If this strategy and liquid staking do not clash with Mike’s proposal, and there are no downsides, is there any reason not to proceed with these now, under Shane’s oversight as temporary director? If these catapult the POKT token price, pre-Shannon, to $1, the PIP-38 monetary milestones could be revised accordingly.
I am back, it seems Michael has verified my claims for which I was banned - unfortunately I am still perma banned from the telegram but as this is being fast-tracked to a vote very soon (just as I said about $GROVE and the fork plans maybe trust me on this one this time) I think its best I share my thoughts. Anyone who knows me knows how much I loved POKT - key word there LOVED. Past tense. Whatever this is now is not the Pocket I fell in love with, it’s not the Pocket that had tremendous amounts of promise. It is not, if Mike has his way, the:
Censorship Resistance Decentralised RPC Base Layer
That we as a community aligned around - PNF did not formulate
its own vision and road map
Rather we - the DAO, the community, the people building on top of this once promising protocol, we aligned on these ideals together. I have the utmost respect for the work that @b3n, @Dermot, @JackALaing did for this protocol and I was thoroughly ashamed to see them booted out of their positions because Michael wants power again.
In this post I aim to give my insights where possible and try to prove without a doubt not only is this a terrible idea, not only the end of the protocol, but with a few correct moves - something Michael clearly doesn’t understand how to do or those around him either unfortunately. I believe we can take the reigns back and push this protocol back on the right direction. I will call for some drastic changes, I may not say the things you want to hear but they are in fact the things you need to hear, we all need to hear these truths and really deep them. This is either the start or the end of Pocket and we need to make sure we make the correct calls - as a community, not a dictatorship lead by a proven incompetent leader.
Lets start with the very first point:
What drew me to start protocol development - no to crypto in general was Pocket so when I say this I saw it with true sadness in my heart. Shipping Shannon has never been a priority for Grove - not at all. They may have said all the right things, put up a front as if it were but hear me out now. I now work for Polymer Labs a mature codebase - they also started by building out a native L1, then pivoted to a rollup using a customised OPStack “Hack” utilising both Cosmos-SDK, OPStack, DA Layers - I hope by now this is starting to sound familiar to anyone who has kept up with the Shannon Development journey. Its exactly what we did - what I was a part of. When I joined the protocol team initially as an outsider working under PNF then slowly transitioned over to Grove (still paid half by PNF) until finally being hired fully by Grove I knew nothing. I had just taught myself to code, sure I picked it up fast and found it easy which helped but I didn’t know what a codebase 2 years under development ought to look like. Having now seen a codebase that has been under development for the same amount of time, is in its 2nd or 3rd testnet and mainnet soon approaching - that ALSO followed the same pivot journey that we did I know now what company focused on shipping a protocol’s codebase SHOULD look like that far in. I don’t even know how long Shannon/V1 was in development for before I got involved - but I know it wasn’t a short amount of time.
It really pains me to say this as I consider @Olshansky a good friend, but friendships aside for now lets get down to the difficult conversation. The time pre-h5law (AKA The Dark Ages) → V1 (pre-pivot/native L1/building cool shit) → Pivot #1 (Rollup w/ Rollkit on Celestia) → Pivot #2 (Cosmos-SDK L1 w/ RollChains integration for Celestia DA added security); in my eyes this journey demonstrates a clear lack of understanding of shipping a product - it even gives incompetence vibes. So much wasted time, wasted research cycles, wasted hires and fires. If Grove really wanted to ship Shannon I can see a few key points where things SHOULD have been done differently.
In crypto its not about who you are but what you can deliver
Simple as that if you cannot deliver you are worthless, nuff said. Its a shame, Its peoples livelyhoods you may say. If they wanted to sit around and not deliver, maybe read a cool paper and do some research go into academia, join a bigtech company. Crypto is different, maybe its why my generation (doxxing myself rn but I’m wait for it Gen Z) love it. Crypto should be free from the bureaucracy and bullshit you find everywhere else, instead it should focus on what started this entire industry - an anon fighting for ideals in a world that lacked them (big up Satoshiiii).
