1. What is a woman?

2. What is a security?

3. What should be $POKT inflation??

It’s the year 2025: $BTC is at 100k, $ETH at 10k and $POKT pundits are still debating inflation using new research papers, models and creative arguments, at times masking motives to preserve status quo.

And $POKT price in 2025 at?? Well, I don’t know.

Btw, please don’t believe predictions such as $POKT to 1, 3 or 10. People pull numbers out of nothing and they are generally overloaded with naivety, inexperience, bag-biases, greater fool’s theory, etc.

A credible prediction model for $POKT and as a matter of fact for any crypto currency doesn’t exist.

Now let us look at what “$POKT’s Market Scorecard” says as of TODAY-

Want to share a couple of new charts.

$INFRA is the recent peer in town for comparison and it has replaced $ANKR as the one closest to $POKT.

It has been a month or so and one would expect a newly listed token to dump against a matured one right? It’s in a ranging pattern for now.

Once more competitors such as LAVA, DRPC release their tokens, the game will get much more intense and interesting.

How will $POKT do against those anon?

We know how $POKT has done against $USD, $BTC & $ETH, and the Total Crypto Market- ABYSMAL!

Let me make the comparison easier for you $POKT lovers-

This is $POKT VS the Alt Coin Market Cap (excluding $ETH)-

“A picture is worth a thousand words.”

$POKT is one of the worst performing tokens in the entire market.

Dear $POKT bag-holders: please stop saying “WHEN THE BULL MARKET STARTS……….”

Bottom for all markets (EXCEPT $POKT) was in Q4, 22 ($ETH in Q2) and we have been on a bull for all markets starting Q1, 23 (EXCEPT $POKT).

NASDAQ, which is very relevant to crypto is up >35% YTD; S&P is up and even GOLD.

And here is more salt on the fresh wounds-

Whereas $POKT is down > 50% YTD.

Will there be a FATWA on me for committing blasphemy if I call “$POKT A Shit Coin” based on its performance in the public market??

Chill the fuck down and stop being so hysteric about your bags.

Bitcoin maxis have been calling $ETH a shit coin since genesis. But they were proven wrong- not “through gibberish, propaganda and emotions” but by passing the test of the market.

So let $POKT do that first and then we shall talk. It’s also in the interest of my tiny bag of $POKT relative to the rest I own/manage.

Btw, I have been wanting to clarify something for a while-

It’s not a secret that I am a student of narrative.

My mental model from another blog-

But I am NOT a proponent of false and cheap narratives. Brainless bag-shilling is not what I call narrative building. In fact I consider that unethical if backed by influence. Unfortunately very prevalent in this space and almost treated as something noble because of the cult like communities.

There is science, art and most importantly there should be ethics behind narrative building. It’s a craft that needs to be done right because of the impact it can create.

On a related note: I might start a blog series on “KISS Investing”. That is going to expose many investing myths, misinformation and misguidance in the alt coin spaces & communities, leading commoners to make very bad investing decisions for themselves.

Let truth be told!!

Ok time for ratcheting up the spice-

2022 was a LOST YEAR for Pocket Network!

And it is unbelievable to see those men in charge who should be held directly responsible for $POKT’s dismal performance are still around with no sign of remorse and no consequences whatsoever. Still making commitments and giving assurances about how “all is under control” and “all will be well”.

Selfishly I hope so too! As I said my SMOL BAG of $POKT will be happy to not die a martyr.

But it does make me think harder about a certain type of challenges to the success of 100s and 1000s of alt projects.

Questions such as the following pop up in my head:

• Are the setups truly meritocratic in nature?

• What kind of “performance management” practices are in place?

• We all know about the rewards. What happens when men in leadership positions earning compensation fail to deliver?

• Are most people working in Web 3 really committed or is it just a quick trade?

• Are these more like research projects instead of business projects, and run by research oriented personnels instead of business oriented ones?

These are questions and not conclusions, the list is long.

To end-

I am not up to date with the details @Pocket since I finished my personal research of getting to know a Web3 project from inside, which happened to be Pocket Network. Nowadays I just read headlines. Forum is too busy and it’s impossible to give a quick glance to know what exactly is going on.

With that caveat, I would like to suggest a few points to the DAO members:-

A) Staying abreast with the history and current events in other DAOs and foundations specifically those related to “control and capital” may help. One could start with ARAGON DAO but there are others to be studied.

B) Keeping individuals aside and putting the foundation as an entity in the discussion:

• DAO should make the decision of letting go of control over 80% of the treasury very x very carefully, irrespective of the urgency and the business cases. Treasury is a big part of the strength and relevance of DAOs. Replenishment could be hard because of potentially big inflation cuts in the future.

• Who is objectively assessing the impact of foundation’s initiatives today? Self-assessment and the constitutional clause of “DAO can vote to remove foundation directors” are lagging and not very effective IMO. There needs to be checks and balances on an ongoing basis to add more transparency, accountability and efficacy. My questions above on performance and consequence management also feed into this.

  DAO and the foundation should jointly put together a committee from amongst the DAO members (excluding foundation members) to assess and rate foundation’s initiatives on a regular basis. Ideally the committee members should be paid for doing this work.

It will be a HIMALAYAN BLUNDER to not introduce something similar to the above ASAP if the vast majority of the DAO treasury is handed over to the foundation.

I repeat- I am talking entities right now and NOT individuals.

C) A few months ago I had once publicly and then privately to the foundation suggested having external audits, redundancy and contingency in place for V1 upgrade and launch.

V1 being almost existential to Pocket Network, the extreme dependency on the single incumbent player today adds too much risk to the future of this protocol.

There is still time IMO.

This isn’t FUD and to cast doubt on anyone’s technical capabilities.

This is standard contingency planning, also a part of change management.

That’s all for today.

And let us all hope that $POKT’s bottom is in.

Maybe the rising tide will eventually lift all boats?

Love / Arrivederci,

Caesar

Imagine disputing the above in traditional markets?

Only in crypto I hear weird arguments about price of a token- driven by extreme bag biases, tribalism, ideology or at times idealism.

Let us check a few charts-

Btw charts don’t predict the future but they are very useful tools. They a) show historical data, b) helps in pattern recognition (if any & if there is enough breadth & depth), c) helps in drawing different types of correlations (if any), d) gauging sentiment, freed, greed, momentum, e) making comparative analysis such as between prices of assets, ++++

$POKT making lower lows & still on a downward trend against $ANKR.

I compare with $ANKR because that’s the token closest to $POKT at the moment. Once Lava, dRPC and other similar protocols have tokens, the game will get interesting.

