Melon Protocol | BlockchainBrad | Decentralized On-Chain Asset Management | DeFi Lego Infrastructure

published on August 2, 2020

hello it's Brad Laurie a blockchain Brad and today we're talking about all things finance more specifically we're talking about melon protocol to do that we have the CEO of avantgarde financial and also the co-founder of melon protocol right

Here to give us all the updates all the information her name is Mona ELISA and she's here as I said to give us all that important info regarding this new and exciting protocol that's emerged very recently on the blockchain Mona thank

You very much for your time today thanks Brad it's great to be here likewise and for all those wondering this is entirely free this is information education and for all of us to learn more about what Mona of what Mona is doing with the team

And what essentially melon protocol is all about now to start off with the slogan or the statement that really does meld with everything that no one stands for is decentralized on chain asset management no no you have a lot of

Experience in finance you could even touch on that if you'd like to in this risen it's question but can you just give us a quick rundown on what it means to essentially be an on chain asset management protocol and your experience

In context of that yeah sure so starting with my experience because I guess that's ultimately what led me here I started my career in traditional finance so in 2003 I started working on the trading desk at Goldman Sachs I was a

Market maker and an trader for almost a decade there I shifted I shifted or made markets and in large cap equity small illiquid equities which which traded quite similarly to crypto and and I basically took positions across the

Whole spectrum of finance whether that was cash equity or derivatives or futures or commodities any other asset classes you can probably think of and you've gotten to quite modest I'm just going to jump in there because

Researching your background we're talking about managing billions of dollars as well in both liquid and a liquid markets you know quite significant experience so do you want to just touch on the depth of that

Knowledge especially with regard to all maybe market-making as part of your experience yeah I mean I think you know I think being able to work in in an environment like that I think I think the timing was relevant to because I

Think in 2008 a bunch of regulatory restrictions got put on the bank which made you know which handcuffed to some degree what what traders couldn't couldn't trade and and how they could trade you know you know a large

Institution like Coleman has a great culture in the sense that if you do well early on they don't care if you're male female you know black white whatever they they're just if you're making money for

Them they empower you and and from her very own they don't care what age you are they don't care how much experience they are they're like if he or she is good we're gonna give them you know we're gonna empower them to grow and to

And to do really well and I don't think I've ever worked in another place like that since but you know because of that you know you you you really strive to do your if you're ambitious you strive to do your best and you get it you get

Exposure to the whole spectrum you know me goldman you know is is is a huge institution with so many different departments and and they're very big on cross asset or you know cross selling so to you know and I have a curious

Personality so I wasn't I wasn't satisfied just sticking to my domain of cash equities I was going over to the derivatives tests the credit desks you know commodity desks and saying hey what's what's going on here what's

Interesting and how can we make money out of this you know and more interesting trades can we put in put on and and and ultimately you know this this you know they like that and I like that I work for them it works for me and

It was it was great fun and it enabled me to learn a ton and and also to make you know to make a lot of money for them in 2011 you know I started thinking that the grass might be greener on the other side and I said I want to become a

Client of Goldman and go and work on the hedge fund side because it always you know it seems more appealing on the other side and and I did that and I went and worked for a large hedge fund client for four years for me personally the

Grass wasn't as green on the other side I you know I never you know I never quite felt as challenges when I worked at Goldman and and and in 2014 and this was the really crucial moment in my career which I

Think shaped and helped foster Mellon I I was approached by a family office we said look we want to launch a longshore equity fund we've had referrals on you from a couple of different people and we think you're the right person to do this

For us would you like to launch your own hedge fund and we'll feed it and I was like hell yeah bring it on let's do this so I never actually stopped for a second to consider the risks or what what I was

Getting into and I just did what I always do which is I did you know I dive headfirst into something and I just immersed myself and I'm like this is gonna be a success because I'm just like such a hard worker and I'm so passionate

About what I do and I'm gonna make it a success regardless of all the risks you know but ultimately I was incredibly shocked to find out that the reality of setting up a hedge fund is incredibly difficult in the traditional world and

What what makes it difficult is the incredibly high barriers to entry and the incredibly high inefficiencies in traditional finance which I've always until that point been shielded from because Goldman is such a large

Institution they can just hire floors and Florida people to take care of all the operational administrative crap that people usually have to deal with and and they're in there ethos is Monas a trader that's what she's good at we're gonna

Clear everything else of her desk so she can just focus on trading same at – and then you know I start as a thirty million dollar fund which is tiny in the world of finance but actually you and I both know it's not not tiny in the real

World you know in kind of non finance world and it's actually very hard to raise thirty million dollars and I'm thinking so where's well my staff you know Chris gonna book this trade for me and who is gonna you know reconcile the

PNL at the end of the day and who is gonna you know who's gonna take that call that the ten calls you know voicemails I have from the fund administrator who's going to respond to that

Why is my PNL not marching the P&L of the fund administrator who's gonna spend the five hours looking into that you know in comparing my spreadsheet with their spreadsheet we're talking you know very complicated spreadsheets not just a

Matter of cash position but you're also thinking about tell FX moves futures cash balances you know all of this kind of stuff that normal people don't have to deal with right and and so and so I just was

Shocked by how inefficient you know we're still booking trades with Excel at the end of the day we're still you know there's we don't have a standardized way of booking trades we have a different way of booking cash equity with futures

With derivatives with you know in each of these are 40 column spreadsheets with which have to be manually filled out reported to the fund administrator the next day you know you're getting a bunch of phone calls why did you book this at

Four basis points and the counterparty book did it to basis points and you're like I don't know you know so yeah like it's like you know I just turned into like an admin monkey and I was like hang on a second I'm not even having time to

Do what I I'm supposed to be doing you know people are entrusting me with their money hmm to invest on their behalf and B I'm not doing what I love doing I'm doing all this stuff but but I guess the most eye-opening thing and I guess every

I would call that a failure my first big failure in my career I guess every big failure comes with a bunch of lessons and for me it was how the engine of financial asset management specifically works something that I

Hadn't learnt the theory off but never actually the you know in practice it's always like oh wow does this really work like this and and that's kind of the eye-opening moment and I was just like wow I can't believe that with all the

Tech we have available today this was 2015 you know I was like all the tech we have available today and Finance which is supposed to be like this let see very well-funded industry is still working like this under the hood

This is insane I'm gonna just jump in you know what's quite amazing is this is only five years ago we're talking about you know this so major change in your own professional career and in that you know you mentioned the word failure but

Perhaps that was really the catalyst for leading into Mellon as well and providing some of those key insights into asset management and then having to manage such a small fund you know in the scheme of Goldman and the you know the

Wider sort of sphere of Finance that you will you know you knew and you know worked in for so long so all these things were building really for expertise and that's why I really want to talk to you because you know speak

With you isn't like someone who's just doing their first startup you really do have a lot of this experience that built towards milind so that's why this is so important I think for the listener to understand that there was such a value

In even that value as you called it yeah exactly no I think I mean I'm immensely grateful to that hey there if you want to call it that but it is it was a failure and I think you know I initially left that

Whole experience after a year thinking I'm just exhausted I can't believe that you know I felt so bad that was I was down I was depressed I was exhausted from you know the long 24/7 days that when I was trying to this whole thing

Work I didn't want to give up and it was like literally you know it was very hard for me to give up on something in an admit that I'd fail and I first reaction was I don't know what to do with myself now I mean I could go back to Coleman

But that feels like taking a step back you know and I'm I said look maybe I just take a year out and and I'm like you know reflect and decide what I want to do next and two months in I'm on a beach in Brazil and I'm like reading

About Bitcoin and then aetherium and then I'm reading about Krypto Valley and I'm like holy crap and I was like I can take my year off another time you know I was like laying back to Zurich and I was like crypto value that my doorstep this

Is a once in a lifetime opportunity and you know when I understood how smart contracts work worked in end of 2015 beginning of 2016 I was like you know we started to see the very first icos and I started to I started to imagine that you

Know the future is tokenized the future is 100% organized every asset you can think of today will have a tokenized form or it's organized as you know an asset class and you know that I'm not saying that Apple stock check you know

Stock story Apple shares will stop trading on the stock market but in the you know on on why wouldn't there be a version of Apple shares that is tradable on the blockchain as well and I just see Vic you know the reason it hasn't

