📌 An opinionated recap of the most interesting news in crypto
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Visions of Ether
Featured on Token Economy, by Felipe Pereira

Felipe takes us on a trip down Ethereum's memory lane, dissecting the evolution of its overarching narratives in a post inspired by Nic Carter and Hasu's famous equivalent for Bitcoin.

Despite its relatively short life, Ethereum has undoubtedly already gone through *a lot* already. With 'open-finance', 'radical markets' and 'DAOs' it may have found some solid long-term narratives to build upon. 
Simon is writing a book based on all the writing he did on curation markets and bonding curves! You can consider this a summary or introduction, in which he documents a bit the history of the research around these topics, and how Bancor (which is actually shipping quite well) fits into it all.
For fans of the genre, here's a good security token landscape map. 
We missed this last week, but feel it's a worthy read for anyone interested in protocol governance systems.

Here, Melon, decides to not go fully decentralized citing essentially the reason: "full democracy sucks" and instead going with a Technocratic model inclusive of a Melon Technical Council and a Melon Council.

Compromises everywhere.
I rarely read such articles from start to finish, but this one is so well written and interesting, that I just had to.

I just recommend reading it. It goes from the concept of Anticommons to imagining how everything will end up on blockchains, how crypto ownership will shape up and touching on Mattereum.
The research team at Circle is doing excellent work, like with this in-depth report on prediction markets, which dives into Augur, Gnosis and Stox after an overarching top-down analysis of the sector.

It's really amazing to see the amount of quality content that is being produced these days, compared to only a year ago.
Speaking of which. Augur is at a really interesting juncture as its largest market to date ($1M at stake over the US mid-term elections) could go through a drawn-out dispute over a technicality that could even result in a fork.

The post makes the case that this unique feature of cryptonetworks, which allows both purists and pragmatisms to have it their own way, is actually what makes networks ultimately antifragile.

"What doesn’t kill Augur will only make it stronger"
The large airdrop planned by Stellar in partnership with Blockchain has stirred up again the debate on the effectiveness of airdrops to drive network adoption.

Here Michael Casey of Coindesk takes the nuanced stance on the matter, making the point that one way of the other adoption requires some level of 'marketing'. He also draws an interesting parallel with governments "welfare distributions as airdrops with intent to promote economic activity and therefore widen currency adoption" (with the obvious difference that the people receiving welfare are already in a position of strong need).

We'll continue to see more experimentation and innovative models of token distribution. 
A brutal take on the 'crypto fund' industry by a family office investor.

- poor risk management practices resulting from young/inexperienced managers and lack of infrastructure
- expiry of lock-up periods coming up soon
- poor management of LP expectations and knowledge transfer
- substantial concentration on a small number of names across funds.
A very interesting idea proposed by Rocco, where PoW projects subzidize an autonomous insurance contract that would automatically deploy enough hash power to prevent a 51% when needed (a new line of business for hash renting companies like NiceHash?).

Rocco thinks this could be funded by the issuer, or though a DAO depending on the degree of centralization.
The team at Aragon One, after having shipped their mainnet contracts, are starting to think more about governance and tokens for DAOs.

One particular worry is how to make sure that passive and minority token-holders can still have their voices heard and respected.

In this post they propose a couple of solutions:

1. Encoding Organization Intent
2. Facilitating Exit en-masse

It's incredibly interesting to think about what is possible now with blockchain-native organizations and to not be bounded by the ridiculously limited types of current offline legal-structures.
It had been a while since crypto valuation models got a refresh. Hash CIB have published an improved approach to valuing utility tokens, inspired by previous work by Burniske/Winton and Multicoin.

The output is a Rational Network Value (RNV), reflective of:
- as today’s utility value plus discounted *additional* current utility values (ACUV) for every year to infinity (via a terminal value calculation)
- dynamic velocity function.

The model received high praise from Chris himself.
Interesting background on Swarm's founder Daniel Nagy, who spent 7 years in a legal battle defending himself from the accusation of copyright infringement for hosting a Direct Connect node (spoiler: he won).

He's been building Swarm so that legal repercussions like the one he experienced cannot happen again. He calls it an “arms race” between developers and regulators, and it really feels that way in light of recent news and events.
💥Newsy stuff
- Jihan is not a board member at Bitmain anymore, and just a "supervisor". One has to guess which regulatory requirements are being met by this.

- Censorship. Nothing new in EOS-land: another transaction rollback. They've basically re-invented the banking system. 🤔

- DEXs. Radar Relay introduces OFAC compliance measures, a set of regulations to ensure that companies don't unwittingly do business with terrorist organizations.
😎 Cool new projects
Coindesk launched their own, very comprehensive, data explorer and benchmarking tool for crypto assets.

