Proposal “REVISED-DIF-FUNDING-PROPOSAL-3MONTHS“ (Active)Back

Title:REVISED: Dash Investment Foundation: January - March funding (3 months)
Owner:TheDIF
Monthly amount: 500 DASH (47882 USD)
Completed payments: 1 totaling in 500 DASH (2 month remaining)
Payment start/end: 2020-01-15 / 2020-04-13 (added on 2020-01-15)
Votes: 924 Yes / 193 No / 7 Abstain
Will be funded: Yes
Manually vote on this proposal (DashCore - Tools - Debugconsole):
gobject vote-many 6a447a2dba9d455d1b56e75ccaec4c558c54d54aafddf2a01dd73838d3c78a5a funding yes

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Proposal description

Monthly ask will be 500 Dash per month for the next 3 months.

After internal reflection and consideration, the DIF has decided to rescind its previous ask of 800D. This ask was trying to maintain a consistent intake of Dash as measured in USD value. The supervisors concede now, however, that this was not a practical solution and will now return to our prior approach of requesting a set percentage of the treasury -- in this case, 9% (as in all previous requests).

What Does This Proposal Fund?

These 500 Dash are for only two purposes: 1) reserves and 2) fund management/admin/legal expenses.

Reserves represent up to 95% of this allocation, with the remaining funds for management, administration, and legal. Thanks largely to Demelza Hays offering the DIF a deeply discounted rate for fund management services, we can keep ongoing costs to a minimum.

What is the DIF’s Strategy Now That it Has a Fund Manager?



Please see Demelza’s presentation in the DIF’s Q42019 quarterly report call embedded above, which begins at minute 5:52. You’ll also hear a refinement of how the DIF measures success, how we’ll report on assets going forward, a review of our contact information, etc.

Please note that the DIF publishes weekly updates of its activities in addition to quarterly calls. They are shared via the DIF's Twitter, and can also be subscribed to on the DIF's new Medium blog.

How Much Does the DIF Currently Have in Reserve?

Correction: 1,762 Dash. (not 2,012 Dash as stated in the quarterly call)

NOTE: We previously stated our reserves at 2,012 Dash. This was a miscalculation, as the 2nd tranche DIF funding for Nov 2019 did NOT pass, therefore reserves are 250D lower than previously stated. This represents all of the reserve funding that has been allocated to the DIF so far.

Note Regarding Possible Funding Proposal Later This Year:

At time marker 30:54 in the quarterly report call above, DIF chair Michael Lewis discusses a potential shortfall in 2020’s admin fees -- the ones that were intended to be covered by DIF director Glenn Kennedy’s initial funding proposal in June 2019 when Dash was $154.
We are currently operating on the premise that the Dash price will recover enough that an additional ask to cover these fees will not be necessary, but want to give you a head’s up regarding the possibility.


We hope to answer any questions you may still have below. 

Thank you, masternode owners and shared-masternode-owners, for servicing Dash’s governance needs.

Show full description ...

Discussion: Should we fund this proposal?

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2 points,29 days ago
DIF funding was always supposed to be an alternative to burning Dash, not a means to push infrastructure out of funding, now Dash NEXT?
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2 points,29 days ago
Pushing out Dash Help Desk from funding, wish you had broken this down into tranches, have to vote no now.
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6 points,1 month ago
Thank you all for the transparency and all the effort being put into running the DIF and communicating with the community. The DIF has the most decentralized control structure (with supervisors and legal structure) of all the proposals! The DIF is a huge differentiator for DASH vs all other cryptos ! It has the potential to dramatically change the valuation of DASH. However, the DIF needs to actually make an investment before DASH can spread the word of this unique value. That's why the DIF funding is critical. Voting Yes, thanks!
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3 points,1 month ago
I agree. The DIF have answered all my challenging questions and from others and example to other proposal owners in my opinion. I am voting yes. They may make some mistakes to start with but what is clear to me now is the are honest, open and have the right attitude and approach. Let's give them a try and see how they get on. Voting yes.
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1 point,1 month ago
I would like to add a few other comments that I hope other MNO will take on board when assessing proposals. First I have had a pretty good success rate in predicting which proposals will be successful. I have made mistakes but I've been much more accurate than inaccurate. These are a few of my mindsets when assessing a proposal.

1. People come first. Idea comes second. The people running the project are the most important factor in the success of a project. Not the idea. You can take a mediocre idea and make it work with the right people. They need the right attitude. What are the right attitudes you may ask? These are what I look for:

1. Honesty and integrity. This is primary. A trustworthy proposal owner will tell you the truth even though it may be difficult and even though it may apparently affect their reputation. I asked some difficult questions of the DIF particularly Demelza however she answered honestly. That is a very good sign in my experience.

2. The right attitude trumps current ability. I have taken on people in the past that have had the right attitude to their discipline but may not have been that successful to date. The things I look for are do they love their subject are they passionate about progressing, improving. These people will overcome difficulties because they have a passion for what they believe in. This behaviour characteristic is more important than current skill sets because it means they will continue until they get it right but not only that. They will continue to improve beyond that. Some of my best employees that have ended up giving genius levels solutions started with average performance but with a desire to improve. All members of the DIF are working for free. Think about this for a moment. People that have given up their free time to work for free for DASH that says something about this team.