Again it pains me to say this, it really does because I love the guy personally - even his knee high socks he’s so nice and caring - but Olshansky, if under management that cared about delivering the product would’ve been either:
I can’t stress how much I love this guy, I genuinely am having difficulty writing this but numerous times Olshansky himself would ask me “Who do you feel like you work for?”, each and every single time I would reply “I work for the protocol, not Grove, I want what is best for Pocket Network” I was very often the one to challenge the team in their decisions - I was seen as the “voice of the community on the protocol team” and I was proud of that. I wish I could have done more to avoid the mess we are in now. I was against the pivot, I was against Olshansky’s push towards the OPStack (thank fuck we avoided that mess), I enjoy shutting people down I can’t lie it was fun to point out why all the ideas were dumb - I said lets either keep with V1 or use Cosmos-SDK for IBC. We settled on Rollkit because it was shiny - but it wasn’t ready for us so good thing we kept the backup plan of just using Cosmos right? Or is this something the Lead Developer, Staff Engineer, Super Senior He Could Date Your Dying Grandma Engineer, Lord of the Protocol Team, Chief Naming Officer (don’t get me started on our tiffs calling it Poktroll - especially now that its not even a rollup 
) Big Man Oldshansky SHOULD HAVE THOUGHT ABOUT JUST A LITTLE. The idea was to pivot and ship ASAP, good intentions - yet another poor execution. It wasn’t ready for us, it set us back. If this was the only misstep it is absolutely forgivable without question. But if you look back through the timeline how many years, where Grove supposedly focused on protocol development, were wasted due to poor decisions, poor execution and just plain ignorance on how to ship a protocol.
The reason this statement doesn’t sound correct is because in reality Grove never was focussed on shipping the protocol, maybe they would have hired more than 5 people to work on it. Maybe they would’ve used the DAO rebate to fund it - not just one of the following:
Its not nice to say but let’s be real, when you’re startup becomes so uptight that being blunt, slightly dismissive of others, or fucking straight up rude and mean to others is more important than shipping your forever SOON™️ protocol release things have gone terribly wrong. Just to be clear here I was the blunt, dismissive, rude and mean one. I admit it but I am of the opinion that if you are becoming corporate before you’ve launched your fucking product thats a sign of bad leadership at all levels. So lets dive into that, leadership.
o_rourke wants to take control of Pocket, he failed miserably before, thankfully PNF picked up his mess and carried us somewhere respectable - a long way to go but god damn those guys did amazing work through bear and bull they shined. Big ups b3n, Dermot, JackALaing and Adrienne on god these guys did a lot if you cannot see that you are delusional.
@Cryptocorn correct me if I am wrong but wasn’t it under o_rourke’s initial tokenomics that the protocol was able to be bleed dry by mercenaries. The 1000% or whatever inflation Pocket came out the gate swinging with does not give me any hope that this guy knows a think about tokenomics - in fact it proves he knows not a thing. Read a book or something, read the forums, get active in the community and you (o_rourke) might realise this community IS INCREDIBLY KNOWLEDGABLE ABOUT TOKENOMIC AND ECONOMIC THEORY IN GENERAL. We have big brains like Cryptocorn and @RawthiL and others I am sure I’m omitting. We DO NOT NEED SOMEONE WHO NEEDED TO SELL HIS OWN HOUSE TO SECURE FUNDING FOR GROVE IN CHARGE OF THE TOKENOMICS OF THIS PROTOCOL. That is literally the dumbest thing we could do. Lets dive into that:
o_rourke I once thought you seemed calm but more and more you seem in way over your head. I would never trust you with any authority or leadership in this ecosystem, if anyone does they are blind as to the mess we are in. YOU ACTIVELY SPOKE WITH INVESTORS ABOUT FORKING POCKET WHY, WHY, WHY SHOULD ANYONE TRUST YOU?
Lets chat on this: Instead of paying Grove who has failed miserably to ship Shannon - but like every other company got lost in the AI sauce, was misguided time and time again and displayed a complete lack of competence. Maybe heres a crazy thought - lets further decentralise the protocol. Fire the entire protocol team, anyone who wishes to stay now must work for PNF - the beef between Olshansky and others at Grove with @poktblade needs to be squashed because I think he should be on the protocol team ffs its silly how you don’t like the guy on god.
