Now back to your regularly scheduled update.

Manifestation Markets: Technical Analysis

MetaDAO

There is only one real competitor in the sector that Manifestation Markets is targeting that being MetaDAO. MetaDAO is a worthy competitor with: amazing capitalization, and some of the biggest names in the space being associated. But I think it’s solving a slightly different and wrong problem.

That problem being governance and enforceable fiduciary responsibility for internet capital market companies. This is worthy and hairy problem to solve, but not the one I’m trying to solve.

In particular MetaDAO is betting (rightly I hope) that futarchy can be a good governance mechanism for certain type of DAOs. I’m not as sure whether token price will work for promoting the best governance in all cases, this is due to a somewhat arcane argument surrounding the nature of theta decay and learning signals. But, crypto isn’t at a point where it makes sense to be arguing about whether or not something is the best way to do a thing. MetaDAO is a credibility signal against rugs not one for saying I’m a good project.

I’m hoping to create a signal that is about the quality of a project’s central premises not it’s governance. The equivalent to a Tier-1 seed investor, something that let’s you know that this idea has been through the most intense scrutiny community could muster.

To do this novel game theory needed to be created to bring the meta of shorting, and more importantly short reports to the pre-liquid internet financial system.

Mechanism Design

The novel mechanism blends aspects of Dominant Assurance Contracts, and Prediction Markets into something entirely new.

Prediction Markets on the other hand are essentially Zero Sum Games where in the upside of the bets comes directly from the other side of the bet. But through their game theory everyone contributes information to the market meaning that from their chaos truth is revealed.

Manifestation Markets takes advantage of a weird asymmetry which is not all investors are equally concerned about downside. In particular early stage investors are less downside sensitive than many other types of investors.

Because of this the value proposition is actually structured to be quite different for the respective sides. For the side who believes in the project the value proposition is that of cheaper equity, funded by the doubter side of the bet. Increasing the leverage and therefore multiple on the upside of their investment. Given Venture math this can be the difference between a fund returning winner and a average investment.

For the doubter side, the value proposition is the promise of asymmetric risk and reward. This side is less concerned about size of upside but more about the relative ratio of risk/potential upside. They’re more akin to sports betting arbitrageurs, looking for unreasonably priced bets. This keeps the platform dynamic and efficient.

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[1]: an earlier draft of this sentence had this as lay the groundwork, and upon editing I realized for the first time the origin of that phrase

https://manifestation.market/

There are several other concurrent innovations happening in the early stage funding space. I thought it might be reasonable to compare them to help better elucidate why I think this is the particular mechanism that might make a difference in token capital market allocation.

To start off when it comes to evaluating any funding model it helps to start off by evaluating it from the lens of a founder, as these are the ultimate end users.

The world of funding platforms has exploded. There are now several different offerings, from traditional product crowdfunding to equity crowdfunding to token launch platforms.

These funding options while all offering the same commodity (“capital”) are actually thus far quite differentiated. Now wether that’s due to our mid-century capital market controls or something else is an exercise I’ll leave for the reader.

On the left side you have the traditional crowdfunding options. Vehicles that are associated with more traditional ventures and are overall less crypto-native. Contrast this with those on the right: MetaDAO and Pump.fun which are entirely crypto-native.

In the center there is Republic, which while deeply invested in crypto takes a more traditional institutional approach. It appears more in the business of working with more traditional institutions and retail. YC, and A16Z while not crowdfunding are targeting the same set of LPs as something like Republic while offering founders a much more hands on experience. Given both of their impact on the ecosystem it seems not wrong to give them an honourable mention.

Each of these options has carved out a specific niche in the current funding ecosystem. Kickstarter & Indiegogo do pre-seed, and seed level non equity funding, for creative projects. WeFunder has taken the middle of the market of equity crowdfunding, whereas Republic has positioned itself as the more premium equity crowdfunding platform.

When it comes to the cryptio native options the choices are relatively lacking. Pump.fun is a great business, take fees from filth. There’s a lot of it so in aggregate you can make a ton, but as a place meant to attract founders and capital it amounts to raising from other people at the blackjack table.

MetaDAO is interesting and the only one of these which I see as a true competitor. This is because in a sense it is a spiritual cousin. Both Manifestation Markets, and MetaDAO are downstream of ideas around how to combine dominant assurance contracts (DACs) and prediction markets. MetaDAO using the proven mechanism of futarchy, while Manifestation Markets chooses to make an entirely novel mechanism, that combines features of DACs, and prediction markets.

Extending our analysis to what types of capital sources these different platforms offer we can see the market opportunity start to come into focus.

There is the gaping hole in the more crypto pilled but not selling shitcoins to retail. Now traditionally this role has been filled by the crypto-vcs. But a simple analysis that they actually mirror the tradfi ecosystem and don’t fully fill this role either.

This takes of to our next distinction which is between things that invest in crypto and crypto-native capital markets.

For Aspiring Early Stage founders in crypto unless you are currently riding a hype cycle wave, pumping a shit coin, or have contacts at a tier-1 crypto vc you’re SOL.

Which bring us to the other issue in the current funding ecosystem. The majority of the current crypto native financial infrastructure isn’t being built on ETH.

This is the positional bet that I’m making with Manifestation Markets. That Ethereum native capital markets are: a solvable problem, and a problem worth solving. Next week we will dive into the technical bet we are making with Manifestation Markets.

Manifestation Markets

Manifestation Markets is a novel funding mechanism that I developed to help solve the token lemon market issue. I have the contracts written along with a brief white paper on the main page of the site. The Contract have been through review and I am currently remediating the issues found. I am also working on assets for the launch such as comparisons with other funding platforms (kickstarter, equity funding, metaDAO, Republic, etc).

Ease

Ease was a project to try and help people round up their purchases to pay off their student loans early and save them money on interest. I have had to shutter this project as it is infeasible due to new regulation around accessing student loan data. In particular Plaid no longer supports these connections due to the STOP ACT.

LSCE

I haven’t yet told anyone about this but it’s a framework for fine tuning language models for high degrees of self awareness, I will probably write a paper on this not as a research report but as a test to see if someone can get it to work. LSCE stands for Latent Space Computational Engine

Incarnation Network

This is a fun, art project which I think may end up being the most impactful thing I do for a long while. I am working towards a v1 of the software (LLMos, Blockchain-RAG, wifi portal interface, etc), but the stack is a lot and as such progress is quite slow.

Monasterion Network

This is my Sole Telos, my goal at the end of time, the thing I desire to become my legacy. It is a parallel society organized a set of values and technologies that combine to be greater than the sum of their parts. There is much I have to do here but many of my projects are intended to lay groundwork for this in the future. My current goal for the next week here is to write a single pager that helps people get acquainted and if they desire to contribute to self select into where their skills could be potentially the most useful.

https://monasterion.network/

And with that I shall bid you all adieu until next week.