Regardless, assets don’t have to be identical to make relative price comparisons. Such as comparing $BTC’s price & $ETH’s, comparing one asset VC $BTC or $ETH, substituting $USD with any other asset. Its the investors way to gauge- where could I have got the maximum bang for the buck.

And it’s certainly not $POKT until now against any other asset.

Since my last blog on $POKT price action on 25th of April, $POKT made 3 new lows with retests. Going back further- My first alert about concerning $POKT price action was in Feb, 23 when I observed $POKT’s lack of traction versus the trending trad + crypto market. Since then I kept sending alerts whenever I sensed bad signals VS the general market. I have recorded those in my last blog , in case anyone in interested.

No crystal balls, just a good sense of public markets having skin in this game 24X7 for a few years.

The following are more recent, from May-

$POKT make new lows since the burn announcements, which is kinda unheard of.

Caesar, are you rubbing salt??

My objective is to re-sensitise that-

a) $POKT’s price action is very abnormal as I have been ranting since Feb, 23.

b) Market is still not buying the story, that I first said in my last blog.

Whether something more or different needs to be done, that’s for the foundation and the DAO to decide.

The market will continue to publish the daily scorecard and I will continue to monitor it calling a spade a spade.

Before ending this section- let me share that I wouldn’t trust the volumes anywhere except on Ku, Gate & Bybit. Those are the only exchanges that have declared their “proof of reserves”.

___________________________________________________________________________________________

Debunking Myth- 1

Here is the back of the napkin list of catalysts for price action of ‘A token’ in the order of relevance (and I mean tokens only, doesn’t apply to equities or other assets) :

1. Health of Macro (capital market liquidity, real economy, war, pandemic, etc)

2. Health of crypto space (liquidity, regulatory mood, scams, etc)

3. Robust machinery to drive narratives (token specific)

4. Liquidity/Capital Markets (token specific)

5. Tokenomics (Price friendly tokenomics)

6. Fundamentals (Product Market Fit, Usage, Growth, Revenue, etc)

Yes, you read it right- “FONDAMENTALS” takes the last spot.

Absence of #6 is not a showstopper to positive price action of a token. The presence of which is also not a guarantee. Check my last blog for examples of tokens.

Moreover fundamentals can have different meanings for different people. For few $DOGE has fundamentals being a premium meme token and for others it’s trash. GOLD fits in the arguable category.

Just to remind- we are NOT talking idealism here, and judging what is right or wrong.

DIS IS DA MARKET!

Tying all this back to $POKT price:

• We can all agree ‘for now’ that $POKT checks box #6.

• After Dec 2022, #1 & #2 have been net positive to neutral. Equities & crypto are up from the lows, except $POKT.

• $POKT sucks at #3. Let us wait & watch how the newly hired PR firm & Head of Marketing performs by Q3. Personally I am not a fan of trad PR firms in todays marketing era but I am curious to see what a ‘crypto native PR firm’ does. That’s new to me.

• $POKT sucks at #4. I am curious to see what happens to $WPOKT, the plan to funnel liquidity & which CEX lists $POKT next. Having $WPOKT in place doesn’t automatically guarantee healthy liquidity. Plus with the current performance, it will be a struggle to get listed on exchanges such as Binance, Coinbase.

  Btw until $POKT is listed in derivative markets, we would’t know the fair price of $POKT.

  Imagine if there was a way to short $POKT at this moment??

• #5 =/ ponzinomics as few would assume. $ETH 2.0 has great fundamentals & unmatched tokenomics, and I have cited examples in my last blog of tokens with solid fundamentals but poor price action due to weak tokenomics.

  I wouldn’t say $POKT sucks at #5 anymore but despite ongoing reduction in emissions & introduction of burn in V0, tokenomics continues to be an achilles heel.

Check the start of the blog where I say how unusual it is for token price to yawn & make new lows after burn announcements.

I do cover my thoughts about inflation later in the blog, keep going.

___________________________________________________________________________________________

Debunking Myth- 2

I tweeted once that in order to survive in financial markets, I had to unlearn what my econ professors who were old school Oxbridge PHDs and had boomer roles such as Chief Economic Advisor to nation states had taught me.

Economists sound smart and can win intellectual debates, but they don’t make money in markets because they are indoctrinated by theories such as “price is a lagging indicator”.

Markets are speculative in nature and therefore forward-looking.

And that is even more relevant in the case of growth assets.

Therefore those who had waited for traditional valuation metrics such as P/E (price to earning) ratios, DCF (discounted cash flow), etc to become favourable before buying the tech stocks, Tesla, etc, dominating the global financial markets today, missed most of the upsides.

Crypto is leveraged NASDAQ and on steroids. The hype gets way ahead of fundamentals by traditional standards and that manifests in price.

Who would have bought $BTC and $ETH early going by the principle of “price is a lagging indicator”? Even by using token valuation models that have been designed today by crypto natives.

And who would touch most of the tokens being traded today?

This takes us back to-

___________________________________________________________________________________________

Is $POKT Inflation gud??

Double digits inflation until Aug and gets to 8/8+ in Feb, 24. V0 is scheduled for Q1, with buffer realistically sometime in Q2. This is not FUD fellas, this is contingency planning 101. And given the recent attrition of a core team member from the tiny protocol team controlled by one ecosystem partner, there are added reasons to be conservative with launch timings.

Therefore ‘Valhalla’ for $POKT’opians which is tokenomics & demand that support mint = burn could still be 12 months away.

That’s a lifetime in crypto, specially given $POKT’s poor rapport & performance in the market.

A quick reminder of a few basics:-

a) Price is a function of supply & demand. Supply is 100% controllable and demand has dependencies, therefore challenging.

The 600k tokens minted daily have to be absorbed somehow for price to be able to go north instead of south. Otherwise the math fails even at a very rudimentary level.

And the big variance allows this to happen on a daily basis-

That’s how hard your sacred coin is getting dumped on Ku, turning your heavy bags into leaky ones. Just a visual representation from one exchange.

This is despite all the burn narrative and everything else.

b) Controlling supply doesn’t come at the cost of increasing demand. Don’t use one to explain the other.

c) Emissions = Cost to the Network. Do I really have to explain how increasing efficiency in turn increases competitive advantage in a crowded market?

And btw for those who blame the sellers & associate market selling $POKT to poor principles, I wrote this tweet specially for them.

I am not going to be precisely tell what to do this time with inflation, but I have to say that pro status-quo side should come up with different reasons to defend their stance. Unless it has become a matter of ego for a few or something.

• Several small node runners are desperate to cut emissions drastically and therefore anyone defending status quo claiming it is for the sake of the small node runners is basically being dishonest at the point.

