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Introducing: The Avalaunch Vesting Marketplace
Avalaunch has been busy and in the coming months will release a number of new features and products in an effort to expand as well as optimize its native offerings. Avalanche is evolving and we have every intention of growing right alongside it.
Stressing utility and flexibility for XAVA holders is a priority and initially, the team is excited to release its vesting marketplace and token dashboard. Beginning with the Deepwaters IDO, this new offering will enable IDO participants to trade their locked/vesting tokens with other users in an open marketplace inside of an experience optimized for flexibility and usability. In other words, buyers can acquire the right to claim tokens when they unlock as if they had participated in the IDO regardless of whether they actually did or not.
The Avalaunch Vesting Marketplace introduces several fundamental shifts for both users of the platform and the projects launching on it:
- IDO participants can now deploy more sophisticated strategies that involve retaining select portions of their locked tokens, while offering others up for sale on the marketplace — oftentimes at a discount to the buyer.
- The vesting marketplace is of tremendous value to projects launching on Avalaunch as it allows buyer and seller to transact off the order books and without an impact to price. Additionally, these locked tokens can now be transferred to holders who presumably have a longer-term interest in the project. Prior to the marketplace, a user might sell these tokens as soon as the unlock simply because it was the only option. Now, they can trade them well before the unlock, freeing up capital while simultaneously putting the tokens into the hands of holders with an extended time horizon on the project. This is a win-win-win for buyer, seller and the project.
- The IDO occurs at the very beginning of a project and doesn’t allow future supporters an opportunity to participate. The marketplace affords projects a brand new ability to engage and excite fresh users well after the IDO and a platform for these users to acquire a position in the earliest opportunity available, well after it has occurred.
- IDO participants are only offered a limited allocation based on sale size and registration numbers. Now, if they are especially bullish on a particular project they can acquire additional discounted tokens.
The Vesting Marketplace is a first for all of crypto, giving way to new market dynamics that benefit both project and user while allowing Avalaunch to continue to establish itself as a market leader with respect to functionality and usability.
Token Vesting, Liquidity & Market Dynamics
Crypto is a space where early stage companies are traded; giving rise to great speculation and volatility versus traditional markets where far more mature assets comprise a given exchange’s tradable assets. Risk tolerance among individuals varies greatly and crypto, generally speaking, is an ongoing fight for liquidity where moving in and out of positions can materially impact price and sentiment. Vesting tokens are often released in relative bulk, often creating chaos at the moment of release causing unlocks to often be bearish events.
Ideally, token distribution schedules should be timed with anticipated demand, however, investors require firm dates where they can expect to receive tokens. The result is quite challenging for projects as they hope to offset inflation with fundamental developments.
Token vesting, in essence, is a process by which tokens are released gradually over time instead of being issued all at once. This mechanism is intended to align the interests of issuers and investors by ensuring that tokens are distributed in a controlled and strategic manner.
Ideally, token vesting is meant to encourage long-term engagement and prevent market saturation, however, this is often not the case. A token vesting marketplace can redistribute tokens into the hands of longer-term participants before tokens are “in the wild.” Avalaunch has developed a platform that allows token holders to buy and sell token vesting schedules, enabling them to trade the right to receive tokens in the future.
Avalaunch’s vesting marketplace is a tool to incentivize long-term engagement that enables token holders to trade their vested tokens, which can result in a more liquid and efficient market. For projects, these marketplaces offer a new way to engage and attract supporters by incentivizing long-term investment.
For token holders, a crypto token vesting marketplace offers a new opportunity to trade their vested tokens to mitigate against risk, free up capital or realize returns in favorable market conditions. For supporters seeking to take a position, they are too often forced to bid up the market with high slippage or negotiate risky OTC deals with prohibitive fees.
For launching projects, offering a fully audited, cost free, state-of-the-art vesting tool and claim portal can be as advantageous to launching projects as it is to users. The Avalaunch marketplaces aims to add market efficiency for launched projects and broader token support. It can prevent supply shock, add liquid flexibility for holders and offer new opportunities for those with longer investment horizons. Avalaunch believes that a trading marketplace for vested tokens can ultimately take the sting out of a growing circulating supply while offering participants a novel way to unlock value.
Avalaunch Vesting Marketplace: Understanding the Features and Functionalities
Avalaunch presents a public-facing dashboard for users to realize value from their vesting positions that allows token holders to buy and sell token vesting schedules, offering them a way to trade the right to receive tokens in the future.
Here are some of the key features and functionalities:
- Token vesting schedules: The dashboard displays the IDO token vesting schedules available for trade, including:
- Unlocked Value—tokens which have been or are currently claimable
- Implied Value—the total value of an allocation, both claimable and vesting.
- The duration of the vesting period and the release schedule.
- Total Token Position—both unlocked and vesting
- Trading functionality: a user-friendly platform for buying and selling vested tokens in real-time with order matching and settlement.
- Price discovery: The marketplace will not use algorithms to determine price but user supply and demand to ensure fairness and efficiency.
- Transparency: The Avalaunch marketplace provides users with a clear and transparent view of their balances and positions in order to make informed decisions.
Let’s use a practical example to tie it all together.
A user participates in an IDO that vests over a period of 1 month, with two unlocks (one at TGE and one 30 days later), creating 2 vesting portions. They decide that they want to participate in the first unlock, but would like to put the remaining portion up on the marketplace. Because the unlock occur in the future and not having immediate access to the tokens creates additional risk, the claim to these tokens should be offered at some discount to make it attractive to potential buyers.
At this point, anyone can come to the marketplace and purchase these tokens, or more specifically, the right to claim them once they unlock in 30 days. Buyers on the marketplace do not need to KYC or have participated in the IDO. Once they acquire the tokens on the marketplace, they will show up in their token dashboard, available to claim at unlock, as if they had participated in the IDO. In this example there were only 2 vested portions, however if there were more, they could offer up any combination of future unlocks to fit their specific strategy.
Wrapping Up
The above was a simple introduction to the Vesting Marketplace, it’s features and implications for projects and users. We have released user guides for step-by-step instructions and will be talking more about it in the coming days and weeks.
With a user-friendly interface, demand based price discovery and secure trading functionality, a token vesting marketplace is an essential tool for Avalaunch for launching projects and participants. Beginning with Deepwaters, Avalaunch believes that the functionality of a marketplace and the convenience of a robust dashboard will slowly become a staple in a growing list of forthcoming products and services. Avalaunch looks forward to sharing more detailed instructions and information as the launch date draws nearer.
User Guide: Video Tutorial
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How to Use the Vesting Marketplace
Watch this video to learn how to claim, buy and sell vesting portions on the Avalaunch Vesting Dashboard & Vesting Marketplace.
Importnat Note:
All sales previous to the Deepwaters IDO in February 2023 will not have Vesting Marketplace support. In other words, you will not be able to buy or sell vesting positions on the vesting marketplace for any sale before Deepwaters.
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Deepwaters AMA #2 – Technical Deep Dive (Recap)
On 02/09/2023 at 6:00 p.m. (PST), an AMA session was held on Avalaunch Telegram with Zorrik Voldman (CEO), Michael Callahan (VP of Marketing), and Greg Barnes (CTO) to cover the technical underpinnings of the project. The focus of this AMA will be the underlying tech development and roadmap.
Below we present to you an excerpt from AMA with questions and answers.
Dave | Avalaunch
Hello again Avalaunch Community and welcome to the sequel AMA with Deepwaters. In part II we will be doing more of a technical deep dive on the project and bringing us some no joke Deepwaters excellence are @zscape0 CEO and Architect, CTO extraordinaire @gregkbarnes and their Market Director, the venerable @mscallahan . Thank you for joining us. How are you all doing today?
And, for an additional cameo we will have their Chief of Staff, @CarltonHoyt
Greg | Deepwaters
Excited to be here and generally not sleeping: getting ever so close to our launch.
Dave | Avalaunch
Can you please tell us a little bit about yourself? Where were you before you started working on Deepwaters?
Greg | Deepwaters
We definitely have a diverse set of backgrounds:
For me: I actually discovered Bitcoin in a past life, when I played poker professionally. From there, it led me into starting a mining operation in Washington State (cheap hydro power) and then into Ethereum, defi and beyond.
Zorrik | Deepwaters
Deepwaters actually pulled me out of early retirement. I was in Kauai , surfing and dreaming of the next best thing, when the idea hit me.
Carlton | Deepwaters
Mid 2021? Deep in covid quarantine.
Jokes aside, I have a background in life science marketing and once upon a time I got a PhD in neuroscience.
Dave | Avalaunch
I have mixed feelings about you leaving that set up but I’m glad you did nonetheless.
Well you put your grey matter to good use. Cheers.
Zorrik | Deepwaters
In past life I started a few fintech companies, sold some to public companies, ran a hedge fund as a quant and created a military communication system that a few countries around the world are using
Dave | Avalaunch
This is a well qualified group to be sure.
Considering the collapse of FTX and how the narrative is to keep away from custodial parties, how does Deepwaters as a hybrid architecture of finance and blockchain position itself as a cryptocurrency exchange, one in which customers can trust and use?
Zorrik | Deepwaters
Couldn’t be happier. This is the most exciting project I have ever worked on.
Simply put, we are a marketplace whose priority #1 is to remove any potential of privileged operations from all parties, including Deepwaters. Beyond custody, and equally important, is order flow protection, which is our main thesis.
Dave | Avalaunch
Excellent. Thank you for that. What are some of the strategies that Deepwater will use to stay above this competitive environment, particularly what options will you provide for onboarding the first wave of users and ensuring their retention?
Zorrik | Deepwaters
What has proven effective so far is staying true to our mission. You would be surprised how many very profitable ways there are to dilute the uncompromising stand on custody and orderflow. If we continue to demonstrate a competitive market place, we will remain competitive. The direct measures we are taking are not unlike the strategy that PayPal employed: reward participation and referral of new participating clients.
Carlton | Deepwaters
We also just announced a really cool promo where everyone who signs up by the end of the day on our launch day (the 14th) gets max VIP tier for one year.
Dave | Avalaunch
Can you explain in more detail how Deepwaters aims to circumvent the impermanent loss (IL) problem ubiquitous to the LP mechanism?
Greg | Deepwaters
Deepwaters is a pure order book. As such it does not have an Automatic Market Maker based LP mechanism. However, we are looking at allowing clients to participate in the liquidity provision and profit sharing through market makers that are going to be trading on Deepwaters. The big difference here is instead of naive buy high and sell low implementation of AMM LP, your money is being used by an intelligent and experienced market maker.
Note, MMs do not have privileged rights or access on Deepwaters but they are protected from the exchange trading against them. Potentially, this will have a positive effect on ultimate profitability.
Dave | Avalaunch
That’s smart and has been notably problematic in crypto.
Greg | Deepwaters
Not for long 😉
Dave | Avalaunch
Amen.
Greg | Deepwaters
Building an exchange the RIGHT way should be simple. Focus on transparency, fairness for all players, and make it provable!
Dave | Avalaunch
Simple is not always easy so kudos to you. Which legislation will Deepwaters be operating under? Any counties that will be excluded from accessing the platform? Do you envision any difficulties in expanding the services to other countries?
Carlton | Deepwaters
Deepwaters is operating under the laws of the Czech Republic, and therefore also the European Union. We’ll have to exclude countries with broad financial sanctions:
• Cuba, some occupied parts of Ukraine, Iran, Afghanistan, Russia, Syria, and North Korea.
We’re also excluding some non-EU jurisdictions with very well-defined regulatory regimes:
• United States, Canada, United Kingdom, Switzerland, United Arab Emirates, Singapore, Japan, Australia.Greg | Deepwaters
All of those we plan to get licensure for, in time. Doing things the ‘right way’ and remaining compliant take time and resources. We are devoted to this cause.
Dave | Avalaunch
Well let’s hope the governing bodies can stay out of the way of progress.
How will the initial liquidity be provided, will there be looping in of liquidity from other CEXs and DEXs?
Zorrik | Deepwaters
The initial liquidity will be provided by the market makers, which is a superior way to create liquidity with the best spread and depth. We are working with aggregators for backstop, as well.
Dave | Avalaunch
Who will be your KYC/AML provider, and how much customer data will you store and for how long? Do you have your own server for data storage, and who will have access to this data?
Carlton | Deepwaters
We’re working with Fractal for KYC/AML. We are required to keep records safely on EU servers, since we’re based there. Access is limited to personnel with a need to be able to access it for compliance or technical purposes.