Im deadly serious reinstate all of PNF immediately, transfer control of the protocol team to them - if that means smaller wages so be it. I can find talented devs to come on. People who care about the protocol are more likely to work for a little less - who knows if we chuck in forcing you to resign we might see a price boom as investors see us cutting dead weight o_rourke would you even consider that? I mean if you truly care about Pocket you must be able to see your influence on the protocol has been a net-negative undoubtedly, irrefutably.
I will stop here for now and continue later. But I’ll end for now on this - I love this fucking protocol, I was devastated to leave working on it. But holy fuck what a mess you have made big boy, now its time for the adults to come and clean it up - sorry if I hurt anyones feelings in this post (I am not) I am expecting another ban from @Jinx for once again speaking the truth (fr tho unban me Michael admitted to all I said you’re being childish). I hope I can convince some people to see the light and take the steps we should’ve taken years ago. Had this been, dare I say it, Web2 Michael would’ve been replaced the dev team cycled through for people that can ship a product and we would all be enjoying Shannon not just starting to discover the mess o_rourke has made in his diaper. If even a single person tries to say this is strawmanning grow up - read the text and you will see I have simply spoken the unadulterated truth, my way.
Look out for part 2
I’m totally back for this.
I’ve been telling you all time and time again that things were not right here. And as simple as it may seem, really thing about this, like seriously - if someone can’t even implement a proper logout flow and/or can’t fix it in a day or two, what makes you think they can build a whole protocol?
Sometimes it really is just that simple.
Problem is no one wants to work to grow $POKT because Grove owns too much of it. Why would anyone want to grow Groves bags.
Most of the good people here have moved on, and it was the teenagers that left first. LMAOOO
Its because young blood hasn’t got time for the older’s outdated mindset. Move fast (don’t break shit build shit) this aint 2000 anymore big man do things properly and do them right - first time preferably @o_rourke its just a little sad asking for a what is it now 5th chance/bailout/takeover however you want to phrase it. If you were my age you would’ve learned this lesson from fucking Pockémon of all places. If you love something let it go - let it grow and find its own path. Sometimes stepping away from something is the best thing you can do for it.
There were smart young guys in pokt, @addison @pierre dipped for greener pastures when they weren’t taken seriously anymore (AFAIK). Time for a new generation - don’t make us be the ones to do a CTO and fork the protocol from you. If we dropped the AI play and left that for the future when it might (if it ever will) be used Shannon would be going through serious testnets. The more I think about it the more I think its a good idea. Just as you forced out PNF we should force out Grove - tbf I’ve only ever heard complaints about Portal from people who’ve used it, myself included ahah ironic a little.
Maybe I’ll come back fork it call it something decent and get back to work on the things I built in the first place lol - SMT is my baby I built what you’re trying to pattent with the ProveClosest method maybe I should just beat you to market and we can see who does it better. The company struggling to raise or the dude doing it in his spare time for free ahahah - IK one of those two will ship a better protocol to be built ontop of with stronger tokenomics and the other will continue to lie, deceive and do all they can to have some power. You decide… Who’s who?
I’m going to remind everyone that in the forums we expect everyone to stay on topic and discuss the proposals.
No personal attacks.
If anyone wants to go insult people, go to 4Chan.
If members have a point of view and want to discuss the topic, you’re welcome to be as negative and dissenting as you want, but be respectful.
I don’t get paid to Mod, I’m doing it as a volunteer and while we are all frustrated, let’s not take it out on others in the community please.
Could you please tell me the difference between censoring a post containing valid points and a personal attack? @Cryptocorn I feel like I am being personally attacked by the Pocket Community firstly for calling out the truth of Michaels intentions which he lied about - turned out I was true about that.
Now I speak my mind in a supposedly open forum raising genuine points and critiques of a failed CEO and the crippled protocol team. Maybe I said it a bit crass but is that grounds to stop people from being able to read my comments and come to their own conclusion? I mean we allow all sorts of people I personally wouldn’t be caught dead associating with in this community but suddenly you can’t take valid criticism (that actually praised you IIRC) from someone who like most people here have been burnt my Michael’s literal defrauding of the entire community with his lies.