3. A positive attitude: I take on people that can take criticisms positively and do not see constructive criticisms as a threat but rather constructive feedback to improve. I posted difficult and challenging questions to the DIF in this proposal and they responded to each one positively and honestly. This is a very positive signal in my experience.

4. Commitment to the cause, what is their motive? This is a very important characteristic I look for. I hire people that love what they do and are passionate about what they do. Money comes second. Passion comes first.

If someone I hire has the capability of improving, the passion in their subject, puts money second and their passion to improve first and they have integrity with honestly and a desire to improve I will back those types of people.

5. How to the proposal owners interact with others? One of the key characteristics of a successful employee is how they get on with the rest of the team. Do they have a good attitude towards others? Do they want to support and work with others? There have been some high profile projects where the project leads were caustic and negative toward others when they made constructive criticisms. I immediately knew these people would not be successful in the DASH project.

6. Confidence - someone that is confident in themselves and their ability will answer challenging questions in a positive way. This is because they believe in themselves or at least want to improve themselves. Confidence may be lacking in other areas but confidence in their ability to learn and integrity is essential. Confidence also means the ability to take on challenging questions knowing that their primary objective is to improve.

7. A commitment to excellence. This means and never ending desire to improve. When someone has this attitude it is a very positive trait because it means I don't need to manage them. I can trust them to continually develop and evolve of their own accord.

8. Transparency and willingness to share their progress: Transparency is another form of honestly. Is a proposal owner responsive and willing to answer questions, give frequent updates and be open about their work.

9. Determination people may fail again and again but if they have all the other characteristics they will eventually succeed. Amanda B. Johnson (apologies for appearing to single you out Amanda) has failed in many past attempts at getting funding from the DAO but here she is again with the DIF. That shows real determination to succeed and a passion to contribute.

10. Charisma is not a factor in successful real world results. Many times people will vote for charismatic people over their ability to do the job. I have found the most understated and humble people are the ones that have the greatest success.

11. Finally the actual proposal idea itself - is it viable?

The idea itself comes last on this list for me because without the other proceeding points the business idea is unlikely to work.

These are just a few of the characteristics for success I have learned over 29 years in business.

I have asked challenging questions in this proposal and the DIF have responded positively to my questions with honesty and with an openness that is rarely found in other projects. Their responses are an example for all other projects. Healthy and constructive debate and differing views are essential in finding the right path to success.

My view is even if the DIF members do not have all the experience and expertise we need right now they have many of the right elements to make it successful in my opinion. We will however have to be patient and be aware they will make mistakes to start with. Hopefully if they listen to experienced MNO business owners they will learn faster and make fewer mistakes.

When I assess projects these are some of the factors I use. I have many others which I prefer not to disclose here. But if MNOs start using these factors instead of just the idea itself you will see that the ability to predict successful will increase.
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1 point,1 month ago
No x13. I don't like this centralization. I don't see the DIF's plans as in the scope of the DAO (funding marketing and code).
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1 point,1 month ago
Decentralization is a means to an end, not an end in it of itself.
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0 points,1 month ago
i agree, voting NO
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2 points,1 month ago
Who are you to decide what the scope of the DAO is? The DAO gets to decide the scope of what it wants to spend treasury funds on, not you.

You realize that every single project that we fund is centralized right? The DIF is actually one of the least centralized projects because it is governed by a board of elected supervisors instead of one proposal owner running the show.
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1 point,1 month ago
> The DAO gets to decide the scope of what it wants to spend treasury funds on, not you

Lol I AM the treasury/DAO, well part of it anyway. See my MNO tag?

> The DIF is actually one of the least centralized projects because it is governed by a board of elected supervisors

By that logic the EU/USA is better than cryptocurrency ;)

You don't seem to understand the idea behind crypto at all.
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1 point,1 month ago
So? Most of us here have MNO tags.
Idk what logic you are talking about but has nothing to do with what I said. The DIF is one of many projects in DASH and they are requesting less than 10% of the budget. Most projects in Dash are basically run by the proposal owner. The DIF is governed by supervisors elected by the DAO itself. The DIF will take any investment decisions to the DAO for a vote. It is obvious you are using the "centralized" boogeyman for no good reason other than to scare away MNOs who might not agree that "marketing and code" are the only legitimate functions of the DAO. Maybe think hard about the reasons we do marketing.
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2 points,1 month ago
You want to abort the DIF before it's even born because "centralized?"

There are a group of people here who cannot argue anything, except to label something "decentralized" that they support and something else "centralized" that they don't support. It reminds me of Newspeak in "1984," where language itself is designed to prevent people from thinking.

So this proposal is doubleplusungood? I hope more rational heads prevail.
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0 points,1 month ago
> You want to abort the DIF before it's even born because "centralized?"

If the people behind the DIF have good ideas let them make proposals for them ;)
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-2 points,1 month ago
Evidently, you didn't get the memo...

https://blog.dash.org/introducing-the-dash-investment-foundation-370cafcc48ee
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1 point,1 month ago
DeepBlue, I think you're being a bit of a bully by raising all these questions and concerns at this stage of the game.

We have a team put in place by the vote of the DAO. The team has selected an investment manager. It's not fair for you to attempt to micromanage these people. It's insulting to them and the hours they put in to this for ZERO COMPENSATION.
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1 point,1 month ago
@geert I am sorry that you have taken this position or see my feedback in this way. It is not my intention to come across in the way you have described.

