Autor Cointelegraph By Jillian Godsil

Back in 1984, a U.K. television advertisement for Kit Kat chocolate bars was set in a music label’s office where a keen young band played their demo for a bored music executive. Afterward, they were served the famous chocolate bars and the manager said:

“You can’t sing, you can’t play, you look awful… you’ll go far.”

This is as close as I can get to explaining the appeal of memecoins to sensible, smart and intelligent people. But don’t be fooled: Smart people are making a lot of money out of dumb memecoins — invariably at the expense of not-so-smart people without good timing.

PEPE is making memecoins great again. (Twitter)

And timing is everything in memecoins, which typically have no utility for anything except having fun and making money. So, without any fundamentals to trade on, can you still take a “smart” approach to making money by trading memecoins?

On Yavin, co-founder and head of business at Syndika, comes in with a hard “no” to that idea.

“Anyone who says they have any trading strategies with memecoins is talking absolute BS,” he says, adding the only reason memecoins have experienced a rush of interest this year is because of the bear market and crypto winter.

“People need to do something with their investments, and they cannot wait until the next bull run. These people are not interested in investing in the real projects that take years to build. And they’re all about flipping and all about making a quick buck. That’s the reason,” says Yavin. 

Whatever happened to EOS? After the biggest ICO in history, the former top 10 token now languishes around number 53. But the community has since taken back control and is determined to restore the smart contract platform to its former glory.

If you’re a newcomer to the crypto industry, you may not even be familiar with The Biggest ICO in History, which launched EOS.

EOS began in June 2018 with great fanfare, an active community and strong tech. Led by Dan Larimer, of Steemit and Bitshares fame, there was a palpable area of excitement with the introduction of new tech, including the delegated proof-of-stake (DPoS) system and EOS Worker Proposals to fund projects that grew the ecosystem.

Block.one, the company behind EOS, raised an astonishing massive $4.1 billion over 12 months.

And then… nothing much happened. The community waited and waited for the promises to be fulfilled.

Douglas Horn, CEO of Goodblock. (Supplied)

“I was very disappointed when little or none of those ideas came to fruition,” Douglas Horn, CEO of Goodblock, tells Magazine. “To be honest, I would say Block.one did a deceitful ICO, whether that was planned from the beginning or not. That’s my personal assessment.”

The exact reasons EOS didn’t go anywhere are disputed, but development dried up, and the community often felt left out. Some say they volunteered to take on the development of new projects but weren’t supported — or even told to halt work by Block.one, as their efforts encroached on developments of its own. In other cases, micro-grants were given on the proviso that no other funding could be used. Typically, those micro-grants were not enough and those mini-projects also ran out of runway. Also read: Journeys in Blockchain — William Quigley of WAX

There are some success stories, with WAX and Alien Worlds the exceptions that prove the rule, but otherwise, it was a moribund ecosystem. In the interim, Block.one came to an agreement with the SEC to pay a fine of $24 million in order to avert any suspicion that the token was a security (an agreement that has subsequently been overturned and which may cause significant new problems for Block.one). 

Timeline of a takeover. (EOS Network Foundation)

Two white elephants

Despite the many promises, Block.one basically stopped developing the base tech, then termed EOSIO, and diverted its focus to two vanity projects: the $150 million Voice decentralized social media platform that has since transformed into an unimpressive NFT marketplace; and Bullish, an exchange that ostensibly used the ICO money to provide liquidity. Trade volumes are around $200,000 a day for its BTC/USDC pair. 

(Block.one, former chief technology officer Larimer and CEO Brendan Blumer were contacted for comment.)

So in 2021, the community started fighting back with the formation of the EOS Network Foundation. Enter Yves La Rose, CEO of EOS Nation, an original block producer, into the fray. Block producers in EOS provide the tech to validate nodes, with the top 21 receiving a fee for maintaining the network.

