Internal AMA Recap with Umbrella Network’s Senior Advisor, Sam Kim and President, John Chen.
Umbrella Network’s Senior Advisor, Sam Kim and President, John Chen, recently held an internal AMA in the main Umbrella Network Telegram channel to answer questions from the community.
At: Umbrella Network Telegram channel
On: Wednesday, 3rd August 2022|Time: 5:30 PM UTC
Umbrella is a scalable, community-owned oracle that securely brings external data on-chain. It is the first decentralized oracle service to empower the community with the scale and security modern DeFi applications require.
The transcript is almost entirely in its original AMA form, mildly edited for punctuation and readability only.
*** AMA starts ***
Before we start, I wanted to take a second to say something.
It’s been a very challenging business environment, with a lot of projects, including Umbrella having experienced setbacks. We are actively seeking solutions but there are likely going to be more challenges ahead. After downsizing the team, we also have had to slow down development, cut our marketing and operations. All of this has led to fewer milestones, slower pace of development as we focus on core priorities, and minimal marketing. However, we’ve been able to extend our runway to 6 months in part because of the reduction in operating costs.
BD is ongoing, but we are looking at only meaningful projects that can have an impact for Umbrella.
We appreciate your sticking with us through these challenging times. We’re working to find a long term solution that puts Umbrella Network on the right long term path. And we’ll keep you informed as things develop.
Q1. Do you think you have a realistic shot at outlasting the bear market and if yes, how are you looking to do that?
If your first answer is — “yes, through further funding, development and the passport solution”, please elaborate concisely into how you’ll get those, what will you be focusing on the coming 12 months.
We’re actively engaged with L1 and L2s who we believe view high performance oracles as critical to their long term success. These protocols are well capitalized and can work closely with UMB to realize its potential and deliver a world class oracle on their protocol. To get to this point, we are seeking to minimize operating costs and find additional sources of capital.
I hesitate to share any more details about which protocols we’re speaking with given certain confidentiality concerns. But there are several that have expressed interest. And we continue to pursue them.
Q2. Will metalcore only use the random UMB generator?
Yes, that is the plan for when MetalCore uses random number generators.
Q3. Umbrella is a very community oriented project. It is a shame to see that the community is feeling a lot of distance between them and the project. Can you form some sort of proposal to close that gap?
We are taking suggestions and feedback from the community on how we can close that gap. We’re hearing some of that feedback now, and we will look to provide more updates on our activities and progress . But the overall pace of progress has slowed compared to previous levels.
Q4. As a community we have noticed that Sam and John are involved in Metalcore. We are afraid that attention has shifted and maybe even caused distraction from operations at Umbrella. The hack, lack of marketing, lack of communication like for instance with the delisting on Kucoin. Can you ensure us that there is still a big or enough focus on Umbrella?
John and I serve as advisors to MetalCore. However, that does not impact our ability to remain committed at Umbrella Network. Given the current objectives and strategy for Umbrella, our work is not as visible to the community. Our focus today is on engaging a number of Layer 1 and Layer 2 protocols to discuss long term partnerships. Furthermore, due to cutbacks in marketing and operations, we have not been as active in updating the community, which we will look to change.
Q5. What is the actual status of Passport? Are the customers in line to use it? How does the team plan to attract more customers?
What will the use case of the UMB token be in relation to passport? Can revenue be used to buy back and burn tokens for instance?
Passport is already deployed and live on BNB Chain. And it’s being deployed now on Avalanche, the bridge is currently being deployed, and we have already successfully deployed the main Passport smart contracts there. Next up will be to deploy Passport onto Polygon. We are already in dialogues with several projects in the Avalanche ecosystem to use Passport, but going has been slow given the current market conditions. Part of the pricing strategy for Passport will be a mixture of stablecoin and UMB.
Q6. Are there currently any projects that use umbrella as an oracle? if so, is it possible to have a list of projects that have adopted umbrella as an oracle for their project?
Currently there are no users of our L2 data. The plan is to rollout passport and make it our primary product
Q7. Is there a budget to track umbrella income and expenses?