I will repeat what I have said in forum in the past- It seems like a few players are financially motivated to not cut emissions and they are holding the network hostage.

• Comparing with other protocols. Here is a random snapshot-

Ah you are smart anon and you want to see Web3 Infra Stack instead. Here you go-

So how is $POKT doing VS the vast majority??

Erdogan, President of Turkey defends continuous devaluation of Turkish Lira to propel economic growth. That’s a quite unprecedented policy and completely delusional. As a result, he has made the Turkish economy significantly weaker, the economy that he himself built when he had come to power.

I get similar vibes from $POKT’opia.

Before I end this section, let me caution people about pulling inflation numbers from just anywhere. I see that as data integrity issue to defend one’s view point.

Refer protocol websites/resources or use Messari. There could be differences of +-1% and that’s fine.

So to repeat myself- I want to see better arguments defending status quo in emissions.

___________________________________________________________________________________________

To end-

Idiosyncrasies of the crypto space with regards to price are all highlighted in my last blog.

I can’t think of many tokens, whose prices did not trend with the market for ‘an extended period’ and then they rose from the ashes like a Phoenix.

Several tokens & protocols don’t get extinct either, just get pushed into a state of oblivion.

Crypto is a subset of the attention economy.

Death is not imminent but dormancy could be, specially in a market thats going to remain inundated with hundreds & thousands of tokens.

Don’t let $POKT go there please-

Someone named Elon Musk from the Western Union mafia emerges with a revolutionary pitch calling the favourite car of Americans Un-American:

"Mustang burns fossil fuels and is destroying the planet. Tesla uses green energy and therefore Americans should buy Tesla."

Next, Elon makes Greta Thunberg the face of Tesla. Greta goes around telling Americans that Mustang kills babies.

How out of touch does all that sound??

Doesn't require a giga brain (hate that term btw) to guess that Tesla probably wouldn't have made this far and would not have been as impactful (to the cause of climate change) as it is today.

Instead-

Elon builds the best performing and the most good looking car, he open sources the technicals & he is committed to making it accessible to different classes.

Consumers have found an i-phone in the form of a car.

They became the evangelists and the ambassadors, just as it had happened with the I-phone.

Oh btw- it's also an EV that uses renewable energy. Car owners don't have to be shamed and they can be proud of themselves.

Pocket Network aficionados have been going through the time-travelled Elon & Greta moments of 1960s & 70s.

Pocket loves to dunk on Alchemy, Infura, etc calling them "centralised" and almost implying that "they are the bad guys" and those who associate with them are accomplices.

Yet growth of Alchemy and Infura continue to soar and the token $ANKR of Ankr Network keeps outperforming $POKT.

There is another problem-

These so called centralised providers leverage Pocket Network and could become its major customers.

It doesn't stop there.

Recently, I am starting to see Pocket cheerleaders walking around with quasi "Ethereum is not decentralised but Pocket can fix it for you" placards.

Ethereum generates the highest volume of relays for Pocket Network.

What is the end game here?

Do you want to do activism or do you want to participate and succeed in the free market of decentralised infra?

Well Elon just showed the ESG activists who have been failing for years, how to galvanise people to save the planet-

"Build great products that people love and want to use.

Decentralisation is a means to an end. Treat decentralisation as how Elon has treated climate change while building and marketing Tesla.

Highlight and compete on cost, security, uptime, latency, QOS, ease of onboarding/integration, etc etc, instead of constantly virtue signalling about decentralisation by vilifying partners & potential partners.

There is no written rule that vision of the visionaries within the teams has to become the gospel for the Go-to-Market strategy. I am dropping a hint here without dropping names.

If you want to scale beyond the echo chamber and earn critical mass, then also focus on "what matters" to the world outside.

To end-

Community contributors are free to promote Pocket Network whichever way they wish to.

The red line will be if similar promotion tactics of negative marketing & virtue signalling infects the foundation's marketing DNA.

Price of a token doesn’t have to be backed by use cases and fundamentals.

Similarly, project fundamentals need not lead to token price appreciation or even sustenance.

Pocket Network is going through the exact same problem.

There is a bigger problem in Pocket- its a builder community that either doesn’t understand markets &/or are in denial of the existential nature of $POKT (Pocket’s native token) free falling.

There are those “let’s just build” & “if we build, they will come” vibes.

I have been very concerned since Q1 & have been repeatedly warning-

And this is my last and final attempt to sensitise the Pocket community leaders to pay exclusive attention to $POKT’s price just as they pay attention to other builder metrics.

The permanent residents of $POKT verse mimic the over zealous and optimistic nature of crypto in general. They are perma-bullish no matter what. Those include a few in $POKT verse I happen to call friends. Their stakes are high and they are invested in this project in many different ways. If I were in their shoes, I would probably not be any different.

Hence accepting critical feedback and those resulting in actions don’t come naturally & swiftly in $POKT verse.

There is also a tendency of “know it all” amongst community members. To repeat what I have said in the past- being a star node runner or a star dev or a star data scientist doesn’t make anyone a market, econ or marketing pro or in some other craft.

The decentralised nature of decision-making plays a role in slowing things down; that just comes with the package.

In the past 10 months, I have been vocal about:

-Macro/crypto correlation (related to $POKT price)

-Marketing/Narrative building

-Inflation

-Common mission, values & goals

-Protocol revenue or lack of it (financials in general)

-Importance of financial dashboards such as Token Terminal

-DAO expenses & treasury management

-Price of $POKT (again recently)

There are plans in place to address many of the above but the teams seems to be missing the existential impact of $POKT’s price action since Q1, 23.

And I am here today to raise an alarm.

2022 was a lost year for Pocket Network & the foundation is in an extremely challenging position shouldering baggages from 22 and new ones in 23.

2023, specially April has seen a flurry of bull posts & announcements from the community leaders @ Pocket Network-

https://poktopus.com/the-bull-case-for-pokt/

https://forum.pokt.network/t/pnfs-ecosystem-thesis-for-pocket-how-we-become-unstoppable/4353?u=caesar

https://forum.pokt.network/t/pni-update-to-the-dao-april-21-2023/4373?u=caesar

And there is one more coming out about protocol revenue, decentralising the gateway pre-v1 in Q3 and activate demand side fees with an off-chain burn.

Now let us check these charts-

Y’all are used to staring at $POKT/USDT charts, comparing with $BTC & $ETH might be little unfair (although smart investors would consider those data point); so I thought let me plot $POKT against Total Market Cap & the closest peer/competitor in the market $ANKR.

Let me be ALL CAPS Jason Calacanis for a second-

“THE MARKET ISN’T BUYING YOUR STORY; CONVINCE THE MARKET INSTEAD OF CONVINCING EACH OTHER.”