La Rose is not without his critics, with some of those in the original Block.one brigade calling him a bully. On the other side, the newly energized EOS community sees him as a bit of a hero. And since history is written by the victors, it looks as though La Rose is going to emerge as the latter.

Bullish exchange is still in operation. (Twitter)

Who is Yves La Rose?

Yves La Rose, CEO of ENF. (Supplied)

La Rose is a self-confessed nerd who started tinkering with his own computers when he was only six years old. Years later, he read the Bitcoin white paper and became a miner. But this didn’t last very long. He could see there was very little scope for lone miners, and he didn’t want to join a mining pool.

By 2016/2017, he could see a resurgence that offered more choices. ICOs were starting to become popular and CryptoKitties famously log-jammed the Ethereum blockchain. La Rose also became aware of Larimer and was seriously impressed with his crypto record and the new tech he was building for EOS. 

“I chose EOS early on,” says La Rose. “And I made the leap into blockchain full time, forming EOS Nation back in January 2018 prior to the launch of the mainnet. And we waited.” 

He was not the only block producer to find out that while ICO promises are easy, execution is hard.

EOS upgrades to Antelope in 2022 (Twitter)

‘None of those ideas came to fruition’

Horn, previously the architect of Telos, is now the CEO of Goodblock, which provides foundational Web3 tools. Like La Rose, he was attracted by the potential of the tech offered by EOS – by DPoS, the governance systems and the planned worker proposals. He, too, grew disillusioned and co-founded the Telos Blockchain in direct response to the absence of any perceptible activity by Block.one on the EOSIO code. 

“In my personal opinion, I think the whole Block.one fiasco was an absolute fraud,” Horn says. 

Of course, any lawyers reading this should take this as an exaggerated expression of opinion, rather than a criminal accusation, but it does show the depth of frustration that led him to draft the Telos white paper. 

“Instead of waiting for them to fulfill their promises, I started to build – and I was also very outspoken in my views,” says Horn. He pushed for a roadmap from Block.one and when it was not forthcoming, he built his own for Telos.

Horn is renowned for his outspoken views but they are echoed across the community. However, some players prefer not to be named for fear of attracting blowback.

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La Rose sees the problem coming from the fact that the ICO was just too damn big and Block.one promised too much.

“There were a lot of expectations in the EOS community and I don’t think Block.one had the skills to actually fill those shoes. Then we suffered one failed promise after the other. By the second anniversary, it was obvious they were not going to deliver anything on the code or for the community,” says La Rose.

“It was then that the ecosystem started hemorrhaging developers and community members. We tried to fill the gaps but without funding it was impossible. Other chains were popping up all the time and they secured funding and, more importantly, they set up foundations.”

Rhett Oudkerk Pool, CEO Zaisan. (Supplied)

Rhett Oudkerk Pool, another original block producer with EOS Amsterdam and subsequently Europechain and Zaisan, also sees the massive success of the ICO as part of its downfall. 

“They claimed they were tied up in legal wrangles with the SEC, and that sort of made sense. They said they were tied up in investigations and, as a result could not do anything. But then, if someone in the community wanted to create a worker proposal system, Block.one said they were already working on it. They’d say don’t worry, we’ll do it. So the community would stop but Block.one never did anything and so they doubly killed initiative,” says Oudkerk Pool.

La Rose resigned from EOS Nation to form the EOS Network Foundation (ENF) in August 2021. From the get-go, La Rose knew that all layer ones need a funded Foundation which would work to nurture the ecosystem, foster new development and oversee continued governance. Without Block.one at the helm, the ecosystem needed direction and leadership.

EOS community steps up

Daniel Keyes, CEO of EOS Nation. (Supplied)

Daniel Keyes took over as CEO of EOS Nation after La Rose left, and he’s also CEO of the community crowdfunding platform Pomelo, which was built after the velvet EOS revolution and helps fund projects on the network.

“We had the community but no funding. We had a lot of broken hearts, and the community just left because they had to survive,” he says, looking back.