I feel an MNO role is to ask the tough questions because it actually helps the proposal owners. It may not be pleasant but these things need to be looked at. Focusing exclusively on the positive can lead to very great problems as has been demonstrated many times previously in the proposals where MNOs are just voting because it's a good idea. Namely KuvaCash, Ben Swann, Alt36 - that's 4 million lost funds.

In a business plan there is an analysis called SWOT which stands for
Strengths,
Weaknesses
Opportunities
Threats

So far everyone is just focusing on Opportunities and Strengths and that is the case with most funding requests. This approach has got us into a lot of trouble in the past were millions has been wasted. We also need to look at Weaknesses and Threats for a proper SWOT analysis. It appears what you're saying is we should ignore the Weaknesses and Threats part of the analysis because we the DIF members are working without compensation?

Past DAO mistakes: I was one of the few MNOs that was informing the community not to vote for KuvaCash in their proposals very early on giving specific reasons why it was not a good proposal to vote in. But I was shouted down by a small group of MNOs. It turns out I was correct on that project and others like it.

Our role as MNOs is to fairly question proposals and concepts in a proposal - it is not to be grateful, it is not to blindly trust, it is to dispassionately raise valid points, even if tough, which I feel I have done.

If the proposal owner answers the feedback constructively it actually *strengthens* their position, not weakens it. It builds their reputation because it shows they have thought about and handled the situation and each objection professionally. The types of questions I've raised is an opportunity for the DIF to *increase* trust with the community and MNOs by answering these questions.

I understand the DIF members are doing this work free of charge without compensation. I don't see it as insulting however to be asking the tough questions that need to be asked. Healthy debate is required for the DIF, and for the project to be successful. I have not been disrespectful I have simply presented arguments that need to be addressed and if the proposal owners are serious about delivering value to the network they would welcome such constructive feedback - as tough as it may be.
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2 points,1 month ago
Your approach to providing feedback -- by flooding us with concerns before the DIF has done much of anything, and threatening to withhold your support as an MNO is demoralizing.

My gut tells me that you don't approve of the DIF in general, and you wish it would just go away.
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2 points,1 month ago
My attitude is that the DIF is a brand new thing -- both for the DAO AND for the whole world of crypto. We have to nurture this thing and be careful not to put too much pressure on the supervisors or anyone else working on this.

It may take a while for the DIF to figure out how to best serve the DAO.
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1 point,1 month ago
@geert then your guy feeling is inaccurate because I have voted positively for the DIF on every proposal they have put forward to date.
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1 point,1 month ago
Sorry for the typo. *Gut feeling!
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2 points,1 month ago
Totally agree @deepblue. I hope you’ve found the answers to your feedback constructive and insightful.

I was also one of the MNOs calling for a no vote on kuva early on, we were in the minority though admittedly, likewise on a number of other large projects that were funded (for many multiples more than the DIF is looking to work with, incidentally).

One of the main reasons for the DIF’s existence is to reduce the risk of the network repeating these exact mistakes of the past and wasting $millions more again during the next bull market.

I also think that the idea that the DIF should prove itself by pitching investments for $5k here or $20k there to the DAO - whilst well meaning - is totally flawed. Genuine businesses prospects that have strong economics and great growth potential aren’t looking for $5k, $10k or $20k investments. That kind of money is pocket change in any real-world business context. You’re going to have the DIF pitching hobbyists to the network if we go in at that level! Is that really going to instil confidence in the DAO that we know what we’re doing?

I know that I as a multi-MNO and successful businessman and investor would consider it a waste of time for all involved.

Regards

Walter
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1 point,1 month ago
@walter, one other point: a project right now that needs such a "Tap and Go" Dash Card Payment system is the DashMall and Parking project. If we had the rights to such a payment system they would be able to sell the solution to the shopping malls and build a business around it and be self sustaining.
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2 points,1 month ago
That’s great, the DIF is all ears and would welcome a pitch to invest in commercialising such a project.

Thanks

Walter
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0 points,1 month ago
@Walter thanks again for your feedback. I do really appreciate it.

I agree with most of what you say except for your comment that investing small is "totally flawed" . Let me give a specific example why I say this.

A relatively small investment of (30K) could have brought tremendous lasting value to the network where hundreds of DASH projects world wide could have benefited. The project was for owning the distribution rights to the Dash Pay POS (NFC payment system). This system which was funded and paid for already by the DASH community was not funded on the last cycle and if it had been then the DASH network would have owned the rights to use and develop that POS payment system. The Estonian project owners stated they would give the IP rights to the network if funded - but they were not funded. Imagine the DASH network having access to our own POS Dash payment system. That means that any DASH project could have taken that technology and marketed it or adapted it for any project world wide. The NFC system developed was proven in the field to work at a music concert so it is not just a pipe dream it was a working solution we could have owned the rights to. The additional funding required would have been around 30K to own those rights to that NFC payment system. The beauty of this system is that there is no barrier to entry. With a tap and go card there is no training required and because the cards cost around $0.5c to manufacture they could be sold for a few dollars to the users. They don't even need a smart phone to start using DASH.