The first time I had raised an alarm about $POKT’s price was in Q2 22 when the community didn’t see what macro would do to the crypto market & therefore $POKT. I remember winning a friendly bet against a community leader. Impact from macro became common knowledge in the crypto community & several other bad things happened in crypto in 22 that took the entire space down. “Correlation” became THE REASON for $POKT going to All Time Low. Fair enough!

Then came Q1 2023 when market went up yet $POKT didn’t (except during the Ku Coin campaign week), & I spoke (pay attention to the last sentence)-

And then I again alerted when $POKT didn’t move up with the market in Q1,23 but moved down recently with the market-

These are signs that only those who spend 24X7 in the markets can catch.

The daily volume of the largest exchange Ku Coin hovers in the 20s-30ks: disgusting!!

The 2nd largest exchange Huobi delisted $POKT.

$POKT is now sitting at “New ATLs”.

And it’s still not looking pretty unless intervened and made a priority for the next few months starting right now.

So why am I obsessed with price?

I agree with once $POKT community member Vitaly’s response to my tweet-

The free falling of price & liquidity is existential to the node operators, security, DAO treasury, protocol development, you name it.

DAO expenses are in USD; what happens if price drops another 50%, to .02s & .01?

Even if price stays at these levels for another 9 months?

I am not making doom predictions but given the fragilities, I also wouldn’t bet against a crisis. I would say that it’s already a moment of crisis.

Let me take this to another level quoting Jason’s tweet, which I agree with-

The above is true about all legit protocols, including $BTC & $ETH. Think for a few minutes to find some substance in the tweet. Is $POKT special?

The is no other asset class & space where reflexivity works as good as it does in crypto. Read “The Alchemy of Finance” by George Soros, one of the greatest investors alive, to understand how “reflexivity” works in markets.

And as mentioned, no other space reflects this better than crypto.

Narrative drives price & price drives narratives.

Convention is that the best and the brightest as ecosystem participant build fundamentals that price ultimately reflects, but its also the other way round- price attracts the best and the brightest to the ecosystem.

The free falling token price does exactly the opposite.

You can’t build the community you want to build in these conditions.

And whatever is remaining will stay divided & torn.

Price is the most effective unifier in the community. Whether the idealist want to believe it or not.

Next-

Every time someone mentions price, a diehard $POKT community member or leader tries to counter that with “fundamentals”.

Fundamentals can have the following characteristics-

A) The token value can be decoupled from fundamentals such as $UNI, $ATOM, $MKR, etc

B) Fundamentals can take time to unfold and specially to impact price.

The following projects have/had great teams, fundamentals, fundings, and few even did pioneering things at some point -

$ZRX, $DASH, $XMR, $ZEC, $ZIL, $KNC, $DCR, $BNT

How relevant are they now despite a lot of initial hype?

And I am being kind to list those that are not dead at least, few are still very respected with have active communities.

Price is the primary reason behind their dormancy.

Price is also the most effective marketing tool in crypto; add reflexivity & the importance of price goes beyond dumb retail.

You can call the little guy who is complaining about price smol brain, moon boy, someone who doesn’t understand &/or care about fundamentals.

But what would you call the collective intelligence of the market that is showing you the mirror not once but repeatedly?

Pocket Network maybe clearing other tests but it is consistently failing the test of the market, which is the ultimate test in a tokenised project (barring few exceptions), traded in the public market.

Do you even care anon?

The negative sentiment in the $POKT community this time around is not from tourists alone, can sense it from participants who are well invested in the ecosystem, including star node runners.

Market is signalling hard & it requires intervention, shouldn't be left to follow its natural course.

The next big narrative is a year away. So plz STOP parroting V1 as a panacea for all problems.

Focus should be what can be done in Q2 & Q3 to give the market some confidence that can drive price stability and hopefully recovery.

This shouldn’t be ad hoc community member driven initiative

Put a def con team in place; no law needs to be broken.

Here are a few comments about arresting sell-pressure in the short term-

1. Kudos to the foundation for the urgency to launch $WPOKT in early Q3, pre V1 (FOR HEAVEN’S SAKE). Should be a life/death project; a 2022 repeat will be fatal.

2. PNI buybacks are tiny to move markets but it can be useful as a short-term narrative if “sold & told” effectively. More below.

3. Off-chain pre V1 burn is an ambitious & bold project; thanks to the foundations for advancing burn. The ultimate will be POW & closure but the narrative has to be sold starting now. That will also drive accountability.

4. Targeting T1 CEXs should be the goal but what if that is taking time?

Don’t dismiss the big and popular local exchanges that offer very decent liquidity. Listing in those exchanges could be relatively easier.

$POKT being a popular token in a local exchange could attract customers from that country/region. Could become a part of marketing & localisation strategy. $POKT leading to new business unlike the conventional way of business leading to token demand- reflexivity as explained above.

5. This is the ongoing SER table-

What stops the foundation/DAO to expedite target daily emissions of 420k from Feb, 24 to June, 23?

No new experiments, simply expediting what is planned already, keeping it constant until the new tokenomics for V1 going live Q1, 24.

Btw Price= Fx (Supply, Demand) doesn’t change when it comes to tokens.

Driving demand of $POKT through revenue is a long game and full of dependencies in externalities.

Tweaking supply is quick and within control.

I have empathy towards community members who rant about supply during these dismal pricing conditions.

6. There were all sorts of assumptions when I did this survey.

The objective wasn’t to start a new proposal based on results but to gauge cursory sentiment. And I am quite comfortable with the sample size given the numbers I have seen in other polls & votes.

My primary takeaway is that the community is probably not aware that a month-on-month reduction in emissions is programmed.

The diehard $POKTO’ opians love debating using facts and details.

But it doesn’t matter whether you know about those details anon, is the market aware? Have you told the story?

Doesn’t appear so- takes to my next point.

7. It will take time to hire and have the new Head of Marketing make any difference.

Hire someone like Coin Desk immediately for the next 3 months at least. All the above actions + MORE require top class distribution for max impact.

I had proposed Coin Desk a few months ago, even shared the media-kit but got immediate pushbacks from community members who have absolutely no clue about marketing.

Messari is not going to serve the purpose I am raising.

8. Utilise the excess 1M the foundation announced in all of the above + providing initial liquidity, basically towards driving price stability and hopefully recovery.

In general-

A) Keep building but make price equally important as everything else. Don’t get stuck in “fundamentals should drive price” mode. Even the top CEOs don’t do that even though they might say it for sound-bytes.

No need to make it a public KPI, keep it internal.

Consult a lawyer specialising in US securities to get the exact instructions, if people are so afraid to even mention price.