“Yves left EOS Nation to try and save the network. It was a lofty goal at that stage and there were several failed attempts,” says Keyes.

Aaron Cox, CEO of Greymass, another EOS block producer, says, “There was development happening in isolation but one of the biggest problems was this behemoth in the corner that just stamped over everyone’s efforts. We needed to stick together.”

Decentralization takes on centralization

La Rose’s road to resignation took some time. He was originally drawn to the EOS white paper and, in particular, the worker proposal system it outlined but which never launched. La Rose says he tried a number of times to launch it and would get the backing of the community before Block.one essentially killed the proposals off.

“There were veiled threats from Block.one,” says La Rose. 

The second EOS conference was held in Rio in September 2020 and was a very grassroots affair. Again, La Rose and the other block producers worked hard to create a worker proposal system (WPS) and gained the backing of some 40-plus signatories. This was also canceled by Block.one.

“At this stage, we knew we could not work with Block.one again,” says La Rose. “Everything that had been promised could just be words, but GitHub did not lie.”

Marshaling the community against Block.one was difficult because of the intrinsic nature of decentralization. Momentum would be gathered but then lost as people drifted away after unsuccessful attempts to wrestle back control.

In June 2021, La Rose stepped down from EOS Nation. He’d given the past 40-odd months to EOS and he didn’t want to bow out. He also knew EOS needed a foundation, and he could not be both a block producer and a stakeholder in a foundation.

He began planning and talking to the other block producers about what they wanted and what the newly formed ENF would look like.

“At the end of the day this part was easy. Everyone knew something had to happen. Making it happen was a lot harder.”

Oudkerk Pool remembers with happiness how La Rose persuaded 15 out of the 21 block producers to join together to stop the staking contract – basically diverting revenue from Block.one back to the community. This was a watershed moment as it stopped Block.one from receiving funding from the community – and it was only possible to change the contract with the agreement of 15 block producers.

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First you get the money, then you get the power

“The initial idea was that we could use this money to work on the software. And La Rose used that money to reward struggling block producers who had been working away with no funds. He asked for blue papers to outline what would happen next and we were given the role of writing the Core+ Blue Paper, an overview document to replace the white paper – but there were seven documents altogether that covered the wallets, the yield etc,” says Oudkerk Pool. 

“Our own role was to do a commercial outreach and we took an EOS roadshow all over Europe and Dubai,” says Oudkerk Pool.

Other coalitions were forming, in particular over the software. Horn was instrumental here. 

“I knew we needed a roadmap and a plan. I stepped up to the plate and soon we had four block producers looking at the code – the Antelope Coalition was formed to replace the now stagnant EOSIO platform. We were now in the driving seat,” says Horn. “We had our Jerry Maguire moment where we (Telos) said we were in – and Yves said yes.”

EOS, block producer UX, WAX and Telos joined forces to run the Antelope Coalition, a new group to build and maintain the EOS source code on GitHub. The team renamed EOSIO to Antelope at this stage, forking the code permanently. A number of key technologies were identified and work began on Inter Blockchain Communication (IBC) and implementation of the Ethereum Virtual Machine (EVM), which went live mid-April.

You heard the news – London baby! Which of the 35 neighborhoods are you going to be focusing on? To motivate you, we sent Miles through an AI portal to sightsee 🧐 pic.twitter.com/dSOCzsU1EH— Upland (@UplandMe) April 24, 2023

Wax and Upland fly the flag for EOS

Not everything on EOS had stalled and a couple of well-known projects successfully built their own ecosystems.

Lukas Sliwka, CTO of WAX. (Supplied)

Lukas Sliwka, chief technology officer of WAX, spent the second half of 2018 building his blockchain team, hiring the right people and then running different POCs before essentially choosing EOSIO and launching the WAX blockchain in 2019. WAX, or WorldWide Asset eXchange, is a gaming and NFT platform. 