Current Income and Expenses:
-Income: there are no paying customers at this time
-Expenses: Approximately $75K per month with half being for personnel and the balance split across community management, validators, blockchain costs and servers / infrastructure
Q8. Since you have been saying for a long time that you have been in contact with Kucoin, is it possible to know the reason for the delisting? I don’t think it’s just due to volumes, because there are many projects on Kucoin that had less UMB volumes and are still present on the exchange
No it was purely due to low volumes for an extended period of time. It’s very unfortunate, but out of our control.
Q9. Given the delisting on Kucoin, will there be repercussions on the partnership you started with their chain?
Not to the best of our knowledge no.
Q10. You are looking at getting further funding to continue your efforts. What is your pitch to larger investors/funds, what do you feel you have to show for that makes it a good decision to further fund you? And what will you be needing the funding for specifically?
It is not an easy pitch to funds in light of the current state of Umbrella Network and the market conditions. Funds are flooded with portfolio companies that are cash strapped.
Umbrella also has a much smaller team at this time. It has almost no marketing. And product development has slowed down significantly compared to before. It’s a decision that is necessitated by the desire to conserve runway.
However, unlike so many other projects out there, Umbrella has a product / solution that we believe many protocols/projects find value in. In other words, we believe Umbrella’s greatest asset is the underlying product. And there seems to be real interest from potential partners that could support it meaningfully and sustainably. And so, our pitch is that Umbrella oracle can be a value adding product for L1s and L2s.
Q11. Hello, how many people are working full time on UMB at this moment? Thanks!
The team size has reduced significantly over the past few months. Currently the team consists of 7 full time and 2 part time.
Q12. My big question is on the status of Funding efforts … are they waiting on full launch of Passport to then raise funds, or is this effort working in parallel to product development?
This is an important issue. And so, we’re doing things in parallel to the extent that we can.
Q13. My question would be: Will there be a focus on security, and improved auditing, instead of spreading yourselves too thin and jumping on every blockchain?
Right now we have gone through and audited every single one of our smart contracts. Processes have been improved and all of our code including smart contracts are all audited. Given our current resource constraints, we are not looking to integrate into just any blockchain, but taking a measured approach and looking to only work with L1s and L2s that can have a meaningful impact for the project. This includes working with potential partners that will support Umbrella with additional resources and position it as a primary oracle for their ecosystem.
Q1. “What is the actual status of Passport? Are the customers in line to use it? How does the team plan to attract more customers? What will the use case of the UMB token be in relation to passport? Can revenue be used to buy back and burn tokens for instance?”
Passport will be live in Avalanche and Polygon shortly where we are focusing much of our BD efforts. Fees will be paid primarily in UMB. Management of the treasury funds will be decided by the DAO.
Q2. Can you explain what has happened to lucidity, if it is still functioning and who has taken possession of the company?
Their had been no mention of a liquidation so I suspect someone has taken it on and benefitted from UMB releasing it
At the time, Lucidity seemed like a low commitment with potential upside opportunity. With the market downturn, supporting Lucidity and any other initiatives away from the core project stopped making sense.
Lucdity has closed and is not continuing as a going concern.
Q3. What kind of advanced notice will you give us about funding status … January we run out, so will you notify us before then about funding status?
We are engaging in conversations we hope will be fruitful with potential L1 and L2 partners, which may impact runway. As of today, we have 6 months, and will inform the community of any changes.
Q4. Hi Emily, can you ask where the marketing allocation has been spent for the past year and where the marketing spending was being spent for it to be reduced please?
Marketing allocation was used to promote Umbrella Network in a variety of ways including but not limited to events, staff, KOL marketing, community management and more. Unused marketing allocation remain in the UMB treasury.
Q5. To be able to use the passport will the projects have to pay or are there also free solutions?
The open source side of things for our oracle will be free, but Passport will not be a free solution. it will be paid.
Join the discussion on Telegram at https://t.me/umbrellanet
About Umbrella Network
Umbrella Network is a scalable, decentralized, and community-owned oracle that utilizes Layer 2 technology to integrate real-time data into smart contracts for accurate and timely reports. Umbrella Network brings the world’s data to blockchains to enable DeFi applications to perform at the optimum level regarding precise information dissemination. It believes a decentralized oracle is paramount to creating a truly decentralized financial space.
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