Proof of Work #47

Downturns, forks, and jetlag, oh my!

Hi from Boston via Shanghai! I now exist in a state of perpetual jetlag—once we’re done fundraising, I intend to completely abstain from all forms of travel faster than a camel for a while, in order to let my battered circadian system have a chance at recovery.

I’ve added short descriptions of each project (in italics beneath the names) to help people who have recently joined the newsletter catch up.

A brief word on the recent market downturn: when people ask me why the market is up or down, I honestly don’t have a clue. When we tell people our fund is long-term focused, that isn’t an ideological or moral stance; it’s just that we have no clue why or how the market is going to move in the short term, but have a lot of conviction about where it’s going in the long term. This is something that’s easy to talk about, but hard to actually do. One of my BTC whale friends, who has over 100,000 BTC made a point that sounds almost syllogistically obvious but which I think is worth thinking about: “it’s really hard to hold BTC through serious dips—look at how few people actually did it!” Of all the early holders, only a small few actually held on long enough to not exit too early, or during a big dip.

The Bitcoin Cash fork drama has also been interesting. One objection I’ve heard from non-crypto people to the idea that Bitcoin is truly 0-inflation eventually is that forks themselves should be thought of as inflating the Bitcoin supply. However, Bitcoin Cash is certainly the most credible Bitcoin fork, but within a single year it’s gone from being thought of by some as a credible competitor to having its own forking event which seems likely to be very value-destructive for it. Bitcoin Cash itself was able to be a schelling point for people who wanted to try big blocks in Bitcoin, but it’s unclear what kind of consensus people who support B-ABC vs B-SV would come to. My prediction is that the ultimate destiny of most forks is to be worth nothing, and for that fact to cause a decrease in the number of forks as would-be forkers realize there’s little to nothing in it for them.

Two quick notes about PoW itself: Someone asked why we don’t try the paid-subscription model given that some other crypto newsletters are pulling in hundreds of thousands annually. The answer is that PoW will always be free (and ad free!) because there’s no way to make money from it that doesn’t make it worse. Someone else asked how many of the projects featured in PoW have we invested in. At press, the answer is less than 25%. I feature in PoW anything I think is interesting, but that doesn’t always align with what I think will make money (for example, some projects had valuations that were too high for my taste, or some other projects I just didn’t know about when they were raising!)

As always, thanks very much for reading this, and please get in touch if you have ideas for how to make it better, or a project you’d like to see featured!

Bitcoin & Friends

James from Summa

Summa is building tools for trust-minimized transactions across different blockchains.

  • On the 18th we wrapped up the first ever cross-chain auction. We sold 10 NFTs for BTC during a 3 day event

  • We used intentional double-spends and stateless SPV proofs to make a trustless Dtutch auction

  • Over the next two weeks we'll be refining the UI. We expect to have another live auction event around the end of the month

Daniel from Grin

Grin is a privacy-focused coin based on the Mimblewimble protocol being built by a pseudonymous team of developers

Jimmy on Bitcoin

Bitcoin is the big daddy

Aviv from Spacemesh

Spacemesh is a coin and smart-contracting protocol utilizing on a storage-based proof of work called Proof of Space-Time.

  • No update, big one next week.

JZ from Decred

Decred is a coin based on Bitcoin, but with a proof of stake addition, and a raft of additional features focusing on governance of the protocol by users with stake.

  • Dustin has written up a piece thoroughly detailing how the Politeia process worked during our first round of votes. Richard has also released issue 4 of the Politeia Digest.

  • Zubair published an overview of the Decred on-chain consensus mechanism, especially timely considering the recent drama we've seen in the space as new coins are born through conflict, leading to confusion and schisms in communities.

  • Lots of dev activity as usual with 2 PRs for dcrd, 14 for dcrdata, 13 for politeiagui, 6 for politeia, 11 for decrediton, and 4 for dcrwallet. New alpha and beta releases are up for dcrdata as well, for those who like to live dangerously.

Johnny from Stellar

Stellar is a protocol that uses a quorum-based consensus (totally different from Proof of Work or Stake) to enable cheap transactions in the native coin, and allow for the issuance of assets.

  • The major rewrite of the data layer in stellar-core has been finally merged in:

  • We're aiming for a pre-release before the winter holidays

  • Horizon (ed: stellars client facing API) 0.15.1 has been released, with a memory leak fix.

  • New Horizon stats initialization command added to alleviate issues (horizon db init-asset-stats)

  • CAP-0013 is open for comment, and is another iteration on handling the current pain with sending assets without a trustline.