According to Sliwka, WAX is one of the most successful blockchains in the sector and, during the bull run in 2020/2021, averaged between 25 and 28 million transactions per day.

Sliwka says the project deliberately distanced itself from EOS. “WAX is probably one of the best-kept secrets in the blockchain world as a result,” he says. 

“We basically took on the maintenance and protocol development ourselves – that is, until the Antelope Coalition was formed,” he says.Also read: William Shatner tokenizes his favorite memories on the WAX blockchain

“We already had our own blockchain protocol team, so we could hit the ground running. For example, as good as the Antelope stack is, there were issues on scaling – which is a key learning point from WAX,” he says. 

“We saw our own blockchain grow by 50,000 to 70,000 accounts a day and that takes some serious scaling resources. I put my hand up from the start on scaling – and also inter blockchain connection.”

Upland.me, a metaverse property game following along the lines of the board game Monopoly, was also sitting on the sidelines, building its community. It actually did receive some of the funding from Block.one, in the form of the Finlab EOS VC Fund, which amounted to $18 million and allowed them to build without having to wait.

Co-founder Dirk Leuth says the coalition was exciting but there were teething troubles. 

EOS independence day

La Rose sees one benefit to the delays of actually kick-starting the blockchain – that it allowed the ENF to learn from the mistakes of other layer ones, which came later. It also allowed him to try and work with EOS founder Larimer which ultimately failed.

A spokesperson for ENF said although Larimer continued to be an active member of the community through March 2022, his last contribution was when he shipped EOSIO/Mandel 3.0 at the end of January 2022.

There is some chat that Larimer was pushed out, but the mainstream conversations seem to indicate that the founder was still following the Block.one line, which was inconsistent with the new ENF policies.

As La Rose says: “Fool me once that’s on you, fool me twice and that’s on me. We opted for EOS independence. With the Antelope Coalition, we rebranded the core code stack and we now maintain, grow and develop it. We hard-forked in September 2022 and that was the final nail in the coffin for Block.one.

“That’s what we call EOS independence.”

A key component in the new EOS ecosystem is that there are formal, well-oiled mechanisms on how to access funding – either through Pomelo or the direct grant framework from ENF, which can reach up to $200,000. The EVM was launched in mid-April with a focus on gaming. A sizable tranche of funding – a $20 million fund – is allocated to this sector out of a total of $65 million.

ENV (V stands for Ventures) is the new $100 million-plus funding vehicle also set up by La Rose. It is a for-equity venture which is owned and operated by the ENF DAO.No one denies there were many mistakes along the way. For Horn, it was the delays, which means they’re only getting up to full speed now. 

Keyes is in agreement. “We are in catchup mode now. But we’re in a good position now to attract Web3 builders out there.”

The future of EOS

Aaron Cox, CEO of Greymass. (Supplied)

Cox is also optimistic. “I think the presence of our independent consensus mechanisms is the best outcome for our family of blockchains. We have this vibrant ecosystem of chains that exist today and there will be new chains dreamt up next year. We have momentum now.”

Sliwka says he’s also excited about the possibilities. “What gets me excited is the fact that we, as a coalition, are going to solve these problems so we can all benefit. That is what Yves has done – he transformed the ecosystem into something that was originally promised.

When asked about what was the most important element in the EOS revival – tech, funding or community, the community gets the biggest vote from the interviewees. Although Cox reasonably points out that the ecosystem really needs all three to be a success.

Yves la Rose has really stepped up in a David versus Goliath battle. At times he has been hampered by the vision of a truly decentralized blockchain, at other times, that has been the strength. But he pays tribute to everyone else involved.

“I may be the guy on camera for the revival but without the hundreds of people working daily on this project, it would not have happened. It’s a humbling experience to be part of this movement,” he says.

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Jillian Godsil
Jillian Godsil is an award winning journalist, broadcaster and author. She changed electoral laws in Ireland with a constitutional challenge in Ireland’s Supreme Court in 2014, she’s a former European Parliamentary Candidate, and is an advocate for diversity, women in blockchain and the homeless.