I wrote an article on this payment system and why it would be invaluable for the DASH network to own such a POS

https://www.dash.org/forum/threads/venezuela-why-nfc-could-be-better-than-evolution-for-granny-and-mass-adoption.42644/

You can see the Tap and Go DASH payment system here:

https://www.youtube.com/watch?v=Vf7ZeDUuupU&feature=emb_logo

Creativity in finding such investment solutions is what is needed in the DIF to start out. So what if we could buy the rights to that system and make that IP available to any DASH project world wide? This is just one idea where a low cost investment could be made and the DIF would learn from this experience.

Creativity, resourcefulness, thrift is what I'm suggesting for the DIF first. Once they get some small successes under their belt, as well as some failures they will start to learn what works and what does not work. This can be done on a small scale first with projects just as I suggested above at relatively low cost and low risk to the network.
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1 point,1 month ago
Just to clarify - I’m certainly not suggesting that the DIF has a minimum investment cap, and I really don’t want my comment to be taken out of context. My general point is that the DIF is going to be of limited value to the network if we only focus on micro-investments, that doesn’t mean that smaller investments will be dismissed. Each opportunity is treated the same whether it’s for $10k or $1m.

Naturally, we would be very interested in any propositions to invest in/or hold assets that have been developed by Dash contractors/POs for commercial usage. We are already talking to Dash Retail about taking ownership of the source code on behalf of the DAO, for purposes of commercial licensing in the future. We expect that process to conclude in Q1 2020.

If somebody comes to the DIF with the type of example you just highlighted above then the DIF would love to pitch it to the network, assuming there’s a real investment case.

Regards

Walter
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2 points,1 month ago
@TheDIF I am voting no for now for the following reasons:

1. I posted a question in this proposal asking for clarifications on Demelza's business experience with no response from the DIF on my questions. This approach of not responding to challenging questions by MNOs that genuinely care about the project is a concerning and honestly I'm getting well tired of it. This behaviour started by DCG in their proposals is now being taken up by other Dash proposals such as Dash News, DashWatch and Alt36 and others that have close connections with DCG.

MNOs we cannot allow this behaviour to continue. No response to questions = no vote. The only exception to this rule for me going forward is when there are obvious trolls such as ValenciaDash etc.

From now on I will not be voting positively on any proposals where the proposal owner does not answer my questions. Period. Irrespective if it is DCG or other projects.

Regarding Amanda B. Johnson's skill set in this area: although loved by the community, Amanda currently has limited skills necessary for this position. This can be seen from a string of Amanda's past proposals that were rejected for funding because they were all simply not good business ideas. I have no doubts however that Amanda will gain the necessary experience but currently she does not have them. What Amanda is good at is her presentation ability and I think that is where she can best serve the network.

Since the entire DIF appear to have limited real world experience in the area of business and investing I would therefore recommend the DIF start out funding smaller worthwhile projects first to gain the experience and leanings that you need. I am thinking more in the order of 5K to 30K projects to start with.

The DIF having 1 million in reserves of the treasury money is not wise with a team that has not yet proven their ability and from what I can see have not got the necessary business experience to make the right decisions for the network. It would be foolhardy for MNOs to assign the DIF that amount of funds until they have some more experience and have some successes under their belts.

I have no doubt that the DIF team will develop and build the necessary skills and experience with time. But bear in mind that all of DASH's million dollar funding proposals have failed miserably. Case in point KuvaCash, Alt36, Ben Swann all a complete waste of time and money that led to next to nothing for DASH. I would say even have damaged DASH. We can't afford errors of that magnitude.

Although the DIF team lack experience I respect and truly appreciate their commitment and efforts and good intentions to support DASH however they are not ready for this level of funding and it will take funds away from projects that are having a very real positive impact for DASH.

Voting no.
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4 points,1 month ago
Posted again for visibility:

Hi Deepblue, it’s Demelza, thank you for your question. In 2011, I started an export business that exported turban material from Punjab to the global Sikh diaspora. I didn’t have any external help, and I taught myself how the harmonized tariff schedule worked, how e-commerce websites worked, how to reach my target customers, etc. By the 6th month of the business, it was earning $3,000 a month.

https://web.archive.org/web/20130709190805/http://www.ourpunjab.com/

The business did not work in the long run, because I started my master’s degree, and I hired a manager for the company who lived in India, who didn’t perform as expected, and was shipping out the wrong products, not shipping to the right address, not shipping in a timely manner etc. I basically had to choose between flying back to India to run the company or winding it up and staying in France and getting a degree, I chose the latter.

My next business was a Bitcoin ATM business that started in 2016 (https://kundmachungen.li/AktuellsteNeugr%C3%BCndungen/Details?nr=FL00025291562&Firma=Blockchain+B%C3%BCro+Anstalt&ort=Ruggell&datum=16.09.2016
and
http://www.blockchainbuero.com/).

As part of this business I installed the first Bitcoin ATM in Liechtenstein. In its highest earning month, it did $55,000 in turnover.

The fund company where I used to work, Incrementum AG, consisted of 5 people. We managed over $100 million. The performance in absolute terms (against broader market indices etc) was not that great, because the strategies were mostly focused on gold, and gold did not perform very well during that time (2013-now). However, that was the focus of the fund and most of our investors just wanted to know that they were actually invested in physical gold bars stored in safe vaults in the Alps, instead of holding on to paper certificates etc.