Happened that was probably regulatory but I just see it as inevitable that everything we can imagine today we will have a tokenized share class and given your experience in Goldman that's quite exciting to hear quite honestly because

Stretching out even beyond utilities to the security realm as well in the future and we see now you know you mentioned the ICO boom that was predominantly that utility token sort of era and boom and we still see the likes of that now and

Certainly relates directly to men as well so you know coming back to the blockchain looking back at crypto how long did it take him I know to really sort of understand the the fundamentals of blockchain to meld with all that

Experience you had in the financial world I'm not going to claim to be you know a technical expert even today to be honest you know I think I read a lot and I teach myself a lot but ultimately I was

Empowered by the people that I helped him mentored in the early days you know which were mostly tech people and they taught me most of what I know you know I just immersed myself in crypto Valley at the time I was the first finance person

Who had not who did not have a tech background and at first they were very resistant to me they were like oh you come from the evil world of finance yeah I was gonna ask you about that but exactly and then I told them well

Actually I don't any more work in CI and I'm actually really fascinated by what's going on here and so I made a lot of friends that way I mentored a lot of early startups from crypto body I invested in a few early startups from

Crypto body and I and and and they you know these guys taught me so much like you know and it was it was through these conversations and lessons that I you know suddenly realized that yeah this is this is this is token I if you if you if

You can buy into the assumption that the future is tokenized then it's absolutely a no-brainer that the future asset management infrastructure is it is digital and it's and it's gonna be run by a smart contract operated system and

That's the exciting part I mean having spoken to you pre-interview as well what's interesting is you do bring this you know significant expertise but you're also very well networked and that's one thing

That's been prominent and clear for a few years now so you know when you talk about that teaming up with though is so technically savvy parties in crypto it's not just your average you know neither you are will wit networked in

Very important spaces within blockchain and within those key even when it comes to the V sees when it comes to the technical parties you're very well set up there and and that arguably strengthens your positioning for the

Future with melon and let's get into it more of the specifics of this minor because you really do stand for that decentralized on chain asset management I called it dome you know just as an acronym but you know that that

Decentralized aspect is unique you know when you add the token into these and then having it all on chain as well so what's the value add fundamentally if having melon out there when we look at the context of what's been in the past

Were traditional models yes so I mean there's two aspects I think there's the there's a there's an automation part so first of all I mean let's start with understanding what a protocol is because a lot of people think protocol is a

Technological term rather protocols have existed for for centuries and they predate technology protocols are just standard sets of procedures which enable things to happen efficiently you know they enable you know for

Example you know here the protocol is you know you drive on the right side of the road you stop when the traffic like it's red you go when the traffic light is green and and I'm protocol for example for driving it's it's what give

Peace it gives people the courage and the confidence to get in the car in the morning and know they're not going to have an accident because obviously pretty cool it's exactly the same in finance you

Know you you you you you can do a trade in finance and traditional finance because you know that if you agree to buy you know Apple shares at five hundred dollars that some someone some magic in the background is going to make

Sure that you know you you pay your five hundred dollars and someone will deliver you those shares and it's because of those financial protocols that you are able to trust and participate in the financial system right they haven't

Always been that trustworthy though as we know from 2008 etc Nima and going bankrupt and you know a ton of people being left out of pocket and so and so and one of the reasons for that is is you know a lack of automation like

Everything is done manually for example you know you can you can oversee you know Rogue rogue traders have gotten away with things because processes are not transparent you had big years you know which have gone unreported or

Undiscovered for four weeks because processes are not transparent and things can get lost in that big admin chain and so and so what what what melon other decentralized finance protocols is proposed to do and where I think the

Biggest a value-add is is that they can automate protocols so if we start from the beginning of the asset management stack right you know you have the token so you have tokenization which we all know about then you have Dex's so this

Enables you know me and you to trade with one another without needing to trust one another because the decks will ultimately ensure that you know if if I if I bid for a price and you hit that you know hit that bid you know this the

The the block team will ensure settlement so we can trade with each other without having any financial intermediary in the middle to generate protocol which enables us to trust one another right and just interrupt for

Those who may not know index is a decentralized exchange same with borrowing and lending you know in the traditional world you have people doing credit reviews you have on you before you can take out a loan you you have a

Bank to you know who has all of your personal contact details if you don't make a payment an interest payment or whatever you get warning letters and someone will chase that on the blockchain you can basically borrow from

You know I can borrow from you bread you know you've got I have to lock up some collateral to be able to borrow from you so you have the knowledge of knowing if I can't pay back for some reason that you have you know the smart contracts

Will give you claim on what I've locked up and so we're automating financial protocol without the need for banks credit agencies those companies that chase you down if you don't pay back etc and an asset management is exactly the

Same thing it's except that we're you know we're automating protocol between fund managers and investors in those funds so as an investor if I'm investing in Brad's capital what I want to do is make

Sure that brad is not going to run away with my money is not he's gonna spend it on investing on my behalf and making a return for me I don't want to see you buying a yachts and you know San Tropez

And partying with my money I want to make sure that you're investing in like if it's a crypto fund I want to make sure you're investing in high-quality crypto and adhering to certain risk management principles etc etc I want to

Make sure that if you tell me you're gonna be investing in crypto you don't take the money and invest it in African real estate which I might not want to have before to right row so the protocol basically ensures that investors and

Managers can have this relationship with one another which establishes trust without the need for in a transparent way without the need for a bunch of financial intermediaries like a farm administrator a custodian asset which is

What all of those guys basically know and when oh this is pretty exciting considering your background gear and hopping back to that CFI world because in that world there's immense cost in that complex hierarchical instruction

And also just the sheer complexity of paperwork that has to be done in all the people involved in that so many third parties this really is trying to redress that immediately cut down or the crack even and make it quite seamless

Cost-effective as well so surely this must be quite exciting with the you know your background and seeing what can be done and how we can simplify this for both parties on either side of the transaction yeah absolutely it's

Absolutely fascinating I mean on average it probably takes a fund manager six to nine months to launch a fund or sometimes even twelve months and it's all the legal paperwork looking for the fund administrator negotiating fees

There's no when I said when I launched my phone that couldn't find a fund administrator that would charge me less than $25,000 a year same with the custodian another $25,000 a year niebo fees you're looking at at least

$25,000 per setup but you know if you want a more reputable firm probably closer to 50 60 and and you know and these things add up you know and you know these up and they're recurring because you know the fund administrator

Is not just a one-off fee it's an annual fee and so you're looking at about a hundred thousand dollars this is absolute bare-bones minimum you know the fund administrator just holds you to a minimum you know because they

They want to make it worth their time they don't unboard small people because there's just like a lot of work for them and not much revenue so you're looking at a hundred thousand dollars you know for the first year and maybe 75

Recurring after that and that's just insane you know and you've actually done it you know you're speaking from experience here so let's move ahead of the future as well clearly the cost can be significant low for someone who wants

To go and establish a fund utilizing something like Mel and protocol that's why you built it so let's get deeper into this this is fascinating so let's discuss essentially what makes a market there's some literature that you've put

Out and others as well about you know the boon with regard to you know some of those core sort of assets when it comes to a market itself like volatility liquidity and I won't mention them all let you talk about it but clearly this

Is all part and parcel with establishing that automated market making and also everything that the Miller protocol offers yeah so so yeah so that's absolutely right so the reason I wrote that piece and providing the core

Yeah scaling in quiddity and decentralized finance is well it's my background so I understand this base quite well and I'm not focused on that space myself specifically but we integrate a bunch of Dex's and and one

Of the frustrations our users have had in the past is not having access to enough liquidity so you know it's all good all well and good building a decentralized finance structure but it has to compete with CFI you know if if

You're getting a price if you're if you if you if you're getting trade execution which is you know even two three four five percent worse off than what you could get on trading on a centralized exchange frankly you know people are

Gonna say well how important is it to be decentralized I might just prefer to trade on CFI so so you have to compete and and so you know if I've watched the deck space you know for the last few years from a distance and we're

Integrated with all the major Dex's and I just think you know what why haven't they sold liquidity yet and and I think you know and I think some of some of them are doing great jobs and there's some some real innovation around there