Dave | Avalaunch
Will Deepwaters be accepting fiat? If so, which currencies do you expect to be supporting and what system will you be using for providing this?
Greg | Deepwaters
Soon! Day one, crypto only. But we will integrate fiat rails and make announcements around supported currencies in the near future. We’re not 100% certain what provider we’ll be using for fiat rails, but we’re currently leaning towards BCB.
Carlton | Deepwaters
FYI, BCB is a super crpyto-friendly bank in the UK.
Dave | Avalaunch
Let’s hope it stays that way. 😁
What’s the hierarchical structure for users to gain access to the platform? What are the main functions non-KYC’ed vs a KYC’ed users will be able to access?Zorrik | Deepwaters
Only KYC’d users can trade. Users, who go through source of funds declaration will have much higher deposit and withdrawal limits, but it won’t be required.
Dave | Avalaunch
What security measures does Deepwaters have in place? Will there be proof of reserve available? What about 2FA?
Greg | Deepwaters
That’s a good question and something we’re particularly proud of.
Deepwaters Beta uses EIP-712-based transaction signing. We require you to sign actions (trades, withdrawals, etc.) with your private key using your favorite web3 wallet. Customer funds are trackable in Deepwaters’ PositionManager smart contracts.
In the coming months we will be expanding our offering and integration with best-in-class custodians (Fireblocks and Qredo).
Dave | Avalaunch
That’s a good answer. You’re on top of this stuff and are looking ahead which is particularly important in the current landscape.
How will withdrawals work? Do you have wallet whitelisting functionality?
Greg | Deepwaters
That’s correct.
In Beta, withdrawals work by using your own wallet signature and broadcasting the tx on-chain yourself.
Carlton | Deepwaters
Your wallet is your remote control for your funds on Deepwaters!
Dave | Avalaunch
That definitely works.
Can you tell us more about the structure of the different wallets and deposit options? How do you ensure that customer funds/deposits are not commingled with company funds? Will there be any transparency in this regard?
Greg | Deepwaters
The PositionManager that we mentioned before leaves a on-chain trail of all deposits and withdrawals.
The best way to deal with this is transparency combined with legal structures and auditing that provide oversight.
Our PositionManager smart contracts hold strictly customer assets and are responsible for deposits, withdrawals, and settlement between customers.
We’ve got big plans around auditing and transparency (the sexiest topic). This starts with 3rd party audits and extends to including Deepwaters validators in on the auditing process.
Dave | Avalaunch
Nothing sexier than a good audit.
Zorrik | Deepwaters
Maybe slow audit
Dave | Avalaunch
And a final question before we move on to the Twitter/Community portion of the program — Are there any other points you’d like to tell us more about to better understand the platform?
Carlton | Deepwaters
If you look at almost all of the big implosions in crypto in 2022, they weren’t because of external bad actors or hacks. They were essentially inside jobs. The operators of the platforms were doing things they shouldn’t have. You can easily create a set of rules which would prevent any and all of those things, while making trading more fair to everyone at the same time. You can solve all these problems with technology, and that is precisely what we are aiming to do.
Join us on our mission, everyone! We welcome you to sign up at https://app.deepwaters.xyz/
Things only change if you vote with your wallet (so to speak).
Dave | Avalaunch
Absolutely. A decentralized protocol is most vulnerable to its own creators. Well said.
Good link to check out.
Community Questions
Dave | Avalaunch
So first up from our community is a virtual assasin. @bookieassassin asks — If I want to participate in governance, is it the WTR token or the ZRB token I need to hold?
Carlton | Deepwaters
WTR. ZRB will act like an ETF. It’s a really cool product but it won’t be ready for a while.
Dave | Avalaunch
Understood. Next up comes from @AguedaShank1998 — Who are the ideal target users for Deepwaters?
Carlton | Deepwaters
Are we allowed to say everyone?
Dave | Avalaunch
You have clearance from the FCC on this, yes.
Zorrik | Deepwaters
Anyone who cares about the best price discovery and execution. And yes, that would include market makers who once in a while have to go flat on their risk.
This includes: retail traders, quants (who would love viable market orders, 100% price improvement and low adverse selection) and institutionals.
Dave | Avalaunch
Good looking out for retail traders. They’ve been through enough.
A common question that gets asked. @spanser77 During the creation of your project, do you consider community feedback or requests to further expand new ideas for the project?
Greg | Deepwaters
1,000% — Yes. We have gotten great feedback and support from our time in testnet. We look forward to listening and learning from our community.
Michael | Deepwaters
300k+Carlton | Deepwaters
King of context right here.
Dave | Avalaunch
and you have a massive community that can attest to this. Prop.
Zorrik | Deepwaters
Michael is a spartan. He is very laconic
Dave | Avalaunch
Exhibit A
but never reticent
Zorrik | Deepwaters
This is DEEPWATERS!
Dave | Avalaunch
Perfect. I’ll quit while you’re ahead.
Carlton | Deepwaters
The 300k number is how many feedback responses we got on our testnet. So yeah, we’re listening! Thanks to anyone who gave us feedback.
Dave | Avalaunch
@AvelinaPatrick99 How is the DEX aggregator implemented by Deepwaters different from other DEX aggregators that can be found in the DeFi space?
Zorrik | Deepwaters
We are a classic order book, quite far from a DEX aggregator which aggregates inferior price discovery of DEXs. The advantage of such an order book is superior speed, cost, price discovery and settlement. Of course DEXs have their specific use cases, just like order books.
Dave | Avalaunch
@Chunwab After all bad scheme and action by Celcius, now FTX, what are Deepwaters strategy to convince your user that Deepwaters is safe and worth it for investment?
Greg | Deepwaters
The trick is not to *ask* our customers to trust us. We’re building a system where users can prove that we are doing what we say we’re doing.
You have to take away the centralized points of control and corruption!
no more walled gardens*
Dave | Avalaunch
This makes a world of sense. Walled gardens be gone! This is Deepwaters!
@AvaxPredat0r — I see lots of engagement on Deepwaters tweets–where did you build your community and what brought you to Avalanche?
Greg | Deepwaters
We’re very excited about the future of Avalanche: particularly around their app-chain approach with subnets.
We also have mutual interest in confidential computing (building on Intel SGX). Avalanche actually has recently migrated their bridge a TEE-enabled solution.
Michael | Deepwaters
We’ve tried to build our community by creating ways for community members to contribute, and rewarding them for doing so. Creating content, referring friends, proving feedback on the testnet, etc. Our community can gain rewards by doing whatever they do best.
We want our community to feel like deepwaters is their project too, because it very much is
Dave | Avalaunch
Keeping in line with this — @Kangjian2 — Are you planning to promote Deepwaters project in countries / regions where English is not good?
Michael | Deepwaters
Absolutely! We’re going to be prioritizing additional languages on the platform in the weeks and months after launch
Zorrik | Deepwaters
By the way We have 28 language groups on Discord and we have employed the best of our community members
Dave | Avalaunch
You already have a ton of communities in your Discord. Do you know offhand how many regions/countries?
That was my follow up. Nice.
@OptimusPrime_SV — You mention that you have flexible strategies for traders of any level; can you tell us about your plans for new traders?
Zorrik | Deepwaters
Deepwaters brings back viability to market orders (they just land on the public order book and take a bite out of it, before anyone can react to them), Also, mispriced limit orders get automatic 100% price improvement. Because of this , Deepwaters is very noob friendly.
Dave | Avalaunch
That’s sincerely good to hear.
People onboarding get into a world of trouble navigating the space so anything noob friendly is super welcome.
Zorrik | Deepwaters
For anyone who is used to RFQ type orders, graduating to market orders and then limit orders is going to be organic. Both will result in superior execution.
Dave | Avalaunch
Another question that gets asked so often I can’t help but include it on occasion — @Sanchezz91 — will Deepwaters accommodate a BuyBack/Token burn mechanism after the token sale or in the near future?
Carlton | Deepwaters
We can’t because it would make it a security. I’m not even allowed to speculate on anything that would give an impression that we are trying to impact the price of the token. The SEC is really strict about these kinds of things and ultimately we’ll need to obtain US licensure.
Zorrik | Deepwaters
We are looking forward to coming back to US as an SEC registered exchange. We are being very careful with compliance.
Dave | Avalaunch
Understood. You all have fared admirably and our final question is upon us.
@Abdul_Rahim07 — Since it’s a zero gas fee exchange, How do you generate revenue? Do you have enough funds to run your project? 🔥
Greg | Deepwaters
Deepwaters charges trading fees. Also, when we launch leveraged trading later this year (hint, hint)… there will also be a funding rate.
I also want to take a moment to call our a great promotion that we’re running leading up to our launch:
Register and begin the KYC process by 23:59 UTC on Feb 14 and lock yourself in to the HIGHEST VIP TIER for both maker and taker fees for 12 months!
One last thing… 🙂
We’re very excited to get the chance to work with Avalaunch and you all, the community. We want to thank the team for all of their support and advisement.
We’re happy to offer our WTR token for this sale at $0.12 and allow it to be redeemed at $0.70 on our platform.
Thanks for being our early advocates ❤️
Dave | Avalaunch
I’d like to thank you all for being here. It’s refreshing to see such an accomplished team so committed to community and willing to keep an “ear to the street.” Avalaunch believes this matters greatly and will come to define the space as we move forward in the face of regulators and continued scrutiny. Something very special is being built and you all represent important builders in directing the path ahead.
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Deepwaters AMA #1 – Project Overview (Recap)
On 02/07/2023 at 6:00 p.m. (PST), an AMA session was held on Avalaunch Telegram with Zorrik Voldman (CEO), Michael Callahan (VP of Marketing), and Madeleine Jones (Head of Community) to cover the project at a high level. The focus of this AMA was business development, vision, road map, and post-IDO plans.
Below we present to you an excerpt from AMA with questions and answers.
Dave | Avalaunch
Hello and welcome everyone to the first AMA of this New Year. Today we are fortunate enough to have some revered guests who come to us all way from Deepwaters, our upcoming IDO. This is the first of two AMAs so to kick things off we have @mscallahan, VP of Marketing and @madeleineth their Head of Community. Given the traction and numbers Deepwaters has garnered through testnet and prior to launch, it’s safe to say they’ve been busy. Thank you for joining us here today. Our guests will be making their way here to us.
@madeleineth and @mscallahan how are you doing today?
Madeleine | Deepwaters
Hey super happy to be here!
Dave | Avalaunch
Glad to hear it. Once again, thanks for joining us today.
Michael | Deepwaters
Hey, great to be here and super excited to talk to your community!
Dave | Avalaunch
Let’s get into then — Please take a few minutes to introduce yourself, who you are, what your relevant experience is and how you ended up in Deepwaters?
Madeleine | Deepwaters
Well I am I am the head of community for Deepwaters, I had a number of community management roles prior to being hired and building out the community and social media side of things
Michael | Deepwaters
Well, I’m Michael Callahan, VP of Marketing here at Deepwaters. I actually started my career as an engineer (my team likes me to say I worked for NASA and the JPL, so I’m the official deepwaters rocket scientist :p). Got into data science after my degree, which eventually led me to Product Marketing. Been in the industry for abt 6–7yrs, and worked all around for companies like OKX, the Transform Group, and OpenZeppelin/Forta. DW needed someone with technical marketing experience, focused on transparency and consumer blockchain, so here I am
Dave | Avalaunch
Super important part of crypto and one of the most challenging to say the least. Welcome
Good having you and sporting a sound resume. Moving on as we have a lot to get through — Please give us an overview of Deepwaters with particular emphasis on what it is and what problems it aims to address?
Michael | Deepwaters
Madeleine has been an absolutely rockstar, and at the risk of even MORE people trying to poach her, she’s underselling herself as our secret weapon.
Madeleine | Deepwaters
haha thank you Michael
Dave | Avalaunch
Avalaunch will do its best to refrain 😁
Please give us an overview of Deepwaters with particular emphasis on what it is and what problems it aims to address?
Michael | Deepwaters
I’m going to give an abridged version of what some of you may have seen in our literature…
At the highest level, Deepwaters has built the most fair and transparent exchange in history, providing protected order flow, secure custody, and provable market integrity.
We use a hybrid approach that brings together what we believe to be the best of both CeFi and Defi. We are fast, compliant, and trustless. Our technology makes it literally impossible to engage in the kind of fraud/trade manipulation/corruption that brought down FTX/Celsius/Voyager/3AC/etc. and ANYONE on our platform can prove it — you don’t need to trust us, we give you all the tools to see EXACTLY how are trades are executed and assets are managed.
