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GAINS Associates

SERO — Telegram QUIZ & AMA — April 10

On Friday, April 10, we had the pleasure to welcome to our Telegram chat:

Tony Tang, Director, and CSO of SERO

We asked them questions about the development of the SERO Protocol, currently ranked 141 on Coinmarketcap.

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

Summary

In this AMA, Tony Tang from SERO joined the GAINS community to talk about the specifics of his project.

SERO is ZCash with Smart Contracts, or Ethereum with Anonymity.

In an innovative way, it allows for user-enabled third-party audits, a balance of privacy protection and requirements of regulations. With Zero-Knowledge Proof, the Super-ZK Library, SERO stands above all its peers in both completeness and performance.

SERO’s utility is not gas. It has an intrinsic value as more dApps connect to the network. As such, it is designed for a set of real-world commercial applications and supports assets with a very complicated structure, called non-homogeneous assets.

Introduction

Q — Alexandre R from GAINS: Tony, can you tell us what you did before crypto, how you got into crypto and if you’ve had any other venture in crypto previous to being involved with SERO?

A — Tony Tang from SERO: I started out as a quant programmer when I first set my foot to Wall Street.

Thereafter I moved across several business areas including derivatives trading, asset-backed securitization and asset management.

My last 2 institutional jobs were at Citigroup and Deutsche Bank.

Then I moved on to start my own private equity firm mainly focused on think tech and medical tech. I’m currently still the executive partner of the firm.

Throughout my financial career, using technology to solve real-world problems has always been my desire, because I believe the traditional financial institutions are unable to solve most of the problems of small business.

Again, it was fortunate for me to be teamed up with our creative and energetic partners at the SERO project.

Q — Alexandre R from GAINS: Can you tell us what your role is at SERO and what the project is about in a few simple sentences?

A — Tony Tang from SERO: My role at the SERO foundation is to open up channels to develop large scale commercial applications, using my extensive financial and business connections and network.

In a very crude comparison, one can think of SERO either as ZCash with smart contracts, or Ethereum with Anonymity.

Product

Q — Twitter user @dwlrmna12: Basically, SERO is a smart contract platform, thus there are many competitors out there such as Ethereum, EOS, Cardano, NEO, Ontology.

How can SERO be ahead of them and what is the long term vision SERO is looking for?

A — Tony Tang from SERO: Basically, SERO is a lot more than a smart contract platform.

It supports smart contracts, for sure, but its other two key features are Anonymity and Non-Homogeneous Assets.

In the field of anonymity & privacy protection, sensible comparisons should be made to ZCash, Monero, Dash, Grin, etc., where SERO’s innovative implementation of Zero-Knowledge Proof, the Super-ZK Library, stands above all these peers in both completeness and performance.

Another fact about real-world assets is that they can’t simply be expressed via “tokens” that are issued on today’s mainstream public blockchain networks. Take for example, an Account Receivable asset, which in the real world is an important access to credit. It requires a full series of supporting data to describe this asset, including but not limited to the original trade info, confirmation info, pre-arranged payment methods, etc.

Q — Telegram user Entoy: Do you think the SERO Blockchain project will solve the privacy problem or do you have a complete solution package to address the real-world privacy issues?

A — Tony Tang from SERO: It is pretty hard for anyone to claim any COMPLETE solution for all problems in a domain. SERO can’t either. However, the problems we can solve are plenty. A very important question, we’ve been asked, is our embracing of regulation. SERO allows for user-enabled third-party audits, which we believe is a balance of privacy protection and requirements of regulations. In that field alone, we can make a very big splash.

Q — Telegram user Pramod: How will Sero, which aims to provide eBay’s model on the blockchain, handle e-commerce? Will all components be on the blockchain?

A — Tony Tang from SERO: Very good question! E-commerce has many parts. What SERO is particularly good for is the money clearance part — decentralized collateral management. In China, for example, where the big dudes dominated, a very vibrant “micro” e-commerce society is rapidly forming. We are being approached to solve their collateral and guarantee problems.

Q — Telegram user Roger 🙌: What distinguishes SERO from ZCash?

Why does SERO’s anonymity compare to ETH’s?