-Foundation is Cayman based

-Members (Foundation/DAO) are globally distributed

-US based PNI is just another vendor

-Not listed in the US yet

No US listing could end up being a good tradeoff, should be explored.

Btw this is Kevin Rose, one of the popular faces in US tech space & founder of Moonbirds, reaching out to the community a few days ago when NFT prices tanked.

I am not expecting a community leader to do what Kevin did.

My point is- Don’t quote “oh because of regulations” superficially, get the details from a lawyer who works in the crypto space, when it comes to “talking price” very specific to Pocket Network’s current set up.

B) Consult those who might have hands on public market experience.

Private market experience //- Public Markets

Academics //- Public Markets

C) Get rid of the word “bootstrapping”, this leads to all sorts of excuses and that includes those that impact price. Pocket mainnet was along with Solana’s in 2020, stop treating Pocket as a baby.

And last but not the least-

Embrace price & price action; don’t be this guy-

Here is why-

1. Crypto is tech heavy and therefore falls outside my natural comfort zone.

Moreover, I consider to be able to demystify complicated stuff a skill.

2. That’s the only way according to me to do reality-checks. Crypto can get high on ideology and can get delusional.

3. To break &/or replace with something better, it’s imperative to know the incumbent.

Such as before breaking or replacing central banks with non-sovereign currencies, knowledge of basic monetary policy, macroeconomics and history are required.

Or before designing tokenomics of your favourite coin that will change the world, knowing basics of classical economics doesn’t hurt.

4. Novelty need not change fundamental laws of nature/physics, basic human psyche & similarly fundamental rules of business.

Such as income statement, cash flow & balance sheet are core essentials in any business- off or on chain. And prolonged asset/liability & income/expense mismatches can be existential.

Such as Profit= (Revenue - Cost) ; and each one of them should be very clearly defined.

Let me bring Pocket Network into the picture and do some mapping with the trad world.

-The protocol could be the firm.

-Decentralised RPC service the product.

-DAO, PNF & the ecosystem participants: the management body and the teams.

-$POKT token is the domestic currency that is tradable in the public market.

-Revenue for the protocol in Pocket’s case could be a commission back to the DAO from RPC sellers/gateways &/or some kind of $POKT burn. At this moment, the protocol doesn’t earn any revenue but that will change in the future.

-Protocol cost in this industry is the token emissions or the inflation.

While I have not seen any financial statements for the protocol yet- internal or external, my presumption is that’s how cost will feature, inline with the industry standard.

I am not convinced though with this approach in this industry to simply equate emissions with the cost and not go any further.

Imagine doing this in a firm- “here is the money, go spend it” without knowing what the costs should be to sustain & grow the business or at least knowing what the costs are down to the origin. In trad businesses tracking both of those are non-negotiable.

So how should it be done?

In Pocket Network, 3 category of network participants suck up the cost or the emissions- servicer nodes, DAO & the validators.

DAO costs are tracked & reported; what is needed is a DAO budget before the financial year starts, as I have suggested to the foundation a few times. The initial versions of the budget should consists of costs alone without considering DAO allocations from the emissions- what the costs should be to sustain & grow the protocol. The latter & the final versions should be in conjunction with the expected DAO earnings (allocation), so that income & expenses match.

The big boys in the DAO space have all started formal budgeting and tracking actuals against budgeted.

But DAO is not the most complicated piece of the puzzle in Pocket, primarily because its one entity.

The node runners being independent for-profit actors, distributed across continents & more than 20k in numbers are.

A common budget is not applicable in their case but what about tracking the cost of doing business?

I see not having the protocol level actual node running costs at finger tips, which is by far the largest cost component to the protocol as a problem.

Imagine that happening in a top notch firm- the biggest cost component not being tracked at any given point of time. How acceptable will that be?

Reminder that I equate firm and protocol for the sake of the argument.

Lack of such data from sources backed by consensus creates confusion & debates without verifiable numbers that individuals throw around, subjectivity where objectivity is needed, and at times causes stalemate with regards to changes to the protocol.

Such as- there is a paradox happening in the Pocket’s node runner community around further inflation reduction wherein a few smaller node runners support a cut whereas the midsize ones are resisting.

Also, I get to hear statements such as- “The small node runners are going to run out of business if XYZ changes.” And, “the large ones can survive because they have economies of scale.”

All of the above are ‘cost related topics’.

Wouldn’t it be better if such debates are backed by data from sources backed by consensus? Maybe few of those debates wouldn’t even take place when the costs are readily accessible, and there will be speedier consensus and better decisions taken if the debates do take place.

Being independent and for-profit entities, the node runners are not expected to expose their financials publicly. Even if they do, it will be impossible to do veracity checks for each of them.

In such scenarios, a statistically relevant sampling can be used.

Those can come from foundation running their nodes and therefore using their data as representative sample. Btw, I have heard of the possibility of the foundation running nodes, so this is not a made-up idea.

Or the sample can also be the foundation having access to financials of a group of node runners who act as volunteers for this purpose.

There are other ways to do sampling.

There can be multiple tiers to represent the broader sizes of the node runners.

My assumption would be that the range of cost differentials for node runners in POS chains is probably not as wide in miners in POW chains. Miners in POW chains can have very big differences in costs primarily because of very different electricity prices around the world.

Claiming “we know it” is not enough. The data representing the protocol has to be readily accessible at any point by anyone just as other statistics are. I understand on-chain ones are easier to pull realtime.

The honeymoon era of selling hopes & dreams only is going to be over.

Financial performance of protocols are going to be discussed more and going to matter more.

A powerful saying is- “what gets measured also gets done.”

Once the protocol and the DAO starts budgeting costs and tracking all costs by line items, maybe that will give a better insight to whether emissions could be/should be reduced by reducing costs at origin, and ultimately improve financials of the protocol.

At least that’s how a well managed trad firm will do in its business.

Billionaire-hating is on the rise and Jeff Bezos naturally gets a fair share of that: billionaires are evil and Bezos is their undisputed leader, Amazon is building a monopoly business, it doesn’t pay taxes, and the mom and pops and local businesses are getting wiped out due to unfair competition from Amazon. There are several other accusations. In addition, economic nationalism and domestic politics pour fuel on them. Bezos’s personal life is under scrutiny by tabloids and moral policemen. Somehow anything he does or says turns into ammo for the cynics. So was his recent 4000 words written statement to the US Congress.

For me however, Bezos’s congressional statement was nothing but a goldmine of inspiration and another testimony that only under capitalism anybody can create history. Bezos loves long-form write-ups. After reading his statement several times, I picked a few lines that intrigued me the most. Needless to say that you are better-off reading the original than my curated points below.