Dave | Avalaunch
Understoood and thanks for that. Makes a world of sense given the recent events and troubles with CeFi that makes crypto on the whole look bad when it’s still centralized authorities.
How long did it take the team to produce the testnet, and were there any outstanding challenges you faced along the way? How did you overcome them?
Michael | Deepwaters
We were building in (semi) stealth for around a year and a half before we entered testnet this past September. I’m not sure if we have enough time here to talk about all the challenges we faced, or if I’m the right person to discuss them on the product/engineering side haha.
One major challenge was that we began by developing a decentralized exchange, but kept running into compliance/assurance/speed/security issues that we were unable to provide solutions for in the ‘traditional’ DEX format. We pivoted to the model we have now about 9 months ago, and it’s been up and up ever since.
From a legal perspective, we’re a centralized exchange. However, our founding ethos and everyone on our team is focused on transparency and the ethos of DeFi — not having to rely on any kind of centralized custodian. So we’ve built a technology that brings that kind of trustlessness, transparency, and accountability to a ‘centralized’ architecture by a combination of blockchain and Trusted Execution Environment technologies.
Dave | Avalaunch
Again, appreciate the comprehensive answer and best of all, it makes a world of sense.
What are the key factors that in your opinion differentiates Deepwaters from the rest of the competition? What makes the platform unique that users will enjoy using instead of the leading providers in the space such as Binance?
Michael | Deepwaters
I’ll give this one a shot, but would love madeleine to talk a bit about how we differentiate w the community as well.
Dave | Avalaunch
That is worth noting. The traction you all got was super impressive so let’s amend that to focus on the community.
Madeleine | Deepwaters
Existing exchanges have been designed to take advantage of trades and exploit the ignorance of traders. These exchanges do everything to ensure that they themselves, and their privileged friends, profit first and most. Traders, on the other hand, are the last to benefit from their own trades. We have flipped that script, and our community knows that and I feel like that was a huge part of our organic growth
Dave | Avalaunch
AMEN!
Michael | Deepwaters
Retail traders are starting to gain a lot more understanding about how they, as traders, are the LAST to make money on their trades. Every time you see something like “Zero Fee Trading” (and no, I’m not going to call out the exchange you’re thinking of by name :p ), you can bet that you’re losing a lot more than you would be on fees. PFOF, internal netting, and adverse selection are quite honestly standard practice across almost all exchanges, and we can confidently say we are the most fair and honest exchange out there — as these things are literally impossible on deepwaters.
All the big exchanges spend a TON trying to convince you that they should be trusted. For me, my favorite differentiating factor is our ability to say: you SHOULDN’T trust exchanges (including us!). We give you the ability to see exactly how our trades are executed and assets are managed. Our trading rules and orderbook are public to everyone. Why should you believe a neighbor who builds walls around their garden? We differentiate by building a foundation of windows.
Dave | Avalaunch
I think you’re launching at an important time.
Let’s give you something a little easier but relevant. As a project voyeur, I have a question that users often inquire about — What does a typical day look like at DeepWaters, and how big is the team behind the platform?
Michael | Deepwaters
ftr, We didn’t have anything to do w the timing of FTX… but we do certainly appreciate it.
Dave | Avalaunch
I’m fairly certain that Madeleine lives in a few time zones. 😁
Madeleine | Deepwaters
Well my day is probably a little different because I am on the other side of the world to everyone else so I do have some pretty wild meeting times. but I do believe we are now 16 full time employees. Which is wild for me as I joined as #5
Michael | Deepwaters
At the moment, we have a full-time team of 16. I can probably best speak for the marketing side, so a typical day involves a lot of conversations with partners, investors, and market makers (a lot of convincing people that transparency, fairness, and honesty are ACTUALLY better ways to make money than exploitation — especially as traders become more informed). We also place a huge emphasis on giving people in our community ways to work WITH us, contribute to the success of the project, and be duly rewarded/appreciated for their efforts. We would have no where near the success that we have if not for the unbelievable work of our community.
Madeleine | Deepwaters
Sorry its 17 now!
Dave | Avalaunch
Ever growing
Here’s something for the both of you so I’ll leave it open ended as possible — Can you give us a rundown of some of your marketing/community strategies you may have planned for launch and beyond?
Madeleine | Deepwaters
So you want me to give up the secret herbs and spices??
Dave | Avalaunch
Maybe you can show us the dish but keep the recipe?
Michael | Deepwaters
FYI, she’s Australian so y’all should know she pronounces the ‘H’ in “herbs”… as an American, I believe this is a sin.
Dave | Avalaunch
I hear it now
Madeleine | Deepwaters
We have a fair few big surprises coming to reward our community for helping us get to where we are. We have been so incredibly lucky to have fostered the community we have and its only right that they get to come along for the ride with us. We did tease a little about what will happen with our social token on twitter but the full surprise will be revealed very soon!
Michael | Deepwaters
As I mentioned above, a big part of our overarching strategy is to give our community incentives and opportunity to work WITH us. We’re not just looking for fans, we believe that 90k people on discord will almost always be smarter than any single one of us, so we take their input and help extremely seriously. We have programs for testnet feedback, content creation, bug bounties, translation, referrals, token listing introductions, etc. etc., and we work hard to reward/recognize the users that help the most. We want our community members to feel like this is THEIR project too, because it is.
Dave | Avalaunch
Thank you for that
And one of the surprises is the presence of @zscape0 Welcome. Zorrik is the Founder and CEO of Deepwaters so maybe I can follow on that look ahead by asking- What insights can you give us about the platform’s V2 planned for Q3-Q4 of this year?
Which is not to preclude Michael or Madeleine from weighing in but I thought the cameo deserves acknowledgement.
Zorrik | Deepwaters
First of all, we will be looking at introducing leverage
Of course we are also looking at listing several projects. The list is being vetted at the moment.
Following up, derivatives.
Dave | Avalaunch
This is exciting to be sure.
Michael | Deepwaters
Well, we’re considering our launch on Feb 14h to be a Beta Launch, as we’re going to be rolling out and expanding a lot more features over the coming weeks and months. Many of our transparency/accountability-focused features will be available on launch, but some, including remote attestation to the trade execution (so users can prove that our trade rules are functioning as shown on LIVE trading) will be rolled out around Q2.
Dave | Avalaunch
It’s a pretty packed roadmap.
Zorrik | Deepwaters
One of the options under consideration is options. Options have not been very popular with the crypto community but we believe that they are an essential investment vehicle, although in many cases leveraged perps have replaced them.
Dave | Avalaunch
That’s a good point. People need to straddle but to date, they haven’t caught on.
Michael | Deepwaters
We’re also going to be instituting some temporary safeguards on launch, to protect our users while we get our feet under us. These include:
- Maximum deposit size of $100000/day and $500000/month
- Kaximum withdrawal size of $100000/day and $500000/month
- Limited trading pairs: we are starting with the five trading pairs included in our testnet along with WTR-USDC. We plan to add more in the months to follow
Dave | Avalaunch
The adding of assets is going to bring community interest from the prospective projects as well.
Zorrik | Deepwaters
In effect, options is one of the most interesting and obvious application of Deepwaters tech. If you think about what ails the option most… thin markets allow order privileges to distort pricing. Deepwaters order protection will make options more viable, just like it makes market orders more viable.
Dave | Avalaunch
As a multichain project, which others are planned to be supported by the platform, and what’s the timeframe for this? How did you decide for Avalanche to be one of the first chains to be supported by the platform?
Zorrik | Deepwaters
We are laser focused on our mission and for our beta we intentionally restricted ourselves to EVM compatible chains, to speed up the GTM and eliminate variables. You can guess the first addition, of course: BTC.
Dave | Avalaunch
I believe Avax holds more BTC (BTC.b) than the lightning network. Shoutout to Avalanche. Let’s take the training wheels off this AMA and just let you all share. Michael I know you have something coming.
Zorrik | Deepwaters
One of the important v2 shifts is moving custody to third parties. We are currently working with Qredo and Fireblocks for that, both leaders in custody solutions for crypto.
Whatever they support today will be the initial restriction on the listed assets but we are working with them to expand that. AVAX invested in us via Blizzard fund, so we of course list them as one of the first.
We are very excited to be working with them.
Dave | Avalaunch
I hope you’d consider a subnet looking ahead. Horizontal scaling.
Michael | Deepwaters
Actually, if I may, I will use this opportunity to pose an ask to the Avalaunch community:
We want to become known as the safest, fairest, and most reliable exchange for the tokens with the most real utility. If you have an upcoming or recently launched project or token in mind that you would like to see listed on Deepwaters, we’d love to hear from you! We provide pretty generous rewards for intros to great tokens/projects, and we’re willing to discount or even list those projects for free, given appropriate conditions.
Dave | Avalaunch
I’ll repost this after the AMA and you will see agendas come to life. I would think they’ll say XAVA for sure.
Community Questions
@Oriap4 — How long do you expect the main building phase to last in order for Deepwaters to achieve the team’s vision?
Michael | Deepwaters
All the features on our public roadmap will be rolled-out by Q3/Q4 2023. (this is the plan, anyway :D)
Zorrik | Deepwaters
Depends how you define our “vision”…. we have some surprises planned beyond what you see on the roadmap. The long term goals are very ambitious but as I said we are laser focused on the core.
Dave | Avalaunch
If you want to tease a surprise, you’ll get no complaints
Zorrik | Deepwaters
Our goal is for Deepwaters to keep growing and evolving for many many years to come. I am excited to have you all with us on this journey.
Dave | Avalaunch
Not quite an “alpha Leak” but appreciated nonetheless.
Moving on…the intrepid @NilsaTellez50 asks — What do you feel is your biggest challenge is in gaining adoption?
Zorrik | Deepwaters
I would say, at this point it is education. Prior to FTX many considered us conspiracy theorists. The sentiment of “it does not happen, because it is illegal” or “it happens in tradfi but crypto is different” used to be prevalent.
Michael | Deepwaters
Madeleine can prob answer this as well, but one is certainly going to be token listing as mentioned above. We have a pretty involved due-diligence process and are going to do our best to ensure no one gets rugged or scammed by a token listed on DW, but this process also means we can’t just list anyone and everyone. This is one area where we’re going to be HEAVILY leaning on our community to help us identify and vet the next unicorns.
Zorrik | Deepwaters
If you want a little hint, we are planning to come back to United States as a registered exchange here and further on, venture into TradFi.
Dave | Avalaunch
I think that holds up 😁 Appreciated.
Michael | Deepwaters
Zorrik makes a great point. The more retail traders understand how much they get screwed on other exchanges, the larger and more enthusiastic our community gets. As a trader, you should DEMAND transparency into how your trades and assets are managed.
Dave | Avalaunch
Absolutely. What would have been conspiratorial tinfoil hat talk became prescient as Luna unwound and FTX collapsed.
Here’s one I always like this question and @Heylay3 is dying to know — I’d love to know the inspiration behind the name DeepWaters?
Zorrik | Deepwaters
The idea was born on Kauai, Hawaii. I am a die hard surfer and many of these concepts were going through my head as I was waiting for waves or was given a timeout by particularly lengthy hold down.
It makes sense… whales need deep waters to swim. The parent company name VatnForn is norse for “ancient waters”.Michael | Deepwaters
Also… ya know… become a whale on deepwaters, whales need deepwaters to swim (I hate myself).
Zorrik | Deepwaters
It also has a certain meaning for the core idea of the project: making the transition from trader clickthrough to public order book atomic (confidential)… Deepwaters hides what’s under, you only see the waves above.
Random fact… did you guys know that the height of the wave is the same as the depth of the ocean floor it is breaking over? We gonna make some monster waves in the industry!
Dave | Avalaunch
Wow. Maybe the best answer to date on this question. Appreciated.
@Pilot9804 who is firm but fair candidly inquires — I see that Deepwaters platform is asking for kyc to start trading on Deepwaters. Why do you need kyc? Is it possible to use Deepwaters exchange without kyc?
Zorrik | Deepwaters
This is a very important question. Many people ask: why KYC. This is Sparta ehm crypto!
We aim to fix the core problem in trading dynamics. That problem is essentially … people, especially people running the exchange and creating the exchange. It may really surprise you, but we have started this project as a completely decentralized exchange.
Greg Barnes and I more or less reinvented many DeFi projects searching for the answer to the question: how do we protect our traders. We walked away dissatisfied with the maximalist approach. However, we are still looking at the emerging tech here. Speed, cost and confidentiality is paramount for a fair market place.