Bridget Greenwood is the founder of The Bigger Pie, a U.K.-based networking organization that supports women in blockchain globally. She says that even venture capitalists with the best intentions still end up funding male founders at disproportionate rates.

“I stumbled over the appalling statistic that of all VC funding [in the U.K.], only 3% goes to female founders, 8% goes to mixed teams, and the rest goes to all-male teams,” she explains to Magazine.

“And that initial figure has gone down to 1.5% over the pandemic.”

“In more difficult times, it seems that VCs are falling back on what they know – which is to fund male founders. This is doubly frustrating, as research looking at the impact of COVID-19 points to the benefit of feminine leadership during challenging times.”

According to data from Pitchbook, the trend is international. Last year in the United States, startups with all-women teams received just 1.9`%, or around $4.5 billion, of the $238.3 billion in allocated venture capital. The 2022 figure was down from the 2.4% achieved the year before. 

Seeking to actively change this reversal, Greenwood founded The 200Bn Club with Amber Ghaddar. The initiative takes its name from a 2022 report on female entrepreneurs commissioned by the U.K. government and completed by Alison Rose, CEO of NatWest. A key finding was that investing in female entrepreneurship would add between 200 billion and 250 billion pounds to the country’s GDP.

Bridge Greenwood, founder of The Bigger Pie and co-founder of The 200bn Club.

Greenwood and Ghaddar embarked on a three-month research journey, during which they spoke with academics, investors and VCs. Ghaddar had already successfully raised money for her company, AllianceBlock, so she personally knew some of the struggles.

As Greenwood summarizes, “We got two key points from our research. The first is that you need a warm introduction. A lot of the VC world is all about networking, and so we have gathered some 200 VCs to be part of our network so we can create these warm introductions.”

“The second point is harder to overcome and happens during the pitching process. As soon as it becomes apparent the founder is a woman, then the unconscious bias kicks in.”

Pitching stage

Research published in Harvard Business Review singles out the pitching stage as a significant barrier for women. In essence, it says that men are asked promoted questions, whereas women are asked preventative questions – which focus on risks and put founders in a defensive position.

“Why is this important? Well, regardless of whether you are a man or a woman, if you get asked preventative questions, you are five times less likely to raise money, period,” says Greenwood.

“However, the good news is that if you understand and recognize a preventative question, you can then learn to answer in a promotive way so that you give yourself a much better chance at success. But this needs to be taught.”

At The 200Bn Club, female founders are coached on how to best pitch to VCs, which also includes the somewhat controversial concept of not pitching “like a woman.”

The abstract from “Don’t Pitch Like A Girl.” (SAGE Publicatications)

While earlier research suggested that investors exhibit bias against women due to their sex, more recent studies have found that the picture is more complicated than that, and that being a female entrepreneur does not diminish interest by investors in and of itself. A team of Canadian and American researchers conducted an experiment that found investors are actually biased against displays of feminine-stereotyped behaviors by entrepreneurs, whether from men or women. The research, titled “Don’t Pitch Like a Girl,” found that behaviors coded as feminine were associated with negative perceptions about the entrepreneur’s business competency.

Now, that doesn’t sound any better from a gender studies perspective, but from a practical standpoint, it means female founders can work around the issue by using more masculine-stereotyped behaviors while pitching.

“It turns out that while female founders are happy to talk about their team, they are much more self-effacing when it comes to speaking about themselves. And since the VC wants to invest in the leader, this is a damning habit for female founders,” Greenwood says. 

“We work with our female founders to deliver the pitch with confidence, assurance and faith in themselves. And we help them answer the preventative questions in a promotive fashion.”

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ConsenSys on equality

Thessy Mehrain, co-founder and CEO of Liquality, has a background that makes her uniquely positioned to understand the system and how to disrupt it. She spent six years creating products at JPMorgan in the U.S. and joined the Occupy movement after the financial crisis, and it was from there that she discovered Ethereum.