The crypto strategy that Mark Valek and I developed while I was at Incrementum was event-based rebalancing between payment coins (mostly Bitcoin) and physical gold with covered call options, and is the basis for the Dash strategy that I proposed minus the covered call options (since there is no liquid options market for Dash at the moment).

While working for Incrementum AG, we started writing a physical research report on cryptocurrencies (I was the main writer, and wrote about 70-80% of it) in 2017. That attracted firms and governments to consult us for specific research projects related to cryptocurrencies. I completed research projects for Germany’s second largest energy provider, one of Spain’s largest banks, one of Germany’s regulators, one of Liechtenstein’s regulators, and several small brokers and wealth managers. Last year (2019) just the CryptoResearch.Report business brought in a six figure revenue. Upon leaving, Incrementum and I negotiated that I will keep the rights to the brand, domain, mailchimp list, and I plan to launch an entire cryptocurrency news outlet for the German speaking market on February 1, 2020. The business is financially supported by several of the most profitable cryptocurrency companies in the German speaking countries. www.cryptoresearch.report. This will be my main business interest moving forward.

Today, in addition to my business interests, I own and manage multiple investment properties, stocks, cryptocurrencies, and commodities in my personal portfolio.

Thank you

Demelza
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0 points,1 month ago
@Demelza, thank you for sharing your feedback and it is good to see you have some business experience.

Regarding your ATM business: I had created a business plan once for a crypto ATM business based in Europe however although turnover would have been good (similar to what you reported) the profit margins would not have been worth while bearing in mind all the costs for running the business, rental space, security, bank fees, maintenance, machine purchase etc. I therefore did not start the ATM business in the end because it would not have been that profitable. You mentioned turnovers of 55K how profitable was the ATM business over the long term?

I have some comments regarding your balancing suggested plan.

1. You put forward a balancing strategy and mentioned buying low and selling high for DASH however this is not so easy to get right in real world situations. Assets such as Crypto and Gold are notorious for being volatile and even with a structured balancing plan such as the one you have put forward the USD amount cannot be guaranteed - meaning there is uncertainty in the total investment portfolio. Going back to the network to ask for top ups is not acceptable in my opinion for a investment fund such as the DIF.

If you need to pay for investment in USD then the DIF funds should be stored in USD. This gives certainty to the DIF ability to make decisions.

Having certainty in finances is more important than prospectively taking a risk with a balancing portfolio in my opinion.

I realise that there are people in the DIF that are strongly against the banking system and using banks and they may have influence on the choice of storing our funds.

If we hold money in USD then the DIF will know where you stand when making investment decisions and certainty is required when making investment decisions. The DIF has already come back for top ups because of the DASH price changes. Even if DASH shoots up in price it is still better to work with certainty for an investment organisation. Otherwise the DIF will keep coming back to us for top ups when things go wrong and we are not here for topping up the DIF funds. I know it is not cool but USD storage of funds is the most reliable and risk free of all options. I realise this suggestion will not find favour with certain DIF members and with the DASH community as a whole. But I think everyone will see later on that if we do not do this then the DIF is going to keep coming back for top ups due to shortfalls. I don't want for us to be in that situation.

If the DIF have to pay for projects in USD the funds should be stored in USD.
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2 points,1 month ago
hi deepblue,

Regarding the ATM profits, I put a 5% spread on the spot price of Bitcoin, and gave 1% of that spread to the store that hosted the ATM, so that left me with 4%. So that's 2200 USD a month, and the machine cost around 8K, so the ROI was pretty good. We had minimal taxes and legal costs. It was 2-way, so we barely had to clear out the cash, just change printer paper occasionally. Turn-key business. There are risks though of course. Competition from other players, regulation, theft, etc.

Regarding the strategy, I am happy to further discuss this with you, and show you all of the calculations, but the strategy actually forces you to sell a part of your holdings when the price is going up, which is counterintuitive. The strategy does not time the market perfectly - I never claimed it would. I said as the price goes up, it triggers a rebalancing, so you are forced to sell as the the price is going up.

I hope that makes sense, but the strategy is not based on timing the market.

I see that you would like the DIF to hold cash. I understand this position, especially going into a recession, when the value of each US dollar has the potential to rise. However, other members of the network have signalled that they would like for the DIF to hold 100% Dash, and no cash.

What I can say in response is that I ran the numbers for rebalancing between gold and Dash and US dollars and Dash, and the former had much better results. This is because, exactly as you said, gold and Dash are both volatile and importantly, uncorrelated. This intensifies the effect of the rebalancing bonus when combining them in a portfolio. The portfolio should stabilize the value of the assets held by the DIF so that we can all go back to focusing on private equity.

Sincerely,
Demelza
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0 points,1 month ago
@TheDIF thank you Demelza for your feedback and for being honest and open about the profits you made on your ATM business. When I did a business plan for an ATM business profits were also similar to what you reported but, in my case, I felt it was not worth the time investment and the risk. The legal advice simply to run the business was a concern for me along with several other factors such the banks reluctance to deal with a cryptobusiness and KYC checks that would have required paid personnel. In the end I could not see it as a going concern. I could have possibly made it work if I had charged a higher commission rate at around 10 to 15% but then there was a risk that people would use cheaper online methods.