We then transitioned into a standard hybrid approach but the question remained unresolved: how do we remove ourselves out the equation. Eventually realization dawned that 1) Orderbook is the superior paradigm for a marketplace 2) Trusted Execution Environment is a superior technology at the moment for us.
Michael | Deepwaters
This is a really good question, and honestly, it’s something we struggled with for a long time. Full transparency, it all comes down to compliance. We need to guarantee that the exchange itself, the assets held on it, and our users, will never (even unintentionally) break the law. We also need to assure that your assets are yours, and we have every mechanism possible in place to prevent identity theft or other fraud.
We will NEVER sell your information, use it for any other purpose than to remain fully compliant and protect your assets.
Dave | Avalaunch
Right. Given your roadmap, that would stand to reason.
Zorrik | Deepwaters
You can see how this leads to KYC naturally if our primary concern is trader protection. This allows for the broadest adoption ultimately and organic translation to application for tradfi markets in the future.
Dave | Avalaunch
Understood and on that note, the irreverent @ekinci_sualp asks — Can you tell us about the security Deepwaters uses to ensure the safety of user funds?
Zorrik | Deepwaters
As I said we are transitioning to best in class third party custodial solutions. The APIs are driven by disclosed code, the code is protected by Deepwaters tech from ourselves. Special legal structures are now being discussed to resolve special cases such company not being viable or infrastructure failing.
Basically, not your control — not your crypto
I personally experienced the dangers of rehypothecation. I had 1mil locked up with MFGlobal (look it up, its a fascinating story with a company which had an amazingly relevant name).
Look we believe in combining the existing government protection (which by the way saved users of FTX.US) with the best in blockchain and TEE tech to go above and beyond what SEC demands of market places
Dave | Avalaunch
Madeleine communities are constantly clamoring to be heard. Some of it is constructive, some of it is not feasible and there’s always a pressing need for right now. How do you separate the signal to noise?
Madeleine | Deepwaters
I’m very lucky I have an incredible team of moderators and admins that assist me on a day to day basis to help sort out the noise but that being said I am very guilty of spending A LOT of time replying to everyone!
Dave | Avalaunch
Okay. I know why you’re being poached. You’ve got that thing in you that says “no message left behind.” Kudos.
Madeleine | Deepwaters
Hahaha. Correct. I get messages telling me to go to bed from the team when they see me online at ridiculous hours.
Dave | Avalaunch
That’s a feature, not a bug. Here’s a question from @Sunsun77 — What were some of the most surprising results from the public testnet launch, and how did they inform the development of Deepwaters?
Zorrik | Deepwaters
Biggest surprise? Traders got it!
Gave us confidence to stick to the script marketing and development wise. Even bigger surprise, someone actually created a custom github project for our API interface. To be frank we did not expect to be understood so quickly, with that support, we just charged straight ahead.
Michael | Deepwaters
Retail traders are a lot smarter than almost everyone gives them credit for.
Dave | Avalaunch
Having been in crypto for awhile, I would say that wasn’t always true but what has held up in my observation, is their ability to learn and adapt is Mach V.
Then again, maybe I was the stupid retail trader when I started and I just recruited everyone else.
Michales Madelein and Zorrik you all have been great here today. Do you have any closing thoughts you’d like to share with the community?
Michael | Deepwaters
We’re getting a lot more questions for the community, and we won’t have the opportunity to answer all of them here so PLEASE come to our discord or telegram so we can answer!
Dave | Avalaunch
For sure. Feel free to post some links to your socials.
Michael | Deepwaters
https://discord.com/invite/Deepwaters
https://t.me/deepwaters_dex
https://twitter.com/deepwatersxyzWe can’t say enough thanks to all the support our community has provided, and continues to provide. we hope we can live up to your extremely lofty expectations! Please help us to find and list the best tokens, and don’t let us miss your questions!And as a quick cap off, here’s a message from our CTO Greg in response to the question abt things we’ve learned from our community in testnet:
We’ve learned that people really like to trade from their phones (even on the advanced view w/ a chart, and we plan to make the mobile experience a priority.
Dave | Avalaunch
For sure. Thank you very much for your time today.
-
Deepwaters X Avalaunch: IDO Announcement
Introduction
The broken trust and absence of promise that has marred the crypto landscape over the last year has largely been the work of CeFi i.e. centralized financial institutions, private equity firms and insider-controlled projects. Unfortunately, these headline grabbing stories have come replete with scandal and corruption worthy of the soapiest of dramas; effectively conflating CeFi and DeFi to the non-native crypto population. Violations of custody have cost traders tens of billions of dollars and 2022 saw traders face immense losses from Voyager, Celsius, FTX, and others. While unscrupulous and predatory behavior is nothing new to the regulated world, the collateral damage to DeFi has been significant. Despite the seeming steps backwards, these recent mishaps fortify the case for an emergent decentralized financial system. Among the chief tenets of decentralized finance are the principles of fairness and inclusion which includes access to tradfi level trading experiences to go with inclusion and self-custody.
Deepwaters
Deepwaters is a different type of exchange that represents a quantum improvement over previous exchange technologies. As we consider the crypto exchange carnage of 2022, we must recognize that there are problems that have hounded crypto traders from inception.
Centralized exchanges control access to information and order flow. As we have seen many times, this creates misaligned incentives for privileged parties to abuse this control through internalization and Payment for Order Flow (PFOF). In essence, traders are playing against the house. Additionally, exchanges have violated the custody of traders’ assets, repeatedly losing those assets to hacks or financial mismanagement. DeFi was born largely due to the lack of trust in financial intermediaries.
Meanwhile, mass market adoption of DeFi has been obstructed by the inability of DeFi to meet the expectations established by the tools of traditional finance. Slippage and front-running create inefficiencies for large traders, and high gas/platform fees make them less accessible for smaller traders. Platforms lack composability, requiring bridges that are susceptible to hacking. Decentralized exchanges cannot compete with centralized and traditional trading without addressing predation, friction, risk, and fragmentation all together.
The failures of these systems manifest for different reasons, but affect traders similarly: risk is increased, and profitability decreases.
Deepwaters is bringing the trustlessness of DeFi to centralized finance, building the first provably fair centralized exchange. On Deepwaters, all traders have provably equal opportunity, and all orders are invisible to everyone, including Deepwaters itself, until they are executed or hit the public order book. This means:
- No front running, MEV, or sandwich attacks
- No PFOF or order internalization
- Any reordering or order flow privileges are impossible
- No adverse selection
- No information asymmetry or data bleed
Violations of custody have cost traders tens of billions of dollars. Deepwaters’ architecture ensures it can only run audited, open-source code with operations that are validated in real time by a decentralized network. In addition to guaranteeing the sanctity of order flow, this disallows discretionary actions with users’ assets, so there can be no rehypothecation or custodial violations. Deepwaters will also be able to be used in a completely non-custodial manner for further asset security, and any deposits / withdrawals occur at the speed of the relevant blockchain.
Deepwaters combines the best of centralized and decentralized platforms while adding novel functionality to provide a service which is highly efficient, compliant with regulations, yet trustless.
The Deepwaters Difference
Deepwaters solves the following problems that are present in conventional centralized and decentralized order books and automatic market makers (AMMs):
Problem Central Limit Order Book (CLOB) Invariant AMM Deepwaters Compromised Price PFOF[1] widens spreads. Adverse selection. Price Fade. Local scarcity micro economic price discovery anchored in arbitrage (invariant-based slippage + MEV-based slippage) PFOF is provably impossible Order Flow Disruption Privileged parties can change and block order flow. MEV[2] players change and block order flow Order flow Immutability Poor Order Execution Front-running and sandwiching by privileged parties. Bifurcation of orders.
MEV players sandwich and front-run traders Front-running and sandwiching is provably impossible Opacity Bid/Ask pyramid may not reflect reality (order flashing) Informational Asymmetry.
Just-in-time liquidity and other MEV-based attack vectors WYSIWYG[3] Custodial Violations Undisclosed and unagreed asset rehypothecation and commingling Immutable custody, but smart contract risk. Immutable custody, but smart contract risk. Deepwaters uses on-chain technology to support self-custody: deposits and withdrawals are done using smart contracts. Business logic and critical data are encapsulated in a TEE enclave. Independent validators are compensated to verify integrity of the system as a whole. Market participants interact with Deepwaters through technology that they’re used to: the Deepwaters Trading API and trading terminal. All business logic is open-source. Validators can subscribe to log replication and native TEE cryptographic attestation to verify that behavior is as intended. These validators are compensated to verify behavior and dispute against bad actors.
Nodes running the Deepwaters application and TEE are distributed across varied regions and participate in RAFT[4]-based consensus. In this way, the system exhibits crash fault tolerance and replication of data while maintaining high throughput, allowing for complex operations, and hindering attempts for any participant to gain advantage in speed over another by means of server colocation.
The resulting order book is public, however the integration of a TEE ensures that incoming order flow is confidential until after it is posted or matched against the existing order book. Sequencing and execution of orders is the same for all parties, including the host of the engine.
The majority of actions initiated by users will occur off-chain, utilizing the Deepwaters Trading API. A combined cross-chain state of user balances and other information is held in a secure computing environment. Actions can only be created by a user, who cryptographically proves they own the address associated with the action they are initiating. On-chain settlement is only required during withdrawals, improving system efficiency.
Deepwaters Beta version development pipeline.
Over 60% of exchange order flow is internalized (usually via internal netting on the exchanges themselves or payment for order flow to market makers; “PFOF”). This means orders are sold or internalized by the exchange before they hit the orderbook, and not matched to other traders. Orderbook spreads are 25% larger as a result of internalization, costing traders over $200m daily. Some or all of the price improvement is taken by the internalizing counterparties.
Internalized orders are filled slower and in a manner that maximizes adverse selection (90% more likely to happen), resulting in orders losing value immediately upon being filled.
Deepwaters is bringing trustlessness to centralized finance, building the first provably fair, centralized, optionally self-custodied exchange. On Deepwaters, all traders have provably equal opportunity, and all orders are invisible to everyone, including Deepwaters itself, until they are executed or hit the public order book. This means:* No front running, MEV, or sandwich attack
- No PFOF or order internalization
- Any reordering or order flow privileges are impossible
- No adverse selection
- No information asymmetry or data bleed
Consider the difficulties one encounters with centralized exchanges:
- Inexplicable system outages
- Hacks
- Funds concentrated in custodial wallets
- Difficulties withdrawing or depositing funds
- Frontrunning
- Improper use of customer funds: Staking, leverage etc.
- Erroneous account seizures
Conversely, AMM driven DEX’s come with their own peril:
- Impermanent loss
- Absence of order books
- Variable and costly gas fees
- Failed transactions
- Predatory bots
Deepwaters exists to solve all of these problems.
[1] PFOF: payment for order flow
[2] MEV: miner extracted value
[3] WYSIWYG: what you see is what you get
[4] The Raft Consensus Algorithm
https://raft.github.io/
Traction
- Deepwaters has had over 140,000 registered wallet addresses access its testnet. These users have placed over 7 million orders and 2.5 million trades.
- Four community members have created custom libraries to connect to Deepwaters.
- 85,000+ members in Discord, 47,000+ followers on Twitter.
- According to DappRadar & ICOdrops, in November 2022 Deepwaters was the fastest growing unreleased project in all of web3.
Deepwaters—Links & Team
Website | Telegram (Discussion) | Twitter | Blog | Blog II | Discord | Github
Partners & Backers
“IVC is proud to back Deepwaters, which aims to transform the way centralized finance operates by incorporating principles of DeFi into CeFi, providing traders with the first centralized exchange that is provably fair and secure.
With its hybrid architecture and real-time & decentralized platform validation, Deepwaters guarantees equal opportunities for all traders and upholds the necessary efficiency and compliance for the greater adoption of DeFi technology.”
– Jeremy Hsiao, Infinity Ventures Crypto (IVC)
“With Avalanche being the primary state layer for Deepwaters, Blizzard is extremely excited to support one of the most experienced and savvy teams in crypto.”
– Yi Hsin Wei, Blizzard Fund (VC arm of Avalanche)“Deepwaters team has a very professional team background to complete what they are trying to solve. The problems deepwaters trying to resolve are significant. They combine the best of centralized and decentralized platforms while adding novel functionality to provide a service which is highly efficient, compliant with regulations, yet trustless. We are very bullish on what they are doing.”