• He starts the letter by reminding of his mission of making Amazon earth’s most customer centric company. Later on he talks about Amazon’s ‘Day One’ culture- everyday is the first day of the company irrespective of its size and tenure.

• Jeff’s mother had him when she was 17; a pregnant teenager wasn’t the most popular figure in Albuquerque in 1964.

• His father is a Cuban immigrant who came to America alone at the age of 16. He didn’t speak any English.

• Bezos left his stable job in NYC and moved to a Seattle garage to start amazon.com.

• Quote unquote: “It was a decision I made with my heart and not my head. When I’m 80 and reflecting back, I want to have minimised the number of regrets that I have in my life. And most of our regrets are acts of omission—the things we didn’t try, the paths untraveled. Those are the things that haunt us.”

• Most of the initial capital was his parent’s life savings.

• Bezos was so ahead of his time that the most common question from the people he met for funding was: “What’s the internet?”

• In the early days, Bezos himself drove the packages to the post office.

• Amazon was ridiculed as ‘amazon.toast’ and ‘amazon.bomb.’ The latter was by Barnes & Noble.

• Amazon’s stock price tanked from $116 to 6$ during the dotcom boom and bust. The analysts and pundits projected Amazon’s demise.

• Quote unquote: “Failure inevitably comes along with invention and risk-taking, which is why we try to make Amazon the best place in the world to fail.”

• Amazon directly employs a million people around the world.

• More than 80% of Amazon shares are owned by outsiders including mom and pops, not by Bezos or any insider.

Bezos wasn’t born in the best of conditions. Wealth and prosperity didn’t come to him without struggle, big appetite for risks and failures. I would imagine that such stories from the lives of successful entrepreneurs would help build bridges.

Yet the moods are different. People are very angry at the rich as can be read in posts such as this on the Guardian and this on the WAPO. I think it would be a crime to not notice that the current state of capitalism has problems and that it requires cleansing. At the same time, I just fail to see a viable, tried and tested alternative that is superior and scalable. Rather on the other side I see only utopian ideology with false promises, large governments with excessive controls, and regressive outcomes. Actually much worse based on precedences.

About Bezos- we can debate on whether he has made the world a better place or not. I understand that it’s a complex discussion to begin with. However, at a very rudimentary level I think we can agree that he has helped grow choices, access and comfort in our lives as consumers. Such as, I had Amazon seamlessly deliver me essentials at my doorstep during peak lockdowns and those are just invaluable solutions to real-life problems. Although, people will find ways to complain about that too, including about Amazon creating around 175,000 new jobs during the pandemic.

Despite all the noise, Amazon remains one of the most admired companies in the world: judgement of the crowd.

Bezos is one of the greatest innovators and entrepreneurs alive. Until someone can show me better ways for ordinary men and women to dream big and change the world, self-made ultra successful entrepreneurs like Jeff Bezos will continue to inspire ‘little risk-taking guys’ like me.

Written in Aug, 2020 (Published with no updates)

Here I type up a few basics such as what it means to me, why is it important, and how it could be done. These are my mental models and I don’t claim them to be exhaustive and/or sacrosanct.

I generally use marketing and narrative-building interchangeably. Although here is how I define them-

Marketing is telling our stories to the right group, the right way and at the right time. That sets the narratives the way we want them to. Otherwise the market or foreign actors shape the narrative for us and we lose control. Narratives drive sentiments (political, markets, world, life) with or without substance. Sentiments decide winners and losers.

Effective Marketing (story tell) → Build the Narrative → Drive Sentiments → Influence Outcomes

Is Crypto/Web3 different?

Yes and No. The fundamentals of marketing and narrative building do not change. A Philip Kotler classic, marketing degree from Kelloggs, courses in digital marketing and grassroots alpha from Vayner Media can be applied in this space as effectively as in any other space.

The tools for distribution of the stories (aka the content) are the same as in web1 and web2. There are no web3 equivalents for distribution yet.

However there are at least 4 characteristics that set this space apart from the rest:

a) Financialization- The tokenisation of the projects make this space hyper financialized and that’s how it is designed to be. In addition, currently buyers, traders and investors of those tokens outpopulate users, builders and producers by a very big margin. Therefore, financial incentives and speculation are the dominating forces.

b) The Pace- Because of #a, because the markets trading those tokens are 24 X 7, and because of the high volatility of the prices of the tokens, everything moves at a 100X speed. The lightening speed is also because of the 100% digital nature of this space and all the participants being digital natives first before becoming crypto natives.

c) Subject Matter- This is a tech heavy space full of developers, engineers and data scientists. The tech savviness, the language full of tech and the birth of something new every minute can be overwhelming for newcomers with non-tech backgrounds.

d) The Culture- Crypto culture is not monolithic from inside once someone ages there. However it can be meme, troll and anon heavy, and full of tribalism (due to the financialization aspect). There is also a big nerd community in it. Btw if Elon Musk and Tesla fanatics had Tesla tokens, they probably would look very similar. Also because there are almost no entry barriers- age, education, financial conditions of participants can swing low quite a bit. In general, the culture is very young.

To be successful doing an F&A (Finance and Accounting) job in crypto, an understanding of crypto nativeness may never be required. I don’t believe I can say the same confidently about marketing in crypto. Growing into it if not being born with it may be needed to be effective.

Moving on-

The objective value that marketing (narrative-building) brings has always been debated just as sales at times, even though sales is way more quantifiable. At times the debate is about marketing or sales. Yes, the need for sales has also been debated such as in SAAS and in Silicon Valley. The tech space is abundant with such debates. You know the tech bros screaming “code is law” types.

At times its about the dollars- people demand marketing at the top of their voices but they don’t like to see the bills. It’s also true that lots of marketing dollars go waste because throwing money alone doesn’t solve problems.

That being said, I don’t see a lot of empirical evidence where products and services have done phenomenally well without S&M. There is always story-telling and outreach involved, they are just done differently.

I believe that it’s reasonable to assume that crypto/web3 will not displace those, that generally involves exploiting fundamental human natures.

Product-market-fit alone without a winning narrative could be a losing game.

Here I go by the meme- “why not both”??

Story-telling need not be random and unplanned. Putting content without a smart strategy and an execution plan, and without being backed by any data and/or reasoning could be a waste of time, effort and resources.

Even though that shouldn’t be the ultimate goal but between putting lots of mediocre level content across multiple platforms and getting data-obsessed, therefore ossified, I will pick the former in todays new age digital marketing just because of how distribution work in the platforms. More about this in the subsequent blogs.

Where to start and how to do it-

I like the classic approach of keeping sales and marketing separated, yet collaborating very closely.

