Aventus Telegram AMA Transcript: 12 August
August 15, 2022
- Will a DEX built on the Aventus Network protect against sandwich attack or front running which results in high slippage? Looks like bad guys are doing this on Ethereum / Uniswap and are making profit from this.
The particular implementation would depend on the teams that may be awarded grants, but dealing with known issues in existing implementations and innovative solutions will be part of the filtering criteria when evaluating proposals. However I am not the one who evaluates the proposals, the Aventus Foundation will be doing so ultimately with input from us.
- How will the 600k AVT rewards for the parachain crowdloan be raised? Are there still plans to mint test tokens? Maybe the Foundation could use some of the test tokens to subsidise parachain rewards?
There is no raise. The Aventus Treasury will pay out the 600k AVT tokens to the DOT stakers who help Aventus secure the parachain spot. We still intend to have a test network with value (like Kusama vs Polkadot) but the timelines have been pushed back as we prioritise our production environment on Polkadot and the client migration. Test tokens will not be available in time for the auction.
- How far into development is the digital twin virtual horse racing platform Cavalieri?
Cavalieri Digital has raised the first money it needs in the form of convertible debt. The whitepaper is complete and being discussed with various clients. The platform has functionality existing for trading horses so far and breeding is on the way. For racing, we are finalising the negotiations with the visualisation partner.
- Is there plans to partner with big UK horse racing events such as Grand National, Cheltenham Races & Royal Ascot?
Yes, Cavalieri has spoken to members of the Jockey Club, some of the biggest breeders, racers, bloodstock agents etc. in the industry across the UK / US and Middle East. No partnerships can be announced yet at this stage though.
- How will the medical data utilisation platform Symbiotix work in regards to access control – who controls the access? Patient or medical organisations?
Access is controlled with the same keys that own the NFT. So technically speaking, signatures will have to be generated by the key pair that owns the specific NFT on a periodic basis to perform queries over the data sets. The NFT will encode the levels of authorisation within the database.
- Who will earn the majority from a patient’s medical data, a patient or medical organisations?
Aventus does not know exactly what the revenue split looks like in the Symbiotix business. However one of their core principals is giving much greater control back to the patients, so we believe they will strike the right balance between commercial interests and protecting the individual.
- How is Aventus affected by the current inflation?
Current inflation in global economies? Well inflation is, at worst, around 10%, while Ethereum price is down 50% from its high, so I would say the impact of inflation is relatively minimal vs the crypto winter. As always in economic downturns, spending is tightened up so we have undergone a restructuring to get lean and cut costs. However, with many others making cuts, it is also a good time to make key hires since the job market has prices coming down, which we have tried to do where possible.
- How many transactions do you expect from the new use case in aviation?
It is too early to make this prediction. We are currently undergoing the product scoping phase. Andrey (CPTO) was recently at Heathrow Airport landside and airside to analyse the processes and evaluate the best way to apply our software suites to it. I will have a better answer for this in a month.
- Can you give us a short description of how the Polkadot slots system works? It seems like the number of 200,000 DOT necessary for getting the slot is determined (also 600,000 AVT for rewards) but on the other side you are talking about auctions. Also, what happens if a slot is not obtained in the next auction after 96 weeks?
So we offer a maximum of 600k AVT as rewards at a rate of 3 AVT per DOT. Those who stake DOT (this has nothing to do with Aventus – it happens directly on Polkadot) cannot sell that DOT for 96 weeks. Whoever gets the most DOT staked for them over the 7 day window starting August 28th wins. If we win then our stakers cannot withdraw their DOT and they are rewarded AVT every month for the 96 weeks for having helped Aventus secure the slot.
- In your last AMA from June you mentioned that you hope to be doing 50-100 million transactions/ month. As you are currently doing 2-3 million / month how realistic is it that an increase of 20-40x will happen in the next 4 months. And what are the main reasons for that planned significant increase?
The crypto winter has slowed down the transaction growth rate we have hoped to see since our clients have also had to make cuts and slow down a bit. Also, we are focusing on getting the parachain launched so that we do not have to migrate serious daily transaction flows to a new production network. Currently I believe we are doing about 1m transactions a week and I expect this to continue growing and pick up significantly after the parachain launch.
