef abstracts away the complexities of using order books and learning how different DeFi protocols work. Just like Robinhood, the app gives the average user access to the traditional financial landscape (derivatives, option chains, etc.). Reef gives access to the DeFi landscape and tokens and additionally augments the decision-making process based on the user’s risk levels.

Q — Twitter user @Humis16: How is Reef farming better than other farming projects?

A — Denko from Reef Finance: As I mentioned earlier, the Reef Yield Engine is powered by our Analytics Engine. We scan the whole landscape and we determine the best allocation based on the user’s risk levels. Then, we route your funds to the appropriate protocols. This means that you don’t have to learn and stay up to date with this super-fast moving landscape, since through Reef you will be able to access things easier and faster.

Q — Telegram user Aleksandr: Why is Reef’s DeFi Intelligence Engine built off-chain?

A — Denko from Reef Finance: Initially, the intelligence engine will be off-chain because there is a lot of data and a lot of high-frequency processing. The moment we can deploy our solution in a decentralized cloud (eg: Crust.network), we will move the whole infrastructure there.

Q — Telegram user Sabrina: Do you think that the Reef Yield Engine is the tool that guarantees Reef’s success?

A — Denko from Reef Finance: The yield engine is one of the advantages. To be able to build the analytics engine which powers the yield engine. One needs to also know statistics and machine learning and not just blockchain development

Q — Telegram user RAMAZAN BİLİR: What kind of terms & conditions are there registering on Reef DeFi’s platform?

A — Denko from Reef Finance: You will always be able to use Reef just with just a Metamask wallet. The moment we integrate CEX liquidity, if the user wants to have access to it, certain KYC procedures will have to happen. We will not be storing user’s data at any point in time. The KYC procedure regarding CEX liquidity will flow from the user’s machine directly to the prime broker.

Team

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

A — Denko from Reef Finance: Since we are based in Slovenia, the development community here is not so big. We know each other from working on different projects. Two years ago, we teamed up and worked on multiple blockchains, as well as for analytics projects together. In January, we decided to focus on DeFi and started building Reef. We are in total 12 people now. Half of the team is engineers. We also have an office here in Ljubljana.

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 — Denko from Reef Finance: We have raised $3.9m so far. They are stored in cold storage. For now, we do not have plans to have future raises since the amount of funds that we raised is sufficient to get the project to a sustainable level.

Q — Alex Raffin from GAINS: Did you have a public sale?

A — Denko from Reef Finance: We will announce details around this soon, but we are currently looking at alternative mechanisms.

Security

Q — Telegram user Keely Blick: How does Reef keep users’ funds safe?

A — Denko from Reef Finance: We are 100% non-custodial. It’s all happening on the blockchain. We are in a process of getting audited by multiple top-tier firms.

Q — Telegram user nyo_cant: You mentioned that staking Reef tokens will allow you to get Reef Pool Tokens (RPT). What will be their mission within the Reef ecosystem? Have you defined any kind of parameters that may suggest if a token could be a scam?

A — Denko from Reef Finance: The RPT gives you exposure to the fees generated by the ecosystem (the 3 income streams). We already have minimum requirements for instruments/activities. So if something does not fulfill those requirements, it will not be suggested in the Reef baskets.

Business Development

Q — Telegram user Anais Renner: Before investing, users want to know the development roadmap of Reef. Can you recommend a Reef roadmap?

A — Denko from Reef Finance: There is already a short roadmap floating around, but we are currently working on a more detailed roadmap that will be published very soon.

Q — Telegram user In Altcoins We Trust: Do you think Polkadot is the definitive base platform for the development and growth of Reef Finance?

A — Denko from Reef Finance: Polkadot allows us to be flexible and integrate with other ecosystems. Since Polkadot is still in a very early stage, and we want to launch quite soon, we will also have infrastructure on Ethereum. Reef’s goal is to be the first project to give Ethereum access to a non-Ethereum ecosystem. That’s why we are called the First Cross-Chain DeFi operating system.

Q — Telegram user Alyson Wintheiser: Community support is one of the biggest aspects of a project’s success. Do you have any special plans to attract and expand the community and improve the user experience?

A — Denko from Reef Finance: Yes, we already did a few contests with the community. We are working on expanding these activities (even replacing the public sale with different activities which involve the community). We are a consumer-focused product so the community is our #1 priority.

Thanks a lot for all the answers Denko. I had fun. Keep us updated. Where can we follow you? — Alex Raffin from GAINS

Thank you! To follow the project and the upcoming announcements, join our Telegram group, follow us on Medium and Twitter as well. — Denko Mancheski from Reef Finance

Join us now! Enjoy quality articles, daily curated news, insightful infographics, and enter a vibrant, fun, and knowledgeable community!

If you want to email us: contact@gains-associates.com.

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