I am not a fan of hybrid functions and titles such as “growth marketing” that blurs lines between the two. I have two reasons-

a) Accountabilities and therefore the KPI’s get mixed up.

b) The skillsets are different in this digital age. Effective marketing in B2C, B2B or even hybrid spaces can be pushed from the backend, being anons with no front-ending whatsoever. However, selling in B2B still requires front-ending and direct human touches. In addition, the demand for localisation is much higher there and might even get into uncomfortable territories such as ethnicity, etc.

In crypto/web3, a 3rd function “community” gets branched out.

And there can be frequent overlaps or even chicken/egg situations between the 3 functions. Such as a community set up can happen first before marketing starts or a marketing outreach can result in a community getting created. Similarly, leads can be captured and generated at multiple stages.

Let us use Pocket Network as an example.

Before proceeding, I have to say that marketing (narrative building) has probably been one of the weaknesses with Pocket. And this is despite having the fundamentals and ammo for driving the narrative.

As per the structure I laid out in my last blog, Pocket can be divided into the domestic economy and outside economies, the sellers and the gateways connecting the two, the foundation being the neutral governing body of the domestic economy. I should add the exchanges too as the connectors, specially in the token economy.

In short, the foundation’s one leg should be in partnering with, guiding and facilitating the marketing initiatives of contributing entities, and the other leg should be in building its own marketing division. The priorities can be set based on several factors

Let’s first discuss a few frameworks that could guide Pocket where to start/restart and how to prioritise and optimise-

A) A framework for “whom to target” (basically audience segmentation) and “how to target”. “How” could be unique to one group (verticals) or could also be shared by all fragments (horizontal).

Such as, following could be rough segmentation of the Pocket audience:

Initial optimisation could be by focussing on the horizontal basics that cuts through all segments.

B) Another framework to narrow down focus could be to prioritise based on:

Talking about the 1st section- organisational goals- in Pocket’s case, the foundation’s Project DNA that will give Pocket Network a shared identity, mission and values could be at the centre around which “the Pocket brand” can be built through marketing.

C) This can be put under the “impact” filter from above, but I believe it deserves its own place.

As I wrote in the last blog -

“The native currency or the token is the “Chi” or life-force.”

'“Token price lies in the middle of the economy of the DAO and the financial health of the protocol.”

“The value of the token doesn’t impact the token investors alone. It also affects the economy of the DAO and its participants- the DAO treasury, node runners P&L, builders and contributors, the quality of DAO management, etc.”

I would optimise impact by never missing any opportunity to broadcast facts that would do justice to the value of the token. And I would tell the story multiple times if needed.

To End-

Marketing can also be held to very high standards. Such as going beyond just basic reach and story-telling- to make the eyeballs become Pocket’s ‘community-promoters. Something similar to ‘word-of-mouth marketing’ but more active and engaged.

Although, such standards rely heavily on the quality of the product and U/C EX.

More about this in Part 2.

In Part 2, I will argue why the retail segment could be the path of least resistance and to optimal impact in narrative-building in crypto/web3, irrespective of the type of end-users.

Hear me out next time before assuming the cliche.

Thanks for reading.

I am not a genius polymath like Balaji who talks about “The Network State,” perhaps a related concept, and I write in plain English. Please bear with the simplicity.

To make my arguments, I use the Pocket Network DAO as my example.

Having engaged with Pocket DAO closely for the past couple of months, I exploit the insights I collected to share my observations about the DAO and the protocol, primarily from a business & economics perspective.

TLDR/In Scope

• DAOs are the new domestic economies.

• Survival and growth depend on how DAOs trade with other economies.

• The native currency or the token is the “Chi” or lifeforce.

• Pocket DAO should treat RPC gateways/sellers as customers (at least as exporters).

• Taxing them could have detrimental effects to the economy.

• Gateways/sellers should have the autonomy to decide pricing with end users.

• $POKT has utility in the domestic economy, utility outside is not mandatory.

• Pocket’s product has market-fit, priority should be to get demand soaring.

• Does decentralisation beyond a point have diminishing returns.

• Pocket’s protocol revenue is zero today but that is not existential for now.

• Token burn is a booster solution.

• Questions around emissions, infra cost, ongoing moat and investment thesis

• V1 looks like a game changer for the protocol.

Let’s rant-

I used to compare DAOs with cooperatives but they are more complex and bigger than coops.

So in POKT DAO, there are communities, investors and traders, voters, mercenaries and politicians, devs & builders, all being economic participants on the land and the infrastructure which is the protocol and the network of nodes, secured by the validators.

A special mention of PNI- PNI has the core dev team building on the protocol and they are also the only seller of Pocket Network’s product (or service)- decentralised RPC (dRPC). In simple terms, Pocket Network is a middleware infrastructure layer in Web3 that connects dApps with blockchains. The mission is to have multiple PNIs building and/or selling.

There is the foundation (Pocket Network Foundation) which is the neutral governing body and it owns the IP and I believe the protocol as well for the DAO.

The local currency in this economy is $POKT.

The DAO is politically democratic, almost like Switzerland- the land of referendums. Well it’s more representative than that I would say.

And economically capitalist, aiming to be meritocratic.

The DAO’s treasury has its income from the emissions that it uses for good and smart governance, upholding the DAO constitution and to make the DAO prosperous- attract the best talent, incentivise builders to continue building on the land (the protocol) through grants and payments.

So that was the domestic side.

The domestic economy ultimately depends on the demand for its local produce and how much it sells in the markets.

Without demand, the economy is bound to collapse, primarily because the native currency will lose its value.

The value of the token doesn’t impact the token investors alone. It also affects the economy of the DAO and its participants- the DAO treasury, node runners P&L, builders and contributors, the quality of DAO management, etc.

Therefore token price lies in the middle of the economy of the DAO.

Recently, the community at Pocket Network has been passionately debating the need for sellers of RPC service (such as PNI) and gateways paying the DAO. I can take the other side and argue why there is a case for the DAO to not charge the gateways and the sellers.

Instead of imposing a tax on the gateways and the sellers, the DAO could consider incentivising those who are selling the primary produce of the land.

There will be more and more dRPC providers in the future. The competition to onboard and retain will not just be limited to the supply side participants but also the demand side participants.

What are the drivers and the incentive for the sellers and the gateways to sell Pocket and not its competitors?

In addition to the quality of service, maybe decentralisation and ease of plugging in, I would assume it will be the taxes they pay. In other words, their bottom lines will decide which protocol they sell.

Low or no tax is pro-market and pro-growth. And jurisdictions compete against each other through tax breaks and incentives to attract those who enrich the economies, and so will DAOs.