Your Balancing Plan: As you point out there is no correlation between gold and DASH and for me that is why I see it possibly having more risk that simply holding in USD or USD equivalent. e.g. the scenario if both the price of DASH and the price of gold fall simultaneously how would your balancing model work under such a circumstance?

With the majority of holdings in USD only, the DIF will know where you stand since I believe you will be paying for services or investment in USD? Please confirm if that is correct?

I understand the majority of the MNO network has voted otherwise - however I wonder how many of the MNOs that voted have actual long term business experience and how many of them simply got in early to DASH and have an "anarchistic" point of view.

In summary what I'm saying is I believe your balancing strategy may have a higher risk of loss against USD value compared to simply holding all our funds in USD or a USD equivalent such as TrueUSD. TrueUSD is backed by a basket of Trust Companies instead of relying on a banks or central entity like Tether is so it is a form of decentralized stable coin that does not require a bank to hold USD. I don't know a huge amount about that TrueUSD coin but I think it offers many advantages over Tether (USDT) which is a central entity relying on a bank.

I appreciate your responses to my questions. Thank you Demelza.
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1 point,1 month ago
I won’t answer on behalf of Demelza, but I just want To reply to this comment:

“The DIF has already come back for top ups because of the DASH price changes. ”

This is incorrect. We have not requested any “top ups” from the network. Maybe you are confusing the DIF with the DAO Trust?

Walter
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0 points,1 month ago
@walters could you perhaps clarify the following regarding top up requests by the DIF

I am referring to this previous proposal by the DIF: https://www.dashcentral.org/p/DIF-funding-proposal-3months

Here is the quote from the proposal: "Monthly ask will be 800 Dash per month for the next 3 months"

In order to maintain the USD amount of funding requested in previous cycles, our monthly ask has been revised upwards from 500D to 800D. This represents funding of $40k per month, or approximately $500k per year currently. "

It states to maintain the value "in previous cycles" . I took this to mean that the previous cycles funds have declined because they were stored in DASH and therefore need to be topped up to maintain the USD value.
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1 point,1 month ago
Sure, the DIFs reference currency for accounting purposes is dollars.

As mentioned above, in the proposal text, after internal reflection and consideration, the DIF decided to rescind its ask for 800D in upcoming cycles. This ask was trying to maintain a consistent intake of Dash as measured in USD value. Much like other POs have adjusted their Dash denominated asks upwards to counter the lower Dash price. I wouldn’t view such changes as “top ups”, they are POs adjusting to the volatility of the Dash price.

The supervisors conceded, however, that this was not a practical solution and submitted this revised proposal in which we have now returned to our prior approach and are asking the same Dash denominated amount as has been funded in previous cycles.

Hope that makes sense.

Walter
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1 point,1 month ago
Thanks again walters. I have voted positively for the DIF on every proposal up until now. On this cycle there are some important projects that I feel need to go through. I will give some more thought nearer the deadline how I'm going to vote. I support the idea of the DIF and I also think everyone on the team is dedicated to DASH and want to do the best for DASH. My belief at this moment is that the DIF should start with smaller investment projects first and gain experience and then work up to asking for more money later. But I will give it some more thought. Thanks again for your clarifications.
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1 point,1 month ago
Thanks DeepBlue for your feedback. We totally understand your position on this. Take a risk on the unknown (even with assurances of dao control), or stick with grass roots projects.. I get it’s a difficult call.. that’s a decision for you though. What I will promise you personally - as a fellow MNO- is that we share the very same interests. I eat my own cooking..

Regards

Walter
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0 points,1 month ago
And even the DAO Trust wasn’t a top up, it’s for ongoing costs related to operating the trust. The initial start up costs last year were covered by DCG budget.

Thanks

Walter
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3 points,1 month ago
Hi Deepblue,

Your question hasn't been ignored, we can assure you. Demelza has been writing her response to you personally (at length, as we've seen the draft) and you will receive a reply later today I'm sure.

The DIF Team
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1 point,1 month ago
Hi DeepBlue,

Demelza has replied below.

Regards

Walter
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1 point,1 month ago
OK I will wait for the response. Thank you.
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3 points,1 month ago
Strange that you've singled me out for mention. Out of six total supervisors.

Strangeness aside, I received more votes than anyone for this role -- probably not because the network believes me to be a seasoned business analyst (um, duh), but rather because they trust me. They trust that I share their interests.

To show the network that its trust has been well-placed, I have published weekly reports of the DIF's activities since day one. These reports share much more information than other institutions like ours choose to share. In fact, one of the DIF's directors even commented in near-disbelief recently that our "meeting minutes are public."

I continue to publish these reports because if I or any other member of the DIF misses something that ought not be missed, these reports hopefully allow more seasoned business analysts within the network to detect problems before they become systemic. An additional benefit of these reports is that they keep my fellow supervisors honest -- they know that I will report on attendance if any of them starts missing meetings, and that I'll mention even the things that show us in a negative light (for example, my recent report mentioning our failure thus far to open specific accounts.)

As you say, it's almost certain that I will learn more about business analysis while in this role -- I certainly hope so. I consider every moment talking to Demelza to be a moment of free, world-class education.