Yet for some reason his incessant lies, hostile take overs and outrageous ineptitude (not personal insults these are backed by his track record) do not class as grounds to do any of the following:
I’d rather not rewrite my post so if you can I kindly ask you return it to where it belongs and allow people to make informed decisions, we are all grown ups here. Treat people like children and no wonder they get fooled like them. Treat them like adults and they suddenly stop tolerating bullshit from serial frauds and wholly inept individuals.
Anyone can come to the forums and criticize proposals all day long.
We prefer to keep things pleasant in the forums and discuss actual details, proposals, and find answers. Raging is for the Telegram and blind rage is for 4chan.
You have valid criticisms to share and the community would be better off if you can share them in a calm, respectful manner so that they can be intelligently debated.
I personally have no beef with you and would prefer that to continue.
And on a side note- I appreciate your kind words for me.
Let’s keep the adult discussions in the forum and shoot from the hip somewhere else.
I’m just going to point out the elephant in the room: Illusory Autonomy
The protocol has always been centralized under PNI’s full influence and control. There has never been a time that PNI could not make a change and enforce it fairly quickly. This is evident in the current scene.
Grove: “we’re going to push through a proposal whether you like it or not”
PNF Directors: “we believe you” - resigns in mass
Valid to you. Valid doesn’t mean truth. I would think miss information or unverified information would justify censorship
I have restored @h5law’s comment: PIP-38: Re-electing Michael O'Rourke to the Foundation - #49 by h5law
I have also made changes to the forum’s Moderation Policy.
The truth never dies
You are tight, but I disagree that the cherry picker was offering any solace in the self-dealing issue. The CP data was withheld during the hyperinflation times, so we don’t know what happened then. When it was released to the public, I took the time to model it and see it it matched reality. It sorta looked like it was being implemented (but not a 100% tho), and that did not prevented many free relays to just evaporate when transitioning from Grove to Nodies.
In this sense, Mike proposal does not change anything.
This is also a problem of the current network, there is no approval path for new chains. God knows the motives behind new listings. What you describe can happen today, it will only be get worse with Michael x10 for new chains, but nothing more. That’s why I asked for “extra care” with this.
I doubt that any change will occur to app stakes, but only Grove has giga stakes, all new gateways are receiving apps with 10K POKT stake and are outside the control of PNF. make 20M relays per session (check here a random app).
This is impossible to know, unless the gateways does some obvious stuff like using the same domain for their gateway and nodes.
Same thing that happens today.
I’m a little lost with what you exactly mean here. Your reasoning seems sound (also the fact that we don’t support latex in the forum is a clear example of the level of discussions that are normally held… I was even accused of purposely confound people just for using it ).
What I can say is that there is no mechanism in Morse that can save us from fake traffic. Trust is the only barrier (trust and PNF legal contracts of course).
Why you say? because unless we set mint=burn there is always a mechanism. Even upping the relay cost make no sense (the 0.85 USD/millon relays ) because we need it to go lik x100 which makes no sense, or lower mint in a simmilar way, which also makes no sense. We are stuck in this matter.
The only way to prevent this is to make the recover of the attack too slow, as proposed by @shane for Shannon. In the meantime it is impossible, as I simulated here an attacker can very eassely recover the cost of staking an app only having a few nodes and waiting a few days.
So, we will still be in the same problem with Michael or PNF, we will have to trust gateways.
Just in case someone says “then remove the burn!” no, this is not the same, we need to prevent “flash attacks”, that’s why we need to set some friction.
Not trying to pile on too much… but what is.
Are you trying to get paid or not?
This is awesome work!!
Re the 48m POKT for shipping Shannon, the proposal should identify the recipients and, roughly, their respective allocations, that is, “everyone else who has participated up until now.”
To repeat, Mike says: “I don’t intend to take any for myself in this distribution. The same goes for the price-based milestones.”
Is Mike saying he does not intend to share in the other milestone payments? Or is he saying that he’ll share these payments with all responsible for achieving these milestones.
The proposal needs to make all of the above clear.
Based on feedback from the community I have added a a 2/3 multisig, voted by the DAO for transfers over $100k once we hit the $0.50 milestone.
Good call out @zaatar - I do intend do distribute myself POKT for the price based milestones specifically. Not the Shannon milestone.
The central goal of this proposal is to lift the token price and thereby ensure Pocket Network’s success.
