Proposal “bsdev-blockcypher-201703“ (Completed)Back

Title:Business Development - BlockCypher
Owner:babygiraffe
One-time payment: 2448 DASH (738372 USD)
Completed payments: 1 totaling in 2448 DASH (0 month remaining)
Payment start/end: 2017-02-18 / 2017-03-20 (added on 2017-02-23)
Votes: 594 Yes / 25 No / 0 Abstain

Proposal description

This is a cross-post from the Dash Forum

This proposal funds the integration cost and support costs for Dash integration with BlockCypher, a third-party API hot-wallet service. BlockCypher is not a consumer-facing service, so I suspect many masternode owners may be unfamiliar with the prominence of BlockCypher in the cryptocurrency industry. A prerequisite for properly evaluating this proposal is an understanding of BlockCypher's business and the role it plays in the overall ecosystem of end-user services.

Daniel Diaz created a post on February 16th explaining more about the industry structure and the role BlockCypher plays. If you have not already reviewed that post, please follow this link to learn the necessary background information to properly evaluate this proposal.

https://www.dash.org/forum/threads/dash-business-development-strategy-update-feb-2017.13133/

Proposal details:

We have been looking for a solution for a hot-wallet API provider for the past few weeks. It has been part of many of our conversations in our weekly team calls. We have evaluated many options to address this need, including the existing service providers, or even running our own service.

Running an internal service carries many risks. It would expose Dash’s network to reputational risk should any downtime to service level issues be encountered by our API service. It would distract the team from focusing on development of our payment network itself.

We contacted both Bitgo and Blockcypher (the two largest providers) and have reached a mutually beneficial arrangement with BlockCypher. We believe that an integration with BlockCypher offers many benefits beyond the availability of the service itself in the form of (i) reputational gains of joining Bitcoin and Ethereum as the only networks integrated, (ii) potential to integrate Dash into existing customers (e.g., cross-selling) without changing technical architecture, (iii) faster time to market with an API solution, (iv) service provider preference to work with a single established API vendor, and (v) offering market-leading expertise compared with building our own solution from scratch.

Who is using Blockcypher?

Just to give you an idea of how extensively used these 3rd party API Web services providers are, here are some of BlockCypher’s clients: Purse.io, Xapo, Coinbase, Verse, Bitrefill, Sfox, Shocard, KeepKey, Meco, Shapeshift, Fold, Blinktrade, Joystream, Coinify, Coinhako, Netki, Coinprism, Vaultoro, Bitkassa, Abra, Bitquick, Deloitte, Bitpagos, Quid, Volabit, Mexbt, BTCfacil, Bitwage, Coineza, Coinjar, Paxful, OKCoin, Paystand and many more.

https://i.imgur.com/6XgCDqN.png

Those are only some of the ones publicly displayed on their website, there are actually many more that are not featured.

What would Blockcypher start offering for Dash accepting services?

BlockCypher will integrate with the Dash Payment Network and provide the following web services:

● Asset API - issue & handle assets on the blockchain
● Data Endpoint - place data or a hash on a blockchain
● Multiple Address Wallet API - multiple addresses under single wallet name
● Multisignature API - multiple signature key management
● Payment Forwarding API - forward, consolidate, add commissions to payments
● Transaction API - build transactions easily
● WebHooks and WebSockets - monitoring & notifications on blockchain events

BlockCypher will support the current fork of Bitcoin 12.0 for Dash v.0.12.1. Additional support for Masternodes (and InstantSend) are not part of this proposal and will be considered at a later time and will be driven based on BlockCypher’s business customer demand.

What else is part of the partnership?


Part of the requirements for this to happen go beyond just covering the integrations costs. We would be going into a more in-depth partnership where our bizdev team would be selling together with the BlockCypher team in all the opportunities that we have accumulated that were missing an API Blockchain Web service provider. So a lot of our focus going forward from a sales perspective would be bringing the BlockCypher team to help implement once a new potential user service says yes to Dash. This should also help offload some of our internal resources, so the business team needs less direct support from Evolution developers.

The second part of the strategy is for us to approach BlockCypher’s existing clients so they can start accepting Dash. Accepting Dash would become a much easier process for the clients since it would just be extending the setup they already have for Bitcoin. We believe this is a superior strategy than expecting the brand name start-ups to go out of their way to start running Dash-specific infrastructure they are simply not running for Bitcoin directly.

Finally, BlockCypher is also requesting a commitment from Dash to participate in conferences and events together. For now a tentative calendar could be attendance (with session) and booth at the following
conferences, providing BlockCypher with a pass:

○ Blockchain 360, Santa Clara, May 16-18
○ Consensus, New York, May 22-24
○ Money 2020, Las Vegas, October 22-25

What are the costs of the investment?