This is just another perspective and drawn from the practices in the traditional world.

Here onwards, let me try to tackle a few appeals and questions I came across in the community channels-

The end users should pay-

We all agree there and I would say let the sellers and gateways decide how much they want to charge or not charge, and how they want to charge the end users. Let the demand side players compete amongst themselves in the free market without any kind of DAO intervention.

Collaboration that is also scalable is fine but intervention isn’t, if the DAO wants to support a free market. Otherwise it would be similar to government intervention in business.

Also, the DAO doesn’t have to try to cut through the middle men to engage with the end users directly. Rather use the leverage, expertise and the distribution network of the sellers and the gateways.

Focus on enabling building great products and creating a business friendly environment for it to get inundated with the best sellers and gateways.

If in other dRPC projects the sellers and gateways are not taxed, then it’s not a competitive advantage anymore. But at least avoid having a competitive disadvantage in that case.

I am not sure if it’s technically possible but theoretically speaking, there can be a rewards and penalty system from the DAO for the sellers and gateways to drive performance, prevent bad behaviours (possibly) and bolster competition.

How DAO’s internal economy interacts with the much larger economies on the outside is extremely critical. And at the cusp are the sellers and the gateways. If they manage to get demand soaring for RPC and success stories are told effectively by the DAO, some kind of value will continue to loop back to the DAO’s economy and that will reflect in the token price not going to zero.

More about this later.

What does the $POKT token do?

The token clearly has utility on the supply side economy and within the DAO itself, for maintaining security, growing the infrastructure, building, including its usage by the governing body for governance, rewards and compensations. All that should ultimately support building a compelling product.

Is there a real need for the token to have utility on the demand side?

If I were to treat RPC service as exports, the gateways and the sellers as the exporters, why should there be a mandate that native or the domestic currency has to be used between the exporter and the end user?

That doesn’t happen in the trad world. China is an export surplus country and most of the trade doesn’t happen in RMB. Trade in oil and gas from the gulf countries doesn’t happen in local currencies but in USD mostly.

It wouldn’t hurt if $POKT becomes money outside the economy of the DAO but then if the adoption is notional and not real- such as the end user buying $POKT to pay the seller/gateway in $POKT and then the seller/gateway selling it immediately to cover cost, then that symbolism might as well be avoided.

Having said that, discussing other creative use cases for the token tied to new kinds of services might not be a bad play.

How does $POKT capture value?

A token’s valued is impacted by-

1. Utility (usage) of the token

2. End user adoption of the product/service of the underlying protocol

3. Token supply and demand dynamics

4. Intangibles & miscellaneous

#1 $POKT’s utility is outlined above and therefore I would check this box as done.

#2 depends on the quality of products the DAO helps build and the demand the sellers/gateways can generate.

Question to ask is- what has been the growth of Alchemy, Infura, Quicknode, ANKR, the centralised RPC providers Vs Pocket’s, since Pocket’s mainnet launch?

Is max decentralisation a moat that the market wants and values, or is there a threshold beyond which the returns diminish?

#4 Narrative building, crypto native marketing, DEX/CEX listings, etc dictates #4. Also other fundamentals such as right kind of communities, developer mindshare specially when product-market-fit is in discovery mode. POKT already has one.

#3 POKT DAO’s approval of Sustainable Emissions Reduction (SER) takes annual inflation to single digits in 2024 and that is a big step forward but that is not enough in the mid and long term.

The market expects less than 5% given where other protocols are, preferably supported by a supply-demand equilibrium through burn.

That takes me to a related question-

What about protocol revenue?

In Pocket’s case, the DAO has a steady source of income- 10% of the emissions. Of course the true value depends on the price of the token.

Revenue works differently in the chains such as L1s, dapps such as Defi, etc. Lending protocols such as Aave, Compound are straightforward because they take a cut of the interest paid out to lenders.

In L1s, some kind of burn of transaction fees gets accounted for as revenue. Such as in Ethereum, the entire base fee is burnt but the tip is untouched.

The burning causes reduction in supply of the native token framed as value capture or accrual. It is similar to share buybacks- less supply assuming the same demand results in a higher price per share.

Unless there is burn, even with the fees there is no revenue for such protocols because otherwise it is essentially circulating or re-circulating the native token.

In the absence of a burn mechanism, protocol revenue of Pocket Network is zero at this moment.

Even if the sellers and gateways start paying a fee or a commission to the DAO somehow, unless the payment is in some other token or the fee gets burned if paid in $POKT, protocol revenue remains zero.

Having said that, I don’t see this as existential because of what I said above:

Therefore, despite the current state of Pocket’s protocol revenue, as long as there is building, maintenance and consistent growth in relays, the DAO and therefore the protocol can self-sustain for now.

Any obituary notices at this moment are false alarms and hoaxes.

Wen Burn?

This doesn’t mean the protocol can’t do better.

And I do see burn as a booster solution.

Burn could get accounted for as protocol revenue and burn can also be used to neutralise mint, switching the deflationary narrative (emissions turning negative) on.

Burn aligns with the standard accounting practices in the space and the narrative.

Question is- what should Pocket burn?

The current plan is to introduce burning of the $POKT required to stake by dAPPs (or end users) to receive relay throughputs.

Long term impacts not just on the domestic economy but also on DAO’s trade beyond borders which is the demand side should be carefully considered.

If dRPC gets commoditised, what will Pocket’s moat be and the basis for fee for the protocol and therefore the burn? Given that there is no clear signal of potential network effects and therefore stickiness, jumping ships and switching providers could be frictionless.

Remaining Questions and End-

The other open question is- will demand catch up for burn (as envisioned today) to neutralise mint anytime soon or a SER Round 2 will have to be introduced at some point.

Token emissions is a cost and it gets deducted from protocol revenue (or burn) to arrive at the profitability of the protocol, whenever Pocket is ready for such accounting.

How can the infrastructure cost be further reduced so that additional cuts in emissions that I reckon will be needed doesn’t hamper metrics such as optimum decentralisation, quality, latency, security, etc.

And lastly- this is not just a Pocket question but a general one for this space- if dRPC is a public good, what is the investment thesis behind it? Are there precedences for public goods turning out to be great financial investments?

Questions I am sure the DAO will continue to debate and occasionally brawl about.

To end on a positive note- I am still learning about V1, scheduled for Q1 24, and the sophistication level in the upgrades is just mind blowing to me.

I plan to write more about Pocket Network and the DAO in the near future.

Thanks for reading.

• The arguments are independent and do not aim to favour any individual or entity.

• The blog doesn’t factor in all changes and pre-decisions in Pocket’s V1 release.

• Ideally I would want to put charts, infographics and memes but time is limited.