Motivations & Implementation
Three years ago we started building GeoDB, a blockchain-based ecosystem with a unique vision: Improving the current Big Data industry while solving great inefficiencies of a growing market, on top of which the next wave of worldwide innovation will be based on.
It is our mission to engineer a decentralized architecture that will allow peer-to-peer, trusted, efficient, fast, open, and transparent data transactions between market participants. And at the same time allowing users to regain many of the data rights that were lost along the way of the digital revolution. Ownership, privacy, and value should have never been taken away from users themselves.
Over these three years, our mission has remained unshakeable, but we’ve learned a lot during our development process. Those learnings have become challenges that the team is constantly tackling to solve.
GeoDB is a project that depends on massive adoption for its success. In order to encapsulate large amounts of user-generated data for such datasets to have value, the number of users acquired must be massive. And for this to happen we must ultimately generate organic market demand.
As you all know, our network token, the GeoDB Coin ($GEO ERC-777) is the tool used for both rewarding users for their generated data and as payment to acquire data sets from the ecosystem. Therefore, the $GEO token is an asset that represents data value in the form of a tradable virtual asset.
Bearing the above in mind, protecting the value of the reward unit (GeoDB token — $GEO) during the initial stages of the network launch is of paramount importance.
Even though a strong offer (data capturing) is highly probable due to the reward system (our first data-capturing platform is already showing high organic growth with more than 40,000 active wallets worldwide which means people are willing to share data in exchange for a known alternative asset), time will be needed in order for the “data lake” to mature and be deep enough to rally buyer’s attention. Thus robustness must be built through a) Data distribution, b) Quality of data captured.
Having said this, and based on current platform metrics, we expect a wide and fast distribution of rewarded $GEOs from the moment one of our Mainnet launch. This brings further challenges to our model: How to protect our reward unit ($GEO) against speculation and an ever-growing number of circulating tokens due to our ongoing incentive mechanism.
Additionally, we know that a system whereby holding $GEO tokens vs dumping them in the market must be designed. So, how is it possible to provide additional value layers for $GEO token holders that will achieve the following goals?
a) Incentivize long term $GEO holding.
b) Reduce of $GEO circulating supply.
c) Increase of return paths for $GEO holders in addition to price appreciation.
d) Foster $GEO trading liquidity.
e) Improve $GEO accessibility.
f) Provide long term stable $GEO price appreciation.
The present crypto market is currently seeing the blossoming of Decentralised Finance (DeFi). A global and open alternative to every financial service today — savings, loans, trading, insurance, and more — accessible to anyone in the world with a smartphone and internet connection.
DeFi is redefining the current financial establishment and is creating countless opportunities for Blockchain/Token-based projects. DeFi offers us the opportunity to enhance the value proposition for $GEO token holders within the boundaries of current financial decentralised architecture.
We are developing a DeFi mission and strategy into GeoDB’s scheme that will allow us to:
1) Provide decentralised liquidity for $GEO tokens.
2) Mitigate $GEO token financial risks.
3) Build a set of tools to incentivize holding vs dumping.
4) Create a tradable financial decentralized standard on top of the user’s data value.
This paper gathers the goals and the implementation of the first phase of GeoDB’s DeFi strategy which will start by means of a Bonding Curve Token Offering with which we will be funding our long term additional DeFi tools and actions.
2.- Goals & Challenges
Recent reports show that the decentralized finance ecosystem has hit a new milestone with over $4.7 billion locked. The value continues to increase day after day. While the DeFi ecosystem boasted massive growth last year, 2020 has already dwarfed 2019 in comparison. Interestingly, of the $3.9 billion growth this year, $3.5 billion came only from the last two months.
Furthermore, Maker & Compound, both decentralized finance applications, maintain its stronghold as the largest DeFi applications by value locked with more +$1.4 billion and $800 million locked assets respectively.
Information obtained from https://defipulse.com on August 10th
Observing this early industry trend, it seems obvious that GeoDB can take advantage of the numerous opportunities that the space is now offering, by leveraging on already existing DeFi tools which are starting to be used by a large number of projects.
As we mentioned before, we will insert a DeFi mission and strategy into GeoDB’s scheme so that it allows us to reach the following goals:
1) Provide decentralised liquidity for $GEO tokens
Crypto trading has, in the past, taken place mainly through Centralised Exchanges (CEXs), which use traditional order books and order matching systems for price discovery and trade execution. CEXs, in the way in which they are centralised, control private keys to those assets “sitting” in a trader’s account, thus providing a bottleneck in the form of deciding which tokens can be traded in their platforms.
The ethos of the decentralised movement is based on foundational pillars in the form of open-source, permissionless, and immutable non-custodial networks.