  • Discussion is beginning around how Stellar works within the context of sub-networks with different features and functionality.

Izaak from Coda

Coda is a project focused on high-scalability enabled by recursive zk-SNARKs

  • The Coda team is hiring for a bunch of senior-level positions. In particular, we're hiring product managers, engineering managers, a head of business development, and a community manager. Check out our jobs page for more details.

  • Delegation of stake for our proof of stake consensus mechanism was implemented in a series of PRs (11481124).

  • We finished the redesign and initial scaffolding for our new system for managing forks and the state required on each one of them.

Privacy coins

Paige & Zooko from Zcash

Zcash is a coin based on Bitcoin but focused on privacy for users based on zk-SNARK transactions to hide senders and recipients

Smart contracting platforms

Myles from EOS

EOS is a smart-contracting protocol utilizing distributed proof of stake and a smaller number of nodes to enable the higher throughput necessary for dAPP type applications

Zaki from Cosmos

Cosmos is a proof-of-stake based system enabling interchain connectivity through hubs, and allowing for zone-based dapps to have inherently stable and economically viable ecosystems.

  • On Monday, November 12th, two critical vulnerability where submitted to our bug bounty and deployed on the gaia-9001 testnet. We've delayed Game of Stakes until those vulnerablities are fix.

  • We have a tracking issue for the security fixes for Gaia-9002 and once gaia-9002 is live we will notify players in Game of Stakes of the 48 hour countdown to the start of the game.

  • The Tendermint KMS had it's first functional release and it's ready to use any Tendermint powered blockchain. 

Kate and Dean from Agoric

Agoric is a new platform that uses an object-capability model and a restricted subset of javascript to make smart contracting easy.

  • We’ve added updated versions of the Agoric Open Systems papers to the website, including pdfs and the full text of each of the three papers! These papers are listed as part of Andreessen Horowitz’s Crypto Canon, so we’re glad to get them updated.

  • We’re continuing to make progress on hardening our proof of concept, exploring use cases and talking with entrepreneurs looking to write smart contracts, and building developer tools.

Financial Infrastructure

Antonio from dYdX

dYdX is a lending protocol that allows for trustless lending of ethereum-based assets

  • Testing OasisDEX Integration. This will allow users of expo to utilize buy/sell orders from Oasis in addition to 0x. Expo will automatically use whichever offers a better price [ed: ooh cool! I’ve always wondered how these two things would interact.]

  • Implementing trade history on expo

  • Hiring for engineering, design, and finance/product roles fulltime in SF

Brendan from Dharma

Dharma is also a lending protocol that allows for trustless lending of ethereum-based assets

  • Continued building Dharma Lever.

  • We’re hiring for a product manager, a product designer, and more. Check out our open positions here (

Coulter from MakerDAO

MakerDAO is a decentralized autonomous organization that produces the MKR/DAI stablecoin system, a stablecoin based on collateralized margin positions of ETH.

  • The community hit a significant milestone with 1% of the total ETH supply locked into the Dai system! Total ETH: 103,215,322. Total ETH locked in Dai System: 1,035,381.31. #1PercentDai 

  • Maker has partnered with Ripio to bring Dai to Latin America via fiat on/off ramp. This is particularly exciting due to the need for a stable cryptocurrency in the region. Remittances play a big role, while the interest rates for a personal loan in Argentina are nearly 70% APR, and 40% APR in Mexico. Dai offers a competitive advantage for both use cases. 

  • CoinMarketCap posted a stablecoin blog penned by the Maker team, breaking down the pros and cons of various types of stablecoins. If you're unfamiliar with them, this is a great primer. 

Lazar from MARKET Protocol

Market protocol allows for trading of derivative assets on the ethereum blockchain

  • Last week we announced the beta release of MPX, the first decentralized exchange built on MARKET Protocol. With this release, users can trade derivatives in a simulated environment on Ethereum’s Rinkeby testnet. Check out our blog to learn more, or try MPX for yourself here.

  • We’ve been pleased with the engagement and feedback we’ve received from MPX users. Our team has already squashed some bugs and is hard at work adding new features.

  • We are looking for more feedback on MPX! To tell us what you like or dislike, please complete our user survey. Or share your suggestions with us on Telegram or Discord.