But continuing education aside, my "skill set" has brought, and continues to bring, the level of transparency I believe the network was hoping for when they elected me.
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1 point,1 month ago
@amanda_b_johnson, I had raised points on Demelza business experience previous to mentioning your good self. So to answer your question of strangeness you were not the only one singled out. See my questions regarding Demelza below and I would appreciate an answer on those question please.

The DIF team need to take care regarding relying on anyone that only has academic experience and no real world business experience. I am speaking from experience myself. I was an academic myself. I have 3 university degrees finishing with a Ph.D. Academia however it did not prepare me for the real world outside and it felt like I got hit by an express train when I started out on my first business. I had to eat humble pie for around 2.5 years before I started to get success in the real world. Academia is no replacement for real world experience.

Demelza's input is of value to the DIF I am saying just don't rely on it too strongly, its easy to get dazzled by academic qualifications but what ultimately really counts is real world business experience.

I think it goes without saying the DASH community trusts you Amanda and your transparency and dedication to DASH. That is without question asa far as I am concerned. What I am attempting to highlight however is that the DIF entire team, including Demelza does not have the real world experience to be able to effectively handle 1 million dollars in funds just yet. I don't know much about the other DIF members yet so I may be wrong - if so please correct me.

What I am suggesting is the DIF are patient and start smaller first, get that experience you need, make some mistakes and learn. The slowly build up from there. In other words be patient and take it slowly.
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2 points,1 month ago
Hi DeepBlue,

Speaking from my own perspective on this - the DAO is not trusting the DIF with $millions of dollars to invest as it pleases. All genuine investment opportunities will be brought to the DAO for a governance vote.

Simply put, the DIF is curating business propositions on behalf of the DAO, researching them thoroughly, creating a report, negotiating a deal (if applicable) and then pitching the investment to the DAO. It's up to the DAO whether it wishes to pursue the opportunity. It's as simple as that.

I accept your comment about the general lack of "real-world business" experience across the board at the DIF, I do think it would have more merit if the DIF was operating on the basis of complete discretion, which is not the case at all. There is zero discretion beyond basic hedging of reserves as demonstrated in the strategy.

Regards

Walter
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0 points,1 month ago
@walter thank you.
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1 point,1 month ago
I don't want the DIF to own some giant pile of Dash that can be dumped on the market. I want to see some other assets in the fund before we give it more Dash. I agree that countercyclical action helps to stabilize the price and that is good as we need price stability to make Dash a usable currency. I am impressed with Dimelza so far, but I want to have less than 50% of DIF assets in Dash before we give them more.
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2 points,1 month ago
Hi Billyjoeallen,

Processes are already being put in place to re-balance and reduce the % of Dash on the DIF balance sheet to 27% during Q1 2020 - as per the strategy set out by Demelza. In addition to that we are actively involved in private equity discussions/negotiations with 4 opportunities currently - out of 26 initial enquiries. If all 4 were submitted and approved for investment by the Masternodes then we could need anywhere between $1m-$2m USD equivalent from the treasury to make those investments.

We hope that helps put some context around our strategy and ongoing ask of 500D per month from the treasury. We believe smaller regular asks put us in a strong and stable position to negotiate on deals, and it helps smooth out any bumps (rather than make one-off large asks for that would be very disruptive to the treasury). This strategy puts the Dash DAO in the best position possible to leverage the DIF and invest in as many worthy opportunities as possible, but in a structured, balanced and methodical way.

Salutations,

The DIF Team
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2 points,1 month ago
I am sorry, but there are some important projects (DACH Business Development - The Dash DAO Irrevocable Trust) that this revised proposal is (still) directly competing with. Personally i rather see above proposals funded, then having the DIF build more reserves for themselves at this point in time.
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1 point,1 month ago
voting yes
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2 points,1 month ago
voting no
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0 points,1 month ago
@TheDIF Demelza according to http://www.demelzahays.com Demelza Hays has an impressive academic background however I can't see much in the way of real world business experience. What experience does Demelza have in real world business i.e. what businesses has she founded, run and owned and how many years has she operated these businesses?

I notice from Demelza's CV states that she is a fund manager of a regulated Alternative Investment Fund that invests in cryptocurrencies at Incrementum AG. How long has she been in this position and how successful has that been in quantitative terms?

Thank you.
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0 points,1 month ago
Hi Deepblue, it’s Demelza, thank you for your question. In 2011, I started an export business that exported turban material from Punjab to the global Sikh diaspora. I didn’t have any external help, and I taught myself how the harmonized tariff schedule worked, how e-commerce websites worked, how to reach my target customers, etc. By the 6th month of the business, it was earning $3,000 a month.

https://web.archive.org/web/20130709190805/http://www.ourpunjab.com/

The business did not work in the long run, because I started my master’s degree, and I hired a manager for the company who lived in India, who didn’t perform as expected, and was shipping out the wrong products, not shipping to the right address, not shipping in a timely manner etc. I basically had to choose between flying back to India to run the company or winding it up and staying in France and getting a degree, I chose the latter.

My next business was a Bitcoin ATM business that started in 2016 (https://kundmachungen.li/AktuellsteNeugr%C3%BCndungen/Details?nr=FL00025291562&Firma=Blockchain+B%C3%BCro+Anstalt&ort=Ruggell&datum=16.09.2016
and
http://www.blockchainbuero.com/).

As part of this business I installed the first Bitcoin ATM in Liechtenstein. In its highest earning month, it did $55,000 in turnover.