There are three components to the integration costs - Development, Documentation, and Ongoing Maintenance. The development expenses are very consistent with what we've experienced with other services and came in at the low range of the initial estimates thanks to the high compatibility with the Bitcoin code base. Those are expected to be $50,000 USD and BlockCypher has agreed to accept any risks of variance and fix that cost. Technical documentation will also be required and is expected to cost $3,000. Finally, BlockCypher requested funding for maintenance and hosting expenses for the first year to allow time for Dash-related revenue to grow, and this expense is $12,000. Total costs are $65,000 for the integration and the first year maintenance.

We will request the initial $53,000 as part of this proposal and will submit a second proposal for the remaining $12,000 either this cycle if the budget permits, or next cycle at the latest.

Additional background:

An NDA is already in place with BlockCypher and the business development teams are already jointly approaching business leads from both BlockCypher's existing customers and Dash's backlog of consumer services that had previously said "yes" to integrating Dash, but could not obtain API services. These efforts are already yielding results for future services being added to the Dash ecosystem. It is early days, but the evidence so far is that the partnership will be fruitful.

This project is being led by Daniel Diaz, so if you have additional questions not covered in the original budget request, please direct them to him by tagging them with @Minotaur to ensure he sees your question.

Requested funding is as follows for the March 5th budget cycle:
Total: 2447.51 Dash

Note: Should any funding remain, we will apply it toward future business development expenses.

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Discussion: Should we fund this proposal?

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1 point,7 months ago
"If it's an indie contractor, can you clarify who will own the IP for the developers' designs and code please? Also answer whether ownership is clear in the agreement with both BlockCypher and the developer? IMO the IP needs to be owned by some entity Dash-side, and provided to BlockCypher under a mutually compatible open source licence."

So do we get an answer on this?
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0 points,7 months ago
Re-posting with @Minotaur to get input from Daniel pls?

I agree with this in principle, but that's about a year's developer time.

If it's an indie contractor, can you clarify who will own the IP for the developers' designs and code please? Also answer whether ownership is clear in the agreement with both BlockCypher and the developer? IMO the IP needs to be owned by some entity Dash-side, and provided to BlockCypher under a mutually compatible open source licence.

If it's $50k to BlockCypher then I think that's too much. I realise it's more work, but the win/win for BlockCypher needs to articulated & understood by them. My guess is they won't spend more than ~$15k developer time building it out, so the remaining $35k strikes me as just opportunity cost for them working on this vs something else. That feels too expensive to me, and I would therefore prefer smaller capex budget, and annual support budgets on-going until they get an agreed level of B2B traction / API fees direct from their Dash-using customers.
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0 points,7 months ago
My previous comment copied from @marcoski711 post (below) if that wasn't obvious btw
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2 points,7 months ago
I agree with this in principle, but that's about a year's developer time.

If it's $50k to BlockCypher then I think that's too much. I realise it's more work, but the win/win for BlockCypher needs to articulated & understood by them. My guess is they won't spend more than ~$15k developer time building it out, so the remaining $35k strikes me as just opportunity cost for them working on this vs something else. That feels too expensive to me, and I would therefore prefer smaller capex budget, and annual support budgets on-going until they get an agreed level of B2B traction / API fees direct from their Dash-using customers.

If it's an indie contractor, can you clarify who will own the IP for the developers' designs and code please? Also answer whether ownership is clear in the agreement with both BlockCypher and the developer? IMO the IP needs to be owned by some entity Dash-side, and provided to BlockCypher under a mutually compatible open source licence.
Reply
1 point,7 months ago
This is an interesting proposal. But I'd like to know why there is no detailed, written submission by the contractor. $60,000 is not an insignificant contract and this service is in danger of turning into a money hose that contractors line up in front of and get sprayed with.

I don't expect contractors to grovel but equally I don't expect due diligence and proper contracting protocols to be dismissed.

Why not pay the contractor £5000 to deliver a detailed proposal with delivery commitments and have them specify whether that commitment is in the form of equity support (e.g brand awareness) or labour hours. If it's the former then how does it improve on, say, a random article in Forbes magazine. If it's the latter then what exactly do they need the labour hours for ?

That secondary proposal could then be submitted for approval with an appropriate level of accountability.
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0 points,7 months ago
If you read the above carefully "Those are expected to be $50,000 USD and BlockCypher has agreed to accept any risks of variance and fix that cost. " So we pay the $50K and then BlockCypher has to integrate Dash. And if the costs end up being higher they will pay for it themselves.
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0 points,7 months ago
Very exciting! A bit pricey but it is what it is and will pay for itself almost immediately IMO.
If we integrate we purse.io the price will explode. Same goes for coinbase and XAPO to a lesser extent. We already have the second biggest volume on purse.io after BTC so that should be priority number 1, strike while the irons hot. This is huge!
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