– Sona, LD Capital“We are one of the earliest investors that supported the Deepwaters team. We enjoyed working with the team for their deep expertise in building robust trading infrastructure, innovative ideas, willingness to take feedback, and ability to execute”
– Calvin Du, OP CryptoConclusion
The automated market maker represented a breakthrough in trading technologies. Quite swiftly, decentralized exchanges (“DEX”) were generating trading volume on par with their incumbent centralized counterparts but not without drawbacks. There has been nothing in the decentralized world where speed did not play a factor, where technology could not be used to game the system and certainly, nothing resembling a virtuous hybrid that offers an institutional grade self-custodied exchange.
Lowered barriers to entry, inclusiveness, disintermediation are some of the “true Norths” that blockchain has been founded upon and somehow, provably fair exchanges have not taken center stage. The maxim “move fast and break things,” has served crypto quite well but has also left some gaping holes in its wake.
Deepwaters is combining the ethos and trustlessness of DeFi with the efficiency, compliance, and throughput needed to ultimately bring this technology to TradFi.
The team at Deepwaters has deep experience across tech, fintech, and crypto/blockchain. Collectively, the team has had multiple large, public exits, conducted over 10 ICOs (including Reg A and Reg D exempt tokenized securities), built high-frequency trading systems, architected cryptocurrency-based exchange-traded products, and founded and scaled many companies prior to founding Deepwaters. There are 16 full-time, non-anonymous team members, including 3 PhDs.
The beta version of Deepwaters is going live on January 31.
“If I could summarize the Avalaunch team in a few words, it would be ‘integrity and competence’. We greatly appreciate that the Avalaunch team only puts forward projects that they themselves believe in. Avalaunch team was thorough in trying to understand our token, technology and intent. Their deep understanding of Deepwaters tokenomics resulted in a wealth of helpful advice, particularly about protecting retail post launch, a major concern of ours. Deepwaters mission is that of creating a level playing field. We want the general public to have the same opportunity as everyone else. This was the common ground for us. The Avalaunch team cares about their community. For them, running a launchpad is about passion for the crypto sector and love of the Avalanche community. That resonates well with us. Of course, they’re also just all-around great people. It was a real pleasure working with Avalaunch, every step of the way.”
– Zorrik Voldman, CEO / co-Founder
Token Economics
The WTR token (pronounced “water token”) is a utility and governance token for the Deepwaters ecosystem. WTR is accepted for goods and services provided by Deepwaters. It also provides coordination mechanisms for future development and various system parameters. While WTR is not explicitly required to use Deepwaters, it will provide the user with exclusive benefits, improving and expanding the user’s overall experience while allowing them to take part in the evolution of the ecosystem through governance.
The total maximum supply of WTR is capped at 350,000,000 units (350 Million units). Issuance is both milestone-based and time-based. This is an effort to ensure that token distribution is commensurate with success of the platform and distributed over time.
WTR can be spent on various goods and services provided by Deepwaters. Some examples include:
- Trading fees
- Purchasing Deepwaters Memberships / Subscriptions
- Deepwaters premium data
Fees are denominated in relevant assets, corresponding to the user’s actions. WTR can be used to pay a portion of the fees on Deepwaters at a fixed dollar-denominated exchange rate of $0.70. The allowable portion is a protocol-defined parameter, subject to the user’s current subscription and/or recent trading volume.
A relevant example:
- User Alice executes a trade, selling 10 ETH for a price of 2000 USDC/ETH
- Alice pays a fee of 10 bps: 20000 USDC x 0.001 = 20 USDC:
- 50% of the fee is paid in USDC (10 USDC)
- 50% of the fee is paid in WTR at 1 WTR/$0.70 USD (~14.29 WTR)
Allocation and Distribution
Distribution of tokens is designed to promote a fair and diverse set of token holders, as shown below. By enabling all stakeholders to participate in governance and token utility, the system is set up with checks and balances ensuring the best interests of the project are pursued.
Funding Numbers
- Total Supply: 350M WTR
- Pre-Seed, tier 1 (4c): 16,866,250.00 WTR | 4.82%
- Pre-Seed, tier 2 (6c): 4,291,666.67 WTR / 1.23%
- Bridge (8c): 25,665,000 WTR | 7.33%
- Seed Round (12c): 25,000,000 WTR | 7.14%
- Avalaunch IDO (12c): 2,083,333.33 WTR | .59%
Total raise: $5.41M
Project Tokenomics & Vesting
- Total Tokens (fully diluted): 350,000,000.00 WTR | 100.00%
- Deepwaters Team: 80,000,000.00 WTR | 22.86%
- Strategic Reserve: 63,192,083.34 WTR | 18.05%
- Pre-Seed tier 1: 16,866,250.00 WTR | 4.82%
- Pre-Seed tier 2: 4,291,666.67 WTR | 1.23%
- Bridge: 25,650,000.00 WTR | 7.33%
- Seed Round*: 25,000,000 WTR | 7.14%
- Advisors: 5,000,000.00 WTR | 1.43%
- Validator Rewards: 30,000,000.00 WTR | 8.57%
- User Incentives: 30,000,000.00 WTR | 8.57%
- Community Fund (milestone-based unlock): 30,000,000.00 WTR | 8.57%
- Community Fund (time-based unlock): 30,000,000.00 WTR | 8.57%
- Avalaunch IDO: 2,083,333.33 WTR | 0.59%
- Marketing / Promotion: 7,916,666.67 WTR | 2.27%
Initial supply: 24,407,035.80 | 6.97%
*Seed round tokens may not be sold in their entirety. Remaining supply will be added to the future investors pool.
Vesting:
Deepwaters Team
- 88% of team allocation: 6-month cliff, quarterly distributions over a two-year period.
- 12% of team allocation: Set aside as ‘employee incentive pool;’ reserved for recruitment, retention, and bonuses—Discretionary unlock
Strategic Reserve
- Held by Deepwaters for purposes of liquidity, partnerships, future investors, etc. Can be used at the discretion of the company with the following restrictions:
- Cannot be reallocated to team or advisors
- Cannot be sold on the open market by Deepwaters
- Any sale or other disbursement of tokens must have at least a 6-month lockup / cliff (call options to market makers must be either 1) European or Bermudan style and have at least a 6-month period before they can be exercised, or 2) American style with the lowest strike price at least 100% above the then-current market price)
Pre-Seed, Bridge and Seed
- 6-month cliff, quarterly distributions from mainnet launch over two years.
Advisors
- Allocated for rewarding advisors to Deepwaters, but can remain unused or be allocated to further community programs.
- Vesting varies across advisory and roles.
- 708,290 WTR unlocked at TGE
- Projected 1,443,970 WTR unlocked at 1 year past TGE (unless new advisors are added and given token allocations)
- Projected 1,958,210 WTR unlocked at 2 years past TGE (unless new advisors are added and given token allocations)
Validator Rewards, User Incentives and Community Funds
- These rewards are earmarked for Deepwaters users and validators.
- Validator Rewards — Awarded to validators for ensuring security of Deepwaters. Milestone-based unlock.
- User Incentives — Awarded to users to incentivize ecosystem growth and early adoption. Milestone-based unlock.
- Community Fund (milestone)— Strategic reserve controlled by WTR governance: to be used for community incentive programs. Milestone-based unlock.
- Community Fund (time) — These time-based rewards represent the strategic reserve controlled by WTR governance—to be used for community incentive programs.
- Unlocked monthly over 4 years, starting at platform launch
Avalaunch Sale
- 50% at TGE, 50% in one month.
Marketing / Promotion
- Allocated for promotional purposes, including airdrops. No lockup.
Other:
- Initial Circulating Supply: ~24.40M WTR (excluding liquidity tokens)
- Initial Market Cap: ~2.929M USD (excluding liquidity tokens)
The Deepwaters IDO on Avalaunch:
- Total Supply: 350M WTR
- 2083333.33 WTR at USD 0.12
- Sale Size: 250,000 USD
Registration Schedule:
Registration Opens: February 6th at 3:00 p.m. (UTC)
Registration Closes: February 13rd at 6:00 p.m. (UTC)Sale Schedule:
Validator Round Begins: February 15th at 6:00 a.m. (UTC)
Validator Round Closes: February 15th at 3:00 p.m. (UTC)Staking Round Begins: February 15th at 3:30 p.m. (UTC)
Staking Round Closes: February 16th at 6:00 a.m. (UTC)Booster Round Begins: February 16th at 6:00 a.m. (UTC)
Booster Round Closes: February 16th at 10:30 a.m. (UTC) -
The BFG Roadmap
This article was written by Battle For Giostone Co-Founder Mile Gramatikov.
A Road Ahead
As a founder, sometimes a great idea will come, and you won’t be able to stop thinking about it. That’s what happened with Battle For Giostone.
After competing and building friendships in the MOBA space for more than a decade, we started to tinker with blockchain apps and immediately fell in love. The thought of combining the two became a mesmerizing concept — we couldn’t help wonder what the result would be of bringing these worlds together. Battle For Giostone is our attempt to reinvent gaming by allowing gamers to immerse themselves in familiar and fun experiences, with the added benefits of ownership and self sovereignty that Web3 technology provides.
That’s no easy task. But Gandalf the White said it best: “Things are now in motion that cannot be undone.”
The Beginning — Q1 2022
Many people remember the beginning of 2022 as a time when the pandemic was still raging on in the world, and the conflict between Russia and Ukraine was heating up. In the Battle For Giostone offices, we were hard at work developing a product market fit for our idea. With the assistance of Theeban, aka 1437, we went through a couple of iterations of the game, conceptualized numerous new abilities, and crafted the first edition of our website. It was was rudimentary, but it was enough to test out the waters and we discovered massive community support for a Web3 MOBA game.
As soon as we had evidence that real players as well as professional gamers loved what we were doing, we doubled down on our ideas and started developing the BFG token. The tokenomics went under heavy development, and in the meantime, we started to develop out our early Web3 contracts (such as staking).
The game production phase itself also started in Q1, where we worked tirelessly to make the first edition playable as soon as possible.
The Middle — Q2 2022
The closed MVP game launch happened in Q2 2022. We devoted a lot of resources to developing the product, and it was important to us to have the hero and ability mechanics working the way we intended. Our initial idea was to make the fundamentals work, and then to make it beautiful later. That was our engineering approach, and it has turned out great. The parameters of the heroes and the abilities began meshing, but of course there were still a lot of bugs to resolve. One by one, we handled them all, ensuring that the Pre-Alpha would come out on time.
Q2 was also special because that’s when we launched our Forum. The Forum has been a place for the community to can discuss major events, patch notes, read announcements, talk about the economy, submit ideas about balancing the game, give item suggestions, or even talk about the rest of the MOBA world.
Also during this period, we were focused on getting Seed Round funding and pitching our idea.
The Current State — Q3 2022
Over the last three months, we’ve completely redesigned our website. That was a massive draw for our community because they loved the new look when we launched it. We also rewarded the most active participants in our Discord community with access to the Pre-Alpha version of the game and got enthusiastic as well as honest feedback from players about what they wanted to see next.
Turning this feedback into reality, we returned to the drawing board, covered their requests in new patches, and even started developing a surprise. This turned out to be our first hosted tournament, with the Pre-Alpha version of the game. Things were getting serious. After two successful tournaments, we started preparing for the IDO, scheduled for the 4th of October.
After the IDO is finished, we’ll start hosting monthly or bi-weekly tournaments with a Spectator mode that will allow casters to comment on what’s happening during the match in real time. That will elevate the streaming experience and transform the game into an enjoyable experience for players and spectators alike.
During this time, we also launched our Official Cinematic Trailer, released Pre-Alpha gameplay videos on YouTube, and released a developer update to cover the new designs and gameplay mechanics.
In the last several weeks, we have started publishing the Battle For Giostone lore. People can now go to our website and read about the story of the Three Kings, the appearance of the Giostone, what it did to their civilization, and why the battle started in the first place.
The Future — Q4 2022
We are really excited about what is to come. Once we complete the IDO, we will release information about the Closed Pre-Alpha game launch. We will also release the GIOS utility token, which will serve as an in-game currency and will not be a blockchain-based asset.
We will then release a marketplace and an NFT Heroes pre-sale and complete a CoinMarketCap listing. Immediately after our token generation event, we will create a liquidity pool where people can stake their BFG tokens and receive rewards for supporting the project early on, per our vesting schedule.
We will also begin placing a much larger emphasis on the Esports component of Battle For Giostone. We’re currently in the final stages of negotiating with several sponsors that we think will make our Tournaments legendary in regards to player rewards. We want the watching experience to be spectacular, where the Story Mode will help gamers immerse themselves into the heroes’ backstories and the world’s beginning.