In order for the above to be achieved, it is of paramount importance to redirect the flurry of activity that at present takes place through CEXs to Decentralised Exchanges (DEXs), which function through market-making algorithms. Liquidity from external agents must be provided to those DEXs, and this has taken the form of liquidity pools that provide Automatic Market Making (AMM) capital in a decentralised non-custodial fashion.
We believe in a future redistribution of trading activity from CEXs to DEXs, and thus we take it as our responsibility to create the necessary systems and mechanisms to provide decentralised liquidity to the $GEO token in the form of fostering the creation and capital allocation to $GEO liquidity pools.
2) Build token risk mitigation
When a wallet/user holds $GEO tokens, its risk/exposure is 100% invested in the success of the $GEO network. It is in every token holder’s interest to factor stability or financial risk-mitigating inputs into the equation, which should come in the way of having the $GEO token provide stability in the form of a basket of assets through a mixed exposure to both $GEOs and stable coins, and thus reducing overall volatility and inherently strengthening its value proposition.
3) Build a set of tools to incentivize holding vs dumping
One basic way to mitigate volatility is to provide incentive mechanisms for long term token holding versus selling them in the short term. Such incentives must be incorporated into the token economic schemes and structures that supersede $GEO token’s primeval reward mechanism and must take into account and put to work all tools now available through the use of DeFi protocols and hyper-liquidity provision whilst reducing systemic risk stacking.
4) Create a tradable financial decentralized standard on top of the user’s data value.
Bringing together the provision of decentralized liquidity, long term holding incentive systems, and diversifying risk through exposure to stable coins beyond GEO, will provide a context in which token holders will have additional options to holding GEOs and waiting for their market value to appreciate whilst strengthening liquidity and organic price discovery.
Bearing the above in mind, the execution of GeoDB’s DeFi strategy will allow tokens to evolve from a pure data value encapsulating mechanism to a financially robust decentralised-driven asset that provides value to its holders and generators, including relatively stable returns and strengthened value appreciation over the long term.
3.- Implementation Phases
GeoDB is designing its DeFi structure in two phases;
1.- A first phase whereby early-stage capital formation and liquidity bootstrapping are achieved through an open sale of $GEOs, of which 50% of the proceeds will be destined for GeoDB development, and the rest to fund the development of GeoDB’s full DeFi strategy. In the first instance, 25% of the overall proceeds will be destined to seeding a Uniswap liquidity pool to provide decentralised liquidity for $GEO tokens and token holders besides traditional CEXs.
2.- A second phase where token holders are incentivised to hold GEOs in the long term. This will be achieved via generation of yields derived from operating in the DeFi market in all its extension (most probably a mix of staking, liquidity provision, liquidity bootstrapping, yield farming, etc) and enhancing GEOs crypto-economics and rewards system. The remaining 25% of proceeds from the DeFi portion of the offer will be used to seed the full DeFi strategy (complementary to the liquidity pool, which shall be announced prior to the Mainnet launch in November.
4.- How to take part in the $GEO Offering
The whole process is decentralized, so anyone with ETH and access to an Ethereum node could potentially take part in it.
However, we understand that the above is not practical and that it is convenient to have tools that make the information digestible and allow our community to participate in a simple way.
Therefore, we are developing a website for this purpose that will be deployed in the following days, where all necessary information will be available, and from which users will be able to take part in an easy way.
Please visit: https://geooffering.geodb.com
As GeoDB relentlessly advances towards its first major milestone, the Mainnet launch, we believe it’s our responsibility to update and upgrade network configuration and general crypto-economic frameworks to stay up to speed with industry progress and standards.
There can be no doubt that a project such as this one, in need for an extended time period for its success, must necessarily evolve and morph to harness value for its users and token holders by making use of as many decentralised tools and concepts as possible.
It is with the above in mind that the insertion of a DeFi strategy into GeoDB’s general concept is a must.
Raising to the occasion, GeoDB proposes its decentralised token offering as a stepping stone to its full DeFi strategy, which will be announced before the launch of the Mainnet. In this first stage, resources will be rallied and decentralised liquidity provision systems will be deployed and funded to enhance trading activity.
The second stage of GeoDB’s DeFi strategy will bring about a deeper redefinition of token-centric value generation and enhancement whilst staying true to our beliefs, the decentralised ethos, and our long term exploration of the paths to rewarding user-generated data, financial freedom, and decentralised governance.
To check our full motivational & implementation paper, download it directly here: https://geodb.com/docs/geodb-defi-geo-offering-motivational-paper.pdf
We recommend you join our official Token Sale Channel on Telegram to receive real-time updates: https://t.me/geooffering
And that’s all for today. We will be posting several additional articles in the upcoming days regarding:
1.- DeFi $GEO Token Offering technical approach.
2.- Bonding Curve $GEO offering and how to participate in it.
So stay tuned, have a nice week, and stay safe!
The GeoDB Team.