Robert from Compound

Compound creates an automatic money-market style interface for any asset on ethereum

  • Completed preparations to add support for DAI to the protocol; tested a new Oracle contract, and stablecoin Interest Rate Model contract; added off-chain price validation/monitoring for DAI

  • Improvements to dApp usability by making UI components more aware of pending transaction state

  • Deployed the “Quick Borrow” developer sample contract to Rinkeby, and began testing

Layer two and interoperability

Tieshun from Namebase

Namebase is the first exchange to allow you to trade decentralized names on the Handshake blockchain

  • Started working with Todd Goldberg to create educational content and grow the Namebase community

  • Deployed a number of small security fixes to our exchange

Paul from Veil

Veil is a custodial platform built atop Augur to provide a curated and easy-to-use interface for making predictions

  • Added the concept of channels to Veil. Channels are collections of similar markets for easier organization and discovery. Examples include Memes and REP.

  • Revamped the Veil home page to show-off popular markets and channels.

  • Added a public Augur Open Interest graph to help track macro trends on Augur.

Rahul from 0x

0x is a protocol that enables trust-minimized trading of ethereum assets via a smart contract.

  • 0x Launch Kit released! Build your own relayer in under a minute

  • published, a python implementation of 0x order-related utilities that was often requested from our community and market makers

  • Relayer Report #14 - thoughts on EtherDelta and permissioned liquidity pools, as well as an interview with Lindsey Renken from ERC dEX

Alexandra from Parity Technologies

Parity produces Ethereum infrastructure, and also a cross-protocol protocol (whew!) called Polkadot

Application infrastructure

Doug from Livepeer

Livepeer provisions a decentralized network of transcoding nodes to allow censorship-resistant streaming of video.

  • Shared an early draft of the "Streamflow Proposal" - which suggests protocol updates to make the Livepeer network cost effective, scalable, and reliable for real world scaled video usage on the Ethereum network. 

  • Merged a long worked upon Object Store pull request, adding support for using storage services like IPFS and Amazon S3 into video workflows built upon Livepeer. 

  • Work is underway on a Probabilistic Micropayments [ed: the original Rivest paper is a wonderful read] implementation - an L2 scaling solution for payments with similarities to payment channels, but different properties that are attractive for streaming use cases.

David from Sia

Sia is a decentralized storage system that allows users to rent storage space from hosts.

  • 1 Nebulous repo was updated. 48 issues were created, 17 were closed. 8 MRs were merged. GitLab users nielscastien, MSevey, ChrisSchinnerl, and DavidVorick had code contributions merged into Sia.

  • The external contributor nielscastien performed a considerably big update to the documentation of the hostdb API (the hosts database), including all the recent additions like the known IP networks the host has been previously using, and its changes.

  • MSevey added a board of developmental tasks and issues in Gitlab, segregated by the affected Sia module. In addition to including all the current issues, properly tagged, the tables include new long-term goals for the revamping of each module. It represents also a very useful hub for people looking to contribute to the Sia code

  • ChrisSchinnerl fixed a bug reported by some users where the block height managed internally by the wallet could lag behind the real block height the whole client is synced to.

  • Many other small code corrections, including: a case of wrong price estimation for renters; a race condition during contracts negotiation; and a clarification that the renter upload command allows to upload folders too, not just files.


Ari from Decentraland

Decentraland is a virtual reality environment with assets secured on the ethereum blockchain.

  • We’re working on deploying a new server (and integrating it with the SDK) for hosting the 3D content that will be viewable with the Decentraland Client.

  • We’re also deploying the user-to-user communication protocol, and testing and validating a new API within the SDK — with added support within the CLI.

  • Last week, we completed deploying plazas as Estates and roads as parcels. Now the Marketplace frontend supports plazas, district, and roads as Estates. We’re also in the process of deploying all community District parcels.

  • With the community’s decision to move the second auction forward, we’ve finished building the smart contract that will facilitate the auction, and have begun the review process. We’re contacting 3rd party auditors to help with this. We’re also beginning work on the frontend UX for the second LAND auction.

Sam from OpenBazaar

OpenBazaar is a decentralized trading platform to allow users to buy both virtual and real-world goods directly from eachother with no middle-man.

  • The first round of smart contract audits have been completed and we’re working to address their recommendations.

  • Due to problems with Insight we've been focusing on using Blockbook for the server infrastructure needed for the new multiwallet architecture, which is working well so far.

  • We've begun exploring what needs to happen for a server rebase to IPFS 0.4.18, which will happen once multiwallet is completed

  • The multiwallet is now feature complete on the client and is in testing.