But there are you know there are some you know there are some core try we laugh annoyed yeah there are some challenges and I think we're lacking kind of people with real market-making

Experience but it also you know we have a lot of people who have the technical blockchain experience but not very many people who understand really understand market making other than theory and and I think that's so I think what we've

Done really well in this face is the automated market making component but by definition when you make when you have an automated market maker it this cannot scale so this can only deal with already liquid orders and when you start to you

Know the whole point of a market maker really is to provide liquidity where liquidity is not there robaix definite has to be you know a price which is kind of manually made and I think what what technologists kind of love to ignore is

The fact that you know the the the the the the technical fully technological solution from start to finish is always more elegant but it's not always the best and I think I think that market making is a people's business if you

Really want to if you really want to excel and scale the quiddity you have to accept that it is a people's business you need to know where all the buyers and sellers are you need to have relations with them you need to be able

To pick up the phone and say look Brad I've got a buyer I know you've been trying to sell this illiquid piece of crap for like you know the last ten weeks and you haven't found the bid I can now bid you for it because of my

Network and and we can settle on Shane and that's fine but that you need to be able to know where the market is and be able to broke it they also need to be able to make risk prices you need to understand that you know an algorithm

Can't properly price everything I mean it can but it will make you lose money ultimately you know and and so if you want to if you want a sustainable market making business you need to be able to price things competitively and in a way

That you do not you know over time you make money not lose money because if you're losing money you'll shut down and then we have a you know real problem because there will be no market makers that so so the so the model you know for

Example if we if we look at a mms like you know many of them are basically based on this model which only takes two inputs and and the inputs are the size of the trade and the volume of the pool and it doesn't you know it doesn't take

Anything in else into consideration and the way it works is the bigger your order as a percentage of the pool so the much wider the spread so you know if you wanted to buy 50% of what was in a unis bought pool you would get an awful

Awful awful execution and you would be lost making for you know for the first few minutes after that you know for a while after that right so it's not rational for anyone to actually trade big size on a on a on a protocol like

Unis walk because they'll always get a better execution you know on a centralized exchange or from a market maker and that's quite standard we say especially you know in 2020 that might change over time and when there's even

More liquidity perhaps with the Dex's and there's more has more uptake but you are right and we say that the bigger orders do tend to go with the sexes right now let's see the centralized exchanges yeah I think people are

Starting to I mean I'm seeing 0x and Khyber Network building infrastructure now which is more appropriate for you know manual market makers they're like you know they both are running programs to onboard manual market makers and get

Them familiar with you think using Dex technology there's still a bit of resistance from kind of a more professional you know market makers to come into the Dex world because there is a kind of technical barrier they have to

Jump through and but it you know it's gonna happen it's just you know you you know it is a people's business you do have to accept that and you cannot just you can automate small you know already liquid orders but you can't automate

Everything good thing right and it's exciting that you've already addressing some of these concerns you certainly informed with your team about the imperative of scalability and in the context of Dex's to be authentically

Decentralized over time so looking at the likes of unis waffle or khyber as you mentioned in other decks as well you're clearly moving in concert with those because you're the integrations are there now one of the things I did

Want to touch on is just looking more specifically at the solutions that are unique to melon protocol because there are also other sort of financial platforms or financial protocols as we've talked about that have emerged so

What sets you apart specifically in line with regard to having started quite early you're one of the frontrunners for this sort of niche area or this vertical within the domain of blockchain so what really puts you ahead of the game do you

Think yeah so I think the first thing is that we're decentralized you know there's a lot of people who you know in defy there's a lot of people who say they will eventually decentralize

But we've done it we've done it a year and a half ago nearly we were the first defy protocol in history to decentralize our governance that means we do not control the contracts we have no we have no way of you know manipulating or

Changing the game or you know anything right that's a big deal so the default gets a big tick from the start yeah so I think we're the only asset management protocol that is fully decentralized so I think that's a starting point second

Part is we were built and this is really important we were built primarily and you know primarily with the goal of being the asset management infrastructure not product right infrastructure so we're not looking to

Launch funky exotic products our users will do that we're looking to be the best tool set or toolkit for a user to say hey I want to launch an ETF today or I want to launch a discretionary fund or I want to launch a yield farming fund or

A staking fund or whatever and I can now do this instead of in twelve months I can do this in a couple of minutes on melon I can customize my parameters I can whitelist investors I can set my risk management rules and all of this is

Now happening in a couple of minutes for I want to say a couple of dollars but the gas fees are really expensive right now you know interesting because you basically defy Lego in the financial world exactly and and that's exactly it

And so you can customize what your when I say fund I just mean any financial product can be built on melon in a few clicks and this is like you don't need to be a developer you don't you know everything is

Open-source everything has an interface everything is easy to access in a few clicks you can deploy a fund to the blockchain for let's call it a couple of hundred bucks it's a bit of volatile right now but but this is like compared

To the hundred thousand dollars that I just mentioned you know referencing the old world and and this is like insane and now you can trade you can build your track record on the blockchain which again I think we're the only protocol

Which publishes track records on the block daily so you know you can basically now take you know one of the hardest things about being a start-up manager in asset management is you can't raise money

Unless you have a two-year audited track record for and then you can but then you can't survive two years because of the high cost and operational admin burden if you don't have operational and administrative support so so it's like

This chicken and egg situation so you know there is this act that says that 9 out of 10 funds fail in the first year if they launch with less than 200 million dollars that is where you know if you launch it with under 200 million

Dollars 90% of the time you will fail that's how severe the barriers to entry are so now what we're doing is we're empowering the long tail we're saying if you're a good trader if you have good calls on the

Market if you're a good investor you can now set up this fund for a couple of hundred bucks you don't even need to attract investors you can just prove that you're a good trader for the first couple of years do it in your free time

Do it in your weekends whatever but but in two years time if you have a good record if you have a good record is now audited because it's on the blockchain you can literally take this to anyone and say I can prove you know I didn't

Make these numbers up you can you can check it you can look it all up yourself now how about that two hundred million dollars you know you said you would invest if I had it you know two year track record and so and so this is like

For me this is like empowering belong tell because until now it's only been possible for the large funds to survive and to do well and and really the small guy on the street or the small ambitious person who might be ten times better

Than the large you know the large incumbent is just doomed to fail from the start because of the way that the industry is structured yeah and then that's why we love defy you know it addresses that inequality and inequity

It allows you you know people anticipate with a small amount of capital to and one thing that we did talk about queen of you at length when we call it up was that you know there's been a period of time where perhaps you know Mellon has

Gone through some tough times you know had to go through that really difficult phase where you know it was touch-and-go for a while because of capital because of the challenges you know that we simply face when we see icos start up

And then move cross into the challenging time when you're trying to establish the team really make sure that there is that use case you have done this for some years now

And we should address that because this is significant given that so many have already failed in you know this transition or in the in this period from starting to now you made it this far and you made it through that hardest time of

All so you want to just touch on a little bit so people understand you now ready yeah so I guess you know I guess one of the big push backs so you mentioned that you mentioned VC earlier and actually I do know a lot of the VCS

You know and in crypto but but I want to I want to make a point which is that Mellon port the company which founded the Menem protocol I think was the only company in in the space and in defy that never took any venture money you know we

Raised three million dollars through a token sale but we actually never had supports a venture Wow no so that's the first thing so three million dollars lassiter's two years we delivered on time on budget in February

2019 we deployed to the main net and we decentralized and we wound down that import and delivered on our promise and you know and then the difficult times started as you know as you know in 2019 and even 2018 it was a difficult market

For crypto especially if we're an altcoin or you know if you were not if you were not eath or Bitcoin so you know what what I guess I never saw coming well to this degree I guess was the the Mellon token price which is the token

That's supposed to fund future development and maintenance on the protocol just absolutely crashed right a couple of factors contributed to that in March last year to year vesting period ended in a cliff and some selling

Pressure I don't I've never sold any of my founder tokens by the way just for the record but but you know it the vesting cliff did end and you know the selling pressure did hit the market you know to

Counter that you know usage is supposed to create demand for the token but we didn't have any users in the first year because unfortunately the first version of our protocol was very very very user unfriendly

And so the first year we had no users we had pressure on the tokens and then and then to make it worse the council gave the first grant to a team that was building on melon and a mistake that we probably made you know there was no