The fund company where I used to work, Incrementum AG, consisted of 5 people. We managed over $100 million. The performance in absolute terms (against broader market indices etc) was not that great, because the strategies were mostly focused on gold, and gold did not perform very well during that time (2013-now). However, that was the focus of the fund and most of our investors just wanted to know that they were actually invested in physical gold bars stored in safe vaults in the Alps, instead of holding on to paper certificates etc.

The crypto strategy that Mark Valek and I developed while I was at Incrementum was event-based rebalancing between payment coins (mostly Bitcoin) and physical gold with covered call options, and is the basis for the Dash strategy that I proposed minus the covered call options (since there is no liquid options market for Dash at the moment).

While working for Incrementum AG, we started writing a physical research report on cryptocurrencies (I was the main writer, and wrote about 70-80% of it) in 2017. That attracted firms and governments to consult us for specific research projects related to cryptocurrencies. I completed research projects for Germany’s second largest energy provider, one of Spain’s largest banks, one of Germany’s regulators, one of Liechtenstein’s regulators, and several small brokers and wealth managers. Last year (2019) just the CryptoResearch.Report business brought in a six figure revenue. Upon leaving, Incrementum and I negotiated that I will keep the rights to the brand, domain, mailchimp list, and I plan to launch an entire cryptocurrency news outlet for the German speaking market on February 1, 2020. The business is financially supported by several of the most profitable cryptocurrency companies in the German speaking countries. www.cryptoresearch.report. This will be my main business interest moving forward.

Today, in addition to my business interests, I own and manage multiple investment properties, stocks, cryptocurrencies, and commodities in my personal portfolio.

Thank you

Demelza
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-2 points,1 month ago
Voting YES.

We must move forward with this and not second-guess the supervisor's choice for investment manager. They seem genuinely excited to be working with Demelza, and that is a good thing. Let's see how she does.
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2 points,1 month ago
Voting yes
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2 points,1 month ago
Voting YES. I want the DIF to build some reserves up.
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8 points,1 month ago
I really like the DIF, but I must say that I would like to see some accomplishments explained in this proposal before giving the DIF more money for reserves. I don't really like the idea of massive reserves without some usage of that capital for good use. Or at least a good explanation in this funding request as to why you want to increase those reserves and for what purpose. I would also like at this point to know how many entities have approached you and on what criteria a rejection/approval was based on, and also what criteria you are looking for and if you have made this public. I'm sorry if this was all discussed somewhere else as well, I haven't had a lot of time to follow threads and discord recently.
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2 points,1 month ago
Hi QuantumExplorer,

The regular monthly funding request is to build up the DIFs balance sheet so that we have the reserves required to engage, negotiate and close on investments in the ecosystem on behalf of the DAO (with approval from the network, on a case-by-case basis).

Examples of private equity investment opportunities we’ve been approached by include companies in regulatory/compliance, tax/accounting, news/media, crypto exchanges/finance and payments, amongst others.

Opportunities have ranged in size from around $60,000 up to $3m.

We have received a total of 26 enquiries via our website.

Of those, 11 were asked for more information.

Out of those 11, 8 were asked to pitch the investment to the DIF via video call.

Of the 8 that pitched:

- We had to withdraw from the process of 1 because the price of Dash went to $40 and they needed a yes/no decision by 31st December. We planned to come to the network for a confirmation vote but we were not in a financial position to do so (remaining unhedged resulted in our balance sheet going from $160k to $60k at one point). The investment was for $100k and we had no real prospect of finding that amount of funding at that moment in time with Dash at $40.
- 3 were rejected by the DIF after further consideration.
- 4 we remain in contact/discussions with, on the basis that our financial position is improving and there is no immediate hard deadline on any of them at this stage. We have Demelza Hays reviewing currently.

The collective size of the 4 opportunities still ‘live’ is somewhere between $1m-$2m USD.

Approval/rejection is based on a number of factors, some of the main considerations are:

- Is the business in a market relevant to Dash i.e. Blockchain, Payments, consumer tech.
- Is the amount of investment required feasible for the DIF given realistic budgets and resources available from the DAO Treasury going forwards.
- Does the business stand up to scrutiny of it’s business plan/model, unit economics, margins, cashflow, balance sheet. We don’t want to invest in something that will run out of money within 6 months and that doesn’t have a well defined route to profitability and scaling up (if not already profitable).
- The broader competitive landscape. What do they do/have that is difficult to replicate or copy? And that gives them a competitive advantage?
- Does the leadership/management have a strong track record?

Apologies for the rather lengthy reply. Hope it helps answer your questions!

Salutations,

The DIF Team
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0 points,1 month ago
Very nice response, thank you. I must say that I don't know how my votes will go this month yet (either abstaining or voting yes) as there are a few projects that I care deeply about that I think are in need of immediate funding or might go bust.
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3 points,1 month ago
Would you please stop spamming the DAO with this crap?
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2 points,1 month ago
Voting yes. Would you (Companero) please stop spamming Dash Central with meaningless vulgarity that adds nothing to the discussion of the proposal based on its actual merits. How to lose friends and burn social capital.
That'd be great,
solarguy
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0 points,1 month ago
Appreciate the revised ask, voting Yes.
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-1 point,1 month ago
Same here, yes from me!
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