- Why are the approx. 70-100k transactions/ day mostly in the afternoon within 2-3 hours between 2 and 5 pm?
I did not know this was the case. I suppose it is because some of our clients will batch update the state of their networks at specific times and it happens to fall in that window.
- Do you feel it is necessary to continue the inflationary model for the foreseeable future? What are the potential advantages of this approach for the average Aventus holder/staker?
Yes, I think the inflation model is sound. Over time, I believe the ratio of how it is split between validators and Aventus Foundation Treasury will evolve. One of the key reasons for the inflation model is legal and regulatory compliance. While the current view is that staking means active participation from most in the industry I have seen, if you dig into the detail most people stake and passively tend to earn fees in these networks. This may be changing in future so we are being proactive in getting ready for significant regulation (see EU MiCA / US CFTC announcements). If staking means you are not affected by inflation (but do not earn anything either) and not staking means you lose value, it creates a significant economic incentive for active participation in the network. Thus strengthening legal analysis with respect to e.g. the Howey Test’s criteria for passive returns.
- As I see it, the largest contributors of DOT (Scytale and any unnamed) will be earning the lion share of AVT distributed via DOT contribution. Assuming Scytale and others have received equity (or some other form of compensation) in Aventus, it doesn’t seem necessary to extend further compensation via DOT staking. I get how important it is to actually acquire a parachain slot, but if it could be done without diluting value via adjusting max supply, that’d be much preferable. Would love further clarification on how close Aventus is, funding-wise, to 108k DOT (most recent parachain auction).
Everyone has equal access to DOT staking and being rewarded in AVT for it. The Aventus Foundation does not have any DOT and will not be participating. There needs to be a sustainable model where we can secure the next parachain in 96 weeks. We will have to see what the community turnout is on August 28th. I do not know the answer to that question. Personally I also have some AVT, as does most of the team, but most of us are in favour of this, since despite the impact it may have in terms of market dilution, we feel it will help the ecosystem ultimately prosper which is good for everyone.
- Is Aventus relying on crowdfunding due to legitimate need for funding or is it required by way of contracts with investors (for purposes of further reimbursing them for their investment)?
Aventus is not crowdfunding. DOT is staked by the community who are rewarded in AVT if we win the parachain slot. At the end of the 96 weeks stakers get their DOT back. It is a pure cost to Aventus Foundation.
- A new proposal was released to create a way for the treasury to be sustainable and future parachain crowdloans to be covered. My question is why is it not possible for future crowdloans to be covered by DOT funding Aventus network received from Scytale, which the Aventus Network could stake at crowdloan to receive all the offered AVT back in addition to DOT staked, then repeat for future crowdloans?
Aventus did not receive DOT funding from Scytale. I am bound by confidentiality on the Scytale relationship, but it cannot do what you are suggesting above. We hope Scytale participates in staking DOT.
As part of the inflation model, the Aventus Foundation will use new AVT in treasury to likely start accumulating a DOT position to get to what you are suggesting I believe, but as mentioned this is not in my control. However, Aventus needs treasury reserves for grants and other ecosystem benefiting activity.
- How does the community counter a governance proposal with suggested amendments to original before original proposal deadline?
Any amendments need legal sign off, communication with existing listing and Aventus Foundation council approval. So if alternative proposals are all that could work then the only option is to vote “no” now and raise them. There is no guarantee that they can be achieved, though.
- Stakers have made a 6% gain in holdings relative to market cap since AVN went live. Why should they vote for a new system that immediately negates that accumulation of value by minting the same amount?
Because of the wider benefits to the ecosystem and the future proofing of the network as described above. An ecosystem with more solid fundamentals should grow faster and deliver much greater utility through the network effect, benefiting everyone.
- Why does the mint need to be equal to the stakers fees earned? Could it not be something like 50% of the value. E.g. Stakers earn 6% so the mint is 3%. This way the stakers gain and the treasury gains. Matching the staking fees just seems a bit arbitrary.