Vesting or a lock-up attached to that and I did they also started selling and so it was just a very unfortunate combination of events and you know at a point in time you know the protocol total protocol all the work that we done

Was worth less than three million dollars but mono you know I have to you know commend you quite sincerely for the transparency here I so rarely get a chance to have these discussions with this kind of openness I genuinely mean

That so we're talking about you know all of the the iterations all of the challenges that you've gone through you've been through the hardest time of all and that's when they cap what when essentially you saw that something

Pressure and that was always going to happen once unlocks you know are available there's always going to be members of you know who participated early do try to offload you know when especially in tonnes when there was some

Questions just more broadly in the blockchain but then you survived it and this is why I find this interesting because now we see version two have emerged you just got the terminal now running got a lot of interest from

Really important parties in the mainstream as well that must have been you know proud moment to see that now start to the traction of start to build once again yeah I mean look throughout the

Throughout the token Christ weakness you know I've always been a believer that don't focus on the prize focus on the work we're doing and and just you know and just push through it and we'll be fine so in October we launched

Avant-garde finance so we started work you know full-time work actually we started it before then we were maintaining the protocol without any funding just kind of out of pocket for the most of last summer we had to do we

Had to Deb's working on the protocol last summer and then in October I'd put the team I put a new team back together under avantgarde finance and I was like I'm not really done here you know I've taken some time out I've watched the

Defy space and but I want to make about that you know if we keep pushing you know this is gonna come this is gonna come good because there's no other asset management protocol that comes close to what Milan can do one

The biggest problems is is just unusable and I can understand where there are no usable users if it's not unusable but also defy was suddenly exploding you know we'd been in D Phi since 2016 when the only other defy protocols when we

Launched were maker and ocker and and you know all of them look at the layout yeah all of a sudden everyone's a defy protocol you know but but but joking aside that you know there's some really you know lending and borrowing wasn't

Around about actually maker was around but you know the the the slash loans concept wasn't around derivatives were around synthetic products were not around so now we've got all these wonderful cool exciting things we can do

With melon you know we can make all of these kind of products available to users and and so we need we need to have another go and you know but I'm like who's gonna fund it the council you know can only give us melon tokens and at

Best you know those tokens were worth not very much when you consider our developer costs yeah so I would think right someone's gonna have to underwrite that risk so I said okay I'll do it you know I have to give myself a finite

Deadline because obviously I don't I'm not able to fund this indefinitely but I'll take my lintel I'll apply for some melon tokens from the council and I will underwrite my own cash to put a team together and fund this project

Regardless of you know I may I may lose money if I'm wrong and and and that was the bet I took in October and and yeah and so and so we released in February the new interface that melon I haven't got melon dot avant-garde of finance if

You've tried it out you have a look at them it should be it's not it's not as easy as I want it to be to use but it it should is certainly usable now and the next release will be ten times better and that's what I want to talk to you

About as well because you know you're increasing that usability you know that user-friendly aspect with the interface itself and there'll be other iterations I'm sure as you like release them but even to date how has the interest being

In sort of the user space you know the feedback from those parties now who are engaging in the protocol and actually using that feedback has been great I have to say you know we you know since releasing in February

And I kind of expected the the user numbers to take up aggressively and we saw new users but not new assets under management and I thought the feedback was great but I was like where where's all

You know if it's so good why are people not putting money into the protocol and it turns out that I think the first couple of months was mostly experimentation with people and then real products started to be launched it

Seems kind of April May and we've seen really big great growth numbers since since kind of the end of March beginning of April you know we're seeing kind of 15% well 12 to 15% growth in new funds every month we're seeing so we're it

Like I think from memory I think it's three hundred and thirty-five funds at the moment we're seeing a huge growth in new investments so you know I think that's also around 15 percent growth per month from memory and most importantly

We're seeing really big growth in the assets under management now so the last two months I think it was 40% growth 50% growth and I think this month is already we know we're not nowhere close to the end of the month yeah but 25% growth

Tracking Wow and one of those numbers you know if we're talking about the last let's say three months that's a significant you know leap forward I can only imagine you know what will happen in the next few months even in next year

In terms of trajectory potential you must be excited and given that now you're starting to get the momentum use time to get that experimentation in the defy world like we've seen the some of the other products all the other

Protocols like for example synthetics they're you know they were popular being buzzwords and now they're doing very well to the lending side of things and now it's time for Mellon do you think that this is the time for it to shine in

The next let's say q3 q4 yeah I think I mean I think um that you know the the I think for sure I think you know you asked me what our users saying and generally the feedback is really positive but there are some things that

We need to do at a protocol level to unblock users that are desperately waiting to launch products but are blocked by certain features missing or whatever that they really need right and so we're

Working like relentlessly entire list need to get those features out for them for v2q for this year which is what we're targeting but yeah absolutely even on the current version you know we will see growth but

I think v2 will really make a big you know dent in how people see melon because it's you know it's you know I about the user experience you know it still takes about 15 minutes to launch a fund and it still costs a lot of gas

Will hopefully abstract you know will simplify the gas requirements for setting up a phone because of some refactoring we're doing and we'll take that 15 minute process hopefully down to a couple of minutes at

Most right you know just continuously removing removing frictions as much as we as much as possible we're also getting complaints that trading is expensive on Shane you know so we're

Trying to think of ways to because of the gas we touched on gas earlier and and so we're so we're kind of thinking of ways to people can trade more gas efficiently and so we're really trying to listen to the user as much as

Possible in terms of prioritizing features and and roadmap because ultimately without users you know we will not succeed so we have to listen to what they what they need now and I love the fact that you know you know driven

By the long term sort of you know goal of this um you and your team and you're listening to the users themselves and clearly that version 2 Q 4 is going to be a game changer already listening to the inflation changes listening to some

Of the claims you have and this is really again just the beginning in the scheme of you know the whole plan for melanin in any years I would imagine that you are thinking ahead but once again you know it's all it's all going

To be determined by real utility showing that showcasing that token as a treat already in context so we probably should touch on some of those things now we've discuss a little bit more about the the protocol itself but I wanted to ask you

About some of the key functions of it more specifically well what it allows you to do so some of the reference points here are things like we know it allows us to deploy on chain funds but things like defining parameters choosing

Decentralize exchanges invest in your own phone your own funds tracking funds and arbitrage are they the predominant things is there anything you wanted to add in in terms of functionality per you know the what it actually does before we

Move on yeah sure that's a great question actually so I think maybe the easiest way is just can walk you through the process of setting up on a set of go fund investing in a fund so so you come

You know as a fund manager you might have an idea for a new strategy or even just a basket let's say we want to create a defy basket and the waiting's have to be you know five biggest defy tokens 20 percent waiting you know each

You know it doesn't have to be that but let's just use that example you come to the protocol you're like okay a create new fund you fill out a form which the former just says you know what's the name of your fund which taxes are you

Going to need to interact with what fees are you going to want to charge to your investors and these are all transparent that's really important because a lot of fees even in defy are hidden um you know and and you so you might want to say 2%

Management fee 20% performance fee so a management fee is for those who don't know a time-based fee that you pay based on the you know the asset so if you're investing $100 you'll pay two dollars every year for you know regardless of

Performance right and if you're and then the performance fee is saying like if Brad makes me if he makes fifty percent performance for the fund I will pay him 20 percent of that fifty percent for doing such a great job so it's almost

Like a bonus or a performance right so so you can you can basically you know define your performance and management fee you can define you know do you want the fun to be open to everyone or do you only want it to be open to friends and

Family and selectively people so white the white listing function do you want to set rules like maximum number of positions or you know Brad can't take a position more than 20% you know it's going to limit the possibility of you

Getting carried away in taking you know undisciplined positions or into lack of this what I mean yeah basically that rubric we've never been able to do that before as individuals really you know yeah

You've always had to have someone guarding over your shoulder to make sure you don't get carried away so basically you define these rule sets you deploy the fund to the blockchain and now this fund is let's call it Brad

Capital you know this fund is now a token of itself existing on the blockchain and Brad capital is now fond or it's a token and now anyone investing in Brad capital has to invest for the interface by playing Brad

