Today, we’re going to catch up with Philipp Doğan, Co-founder and Head Of Strategy at Midas (pictured, left), to discuss the ups and downs of technical development in the crypto space, why they cancelled their ICO in favor of a Melon token mining event, and how they see crypto investments fitting into the increasing demand for impact investing infrastructures.
David Smooke: What is Midas? And why does the world need it?
Philipp Doğan: We give users investment funds on their phones, hosted on Ethereum. Our mission is to provide access to a decentralized financial infrastructure to empower the user. Midas is about low-barrier access to crypto assets and connects the user’s asset mixes with information market platforms like Gnosis, charity platforms and other decentralized services. People have the chance to take control of financial instruments and combine them in creative ways for the first time. Given the social and environmental significance of your investment decisions, every asset mix on Midas can be turned into an impact investment fund.
Money should no longer be defined by banks only. We provide the tools for our users to remix finance.
Your FAQ page describes Midas as “a decentralized portfolio management system on the Melon protocol. Every user manages a technology-regulated investment fund (mix) on the blockchain that can hold any thinkable crypto asset: cryptocurrencies or utility tokens, as well as tokenized analog assets like stocks, real estate or art.” What type of crypto assets will drive early product usage?
Our main focus is on assets that casual users can relate to. Financial products like bonds or ETFs don’t mean nothing to most people. That is why we integrate assets like prediction markets or crypto collectibles.
Last year, Cryptokitties has shown the power of collectibles in terms of onboarding and engaging users. We will start out with the existing ERC20 tokens that are traded on the exchanges integrated in the Melon Protocol. Information market outcome tokens as well as the first collectibles will follow. In the future we want to expand the selection to other chains enabled by technology like Polkadot.
Midas recently cancelled a private and public token sale and is going to do a Token Minting Event to the Melon community. In the short and long term, how is this going to make your company more money? And why was it the right strategic choice?
I love that we took the decision to cancel our ICO and commit 100% on the Melon protocol TME proposal. The governance feature the Melon team presented makes the protocol truly decentralized in the long run and guarantees its maintenance and further development by its stakeholders. Projects building on Melon can ask the Melon community for funding through minting new MLN or merge an already existing token with MLN. By reducing the amount of different tokens, we erase friction between projects, reducing entry barriers and makes MLN the token for the asset management industry.
Teams uniting behind the Melon protocol and supporting each other will strengthen the protocol’s resilience given the huge incentives in play, since it is the technology we all build on.
Your one pager identifies your target market as “Millennials, aunties, investor noobies & professionals: hundreds of millions of retail investors and almost 2.5 bn. social media users all around the globe.” What is the high level strategy for user acquisition of the Midas network?
Users have the opportunity to monetize their crypto investing skills. We have a rewards pool for the best performing mixes on our platform. If you are good at this you can fundamentally change your life. We also reward users for onboarding their friends, plus we work on integrating popular wallets to increase early adoption.
Your one pager also points to monetization as competition fees and promoted content. What existing businesses and businesses models do you look at as inspiration for Midas’ monetization strategy?
We decided to get rid of any transaction fees except gas. What we do is we take fees for 1vs1 challenges between users. Users can compete with their asset mixes, rise through the ranks and increase their exposure to the rewards pool. We take a cut of those fees, the rest goes straight into the pool. In the future we plan to expand on that model by adding promoted content, which is a bit tricky because we want to provide useful content to the users and not spam them with random ads.
Let’s talk about the name “Midas.” Everything King Midas touched (apparently) turned to Gold. Why are you called Midas? And how did the name come about?
King Midas represents exactly this: generating profits is great, but if you get greedy you can destroy everything around you. On our platform you can connect your asset mix with a charity or NGO of your choice. Blockchain enables services where you can transparently track every step of a donation. Combining this with micro profits of retail funds, we get a new style and scope of earning streams for those organizations and really push good causes harder then ever before.
How do you plan to gamify interest in the investment choices of the leaders in your community?
Investing in top ranked asset mixes increases your chances of upgrading the performance of your own asset mix. This increases your chance of winning battles against other users and to gain higher exposure to the rewards pool.
Picking mixes and assets to build your own mix is like collecting pokemon, each has its own performance indicator, strengths and weaknesses. You try different combinations and twist your mix until you get an edge over the competition with your own unique style.
The concept paper reads, “Midas’ key function is the Midas Touch. With the Midas Touch users can buy crypto assets or invest in other users’ asset mixes. It is as easy to use as a “like” button, but for investments.” The like button for investments is a clever idea, but the like button is a pretty low barrier to digital social engagement. Are you picturing a median investment of what USD level? And how else do you flush out this comparison?
Actually you have to go through two additional screens after tapping on Midas Touch: set the amount and confirm. We are dealing with money after all. Users can skip the “set the amount” part though by setting a default value for their investments so they only need to confirm one time after tapping.
The beta version is scheduled to be released in the first half of 2019. Could you give us a rundown on the techstack, the product’s progress to date, and what will be the biggest technical hurdles over the next year?
We started the back-end development one year ago and are in the middle of the front-end development right now. We just recently published eazyX, an interface to a decentralized exchange based on dutch auctions and we got some valuable insights out of this UX research project. On the blockchain side we build on the Melon protocol, the Gnosis information markets platform and decentralized exchanges like the DutchX.
A big challenge is to combine the blockchain back-ends with our centralized service layer which is build around microservices mostly written in Scala and Haskell. We feel this combination is necessary to enhance the blockchain services and to create a snappy and crisp user experience. Another big challenge is finding the right balance between usability and transparency. It is all about UX in the end.
Could you tell us about the team?
The core team members know each other for quite a while already. Apart from a diverse skill set, most important to us was that new team members would fit on a social level. We love free minds and we like to give a lot of freedom. The team is currently distributed over the entire planet with people in Germany, Switzerland, Portugal, Argentina, India and Australia.
What’s the best way to stay up to date Midas’ progress? And connect with you?