Many seem persuaded that to achieve that goal in today’s circumstances, the slow and unwieldy process of DAO proposals and voting is ill-suited.
However, the proposal, as currently formulated, fails to properly address conflict of interest. Further, there are valid concerns about ceding too much power to Mike and subverting the DAO.
Given that 75% of a quorum of voters are needed to pass this proposal, Mike would be wise to add some DAO oversight as suggested in this thread. Oversight would not only check power abuse, but also it would prevent actions designed to place Grove’s interests over those of the DAO, allaying conflict of interest concerns. DAO oversight also addresses concerns over centralization and SEC reaction, and effacement of the DAO. In addition, it would reduce divisiveness and help preserve community cohesion.
Leaving concerns about lack of oversight and conflict of interest unaddressed could lead to the failure of this proposal. For those who support the central goal of this proposal and believe that PNF nimbleness is needed to achieve that goal, the failure of this proposal would be unfortunate.
Mike says he will push forward with his economic proposals if PIP-38 is rejected. Having the DAO consider them collectively or piecemeal would delay, if not block, their passage. Requiring a trusted DAO member or members to sign off on Mike’s economic proposals would facilitate their quick adoption and, at the same time, give the DAO the oversight assurance that it needs.
The trick is to design an oversight mechanism that’s meaningful but at the same time does not prevent nimble decision making.
It’s been suggested that the DAO appoint or elect people to provide that oversight.
Lucky55 proposes advisory board(s).
Breezy proposes that we elect three new “board members” (PNF directors?) - with combined legal, tokenomics, and technical expertise - a majority of whom would have to approve Mike’s protocol changes. “The DAO," says Breezy, "would retain the ability to vote on key changes and override decisions inconsistent with our vision.” The “board members” would have to justify to the DAO in writing their decisions to back Mike’s changes. Not sure of the legalities, but perhaps this could be an advisory board as opposed to a slate of PNF directors.
For a 2d opinion and possible refinement, and to gain the DAO representatives’ support, Mike could consult them before finalizing any changes.
This would provide real DAO oversight without cumbersome, time-consuming DAO proposals on every change that’s introduced. Where Mike fails to get the required 2 out of 3-person backing, he could put his proposed change up for a DAO vote.
Alternatively, it’s been suggested that oversight come in the form of a shorter time period for Mike’s sole directorship, say, 6 months, subject to renewal by the DAO. But this does not resolve conflict of interest concerns or protect against harmful changes.
To sum up, an unobtrusive, though effective, oversight mechanism is needed. Starting with the good ideas already provided in this thread, let’s devise one.
According to Jack, you’ve got to “consult legal” before finalizing your proposal.
I agree with MSA that constitutional changes should be made only where necessary to achieve this proposal’s objectives. Therefore, the reasoning for each of the proposed constitutional amendments should be added to the proposal so that voters can properly consider their necessity.
For example:
Article 22: Transfer by Way of Continuation
Current Article:...
Proposed Adjustment:...
Reasoning:
Without the reasoning, It’s difficult for voters to understand why the change is being sought.
Further, constitutional changes should be only as extensive as required to achieve this proposal’s objectives; setting out the reasoning for each of the proposed adjustments will help voters see whether they’re sufficiently narrowly tailored.
The proposal as currently formulated needs amending. I recommend rewriting it as a pre-proposal for further consideration. I would then incorporate new and prior community feedback to try and build consensus around this PIP.
(I would have refined this post further but wanted to publish it before today’s ecosystem call.)
As a mostly quiet investor in POKT coin this seems to be the classic case of the Captain of the ship trying to regain control after not being satisfied with the direction the ship is going in. There is a lot of finger pointing and egos involved. To be clear I’m not opposed to the idea but more oversight and shorter checkpoints are needed to make sure the ship isn’t being ran into the ground.
“Example: 4.38 For a period of 24 months from the date of this proposal passing, the sole director may establish new compensation agreements for directors and officers, including performance-based incentives tied to the price of $POKT, without being subject to the existing limitations in Article 4.38.”
The above scares the crap out of me. I’m reading it as “he”/“sole director” can change his own compensation without anyone else’s approval? Someone tell me I’m wrong.
Final thought/question…who gets to vote on these proposals and how do they vote?