Capital hit the invest button send a crypto by investing into the fund and they receive Brad capital tokens back right at at any point in time those Brad capital tokens are redeemable for the underlying assets in the fund so you

Always as an investor have to pull cast custody of your assets so so the investor can just get exposure to investing in a few funds and basically you know letting you I don't want to manage my money day today so I'm just

Gonna give 20% of my money to Brad 20% to x-y said you know and basically just let them do it they are and a fee for it and I can just you know do the other stuff that I want to prioritize so very importantly the protocol from the point

That you deploy the fund the rules of the fonda are transparent so anyone can see the fee is the rule sets etc before investing they can never be changed which means that it's not that I invest and then you can say actually I'm gonna

Sneak Lea increase the fees on Mona you cannot do and really importantly it takes care of the nav the nav is just the net asset value or the pride the share price of the fund gets calculated it actually gets calculated on a live

Basis but it gets published to the blockchain once a day which enables you to create a track record so if in two years time your track record is looking really good you can be like hell hell yeah this is this is actually I'm

Out performing and you can show it you can you can asana and you can prove I'm not performing ninety percent of the funds on menon you know maybe I can quit my boring day day job and like you know basically you know go out and raise

Money make this a proper full-time job so so you can you can do this with any strategy can be automated it can be manual it can be self rebalancing it can be discretionary whatever we know we're designed to cater for any strategy and

And yeah and and the other cool thing is you don't have to worry about the fees the smart contract calculates the complex management and performance fees which Radek bush they usually drive on administrators

Crazy and they take care of distribution so all of the process the protocol as we said earlier is totally automated from start to finish and all you really need to do now Brad is invest and do what you love and do what you're good at so this

Is the point right and one of the things we can talk about soon in an interview is also the options you have built in to the protocol with regard to assets themselves but again hopping back to that analogy of the Lego to steel

Theorems you know concept for a moment define it really is that Lego that you're allowing for someone like me or anyone who that's wants to create that fund what I like is that built even that Lego is the token true so whilst I'm you

Know can establish my own fund on my own token I have to make sure that you know I run through the Lego itself and that's also valorizing and validating that token that is that international representation of millons so that's

Going to be important that we unpack that now just to reiterate open source is you know the nature of the whole protocol as well you have those new interfaces built in v2 as you touched on coming q4 that's the plan in the roadmap

Now in terms of other tech developments or updates one I'd read through was Mellon JavaScript the J yes you know can directly linked it aetherium and I wanted to talk to you about that but also if you I know that you're not the

Tech side of odd Mellon but is there also interesting perhaps looking at the potential other platforms like for example polka dot we now know that that's getting a lot of traction low attention and your own Gnostic as a

Protocol so can we talk about now in the context of what can be done that night yeah definitely so yeah so basically in terms of our challenges right now I suppose biggest challenges we and our users are facing I

Guess are related to unbelievably I gasp costs right now and that's kind of direct results of you know aetherium works as you know II it's a it's a process of scarcity that makes it to the block so basically you know you

Know they essentially they also have gas issues themselves as you know yeah yeah yeah but relied today exactly but there is basically a limited number of transactions that can fit into each block and right and that's what the

Mutation occurs and so we've reached that limit I guess and and and so and so transaction costs are getting really high and so you're starting to see people complain about I'm paying more in gas than the value of my transaction for

This trade and you know and and this is a real problem we we can't we absolutely cannot sustain that for too long right if we want to keep promise if we want to keep the promise that we're empowering the little guy it's fine if you're the

Big guy you can afford to pay those fees but then you're not empowering the little guy and that's what you know I think if I were supposed to be doing it so so so we're so we're definitely looking at solutions we think it's a

Little bit early to commit to any one solution so hence yes we are agnostic at this point you know polkadot is on maenette but it's still I think in a in a restricted capacity yeah same there you know other solutions like near

Protocol etc and so we're really waiting for you know a few months at least to see how some of these things pan out but also am I'm keeping a close eye on on things happening with um you know startups like diversify and loop ring

Who are who are also looking to other idea Jets okay they're looking to use roll ups to take a lot of the computation and transactions off chain and then bring them back periodically every I mean you

Know it should be every few minutes but it's actually every couple of hours in the case of diversify right now again because the gas freezer are too high in they can they can increase the frequency the gas like that the economics also

Have to work for them in a bitter so I'm excited already just hearing you respond to this because clearly you're thinking very much in line you know in line with making sure that this cheater essentially to use smell and protocol

For the future and just the kinds of you know the context of the technology talking about with optimistic roll-ups you know even the context perhaps of other innovations that we haven't yet seen when it when it comes to Dex's when

It comes to new platforms you mentioned near protocol another really exciting team coming forth all of these offer you know potentially new innovations whether it be from charting whether it be from even technology that's built in layer 2

You're agnostic you're looking at these things your focus is on making sure that essentially it's cheaper for gas you know so that's probably you know they're gonna that's going to be shown no doubt as you move into that qq4 phase with v2

Exactly so that so I think you know we're focused on the low-hanging you know the low-hanging fruit now the block removing blockers that are preventing users and removing or increasing gas efficiency through our contracts by

Refactoring them and cleaning them out and and then phase 2 of that thought process is is he's 20 gonna help us in terms of keeping costs low or are we gonna have to look elsewhere and and and if we look elsewhere you know we now

Have a few months of track record to say okay all these new technologies have now been on the main that for 6 to 12 months and we can now we so yeah we can now assess and can take you know we can basically analyze and assess you know

With concrete data and see which you know which solution is gonna work for us so so so is that going to be a focus for us but we just think it's a little bit early now so we we're not you know prioritizing this because we just think

It's too early then you you also asked about mana and Jas and the library that we released recently so yeah we're really excited about that so manage a as is an easy way for developers like who can who can code in

JavaScript to interact with the etherium smart contracts of melon and so it's a library which you could use for building your own interface to melon and we really encourage people to do because I'm sure you know someone out there can

Do a better job than us because we are not designers or UX UI people but we encourage people to white label melon and to build their own interfaces and own designs we'd love you to do it so you know so we wanted to make it as easy

As possible so the documentation helps you interact with the smart contracts from from JavaScript mmm but it could also be used for building a trading box on melon and basically yeah it walks you through kind of how how you would

Interact with the contracts if you wanted to do completely automated or self rebalancing strategy right and all that again available through the github walls there it's all open source it's all basically the tooling that's the

Lego again for any of those dads who want to engage now one of the things I wanted to ask you about Mona which is probably more about design or architecture of melon itself and that's the council you know and the governance

Aspects of this so can you just give us a bit of a rundown on how you went about building out the council the systems of governance the parties or the the groups that were that emerged or the subgroups as well so they understand the planning

That went behind establishing melon you know from the start yeah so I mean yeah when we designed governance I think we in fact I'm sure we were the first defy protocol to decentralize so there wasn't really a precedence and and our thinking

Was the token ah makes the melanoma –kx basically represents two of the stakeholders in the ecosystem the maintainer xand developers because if okay so yeah the maintainer is and developers because if they do good work

On the on the protocol we get more users and therefore the value of the token goes up and they earn in melon token and then the token holder is like if they hold the token and they helped grow the protocol through community management or

Spreading the word or whatever again the value of the token goes up so token holders and developers are somehow represented through the token omix but the Unruh unrepresented party and our stakeholders were the users

Themselves and and the users are actually the people who take the most risk too because they're using the protocol they're not sure you know what's going to happen to the fees of the protocol in the future they're not

Sure ain't when to upgrade you know who's going to be in charge of upgrades and what if someone completely incompetent makes an upgrade and you know that you know for example like if token holders

Voted on an upgrade are they qualified to to to vote on an upgrade you know you don't know who the token holders are will they even vote and then you know isn't that like especially when our market cap was three million dollars

Isn't that at an attack vector like someone could just buy up a bunch of tokens and vote in a malicious way exactly so so we really wanted to protect the user through the I think that's the most important message to

Send so the melon council da was created to represent the user and we thought there are two ways to represent the user the first is by making sure that the council is made up of technical experts so we

Call them the melon technical council that's a subcommittee of the council right I mean users and so so basically the technical council is what we have right now you know it's made up of you know we'll harborin from diversify you