“So, I totally fell in love with Web3, but I also didn’t want to be part of something that creates technology that repeats what we have in the legacy world,” she tells Magazine.

While still working at JPMorgan in 2015, she heard Joseph Lubin, the founder of ConsenSys, speak at a fintech conference and was blown away by his vision. Shortly after, she jumped ship to ConsenSys and began working on a project to explore swapping between Bitcoin and Ethereum in a decentralized manner without a middleman. That project evolved in time into her startup, Liquality.

It was a great success! 🏆🌟Our first blockchain meetup for women in Tel Aviv was a huge success, with a turnout of dedicated and interested participants. pic.twitter.com/qcot4Wyjwx— StarkWare (@StarkWareLtd) December 17, 2022

In 2016, Mehrain also created the New York-based Women in Blockchain group to help address gender inequality in the sector. The group now boasts 3,000 members.

Working at ConsenSys provided her with great support, access to technology and a co-founder — Harsh Vakharia, who also previously founded the startup Etherbit. Coming out of ConsenSys, Mehrain recognizes she had many advantages over other unaffiliated projects.

Thessy Mehrain, co-founder of Liquality. (Photo supplied)

The pair successfully raised $7 million in 2021. When asked if she experienced different treatment as a female founder, Mehrain replies: 

“How would I know? I was never raised as a man. However, coming out of ConsenSys definitely gave us an edge and warm introductions. It was at that point, during our raise, that I became aware of the dominance of men in this space. At Liquality, we are focusing on the Global South, so we knew from the get-go that we needed to have diverse representation in our funders. That changed our thinking and our outreach.”

“We knew that diversity makes products more sustainable – it’s not just the right thing to do, it’s the right thing to do in business terms. We needed to explain that to our investors. But it’s more than having diversity at the cap table, it’s what you build afterwards.”

Mehrain and her co-founder have assembled a team that reflects the culture in which they want to grow. “We work hard at this. It’s not an afterthought. For example, we have a female engineering lead and a lot of strong female engineers — but that took work. 

“We are creating a legacy as we go. It’s very important so the next generation of women founders and leaders have role models and supports to help them.”

Corporate backgrounds help

A strong corporate background can also help female founders navigate the stormy VC waters. Ayelen Denovitzer was previously with Bain and Revolut, and co-founding Solvo has been her first startup role. She raised $3.5 million led by Index Ventures over just three weeks last year.

Denovitzer did not notice any limitations due to being a woman, but she is also happy to debunk some common urban myths.

Ayelen Denovitzer, co-founder of Solvo. (Photo supplied)

“There is this notion that female leaders are more risk-averse and are more emotional when it comes to decision-making, but I think that is largely debunked. Of course, there is unconscious bias, but we are making inroads on those notions too,” she tells Magazine, noting that individual differences are much more salient.

“I believe it is more down to individuals – how we mix. I am much more methodical than my co-founder, which is a ‘me’ thing rather than necessarily a female thing.”

Like Mehrain with Liquality, it was important to her that the VCs at the cap table reflected the project’s ambitions. Solvo is a retail-facing financial app that aims to bring the best features of crypto without the complexities and jargon.

“So, we needed retail-facing VCs to come onboard,” says Denovitzer.

Finding the right fellow co-founders is another element more important than gender. Helena Gagern and Grace Wang, co-founders of Web3 messaging app Salsa, both agree.

“We had shared values — which was of top importance to us both – and similar energy levels,” Gagern tells Magazine.

1/ We’re SO excited to reveal Salsa. Here is the story of how a chance encounter in Miami led us to build the app where social proof meets web3 messaging. pic.twitter.com/2tbBdi61C9— Salsa (@salsadotme) February 16, 2023

They bonded over a pilot project during two weeks in Austria, where they learned about passion, energy and pragmatism. They knew they would work together on a bigger project, which turned out to be Salsa, for which they raised $2 million.