I am not a DAO voter but I have been following this project since 2021 and had written an idea about the structure of inflation which I had been pondering for a long time in conditions of lack of information. So I think I have the right to give my opinion about this proposal.
I have attentively read this proposal and am continuing to read all messages in telegram group, so there emerged many questions about the past money management and the effectiveness of its use, the made strategic decisions etc. which cast a shadow on the future success of the project or shows this project to be more risky with the possibility of becoming successful. Most likely such a drastic proposal should have been discussed first within the two organizations internally between the main actors what could have prevented the price from falling by 30 percent. On the other hand, all the factors are unknown to me in order to say what could be done and what couldn’t. The only thing I like so far is Mike’s confidence in that the project can or will be revived.
Before moving on to some points of the proposal it is worth paying attention to the conceptual wrapping of the entire message coming from “reflexivity”, on the basis of which appeared specific Mike’s ideas. The focal point lies in Soros’s theory of “reflexivity” which can be considered of speculative nature. At the time of the financial actions of his hedge fund “Quantum Fund” he was a pure speculator with some philosophical ideas about an “open society”. Soros once said :
“It doesn’t matter at all whether you are right or wrong. All that matters is how much money you make when you are right and how much money you lose when you are wrong.”
However, the theory of reflexivity сan’t estimate the value of an asset, comprehend long-term prospects and is aimed at extracting short-term profits with the help of mass psychology using media and advertising. Sometimes this theory works well, a good example of hype would be the succesful initial public offering of BYND stock - the company that produces an artificial meat substitute. But then this business went poorly and the stock fell. Every step he took in speculations was with his new ideas without the possibility of using standard NPV, IRR and other models in real investments. Soros had a well-developed intuition that helped him speculate. As he said:
“My personality is that I don’t have any particular investment style. Every time there’s something new – new approaches, new methods, new ways to achieve your goals.”
Soros even worked for a while with Jim Rogers who additionally carried out the fundamental analysis. So this theory not about business but about speculation. From this point of view, the principles of Warren Buffett who are adheres to the theory of value investing is much more suitable.
Strategic points
A) Pocket project represents a real business with a new category of digital asset - pokt. The token price is not the best representative criterion for the success of the project’s business. Hence, it would be better if this proposal was presented in terms of business prospects (relays) rather than a token price.
Let’s make some calculations to comprehend the necessary number of relays for token price levels. For instance, if we eliminate the speculative component moving away from exchanges when where are only clients which buy tokens from Pocket network then price (intrinsic token value) will be created only by demand from clients and inflationary supply. In this case:
5 usd per 1 pokt at the current level of inflation will be correpsponding to 220k pokt * 5 usd / 0,00000085 = 1,3 trillion daily relays;
3 usd per 1 pokt will mean 780 billion daily relays;
2 usd per 1 perk will show 520 billion daily relays;
1 usd per 1 pokt will give a number of 260 billion daily relays;
0,5 usd per 1 pokt will be stipulated by 130 billion daily relays.
As a token price rises to 5 usd inflation can be reduced to 30% (calculation not shown) - a level that would meet the interests of node runners and stakers (on condition of 10% allocation to DAO and 45 000 (15k pokt) nodes)
Next, as it was shown in the new tokenomics model that for LLMs the price per relay can be twice as expensive. It is not possible to say what part of relays would come from LLMs but there could be guessed offhand that 20%, then an average price per relay would be 0,00000102 usd what gives another (0,00000085/0,00000102) 20% reduction of relays for the target prices. Then the adjusted number of relays to reach the target prices will look as follows:
at 5 usd per 1 pokt - 830 billion daily relays;
at 3 usd per 1 pokt will mean 500 billion daily relays;
2 usd per 1 perk will show 320 billion daily relays;
1 usd per 1 pokt will give a number of 167 billion daily relays;
0,5 usd per 1 pokt will be stipulated by 83 billion daily relays.