Finally, we will begin working on the Android, iOS, and Ubuntu releases of the game to broaden our funnel for player onboarding. We are excited to involve as many people as possible in a project that aims to reinvent gaming as well as the rewards it provides for their time, effort, and skills!
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BFG: Building A Token Economy
While progress is ultimately measured in both steps backwards as well as forward, those living in the day-to-day of crypto have an acute understanding of the pains of each step back. In the Web3, gaming is a microcosm of the broader markets and the embodiment of three steps forward, two steps back. While pundits nearly unanimously agree that blockchain built games will rule the roost in due course, getting there will not be without its growing pains.
There are complex difficulties in creating a sustainable token economy for a game. The current cris de coeur amongst experts is to shout the rather self-evident, “a game must be playable.” True, but there is much more to it.
We all know:
- Attracting users through inflation is unsustainable.
- Rewards easily earned are easily spent.
Typically, tokens can be earned through play, staking and LP’ing.
From first principles we can understand — a game is an attention economy. This is why the narrative “games need to be playable” is an important one. Should a DeFi protocol masquerade as a game, the attention required to drive sustainable ongoing growth is not there. Instead, participants merely work on “gaming” the protocol, rather than have the protocol serve the gaming experience.
Earning
The stain of an earning game that no longer has sustainable economic activity does not come out in the wash. Whilst Web3 games can be dynamic and create opportunities for a higher percentage of players to earn income—thanks to decentralized value distribution models—without ongoing revenue this model will fall flat. Dota2 famously generates more than 200M USD annually and puts about 40M of that revenue into tournaments. Were a Web3 game to attain similar success, by all accounts the tokenomics should be much more inclusive. This would equate to a much larger percentage of value being distributed via rewards, tournaments, tokenized incentives and the litany of possibilities that simply do not exist in Web2. However, the key differentiator here is that players return to Dota2 over the course of weeks, months and years. Utility (or attention) drives value, hence value needs to be driven into utility. Passive staking for example is not complementary to play and must be reconsidered. Game loops must be thought of as value loops, driven by the attention and enjoyment of the player.
A Word on Staking
Locking tokens to receive emissions is mildly worthwhile as it incentivizes vesting as a project matures but — it is not the utility of a token. Users receive more of a risky asset and can now mitigate some of the risk by selling it. This is a simple equation that often undermines inchoate game ecosystems.
Liquidity
Incentivizing liquidity is of value but should not be too heavily front-loaded or bloated, otherwise, users will depart when they see their outsized APYs dwindle. Teams should be willing to provide more liquidity than they often do for myriad reasons. Should a team not feel like their listing price is a worthy buy, why should anyone else?
Proper liquidity forces teams to reevaluate their diluted market cap as reliance on people showing up to provide liquidity for them in uncertain markets is a perilous prospect. Even in better conditions, the same scenario has played out ad nauseum — highly valuated, well capitalized projects experience a dramatic drop in volume, making it near impossible to enter or exit a position without massive slippage. While all markets have suffered greatly, these projects are going to have difficulty re-emerging as unlocks continue and every bounce gets sold. Teams that experience this become gun-shy and attempt to save every last dollar rather than defend their own token. The psychological impact is awful on early stage projects while private investors sit on the sidelines, saying nothing and waiting to sell. Early on, it is essential that a team understands their fragility as a new entrant into a highly volatile trading environment and must learn to balance their funding needs and liquidity.
Diluted Valuations
Battle For Giostone has a considerably lower diluted cap than most projects coming to market. And, as anyone can see, their distribution is a little different than what has become a standard but hugely flawed practice. Participants became worried that investors could own too much of a given supply and teams responded by raising their valuations in order to sell less tokens. This hugely limits upside potential and makes it extraordinarily expensive to provide liquidity, especially following unlocks. BFG as a project wishes for broad distribution of their token across their user base while conversely, keeping their cap table incredibly small. They have been remarkably efficient and believe that a lower starting point in terms of diluted value supports not only their prospective public but the future of the game economy itself.
This is inherent to preparing a worthwhile token economy — one in which the game tokens are prepared to grow in step with the growth of the game, not one where a newly released ecosystem sags under the weight of initial overvaluation.
In-Game Economy
The Battle For Giostone economy is a rethinking and gamification of the typical play-to-earn model. Sustainability should come from activity within the network and not be a slave to time-based emissions or investor demands. The borderline delusional hope that value can be shared and sustained through gratuitous emissions, without real underlying attention and activity will hopefully constitute a misguided footnote in Web3 gaming history. DeFi apps, which deployed similarly disastrous strategies, have woken up from the slumber of three-digit APYs to a rather stark reality. In recent months, the term “real yield” has become popularized. This simply means that APY is created by revenues derived from a given protocol. Gaming can be approached similarly even though the value of play is not something that can be perfectly quantified.
The dynamism of a token within a game is essential. While there is no game without capital contributions, players everywhere see these parties as prospective enemies. This largely adversarial relationship is problematic and was previously mitigated by very large community funds where players received free tokens, causing massive sell-offs. An improved appearance created a worse reality whereby the “cure” was worse than the “disease.” Tokens and their economy must be designed to serve both of these parties — the holder and the player — at the same time.
To better align incentives, the BFG economy has been designed to respect all types of token holders by introducing a looped economic system. After all, those who earn tokens bring activity and revenue to buyers while token holders can bring revenue to gamers, within the constructs of a mutually beneficial architecture.
A schematic of the BFG in-game economy (some of these values may change)
The diagram above illustrates how a shared value economy can function within both a gameplay and holder loop.
For example:
- A capital contributor who supports the project will hope to earn additional tokens by staking their tokens.
- In order to do this, they must forge an NFT which will be taxed.
- In the diagram, the tax is 10% (as an example).
- This tax is then deposited into a player reward fund.
This is the beginning of a symbiotic relationship — holders are likely to lock up their tokens when they see future growth potential in the ecosystem while future growth potential must come in the form of new players.
- Network generated revenues offer BFG rewards to the NFT stakers.
A Tradable Asset
An overlooked element in all of this is the listed token which can live in a world that is separated from the game itself. Since the BFG token utilities is an acting currency among other utility, all game associated revenues will be converted to BFG. This allows for some token velocity and creates a direct relationship between APY, token price and emissions.
- When the APY is lower, the token price will respond in kind thus:
- Stabilizing the amount of BFG tokens to be distributed as revenue.
- When rewards increase, APY increases as will the token price, thus:
- Stabilizing the amount of BFG tokens to be distributed as revenue.
- Any inefficiency or lag creates opportunity for those who follow the game’s economy.
There are additional safeguards in place that further capitalize on the price to earning ratio:
- Not all locked BFG will have earning power — it will be capped by a percentage of the supply to incentivize early participants to gain earning seniority.
Naturally, economic activity will ebb and flow but the APY will be adjusted at the both high and low end to best support a burgeoning economy:
- Effectively rebasing to a lower APY when activity spikes around very bullish price activity balances value between the token and its return.
- Conversely, boosting APY during a lagging or developmentally intensive period will also impact price.
- The overall effect is stability both in BFG earning power as well as potential token price.
The ultimate aim is to create a popular game that has a sustainable economy with robust token utility. This requires thought surrounding the speculative nature of crypto in general as well as the seasonal aspects of gaming. Three digit APYs do not support the long-term growth and reward a minimum number of early entrants. APYs that offer very little do not attract users. Using a rebase function to create ceilings and floors provides economic sustainability. This is also the reason that not all BFG will have earning power from day one. The reasons are as follows:
- A new game needs time to grow and creating seniority incentivizes early adopters to forge NFTs (lock BFG) in anticipation of network activity.
- Increased economic activity will create more earning NFTs but — it must be sustainable.
- A user can lock in their earning power by being early to forge an NFT.
Modifiers
In order to create a sympathetic relationship between active players and token holders there must be a point of convergence. When there is zero overlap between these two parties, dissent can occur as gamers tend to see capital contributors as a necessary evil at best. The reality is far different but in gaming economies, there is something of a Chinese Wall between token holders and players. One never seems clear what the other incentives are and on occasion, they function independently of each other. There are examples of games with poor token utility with limited activity and vibrant gaming communities. This is a massive lost opportunity for genuine synergy as a vibrant Web3 game needs players and speculators alike.
To combat this, Battle For Giostone has introduced artifacts generated from in-game activity that are of benefit to token-holders, called modifiers.
- Modifiers are NFTs that boost earning power for a finite period of time.
- Modifiers can only be earned through gameplay via random or skill-based drops.
- Token holders purchase these from players on the BFG marketplace.
- Modifiers can have varied utility but can only be used with forged NFTs that have earning power.
Mutual support between gamers and passive token holders is an ideal for Battle For Giostone. This is achieved through the dispensation of earning modifiers that are dropped to gamers as a result of general gameplay activity. The range of modifier functions will be broad, not limited to but including — improved APY characteristics for the modifier holder, upgraded seniority position in the locking queue, time-based upgrades that provide powerful results for a limited period, and rare modifiers that will only ever exist on a very limited basis.
Recap
The BFG token economy is a significant departure from what has become a flawed standard play-to-earn economy. In fact, there are numerous differentiators across gaming economies on the whole that represent an important step forward.
Some key features of the BFG economic cycle:
- NFTs must be forged by BFG holders and staked in order to participate in the rewards schema.
- Saleable items, of value to holders, are generated through economic activity within the game.
- Forging NFTs exercises a tax, generating rewards for the players.
- Yield is non-inflationary and tied to actual in-game popularity.
- Player Rewards tend to be earned by highly skilled players.
Within this gameplay loop, there is a token flow to players that is bolstered by modifier drops (which boost the earning power of BFG locked NFTs), to be sold in the secondary marketplace. BFG producing NFTs are seniority based so longer-term users are always first to earn. Depending on the flow of rewards coming into the system, an NFTs earning power will vary.
As it stands, there is a second tokenized asset, GIOS, which lives off-chain where players can only earn GIOS through gameplay and which will not be tradable on exchanges. It acts as an in-game credit and its primary purpose is to forge new Heroes. While there may be a modest conversion rate to BFG, the rate will be purposefully high to stimulate players to forge new heroes.
The game itself will evolve rapidly as assets are created and seasonal play begins. There will be clear epochs that will stimulate economic activity and create favorable circumstances for entry. New entrants into the game will not feel behind in any capacity and the entree itself can be sped up through skilled play or subsidized by economic activity.
Conclusion
The BFG economy is designed for any and everyone to enjoy, however, participation trophies won’t come with monetary rewards. The promise of Web3 gaming and broader distribution of value is that more players are able to economically benefit from playing a game but more does not mean all. It is unrealistic to expect things to be any different and the performance of early play-to-earn models are proving this point in a painful way. Nonetheless, they are not to be maligned as progress is always marked by those who came first and dared to experiment.
Battle For Giostone has set out to improve upon the great experiments that have come before them, focusing on creating an economic loop that seeks to unite the passive and the active, the player and the invested holder if you will. It is not a DeFi protocol dressed up as a game. It is a well-balanced game, a long time in the making, where yield is non-inflationary and rewards benefit all parties. Economic activity and play are the drivers of this economy, not inflation and bloated APYs. Investors are incentivized to forge NFTs that add to the player reward fund, and invest in boosting modifiers via the secondary marketplace to improve their yields. The ultimate motivation behind this design is to enhance the existing gameplay experience for players into something that is uniquely Web3 oriented, financially rewarding, whilst at the same time provides for the familiar sense of enjoyment found in traditional gameplay experiences.
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Battle for Giostone AMA #2 (Recap)
On 10/01/2022 at 2:00 p.m. (PST), an AMA session was held on Avalaunch Telegram with Battle for Giostone Co-Founder, Mile Gramatikov. The focus of this AMA will be the business development, vision, road map, and post-IDO plans.
Below we present to you an excerpt from AMA with questions and answers.
Dave | Avalaunch
Hello again and welcome everyone to, not the first, but the second AMA with the venerable Battle For Giostone. They are a game with big plans and have an assembled a team they feel is up to the challenge.
Today we have none other than @milegramatikov ready to take on all comers and answer all questions. @milegramatikov how are you doing?
Mile Gramatikov | Giostone
Hey, I’m feeling awesome. Thanks for inviting me!
Dave | Avalaunch
Good to have you here today. Let’s get right into it…
Let’s start with a brief introduction about yourself: your background, career path, and how did you end up where you are today?