“We were fundraising in a bear market and initially were looking for $500,000.” 

However, the co-founders quickly realized that this amount was too little and jumped it up to $2 million – which quite possibly ensured their success. 

Another element of their success was that they had met their investors in real life at conferences over the past two years. Those warm introductions went a long way to smooth the path to success.

“I didn’t feel being female was a disadvantage, but I did strongly feel the underrepresentation. This pushed us to approach female VCs as a priority,” says Gagern.

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Benefits of being a female founder

Wang tells Magazine that there are a host of benefits to being a female founder. “Once you get over the imposter syndrome issue, being a woman can make you stand out in a male-dominated space. All-female teams are rare, and so we pushed this to our advantage. And we also reach out to other female founders – helping each other.”

From left to right: Helena Gagern and Grace Wang, co-founders of Salsa.

But why the focus on female entrepreneurship? Aside from offering gender equality, there is data that points to female founders achieving better results. According to a study from the Boston Consulting Group, businesses founded by women produce twice the revenue from every dollar in funding than men. Given that they also receive less than half the funding, that’s a better bang for your VC buck.

Statistics compiled by Springboard, which helps accelerate the growth of women-led companies, suggest that even a little bit of gender diversity helps and that startups with at least one female founder outperformed all-male founding teams by 63%. 

Finally, Mehrain is pragmatic in this gender-balancing game and says men often want to help but just don’t know how.

“You know, white males are the best allies. Right? Tell them what to do, tell them what is needed. Make them allies and really have them understand how important this is. Then it’s a win-win for all.”

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The most engaging reads in blockchain. Delivered once a
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Jillian Godsil
Jillian Godsil is an award winning journalist, broadcaster and author. She changed electoral laws in Ireland with a constitutional challenge in Ireland’s Supreme Court in 2014, she’s a former European Parliamentary Candidate, and is an advocate for diversity, women in blockchain and the homeless.

Everything makes its way to the sea, and none more so than plastics. There are now five floating plastic islands in different oceans across the world, with the largest island even having a name, the Great Pacific Garbage Patch, which is three times the size of France. Lying between California and Hawaii, it is the world’s biggest ocean waste repository, with 1.8 billion pieces of floating plastic that kill thousands of marine animals each year.

Of course, we now know that 35% of waste originates from wealthy countries and 50% of this waste is exported to developing countries. At the same time, 70% of developing countries mismanage their own waste and lack the infrastructure to collect and recycle waste. Finally, 90% of all plastic waste enters the oceans through rivers, mostly through a few hundred rivers in Asia, Africa and Latin America.

Many projects have sprung up looking to tackle the problem of plastic pollution at the end of its journey. On Bitcoin Beach in El Salvador, one of the projects funded by Bitcoin philanthropists is the collection of plastics in the river before they reach the sea. 

Plastiks.io is another project that addresses the end games, identifying credible recycling and cleanup projects typically in developing countries that are funded by business or philanthropic individuals in the west.

Canada-based Plastic Bank also works to incentivize stewards to collect plastic from the oceans and, to date, claims that its Ocean Stewards have stopped more than 64 million kilograms of plastic from entering the ocean.

In 2014 in Malaysia, students from Nottingham University, then led by a co-founder of DeFi app Alluo, Remi Tuyaerts, were involved in a number of social enterprise businesses, including one that uses black soldier flies to eat waste and another that converts plastic into beanbags employing the homeless. These businesses are still thriving.

In 2019, Manila Bay Beach in the Philippines was filled with so much plastic waste it earned the nickname “rubbish beach.” Then, within a couple of months, it was reclaimed in a major cleanup. Initially, 5,000 volunteers removed over 45 tons of garbage. Prior to the onslaught in 2018, Bounties Network paid fishermen to collect trash and rewarded them with tokens, and the continued payments helped fund fishermen’s precarious livelihoods and keep the beach clean.