Everything seems to be benchmarked against Bitcoin and many of the scores are known to be gamable, so it is to be taken with a pinch of salt. But any attempt to surface data and bring transparency to the industry should be welcomed. It will be interesting to see which will become the standard.
The team at Market Protocol have launched the beta version of MPX on the Rinkeby testnet. 

MPX is the first decentralized derivatives exchange to be built on top of their Ethereum-based protocol.
First (?) block explorer for Handshake, courtesy of Handshake Alliance, a newly formed group of firms and developers building open source infrastructure to support Handshake, 
More applications of MetaTx are emerging. 

This weekend project by Piotr of Chronologic, called GasStation Subscription Service, allows users to buy subscription to Gas, thus fixing price for a certain number of transactions.
0x's response to the SEC cracking down on tokens and decentralized exchanges is to let a million new ones bloom.

The Launch Kit is a start-you-own-relayer tool. Constantly impressed with this team.
Curated on a Product Hunt collection!
💰 New funds
In a somewhat surprising move, Grayscale's new investment trust is about Horizen (ZenCash). 

Sad for me I guess, as I remember buying a truckload of ZEN on some weird OTC forum an eternity ago and promptly losing it all.
💸 Funding rounds
Galaxy Digital through its EOS VC fund has led a $16M round in Mythical Games, a platform to enable game developers "to create and deploy game items which are secured on the blockchain".

Other investors included Javelin Venture Partners, DDC, Fenbushi Capital, Noris and OkCoin.

A solid team with industry experience and interesting choice of initial platform.
KuCoin has raised a $20M Series A round from IDG Capital, Matrix Partners and Neo Global Capital.

5M-user strong, it will be eyeing aggressive international expansion, investment in customer support and a new version of its platform described as "dynamic, secure and malleable” (🤷).

Exchanges still manage to capture investors imagination. 
Dust Identity is a fascinating company using diamond waste dust coated onto objects to provide a trusted identity layer written to a blockchain. 

The just closed $2.3M from Kleiner Perkins, New Science Ventures, Angular Ventures (👋 Gil!) and Castle Island Ventures (their 1st check!).
The Bitcoin-based cashback browser extension closed $2.25M from Bain Capital Ventures, Version One, Forerunner Ventures, 3K VC, SV Angel, FJ Labs and other angels.

Their mission is to onboard the non-crypto native masses to Bitcoin via a familiar user interface and flow.

From the Chrome app store it would appear the extension is used by ~2.5k users, so still early days.
👮 This week in regulation
Barely a week after the Etherdelta news hit the press, the SEC is making crypto headlines again, not with one but with two simultaneous actions ("undoubtedly a wave of new enforcement actions will be hitting the press in the next 6-12 months" , we wrote last week).

Palley published an excellent summary and analysis on The Block, if you want to read something let it be that.

But that wasn't all. The SEC then went on to publish a broader industry statement covering pretty much all actors in the space, from ICOs, to funds and exchanges. The statement seems to be connecting all the dots, from The DAO report to Munchee, Etherdelta and now Airfox/Paragon. For more on that we reccommend picking up Jake's tweetstorm from 6/ onwards, where sheds some lights on the SEC's overall strategy of leaving the rules "vague & ambiguous". 

The most interesting points to take away:

1/ "there is a path to compliance with the federal securities laws going forward, even where issuers have conducted an illegal unregistered offering of digital asset securities.". This is a helpful statement that can be interpreted as largely supportive of the category as a whole, potentially opening up to a phase of 'compliant ICOs' that we don't quite know what will look like (hopefully to be addressed in the recently promised 'plain English' SEC guidance)

2/ the SEC didn't go after fraud nor misrepresentation, which means that non-outright scams are equally potentially liable if they've sold unregistered securities or haven't qualified for an exemption.

3/ the civil penalties imposed seem fairly light: $250k plus compliance requirements for having raised $12M and $15M respectively. I suspect many non-compliant issuers felt relieved, though such fines presumably reflect full cooperation from the issuers.

4/ not so relieved about the refund requirements though: issuers are required to refund *USD amount* raised plus interest to investors (US-based ones only?) who submit timely claims and can/want to prove they are entitled (even those who sold for a loss already!), which could be disastrous for those projects who raised in ETH, had no/poor treasury management and whose tokens are down +80% since ICO. This will most likely lead to a wave of bankruptcy proceedings.

5/ both actions appear to be carved out of a template for ICO enforcement, with similar/identical language throughout. So we more or less know what to expect for the upcoming actions.
ℹ️ About us
Token Economy is written and curated by Stefano Bernardi& Yannick Roux.

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