Mile Gramatikov | Giostone
First of all, I’d like to start with my background as a gamer. I played DotA when it came out, and I was instantly hooked. That was everything that I wanted to do in life. Then, Dota 2 came along, and it was even better. Because of my love for the game, I started connecting with other like-minded people, and that’s how I met most of my friends. We played the game in internet cafes, at home, and I even organized 20+ esports events related to Dota2. I was a massive enthusiast and competitive player.
When I finished high school, I completed a backend developer course and started working in a programming company. I worked as a backend developer for 2+ years and decided to switch to marketing. It’s a drastic jump from one niche to another, but something pushed me to try out marketing, and after 2 years of being a marketer, I started my own company. For the last 3 years, I’ve been the CEO of M-Tech Entertainment, and our company is responsible for handling the Discord security of the Axie Infinity server of Sky Mavis. That’s how I got into crypto, and an idea clicked into my head. That idea was Battle For Giostone.
Dave | Avalaunch
Well it’s safe to say you got off to an early start. Very impressive.
As the ultimate, first MOBA game, what’s the range of experience that the team holds collectively? How many in-house developers are working on the project? Are there future team expansion plans?
Mile Gramatikov | Giostone
Most of the team has been with me in M-Tech ever since the company came to life. Their skills have been battle-tested on numerous freelance projects that we completed. Even though we are based in Macedonia, we’ve worked with a myriad of international clients to gain the necessary skills and experience to make the peak of MOBA gaming.
Currently, 40+ developers and designers are working on the project. We’ve been steadily increasing the number of people that work with us. Since we’re about the launch the Closed Alpha of the game, we’ll push even harder. Of course, that means that the team will expand, and we’re always looking for passionate people to start working with us.
Of course, there’s also Theeban, our Co-Founder, who works as the game’s main balancer. His experience and know-how are irreplaceable since he’s the only person in the world to have so much Web2 and Web3 experience.
Dave | Avalaunch
That long history and working chemistry is a great thing to have when venturing into crypto. It will test all your relationships 😁
Battle of Giostone is a concept that was in development for over 1 year now. How many iterations did it take the team to prepare for the pre-alpha phase? Also are there any highlights about this major milestone you’d like to share with us?
Mile Gramatikov | Giostone
Many people think that making a game is easy. You just create a plan, follow it, and you end up with a product a year later. That’s not true at all. There are plenty of roadblocks along the way, especially when you’re dealing with complex game mechanics. Ten people will be clicking at the same time, and the program needs to respond to every click, every press of the button, combine video effects, and voice effects, and change the parameters of each character. All of that takes an inside amount of coding experience to make it work well together.
This explanation is to make it clearer for the people who think games are simple. At the moment, the Pre-Alpha is the 17th version of the game. The 18th version is on the way with a spectator mode that will allow us to host tournaments and cast them online. The first tournaments we made didn’t have this feature, so players needed to stream on Discord, and we broadcasted their streams on Twitch. We’re incredibly serious about esports, which is why we’re focusing on making the game work first, and then streaming it to the public to show what we’re building and how we’re progressing.
Dave | Avalaunch
I have news for you — after all that’s happened in Web3 gaming, no one thinks it’s easy any more.
As with most games built on the Web3, NFTs are intrinsic to this game dynamic. Can you give us a top-level overview of these NFTs?
Mile Gramatikov | Giostone
The main NFTs in Battle For Giostone will be the heroes. There are 6 hero combinations: Gogmangog, Auri, Akuma, Lucius, Ranvir, and Gurluk. Every NFT will have one of these heroes as the base, with equipment on their bodies. The equipment is responsible for the skills that each hero will be able to use inside the game, and you will not be able to change it. There will be skins that work like cosmetics upgrades, and they will only change how the hero or the equipment looks like, but they won’t be able to change the main design.
All of that was from the design aspect. When it comes to functionality, each NFT hero will have 4 ability slots. You can pick 4 out of the 72 abilities in total and forge a hero based on your play style. That could be a Melee Warrior, Ranged Warrior, Melee Assassin, Ranged Assassin, Melee Wizard, and Ranged Wizard. By matching the hero class and the ability class, you could create a tank, assassin, jungler, mage, support, fighter, or marksman. The style of play depends on you alone, as well as your team. More than 6 million hero combinations are possible, making the game incredibly competitive, and you’ll always be looking for the ideal champion.
Apart from the heroes, there will be skin NFTs that work like cosmetics for the heroes and abilities and revenue-sharing NFTs that allow you to lock BFG tokens.
Dave | Avalaunch
The heroes do look cool. Ranvir reminds me of a guy I know. Appreciate the comprehensive answers.
According to the roadmap, the plan is to hold an NFT pre-sale shortly after the token launch. Are you able to elaborate on this plan, how many NFTs will be available, the price range, and where the pre-sale will take place?
Mile Gramatikov | Giostone
We haven’t decided about the final number of the Heroes that will be minted or their price yet. But what I can say is that every one of those NFT’s that will be on pre-sale will be called Genesis and will be very rare. They will be only obtainable through the pre-sale. Let’s say Auri with Golden Wings. Everyone else will have the normal wings but your hero will be with Golden wings because it’s Genesis. Later, people can sell those heroes for profit if they decide, because everyone wants to have different and cooler stuff than the others.
Dave | Avalaunch
Nicely answered. Among the range of cool features that come with the game is an NFT marketplace. Can you talk about its use and how its integration relates to the vision of the project?
Mile Gramatikov | Giostone
I remember when I was little, my friends that played Metin2 or World of Warcraft were making money by selling accounts on shady websites. The game companies that made these games didn’t allow trading, and people became creative and created platforms specifically designed for exchanging characters.
We believe that the essence of gaming is to give power back to gamers. That’s why we’re choosing the blockchain and making the marketplace on our own website. Everyone will be able to come and buy or sell heroes, skins, modifiers, and even revenue-sharing NFTs on our site. Instead of us selling pre-made heroes through a game shop, gamers will have the power to create new characters themselves and trade on an open market. We won’t set the prices, which will make the gamers in charge. That way, the game is truly made for the players.
Dave | Avalaunch
With each Hero it seems that the user is able to combine their preferred abilities to create a Hero in their vision. For the audience that’s not aware, can you please briefly tell us how this process works?
Mile Gramatikov | Giostone
Sure. In MOBA games, the playable character usually has 4 abilities that can be either passive or active. Passive abilities give a general boost in stats or work under specific conditions. Active abilities, on the other hand, need to be clicked to work. They deal damage, heal the character or the allies, provide shields, or crowd control the enemy such as stunning, silencing, or disarming.
Based on your gameplay style, you can create a hero NFT that has the abilities you want to play. You can forge a warrior that does magical damage with their abilities. You can forge an assassin that has healing abilities. However, picking abilities from the same class makes the hero stronger since it boosts the base stats such as strength, agility, or intelligence.
Because the game will be free to play, gamers will be able to try out several versions of heroes that we will provide an update on a weekly basis. That way, they can learn how the abilities work, and what they want to see in their own hero, and then choose to forge something of their own or buy a hero that someone else already made on the Marketplace.
Dave | Avalaunch
One of the main features that I think will be extremely popular among the players of Battle For Giostone is the Esports tournaments which according to the roadmap is around the corner. Can you give us a comprehensive outline of how this will kick-start; what the players are to expect when this feature becomes available in Q4 of 2022, what the prize pools will be etc?
Mile Gramatikov | Giostone
Security is a massive concern. Axie Infinity is the biggest game in the space, and yet they suffered a 600 million dollar breach.No one wants that to happen, but there are cybercriminals whose goal is to ruin the experience of other people. We’ve included several security mechanisms to ensure the same thing doesn’t happen to us.
One thing that we’re still working on is to have a manual review of bigger transactions to ensure they’re legitimate and not a hack. Additionally, every internet project is only as secure as the people working on it, which is why everyone on the team is using an antivirus program, a VPN, and we don’t click on any links or download files that are unsafe. Socially engineered attacks are on the rise, which is why we’re incredibly careful and constantly upskilling ourselves in terms of cybersecurity and the latest scam or phishing attacks.
Dave | Avalaunch
As a first of its kind Esports MOBA on Avalanche, what were some of the challenges encountered while building the game, and how did you circumvent these challenges?
Mile Gramatikov | Giostone
The biggest challenge is making a game that’s actually fun to play. When you’re playing a game, it’s always the little things that make you angry at the developer, such as pressing a button and the ability casting half a second later than when you clicked. The user end needs to be seamless, and for that to be possible, many components need to work together without breaking. We circumvented these challenges by working relentlessly and using bots to play the game to see where it breaks to fix it before we actually launch it to the public.
Dave | Avalaunch
What were the reasons behind choosing to build on the Avalanche blockchain over the other options?
Mile Gramatikov | Giostone
Avalanche is one of the fastest networks in the entire blockchain space. The people that work on this project are some of the greatest we’ve seen, and they’re true to their mission and vision. We’re a part of the Avalance Builders program, and they saw the potential in us, which is why they invested in Battle For Giostone. They’re one of the top growing platforms, have a big name without any incidents, and their working environment is incredible. Last but not least, we’re going to have a subchain, which makes this partnership even better!
Dave | Avalaunch
Before we move on one final question Sir
Are there any lasting thoughts you’d like to share with our community before concluding this AMA?
Mile Gramatikov | Giostone
Battle For Giostone is a game that aims to reward players for their time, effort, and skills. Our goal is for every person in the ecosystem to find their place. People from different backgrounds will join our universe, and we want to have something for everyone. If you’re a good player, you’ll climb the leaderboards and earn rewards. If you’ve got a few friends, you can try to be the best in the group. If you’ve been a massive player of MOBAs and want to come back to the space, there will be new friends waiting for you. If you’re lucky, you’ll get modifiers to sell to investors.
If you’re somebody who doesn’t know how to play the game, but you want to be a part of it, you will be able to lock your tokens in a revenue-sharing program. If you’re a creator, you will be able to create content, build a community of your own, and get rewarded for being a part of our ecosystem. The opportunities are endless, but for all of this to work, the game needs to be fun to play. With the people we have at the moment, we’re sure that we can deliver. Stay tuned and see how we reinvent gaming!
Dave | Avalaunch
Congratulations Mile. You have fared in your journey through Avalaunch-land. Now you must stare down the twitterati, the forces that conspire to ask difficult questions. Are you ready for Part II?
Mile Gramatikov | Giostone
Yess!
Twitter Questions
@Xenada01 — How fast and secure is BFGiostone platform? If the number of users spikes, will transactions on your token get congested?
Mile Gramatikov | Giostone
We decided to work with Avalanche because their network is really fast and secure and offers great scalability solution with their Subnets. The ability to create your own rules on a subnet and use your token for gas fees is a great utility and it also provides instant finality. It’s an amazing opportunity.
@KleinVars — Many games today set high costs to start the game & therefore start with a small player base. Does Battle For Giostone only an entrance fee or starting conditions & if so,what are they?Do I need to hold an NFT or hold a certain amount of tokens in order to enjoy & play the game?
Mile Gramatikov | Giostone
Everyone will be able to play the game for free with one of our weekly free heroes. However, the free users will not be able to earn GIOS after each match but they can still reach leaderboards and earn BFG after each season.
We want to keep hero prices reasonable so the game is accessible for everyone.
@leonardo_mark11 — Which is the most proudest milestone BFGiostone has achieved so far?
Mile Gramatikov | Giostone
Having a balanced, cool and playable game!
Dave | Avalaunch
Great answer. Short, sweet and tells us everything. Well done.
@sentluciya — To what extent does your focus on the entertaining aspects of the game?
Mile Gramatikov | Giostone
The fun is based on complex gameplay, outplaying your opponents and collecting heroes & skins. Playing competitive for tournaments will be also fun and entertaining.
@Rozina_Kazin — There is a large audience that does not understand the English language at all but is interested in crypto. Have you created or planned to create local communities to include this audience in your project?
Mile Gramatikov | Giostone
We are working on creating local based communities, but everything should come at the right time and that is why we are not rushing with that. However, we have local communities in our discord and have separate chats for many different languages.
Dave | Avalaunch
Congratulations @milegramatikov you’ve navigated the treacherous waters of our questions and the inimitable peeps over on twitter.
Now comes the final leg of this great journey you’ve embarked on and that is the community. Normally we unmute the chat and allow it to populate with question but today we have a new twist. We have had our community weigh in…
Telegram Questions
@mrallaw — There are a lot of characters in the gameplay — what are they inspired from?
Mile Gramatikov | Giostone
Every character in the game is based on the lore which was created by our Art Director. Each character has their own backstory based on the lore. For everyone out there that wanna read the lore, you can do it at https://battleforgiostone.com/lore
@Ray699 — What are your plans for building a Subnet and how important do you think that is?