Know martin month fool who's done a lot of work on formal verification one of our former auditor is Nick Munoz McDonald and you know ourselves and a couple of other you know big players in the space and these guys all have a very

Solid understanding of the melon protocol and can make decisions you know which are highly technical and they you know which lowers the risk of you know incompetent decisions being essentially trusted parties for that specific role

Exactly and but also they're bound by fiduciary duties so that all the parties are known there's no one who's and no one anonymous is allowed on the council and they're bound by fiduciary duty so they have to do what's in the best

Interest of the council and and so and so any conflicts of interest they have have to be declared upfront when they joined the Council and any as they as they change on an ongoing basis they have to be declared and so often we've

Had votes being made or decisions being made where certain people in the council have had to abstain from the vote because of their conflict and so it's basically as simple as that because you know we just thought that or we firmly

We might we might be proven wrong that we need to have this user representation the the the Mellen user component has not been added yet but we're actually just about to publish a blog post on that and the reason we hadn't added the

Mellen user component is because we didn't really have user as one so recently yeah I really appreciate that Spencer you know I mean everyone's excited to see more and more use usage obviously but when you you talk about

That bifurcated model you have the MTC that you just discussed but then you have a really interesting part and that's the Mellon exposed businesses is that there I think any may be and you're part of that as I'm seeing so that's an

Exciting component as well yeah so the Mellon so Mellon exposed businesses is just a heavy word for Mellon users basically it's it's just so we're we are I would actually put us in the Mellon technical council bucket given where the

Lead developer of the protocol at the moment okay and so it's really the the the user the exposed business is actually maybe it's a bit misleading as a name but it's really intended to represent the people who are setting up

Funds and managing large assets on the protocol and so we are we're just about to make a call to action to to Mellon fund managers basically if you have more than one percent of your assets locked in the Mellon protocol you're now

Eligible to join the Mellon Council so we're looking for applications and we're looking to add to use of representatives so we'll take a short list of all the users who qualify that want to be on the council and then if there's more than

You know more than we have space for will basically ask users to vote on who they want to represent them and then basically those two users representatives will have a voice and a vote on the council and be able to say

Look you guys are spending too much on the interface when actually people really want you to be fun you know they wanted to spend more money here at E or you know you're spending too much on security and we actually just want

You to bloody integrate derivatives because options you know that you're also including you know giving more of a voice to the people in that respect and I did want to also mention what I found interesting also is that you do have

Parties like Kri in there you know Aaron yeah and you also have the the deaf hub through aetherium as well so you do have a real strong even parody which I found early interesting so you

Haven't really a diverse mix of highly highly experienced parties that are all within that MTC that all also overlapping to the meb as well to support you know the use of uses as well so I I like the fact that there is that

Aspect of how to join you know that's clear in the literature right now so where are we position now in terms of the stages of the council yeah so we you know we're looking to so the council is seven members right now like you

Mentioned that and I had forgotten to mention Fabian gone from priority and also Janos from kryptonite okay are one but but basically yeah we're we're we're now looking to grow the council so the council has been pretty much the same as

When we launched for the first year and and there's two aspects to growing before you grow you have to also think about something we haven't been very good at is how do we get rid of people on the council right because it's an

Uncomfortable subject to bring out bring up when you know someone is is not performing or when you know there's there's like you know a frustration maybe between you know some members are doing all the work and others are doing

Not much at all so what we decided to do internally is to build in measurable metrics that can measure the performance of each member of the DAO so things like how many meetings have they showed up to or been absent from how many votes have

They taken part and how many you know how quickly do they participate in votes how responsive are day how much work have they done you know in there a specific area of expertise and and so we want to define those metrics and measure

Historically how active people have been and then more importantly we want to use those metrics to introduce minimum thresholds so that it's not even a discussion about you know what you did this and you didn't do that I'd say okay

Automated yeah and if significally those minimum threshold if you if you missed three meeting I'm just making this up because we haven't established them but if you missed three council meetings you're out

It's not well I think people will really appreciate that because it lends itself again to harp on that keyword of automation it you want that because people will also step up to that expectation you're raising the bar

Through that automated you know requisite of of action and of performance so you know I think actually eventually I think we tried the relaxed way for the first year and it just doesn't really you know it I can't see

The council growing without input introducing these kind of minimum requirements because I think also people more generally want to see that their bar race so that it lifts up the standard more you know more broadly

Across the board for every party in the boardroom and that's what you're doing so that's exciting now one of the things I really want to touch on is that tough sound tough talk about the gas costs you alluded to them before but can we get

Into that little detail so that we understand what currently are the costs and what do you expect to change so I've read a little bit about 1/8 for set-up cost that kind of thing we talked about with you in being a barrier to entry and

Arum itself sometimes is now given this and congestion in that network so yeah let's get real about the challenges of cost and you know planning ahead yeah so I mean we've probably had the most expensive gas month in history since

Melons been on the main net this month I mean like four weeks prior to today and and I you know fun set up used to be about $40 and it's now about two hundred and fifty dollars so it's almost a 5x increase over the last few weeks in

Terms of cost of setting up a fund right and you know interestingly we're having the this month has been the fund we've seen the highest growth in new fund set up so the good news is that fund set up is not causing people to stop it costs

To set up a fund or not holding people back and why do you think that is is it because of what we talked about before in that in the real world it's just so ridiculously expensive irritably anyway yeah exactly you're getting a lot

You know the next best alternative is like a hundred grand in the real world so do anything a bang for your buck really for one yeah exactly it's still a good deal so I'm not too worried about that although we're still really aiming

To reduce that as much as possible um a bigger problem is our Chi so you set up the fund and you know we've we've made this big promise to people that you you can set up a fund with close to zero AUM and just build a track record but so if

You do set up with small funds you start trading and you're like oh you know that last transaction cost me $4 in gas and you know the size of my trade was $20 so it's like I'm paying 25% in fees to the network and so you're like yeah that's a

Problem because you know that adds friction to to trading some strategies require lots of trades done per day and that can very very quickly add up unless you've got a buy and hold strategy which we don't want to limit ourselves to so

This is becoming a very real problem and we're working very hard to figure out how to address that you know from a contract level and then as we mentioned later we'll also look at other solutions like you know roll ups or you know going

To exploring other change or just you know seeing what comes over you 20 yeah it's gonna be so exciting to see all these changes come through with version 2 what about you know just looking at some of these challenges as well we

Discussed it the the costs of setting up a fund but just more generally are there any other issues that you find that have come up from the users perspective that they would you know when they're facing I guess the monetary issues with setting

Up the funds or anything else we've missed aside from just those general costs from in terms of feedback from them you can think of legal you know some some people start to ask well what does it mean to set up a fund from a

Legal perspective and you know I guess if you want the certainty on that you always have to get a legal opinion but that's the only other thing I can think off and that's you know I guess still if you you know if you take the $250 in a

Legal opinion there's still one less than you know the hundred thousand yeah I mean it really is exciting to understand this listening to you you know it helps people like us understand just how how much potential there is in

This market coming up Mona we're talking about a billion trillion dollar market the people haven't yet realized utilizing the benefits of the blockchain and you're leading this out so you know that's a pretty amazing thing you know

For it being potentially a global change for five moons now but one of the other things I want to talk to you about was linking with other projects it's very clear right from the outset we talked about your network that you are engaging

With others the likes of or just came out came up a cropper list might as social for example I'm sure there are others but I just wanted to more broadly touch on the potential for integration for partnerships for working and

Collaborating together to really strengthen the future of old Millett yeah I mean we're totally open to partnerships and working closely with teams on integration we're currently working on integrating lending protocols

As the next step so we're looking at compound and chai and we're you know after that going to look at their derivatives I say broadly um you know so we 100 percent we're like totally you know we're already integrated with many

Defy protocols at a smart contract level and we're you know which is why it takes longer because it's not an integration on an interface level but it's really at a back-end level and basically yeah well you know we're you know we're always

Looking out for I'm so excited about what's happening in the you know option space and the synthetic product space and you know keeping a close eye on you know projects like uma protocol like Vega protocol open yes that one is

Exciting I just want to jump in there I've interviewed they're not gonna release at interview but the fact that you even said that you know they got of people have been talking about that you know the big players in this space Mona