Please refer to my point on legal and regulatory compliance above and being preemptive in future proofing the network. We have always put fundamentals first. However, validators very clearly have an active participation in a network and this will never change. I expect over time, as the ecosystem rolls out, we will ultimately get to a point where the ratio of how inflation is split between validators and treasury is community driven and treasury all sits in a DAO for community distribution to grants / other ecosystem benefitting activities.
- My current understanding is that Aventus’s investors will be contributing DOT to the parachain auction so in effect a lot of the minted tokens will end up back in the hands of investors or the Aventus foundation. Is this correct?
What do you mean by investors? If you mean AVT token holders then yes we believe any AVT token holder should be incentivised to contribute DOT to the auction to help increase the utility of the network and be rewarded in AVT for doing so. There is equal access to the DOT staking for all, on a first come first served basis so I cannot really answer that question. It depends who in the community decides how much DOT to stake fastest. There is no unfair advantage to anyone.
[ADDITION] I meant investors like Scytale.
Scytale is just a token holder like anyone else.
- Why did you propose an inflationary model of tokenomics instead of changing shares of fees? For instance, 60% stakers, 20% Foundation, and 15% validators.
Please refer to the legal and regulatory compliance point above. Fundamentals first always.
- How are stakers AVT split between validators? Is it split equally between the total number of Validators or is the split more weighted to increase the deposit of validators holding less AVT?
It will be split in the ratio of fees earned relatively to mimic the current mechanics as closely as possible. Probabilistically speaking, over a long period of time, every validator should get an equal share. Relative stake makes no difference we have a fixed requirement for validator stake and that now counts towards staking, not probability of selection to create the next block.
- If the plan is to IPO in the next 5 years, how will the Aventus token holders benefit from this?
Commercial entities that provide valuE-added services around the network (e.g. Consensys for Ethereum or Parity for Polkadot) would be those looking to IP, not the fundamental network itself. More capital to these entities and better tooling should mean greater adoption and more transactions / clients on the network, increasing the utility available to AVT holders.
- From what I understood, funding had already been secured with Scytale to fund the first Parachain slot. Why is it now being proposed that the funds be taken from retail investors / token holders?
Aventus did not receive any funding from Scytale to fund the parachain slot – I cannot get into the details of the deal though because of confidentiality. The reason we wanted Scytale to have an AVT position is because of their connections with Polkadot / Parity which have helped us get through the process faster and drive more deals.
- Whose decision was it that 75% was a reasonable amount to be allocated to the treasury? This seems like a very large amount to take from the community and investors who have held strong for over 4+ years, please can you break down how you came to this figure?
This is the starting point to secure enough to sustainably be able to secure the next parachain slot within 96 weeks. This ratio along with a whole host of other network parameters will ultimately be in the hands of the community on chain governance with AVT, DAO style.
- A quote from the latest governance proposal:
“The positive treasury balance will ensure the continuity of operation of the Aventus Network by providing funds to secure future parachain slots and other essentials.”
Other essentials seems a rather vague term for requesting such a large amount, please can you go into more detail about “other essentials”.
As mentioned, I do not control Aventus treasury but I would believe items that would count are including but not limited to: exchange listings, community grants, liquidity provision, bug bounties, audits etc.
- What happens if only 1 million AVT is staked? At the same volume of fees (150,000 AVT) it would mean 15% inflation? Would the Foundation be willing to fill up nodes like it did in the first circle of staking?
Yes, that is what it would mean and the reverse also if 10M was staked and 150k AVT in fees it would be 1.5% inflation. This mechanic encourages active participation and please refer to my point on legal and regulatory compliance. No, the foundation will never receive fees from staking, it did not the first time around either since those were all subsequently distributed to stakers in round 2.
- So, it seems that for regulators, earning with staking will become illegal (or not recommended). Did I understand correctly?
Avoiding passively generating a return from the entrepreneurial efforts of others for token holders puts the network in a significantly better position in terms of the Howey Test is advice we have received, and the inflation model seems to move the AVT tokenomics further into this category.
- What about lending DOT and getting AVT? Is it different?
DOT is also inflationary so by staking DOT, you are losing value. But you are rewarded from Aventus for active participation and the utility you helped secure with the parachain slot. I believe this is why it is considered acceptable. However, I am not a lawyer so this is just an educated guess.
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