Mile Gramatikov | Giostone
Avalanche’s tech is generally superior to any other chain but subnets make it an easy decision. A sub-network with a strong set of validators is decentralized but it’s like having your own blockchain where you can make your own rules and function independently. Having your own token act as gas on the network is also a strong utility and encourages people to participate.
@birdie_johansen — Projects often overlook the utility of the tokens — can your tokens deliver value from the game?
Mile Gramatikov | Giostone
BFG is designed to do exactly that. Deliver value. It is the driver of all things in the ecosystem from gaming to passive holding. Transactions in the game translate to BFG. Rewards are in BFG. It is truly an apex token that all activity runs through. It is what makes the Web3 great.
The dynamic interface of a token with players is exciting, it’s just gotten so screwed up in the wave of games. A token that can earn rewards, be used as a currency, act as gas of a network, be bought and sold, used to purchase anything from skins to modifiers is so much more interesting than the web2 to me. It’s time to take advantage of that.
@naKohl1996 — What is the plan to ensure sufficient liquidity on exchanges to fill market orders, especially as adoption increases and clients begin multiplying year-over-year for your project?
Mile Gramatikov | Giostone
Listing liquidity is very important. Projects don’t consider this. When you have a token that has an FDV of say 40M and they put 200k in liquidity, it is basically .25% of the supply. That’s nothing and is not going to allow people to buy or sell without a lot of volatility. In a bull market no one notices. It all goes crazy.
We want people to discover us and be able to trade the token so our diluted cap is low so our liquidity could actually absorb what’s circulating. I wish we could buy the whole supply at IDO prices. Over time, the fundamental progress is what matters and then we will look to create more exposure for the token across exchanges.
Dave | Avalaunch
A tough but fair question. Mile was toiling. Fire answer though Sir.
and the final one is perhaps the toughest of all. Hope you’re ready for this —
@gksml1104 — As we saw with Axie’s downfall, the problem with current P2E is that it’s not sustainable. I believe that for a sustainable ecosystem, the focus should be on Play, not Earn. In this respect, I think BFG’s focus on esports is a good direction.
But can you really onboard a large number of players and host esports on a large scale? It seems that BFG’s backers are only Ava labs and Avalaunch, and there doesn’t seem to be any partnerships with YGG or other big gaming guilds.
If BFG has the capacity to host large-scale esports, why don’t VCs and gaming guilds approach BFG? Please tell me BFG’s vision for esports.
Mile Gramatikov | Giostone
This is a great question. To begin, I believe we can host on a large scale or I wouldn’t be here. Our background is in Web2 gaming on a professional level so we have strong ties to a number of large players in the space. We kept our cap table small for strategic reasons and you can’t get stronger investment partners than Avalabs and Avalaunch.
It’s like partnering with the whole ecosystem and we did not want to get into the VC game with 20 VCs on our cap table because this is a community project. We’re starting out with a very low market cap so people who learn about us can go for the ride. We weren’t going to sell it all to VCs and let them own it and play that game. As part of our rollout, we have been in touch with numerous guilds, both very large and more boutique.
Our vision for Esports and overall vision for the game has been spelled out in detail over the last few weeks. There are tons of videos and articles we put out with Avalaunch that are really worth having a look at. When people really see how devoted we are and the progress we’ve already made, they’re going to wish they paid more attention.
Dave | Avalaunch
Excellent work. That was a tough question. The last two especially.
Appreciate your time here today and your occasional presence in our chat. I appreciate you moving forward in these uncertain times and having the confidence in the game to drive things forward.
Mile Gramatikov | Giostone
It was great to be here, thanks for inviting me over. I hope that the community learned a lot from this AMA and if someone got more questions feel free to ask anything here
Dave | Avalaunch
Thanks again. Pleasure having you. Have a good weekend.
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Building A Web3 MOBA
This article was written by Battle For Giostone Co-Founders, Mile Gramatikov and Theeban Siva.
Filled with promise, blockchain gaming has taken the world by storm and it has been stormy at times. In a space still taking its earliest steps, forging ahead requires development teams to navigate an oft confusing road. This is especially true in the creation of a Web3 MOBA.
MOBAs are the most difficult games to master because they exhibit infinite strategic complexity. To begin with, one must make team-oriented decisions — it’s as if instead of controlling the entire chessboard in chess, you control a single piece. And instead of individual defined moves, you must then make thousands of momentary decisions which build towards the same goal as your four other teammates. Popularized by Dota2, League of Legends, and hundreds of other copycat games — we believe it is now time to transition this Web2 genre into a true Web3 experience.
Battle For Giostone
Battle For Giostone has already undergone significant active development and is coming up on an alpha release. From the outset, you’ve got two teams made up of five people, and the goal of the game is to destroy the enemy base within the first 25 minutes. This mechanic should feel very familiar to existing MOBA players.
However, there is an added a gameplay twist. Should a base not be destroyed in the 25 minute time-frame, all of the players get summoned by the dragon Gio (a monster that spawns on the map, dropping stones to powerup teams following defeat), leading to a battle to the death. The winning team of this final fight emerges as victorious.
Uniquely, in Battle For Giostone, Heroes are created via a forging mechanism. Instead of using pre-made heroes, players are able to forge an ideal hero, customized to individual playing styles. There are six Hero classes and a total of 72 abilities, with each forged Hero possessing 4 permanent abilities. With more than 6 million combinations of play styles available, strategy and playing to one’s strengths is of paramount importance.
From the outset, we have wanted to make Battle For Giostone a game that was built by passionate MOBA gamers, with tweaks that we believe improve the overall gaming experience. This might sound easy in practice — but turning that into reality is another story. In Battle For Giostone, gameplay has always been our main focus. An example could be — if you attack an enemy hero and they’re near their creeps, they need to start attacking your hero to defend their position. We believe that continued refinements like this add up to an overall experience that takes the genre forward.
Visual Design
In order for a game to be successful in this day and age, it needs to be visually pleasing. This is obvious but surprisingly overlooked as gaming projects often prioritize the wrong things. In a MOBA, the map, towers, creeps, heroes, bushes, lanes, equipment, abilities, the dragon Gio, and the user interface need to have the same theme, branding, and look like a premium, AAA game. We have a team of designers working continuously to push out in-game assets whose aesthetic supports this vision.
Balancing
Abilities, stats, level upgrades, and items require lots of balance testing. Most abilities have counters, and the ones that don’t will be countered by items. Heroes that have abilities from the same class have increased stats, and that can influence the outcome of a match. Balancing means that all playstyles and levels of experience will feel rewarding in-game. Over time, this meta will change and we will remain vigilant not to nerf, or overpower specific abilities in those changes.
Tokenomics
Gameplay and design must be at the heart of every Web3 game—but that doesn’t mean that the tokenomics aspect isn’t a vital and crucial piece to the puzzle. Some people will play a game just because of its ability to earn. In Battle For Giostone, there are two tokens: BFG and GIOS. BFG is a blockchain-based token on the Avalanche network, while GIOS is a non-blockchain token that will work as in-game credits to forge heroes. BFG is the absolute driver as we don’t believe utility belongs in the hands of a team controlled token supply. It is there to complement BFG and allow users to advance in the game while BFG runs and effectively is the economy. We are constantly refining our design around these tokens to ensure that rewards will be fair for both the players and the investors.
Players will be able to earn by playing, winning esports events, forging, trading Heroes, and creating content. The more passive will be able to earn by staking BFG tokens but must forge NFTs to receive any share of the revenue from the game and furthermore, need players to maximize their earning potential. In order to increase staking rewards, token holders require modifiers that spawn inside the game, and must buy them from the players. This creates a circular economy and a closed loop where the two sides help fulfill each other’s objectives.
Community
The best game in the world, is nothing without its players. Our community has been incredibly supportive so far, and we are excited to see it continue to grow. Many people have played traditional MOBA games, but are thirsty for something new. We believe Battle For Giostone is the thing they’ve been waiting for.
Team
Everyone on our team is passionate about MOBA gaming and crypto, and they firmly believe Battle For Giostone is the future of Web3 gaming experiences. We are a highly motivated pedigreed team filled with skilled individuals working toward the singular goal to make both the game and a token economy a riveting success.
Conclusion
While we don’t suffer from a lack of ambition, we are very grounded and focused on our deliverables. The Web3 may offer unlimited potential which has also hastened the migration of opportunists looking to exploit the space. Hyper inflationary tokenomics and unsustainable DeFi protocols masquerading as games are slowing the potential for growth and BFG believes it is incumbent upon us to do something about that—beginning with a game that earnest games want to play.
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Battle for Giostone: Esports & Tournament Infrastructure
This article was written by Battle For Giostone Co-Founders, Mile Gramatikov and Theeban Siva.
Without question, play-to-earn made a massive impact on the entire crypto space with Axie Infinity paving the way. The sector grew quickly, perhaps too quickly as the infrastructure and inflationary tokenomics could not support such a large influx of playing and earning. Scalability issues and sell pressure were an inevitability that we are now facing.
Both opportunists and players came in droves and unceremoniously left. It was lacking in economic stability but from a player’s standpoint, there was a crucial missing piece of magic that has historically kept players hooked and that is tournaments.
Tournaments
Gaming is all about competition. The quest to climb the leaderboards and prove that you’re among the best in the world is an inherent driver for any true gamer. It may start passively enough as users hone their skills to be competitive with friends, and from there, morphing into an unquenchable desire to dominate your opponents. That’s true in chess, it’s true in checkers, and it’s true in any other game on the planet.
A MOBA, being the most complex game of all, requires the combined effort of five people to play as one. Unity in the name of a singular goal will push one team to victory, while the others will succumb to defeat.
As humans, we love watching competition when the stakes are high, and the boundaries of what we think is possible will be pushed. It is a vicarious thrill as we live in the moment of a shared experience with players and spectators alike.
“Winner take all” tournaments are the ultimate form of competition because there can only be one. It is an all-or-nothing proposition where only one team will be left standing to claim the grand prize.
Battle For Giostone—First Tournaments
Battle For Giostone is a game that’s embedded in true MOBA culture. We are defined by Esports and started hosting tournaments long before the pre-alpha was released.
Recently, two of our guild partners competed in the first tournament, and the gameplay was spirited and intense. It was a watershed moment for us and following this success, we allowed multiple guilds to compete in order to further crystallize our vision for the game.
In the beginning, the two opposing teams were targeting the enemy shrines. These structures restore HP and Mana which is crucial for team fights when you’re running low and battle beckons. The teams actively guarding these structures were initially able to slow the matches because no one wanted to lose their shrine. However, when multiple guilds joined in the second tournament, a massive shift happened to the in-game dynamics. The players understood the role of Gio and the Giostone giving powerups to their creeps. Suddenly, the gameplay changed, and everyone rushed to kill the dragon before the enemy team. The match duration decreased instantly, which led us to add another victory condition.
When players are unable destroy the enemy base within 25 minutes, they will be summoned by Gio for a team fight battle to the death. This is of paramount importance as the last team should always stare down and overcome death before they can exit as the winner.
Our Next Tournaments
Rome was not built in a day. Everything great requires time, trial, and error in order to continuously refine and improve the game. Our mission is to be recognized as one of the best MOBA games ever made. We can only achieve that by hosting sizable tournaments with significant prize pools, competitive viewership numbers, and partner collaborations.
Casters make tournaments special because they add their personality to the matches. Their commentary builds up the hype, and newbies and pros alike will have the same knowledge about what’s happening at the moment, what could happen, and what each team is thinking. These people will know the game inside and out.
Finally, if local communities, individual organizations, and creators would like to host a tournament of their own, we are open to creating unique maps, custom skins, and ad placements for them.
Let’s say that a massive sponsor wants to create an open tournament where everyone will be able to compete. We could make custom towers and creeps to thank them for their support or add their logo on the lanes or shrines. That way, apart from the leaderboards, the players would have an additional source of income that increases the total earning potential from the game.
Tournaments Are Filled With Emotions
People love games that make a visceral impact. Experiencing an emotion, a drive and desire is amplified when it is being experienced in real-time by any number of people. When thousands or even millions share an emotion, you get a masterpiece.
Recently, Theeban, aka 1437, visited our home country Macedonia. In a small local internet cafe, we played a few matches and felt an atmosphere of pure emotion. That’s what we want to achieve on a global scale. Happiness, sadness, anger, joy, rage, and elation unite people, crossing physical and language barriers.
Join us on our quest to reinvent gaming.