You really do and the fact that you're talking of with CEOs or in the defy space of the highest level that gives us a lot of confidence I think to really be assured that you are with the right people at the right time

As well yeah Barney and I speak regularly you know they're not on maintenance but I think that's because they've honestly I think it's because they've thought through their protocols so well and it's so well thought out on

Every single level they've thought about the liquidity risk management you know capital efficiency every single factor that they should be thinking about in my opinion they've considered and so therefore it's a bit like melon you know

Because it's a little bit more complex it takes a bit more time to deliver and but yeah I've been fortunate enough to get a sneak peek at their Tesla and it's just so exciting and and yeah and you know I'm in touch with Allison and harp

From OMA and you know watching closely all you know partner from open like we're watching all of these guys super closely you know we talk to them regularly you know it obviously has to be a time where it makes sense for us to

Integrate we're focused on lending now so we're you know also speaking with Robin his team mm-hmm on that when we need them but you know it's all happening and you know the space is very interconnected and very very close I

Think like yeah I mean there's definitely a respect for ya you know I think there's a mutual respect between between kind of most my players right and it's great to hear to be honest because you are at that highest echelon

Of startups is clear you know there is obviously a hierarchy of quality that exists and you want to maintain that triple a standard you know to use that analogy from the past in finance and I think that's going to be the case where

We do we can assess quality based on performance based on users based on protocols themselves so you know kudos to you for establishing those important connecticut connections for the future now with regard to regulation you

Yourself would know that that's imperative for the world of internet finance being compliant making sure that you have the proper registrations also for different jurisdictions are you confident you're moving in the right

Direction that you're taking all the boxes as you build out this protocol for real use cases especially when you are essentially competing against the CFI mover in the past yes I'm I'm very confident we're moving in the right

Direction everything we do we do it with a view to assuming that many of larger fund managers especially will you know will need to be regulated and and so we're building the protocol in a way which will make it very easy for them to

Comply with basic regulatory requirements because of the way that the protocol is built we don't enforce it we don't tell anyone how they should set up or manage their fund but we definitely want to give people the tool sets to do

Things in a way that they feel comfortable right got it now with regard to the structure of the talk and the melanoma as they're called do you think you've got this right I really want to dig deep into this many people love this

Discussion because so many a focus on the speculative aspect of the token as you know right now but you do have create three key functions built in other things like setting up the fund investing in the fund claiming any fees

We've touched on those ERC 20 by design as I understand but more importantly let's get into the the the key factors that really drive the value so you touched on potential inflation changes as it moves on but you also have some

Other things up your sleeve as well when it comes to the token that the token omics or the melon Onix things like token swaps things like token mergers there's a lot happening for you in this design yeah so starting on here

Inflation so that was actually a proposal made by someone else not by me personally so this was actually first testament to you know decentralized governance and community in both involvement working Tom Shanna C ceteris

Paribus and Chris Meneses so three kind of independence researchers came together and they were like you know the melanoma –kx makes a lot of sense but it's not capturing value in the way that it could

Be capturing value and that it should be capturing value and so they proposed recently they proposed the melon improvement proposal number seven which is yes I have that data in my notes I would definitely want to ask you about

That I was fascinated that it was those independent parties as well great this is a really exciting moment for me because until now you know the melon council has driven most of the work on the protocol and

See the community now coming involved and you know such high caliber people as well was really really exciting so the moment to summarise MIP number seven it's in its I can do it in a couple of lines so today the way that the token

It's a buy and burn model so the way that the token accrues value is as you set up a fund or invest in a fund mellon token are bought in the background and burns so so basically it's the more users you have the more tokens are burns

But it doesn't capture the growth in assets under management so with some it captures a number of users but not the the assets locked in the protocol right so so Thomas a terrace and and Chris came along and they were like we think

It should capture yes'm you know that asset under management grows so they actually made a couple of really big points the first one is remove setup fee completely you want to remove friction from onboarding users neatly so make it

Free to set up a fund so that was really interesting the second one is charge a recurring fee on assets under management I think it was from memory 20 basis points but I'd have to check ok the third thing is give discounts I think

This was a proposal a sub proposal made like give discounts to people who hold Mellon tokens so the more Mellon tokens they're essentially staking I guess the more distant they're eligible to for the piece on the network and then the fourth

Thing was what you touched on which is over time commit to commit to reducing the inflation or yeah the inflation you know and that's gonna be a big deal because it's quite high at the moment and I love the fact that there's a

Incentive built in with what these guys have suggested a proposed to okay so the inflation is higher but it's important to note that it's a maximum installation it's not designed it doesn't have to be spent but okay you

Know maximum three three hundred thousand tokens a year can be issued so it's disinflationary in the same way that you theorem is disinflationary etc right and so what they're saying is commit to

It basically being deflationary I guess or you know try to let's try and do everything in our power to make it deflationary and I think that needs to be carefully thought out you know there's a I'm all for it but not in the

Early years of the protocol because there's so much development work to be done and so we need to make sure that it can be funded but as we get to a more mature state you know maybe year three for then I'm definitely in favor of you

Know learning more tokens and want to touch on the burning as well because there's some conjecture out there there's some suggestions that by affecting the overall supply you know through burning divided somehow reduces

Scarcity but doesn't really afford for more utility because reducing the number of tokens overall so do you want to comment on that at all but the the buy and burn model in terms of subsequent and perspective utility that you know

You're really striving for you're building for no I mean the you tote I mean um I you know I think actually this this model of capture is value better than any other token model I've seen in the space you know it's it's basically a

Fee-based model there is a sink attached which removes the supply and there's also this you know and and so if you if you think about kind of monetary value of money like economic theory 101 you know the the all the right ingredients

Are there for token value to go up with usage um the only I guess the only difference is that previously you have to have a ton of users to make the ton of value the value go up and now you can have less users but if they're big in

Terms of assets under management or if they're assets under management grow you can accrue fees faster than having to wait for thousands of users that makes sense it does and what I like you mentioned those those key independent

Parties that took on the challenge of doing the proposal what I liked is that they also have expertise in their own right whether it be you know speaking about the blockchain on podcast but more importantly they were key members of

Capital funds and silts so they have an interest also potentially in Mellon you know personally probably as well and also to support funds and they certainly have connections all the way to places like

Coinbase soared to consensus sir and knowing Tom myself you know it was interesting to see his interaction his involvement and then openness you know for that high-level as well once again hopping back to your network now just

Touching back on those token swaps or token merger is there anything you want to touch on there as well with regard to just you know the value-add there with things that can be done yeah so I mean when I wrote that piece in 2017 I think

I can't remember it but I think the idea that I had in mind was that and I think we still might see this although we haven't we've seen a couple of small examples of it but the idea that protocols might merge or acquire one

Another where if and when it makes sense and the idea is it's just it's yeah it's very simple if there's you know a new startup you know that issued their own tour token and is doing something that is beneficial to Mellon or complementary

To Mellon then it might make sense to consider well what if you know we you know for example this new protocol burns their token and receives new Mellon tokens instead and so we're one bigger project working together to grow you

Know we have a smaller slice of a bigger pie type of things you know mergers would be more complicated because but not impossible because you probably have to kill both tokens and creates a new token but also and then kind of decide

On who gets what share but it's totally not impossible and then the idea that a token could acquire another token or you know you know absolutely you know again you know the mechanics would have to be sawed through but I see you know that

The whole point of you know the whole point of defy is to remove inefficiencies so you know the less tokens there are the better and the whole point of token is that network effects can ensue so to a large degree

You know it has to be a really good there has to be a really good reason to set up a competing protocol if you you know instead of building on an existing one because then you're just gonna have to build everything from

Scratch or copy it and then not understand you're not really gonna understand it because the people that built it that built it a certain way learn from certain mistakes and and know the inner workings of it and so even

Though it's open-source that doesn't mean it's just copy paste of a stable yeah this is a really important point to make because if people think they can just go and apropriate all of that you've done it's not that simple and

That's part of your I guess you're valuing I welcome them to vary but I don't it's not as easy as it sounds and we've already seen bad examples of that on much similar protocols than Mellon exactly now one of the things that was

Really exciting your reference before was the success in the last let's say 90 days as reference in some of the tweets an immense amount that's been locked successfully now the response from the community has been you know wow they're