A — Tony Tang from SERO: ZCash doesn’t support smart contracts — it’s a derivative of BTC. There is no asset issuance. ETH supports smart contracts and token issuance, but the tokens are homogeneous. On SERO, one can issue assets with a really complicated structure, truly homogeneous tokens!

Token

Q — Twitter user @dani_unss: What is the token utility in the ecosystem? Where will it be used and why should the demand for the token increase?

A — Tony Tang from SERO: SERO implements three different types of data structures at the base network level to abstract such real-world complexity. It’s far more than your garden variety smart contract platform, by that feature alone.

Let me use an example:

First of all, it is NOT a gas utility. SERO is not an experimental project, so if the token value were to reflect the value of gas, no real business could afford what we expect SERO’s market value to be — it is simply out of the question.

The utility value of SERO is defined as its intrinsic value in DApp contracts, and no one can define the intrinsic value better than the users of the ecosystem, or the application.

Let’s look at a typical example of Asset-Backed Securitization transaction, such as a CLO. If a pool of loans bearing an average interest rate of 8% is packaged and sold to investors as a security, the security is likely to bear a 6% coupon, a whopping 33% real cost to the borrowers.

Various intermediary agencies must be involved in such a transaction and they must all get paid, and hence the cost, because the “take-on” cost of processing a $10 million deal is virtually the same as that of a $200 million deal.

On the SERO network, though, any asset manager can do any deal with the very reasonable take-on cost because multiple layers of intermediaries are replaced by smart contracts.

His fee, however, will be paid with SERO tokens, and how much he charges is a matter of how he negotiates between his investing clients and the borrowers.

Since the payment distribution is done through a smart contract, each borrower can acquire an agreed-upon quantity of SERO tokens to be collateralized by the contract, both as a fee and as part of a group insurance premium.

This is merely one example (which we are working to launch shortly in Korea) of how we intend to let the ecosystem determine the utility value of SERO tokens. As long as the SERO network broadens its commercial users, so will increase in the demand for SERO tokens, and miners will be incentivized to maintain the network.

Think of 10 commercial ecosystems each with 10 to 30 million SERO tokens in demand; we’ll leave the speculation of SERO token’s price to the market.

Business Development

Q — Twitter user @jazieph: What can we expect about the strategic partnerships of $SERO in the future? And how does it contribute to the development of the project?

A — Tony Tang from SERO: Since the SERO project was designed with a heavy tilt toward a few sets of real-world commercial applications, we choose our partners with existing large scale businesses that can be remodeled to be deployed on decentralized platforms.

Specifically speaking, SERO technology was designed to carry three groups of DApps: Supply Chain Management/Finance, Private Data Management/Anonymous Payment, and Digital Asset Management/ABS.

A separate team has already been spawned off from the original SERO team that will entirely focus on the commercial development of DApps and DeFis. This team will be injected into a traditionally structured corporation, funded by the SERO Foundation and several industry players as mentioned above.

In the coming year, we expect to deliver at least one significant DApp within each of the above-mentioned categories.

Q — Telegram user Sakina: What is your long-term vision about the industry SERO is working in? Are you afraid someday there will be another project with more innovative technology that can replace SERO?

A — Tony Tang from SERO: No one in a young business can be afraid of competition. One can only strive to maintain the lead while acquiring mass usage. This in itself is a barrier of entry. Speaking of which, Vitalik (Ethereum co-founder) himself is giving serious thought about adapting ZKP into Ethereum, but given the legacy issues, that can only be done at L2, which is not a complete anonymity system, and will consume a huge amount of Gas.

Thank you for coming in today Tony and telling us more about SERO, which is not only “just” a privacy coin but also a whole ecosystem for companies who wish to do business privately, while still being able to be compliant! All that thanks to Smart Contract support and homogeneous (=complex!) tokens.

SERO’s tech and business acumen sound very strong and I’m looking forward to further developments. — Alexandre R from GAINS

Thank you, and the great crowd! I hope you all enjoyed this as much as I enjoyed the sharing. Thanks to all the Gains Associates team for holding such a great AMA and special thanks to Alexandre. Please do join our Telegram channel for all the latest SERO updates and upcoming AMA events. — Tony Tang from SERO

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