In addition the Price to Earnings ration (P/E) from the traditional financial analysis can be applied to evaluate the number of relays which are needed for a price of 5 usd per token and for the company to be considered well-establlished in the market. In this example revenue will be taken instead of net profit. Number of tokens is taken after inflation increased by 20 percent. The current P/E ratio for Pocket is 411, сomparable to the value of venture dotcoms. Provided that the average P/E ratio for technology companies on the stock market is about 40 it is possible to get a number of relays:
P/E = (5 usd per token * 1,7 bln tokens * 1,2 additional inflation in proposal ) / (Daily Number of relays * 0,00000085 usd per relay * 365 days) = 40
where Daily Number of relays should be 820 bln which is close in value to the aforementioned assumptions based on the estimation using intrinsic token value.
If to speak in terms of reflexivity or “expectations” of market participants the reflexivity ratio can be got as the market token price divided by the intrinsic token value what equals as of today:
Reflexivity ratio = 0,045 / (524 mln daily relays * 0,00000085 usd per relay / 220 000 pokt) = 22,5
When a token rose on the news about Big Announcement, Upbit listing, Crypto listing, Andrew Kang tweets then this ratio reached 100. Why is this number “22,5” attractive to date? On the reason the today’s reflexivity ratio is net-clean and in circumstances of uncertainties is based only on goodwill of Pocket Network. Moreover, this project isn’t backed by T1 VCs like Jump Trading, Jump Crypto, a16z, Paradigm, Multicoin, Polychain, Binance Labs, Coinbase etc. which have vast marketing possibilities.
What does this “22,5” reflexivity ratio show? This number allows to 22,5x reduce the number of relays at the appropriate token price levels based only on the intrinsic token value.
So combining both approaches together there can obtained the ranges of the volumes of daily relays necessary to reach the token price levels:
at 5 usd per 1 pokt - 37 …… 830 billion daily relays;
at 3 usd per 1 pokt will mean 22 ……. 500 billion daily relays;
2 usd per 1 perk will show 14 ……. 320 billion daily relays;
1 usd per 1 pokt will give a number of 7,4 …… 167 billion daily relays;
0,5 usd per 1 pokt will be stipulated by 3,7 ……83 billion daily relays.
Thus, Mike’s proposal should include the additional target criteria expressed by the volumes of future relays (proposed by Mike in his vision) and tied to the compensation price levels. This step will show the project’s confidence in the future and its focus on the long term prospects.
B) That part of the proposal where is suggested to increase inflation by 20% has the ambiguous consequence and the questionable impact on the token price. If I caught the course of actions right this step wouldn’t be of any avail for stakers besides dilution because 75% of daily inflation will be directed to DAO. It turns out that the total supply will be 1,7 bln * 1,2 = 2,04 bln, every day 930 000 tokens will be minted and 700 000 of which will be moved to exchanges to fund the further work. Will it create a pressure on price via selling on exchanges? Certainly. This action will be bringing down the price further because this measure violates the economic principle by significantly increasing the number of tokens without providing them with collateral (relays).
So a big contradiction appears: on the one hand, the proposal declares its intention to increase the price of the token, on the other hand, unsecured inflation will bring down the price of the token. In economic terms these additional tokens can be considered as a credit secured by future contracts for relays from AI and other companies. The second important point is how will these tokens be sold if there is no liquidity so as not to collapse the price? In order not to destroy the price of the token, liquidity must be created.
That is why in Mike’s proposal the timeliness of steps is urgently essential. In this sense one of the best scenarios for the development of events may be the following:
How to secure such a contract, not yet known but I don’t work at Pocket to answer, the only thing that can be said is that now the main vector of work should be aimed at obtaining such a contract to increase the company’s goodwill.
Tactic point
That part of proposal dealt with the reduction of minimal stake to 5000 tokens is controversial. Why do new people would like to stake in this project if there is no any comfort in staking? Now for staking a person must perform many actions: go to the project website, then visit TG group and find out about Discord, or visit Discord at once, then enter Node Runnder group, then to choose a Node Runner, to understand APY, then communicate via email or other sources, then send tokens because there isn’t yet truly non-custodial staking etc. Can this be considered as comfortable? Certainly, not.
There needs to be done a lot work with Node Runners related to the quality of the staking service when a person enters the website (it can be comparestakingservices or other website) where all node runners are presented with the clear information about APY, available number of nodes or slots for staking and the most important the possibility to stake and unstake via smart contract when a potential staker doesn’t need to send tokens to address of a node runner and conduct correspondence