Paying attention right now suddenly melons come up for a lot of conversation a lot of speculation even with regard to interaction with the token what are your thoughts on that when we see use it users just starting to really emerge but

We still see the influx in speculation on the asset itself on that utility token what are your thoughts on that is that sort of a surprise to you that people are going to jump in and play around with MLM the token so yeah so I

Mean I'm really excited to see more users there I mean it's like you know it's still early days and it's still you know not as high as where I would want to see it go at all but it's its movement and we haven't seen movement in

A long time and so this is it's really satisfying to see after all the hard work we've put in my reaction on the mln token is frankly what it was before I'm happy to see it occurring value whether it's you know I'm happy to see a

Recording value I mean I you know personally I thought this you know the market cap of three million dollars was just unfair you know and and and made made life very difficult and you know I think that made life very difficult for

Growing the protocol expanding developing and created a lot of risk for people like me we're putting their own capital at risk to underwrite the development so I'm really really happy we're seeing you users I'm really

Happy that the token is reflecting that growth if you look at the moon interesting if you look at the movement in the token price it's it almost reflects one-for-one the move in the assets under management grow so it's

Actually quite interesting that is interesting you know and that's that I should be I think and given given that well given that now we see roughly around 70 ml market cap you're still relatively young so relatively you know

Small in comparison to many of the financial one who calls out this has a huge potential for you here ranked around 200 on CMC that would be different on coin gecko I'm sure but the thing I did want to ask you that when it

Was your search supply roughly from what the data I have and correct me if I'm wrong about 1,250,000 but I wanted to know what the total supply was you know because we see that some startups have a very vastly

Different search supply to the total supply yeah I'm just going to check that I think from memory it's I think it's one and a half million right ok so you have most of them out and sex supply then we have yeah so so don't forget

Every year 300,000 new token can be created right and so this year's have already been created so that's included in that number they were created in March ok so incrementally that total supply

Will go up but what I like is that there is a higher number of tokens in circulation yeah there is a higher number of tokens my gosh yeah and that's something I think a lot of people wanted to make sure of now in terms of

Exchangers mouna looking really good you know we talked about the Dex's and the centralized exchanges you're on so many already with regard to her being supported from kraken which is a great you know

Obviously advocate for what you're doing yeah and also all the way across you know swap which is again a predominant supporter and Kaiba so what about the future do you think you're going to expand or doesn't matter that you engage

With more indexes for example do you want to get on more centralized exchanges to have more liquidity because obviously your experience is you know in an area where liquid B really matters I think what's been really interesting is

That with the growth in turn in our user numbers community has been much more active in creating pools for liquidity i heard of a group creating you know liquidity on balancer for example you know we've had i haven't had time you

Know I haven't I haven't had time to look into the details of this but I've seen that we were listed on two exchanges just in the last few days that saw one that was MXC I think I'm EXCI and I think boy neck or something I

Haven't even had to look at them but but you know I think it's interesting that you know these these listings are happening you know presumably because there has been interest so and we're getting you know we get requests every

Day from exchanges that that wanted this but you know we will never pay an exchange listing fee you know I think that you know we you know we that's not part of our ethos but we're we're we're very much you know what you know no one

Needs a permission to this the token yeah we really appreciate that to be honest we don't want to hear about teams having to pay for existing that's not the way the defy supposed to be it's about supporting you know the ethos and

Also the architecture in the technology that Lego so kudos to you for not signing up for that kind of deal now in unis what was a great integration you know discussion as well how how is that going in your roadmap is that imminent

Or is that has that been completed you know swap has been completed we're just in the process of migrating to v2 though but v1 is you know have been up and running for a few months and that's yeah that works

Members great I'm very excited to move towards v2 and will also be integrating era swap in the next release as well awesome okay so people will be excited about that now just more generally in your roadmap

Is there anything that you wanted to hint about or wanted to do you know divulge that's exciting to you that you can obviously can tell us everything but in the coming months aside from all those things we discussed

So far I guess um I mean more of the same I guess like I think I think yeah I guess I guess there are some things on our roadmap that the order I rather I think there are some things that are not on our roadmap that we have planned for

And I think that it won't be in the next release but probably in q1 q2 next year we'll be looking to to include some of this these newer concepts like you know be able being able to launch a fund which can

Provide capital to two pools like so liquidity pools and then managing the PNL of those you know strategy so you can actually become a market maker through a Mellon fund or or yeah so basically like you know kind of much

More native web 3 stuff that has emerged since we published the initial roadmap so I guess yeah I guess if I was to I guess drop a hint I would say we're looking to natively integrate with some of these exciting web 3 innovations that

Are happening I like hearing that because I keep thinking about parity I keep thinking about Gavin wood I keep thinking about polka dot that sounds straight so a lot of exciting things that could actually work even in that

Context of web 3 and then the thing I did want to ask you also about you know in terms of the roadmap what about events you know we've seen you know over time the issues with favor will relax hopefully you'll see more

Events you know that allow us to probably engage not just through the screen are you planning on doing more of that in the future as I guess a marketing push so actually really interesting we had to cancel our annual

Conference which was it would have been today and tomorrow at Oxford University edgy but we had to cancel it because of kovat and well actually I would say postpone it not cancel it so we're definitely looking to reorganize our you

Know our our event early next year I think when things you know I don't want to have to postpone again so I think I'd rather give it time to you know finish but we're we're incredibly active and actually in many ways were active in

More events on the in the virtual world than we were when we had to travel because you know we can we can be in in Singapore in San Francisco and and Australia in Australia on the same day you know in the same 24 hour period

Which would have just been impossible by plane so you know I'm I'm up here speaking to you at 5:00 am my time and it's been in the story of my life the last few weeks you know like staying up until 2:00 am to do a call or a

Virtual presentation well I know we really appreciate it honestly because like you said you'd up the ante with more engagement rather than less that just shows the power of all of the different technologies out there all the

Different media that you can engage with now speaking of that one of the things that was really impressive is that you're engaging with companies like real vision for example even the likes of Masari potentially through you know the

Likes of Tom you know through his affiliation consensus seems to be quite supportive of you even if there am so you do have all of these parties that lend themselves well to more of that marketing push so are you also planning

On doing more work in that context you know in the future whether it be podcast whether that be many releases yeah absolutely we're always open to to you know doing podcasts or fun virtual events or even in-person events when

That becomes a thing again but we're yeah we're super excited about all our relationships in this space and and we're you know we're you know you know we're looking to help people grow and grow with them ourselves

Absolutely well Mona Orly so it's been an absolute privilege I sincerely mean that speaking with you today you've taught us so much about every facet I think of the introductory aspects of Mellon protocol but for those who want

To know more you know this is really just the starting point are there any social platforms you would recommend that we can go to all the permalinks below just so that we can better educate ourselves and read up on

That one protocol and everything that there is you know tonight sure yeah well first of all it's been a pleasure Brad it's been a lot of fun but I think that best like kind of learning resources are on our

Medium page so medium slash melon protocol and and also our you know come and chat with us we're a friendly team you know we're a friendly ecosystem because it's more than just the avant-garde finance team you know we've

Got Ashe finance gorilla funds we've got on slash we've got a bunch of projects building on Mellon and they're all very friendly and we'd love to hear from you we use telegram so it's still the old mother import telegram channel and we

Used which is a completely community run channel but it's also you can always find us in our dads in there as well got it so tell maybe I'm over some of those articles they are updated I've seen a few that

Are recently been published I'm not just by yourself but by other members of their team if you'd like to know more about the team as well that we didn't discuss in detail you can certainly look at the links below and go and read up on

All aspects I'll make sure the website is there for you you can also look at the terminal more broadly look at the interface engage in that respect but on behalf of us all thank you so much mono for teaching us about what is dome

What is the decentralized on chain asset management platform protocol more importantly and that Lego for finance that you're really trying to redress old systems that perhaps are expensive updated and don't allow us as that

Access as average people now you're changing the game and making accessible for all of us and you really appreciate everything you've done you've haven't given up you've stuck to your guns and your keep building so congratulations so

Far this is just a start for you and your team and I wish you all the very best the rest of this year looking forward to q4 when the v2 comes out and then we'll catch up again sounds awesome thanks a lot Brad you're very welcome

Take it

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