Here’s what 10,755 kg of trash pulled out of the ocean looks like on deck; in total, System 002 has cleaned up 169,565 kg from the Great Pacific Garbage Patch so far. There’s still a long way to go, but we expect to deploy System 002/B again later this week. pic.twitter.com/Y2WMsN9EVK— The Ocean Cleanup (@TheOceanCleanup) November 9, 2022

“Bounties Network got a partnership with a local digital payment provider, Coins.ph, to make sure people could exchange the Ethereum into fiat,” says Simona Pop, co-founder of Bounties Network.

Mark Beylin, then CEO of Bounties Network, documents the impact of the cleanup on the local supporters:

“One of the most interesting dynamics we saw throughout the weekend was the manner in which people shifted from being extrinsically motivated to intrinsically. Many who attended the event came out simply because they saw the opportunity to earn supplemental income. However, as we engaged with participants on an individual basis, we learned about the sense of personal accomplishment they felt in collectively improving their environment.” 

However, these projects are all trying to tackle the consequences of littering and its impact on developing countries. What about the projects tackling the issues closer to the source? 

A revolution in geography

In 2008, Seán Lynch, founder of OpenLitterMap and LitterCoin in Cork, Ireland, discovered GIS, the mapping software for real-world data such as what governments use to map roads or pipelines and — as a gamer — saw that it was very similar to many of the maps in his games. He then wondered whether he could use this tool to map real-world data into a game. The next question was the use.

“Where I lived in Cork, I had to pass a litter blackspot on my way to college. This was in 2008, and I wondered if I could use GIS to plot this illegal dump onto a map and start a conversation locally. I knew that while litter generally is a global problem, if you could identify local issues, then you might generate interest and, from that, generate action.”

This was in 2012, and Lynch was puzzling away about how to capture the data when the perfect tool in smartphones arrived.

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“I was traveling and working as a scuba diver in Thailand, which I adored. I had a really close personal connection with the ocean. Other divers and backpackers like myself picked up a lot of litter from the beaches every day. But it was only with the advent of social media that we realized how badly the planet was polluted,” he says

“One day, I remember seeing someone with an iPhone on the beach, and they were using it to track their location, and this was my next ‘aha’ moment: Why not use this increasingly common mobile device to take photographs and document the litter?”

Inspired by this revelation, Lynch returned to his native Cork to study for a master’s in GIS to fully understand how to use technology to solve the pollution problem. He also realized that the mere presentation of the problem, however huge, would not be a sufficient motivator — it had to be more immediate.

Lynch evolved his thinking into a citizen science platform where data can be crowdsourced on a hyper-local basis:

“People are being asked to make changes to help mitigate climate change, but I can’t pull a CO2 molecule from the air and show it to you. People hear about the environment as some far-away place being polluted, and although it’s true, this approach is disconnected from most people’s day-to-day reality. But if I can help people discover litter on a more local level, like when people zoomed into their home on Google Maps for the first time, I have your attention.”

The timing in terms of the evolution of geography is also on Lynch’s side. He explains that the study of the planet has gone through several iterations and paradigm shifts. Up until the 1960s, the study of geography, and the practice of teaching it, is largely a descriptive process. Then, a computational revolution occurred where universities started getting access to computers and governments started putting satellites into space.

“Suddenly we were able to take this quantitative information about the planet and store it on a computer. The geographers of the world realized they could not only describe how landforms looked but they could actually count things such as the amount of rainfall or how green the grass is. It’s referred to as the quantitative revolution in the study of geography.”

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This revolution, combined with approximately 4 billion people owning a powerful data collection instrument — their smartphone — gives birth to citizen science. It is no longer just a few experts counting and collecting geographical data but thousands of possible data aggregation points.Now it is just a case of making the data count and finding out what data is relevant.

In 2014, Lynch started following Bitcoin and particularly liked the concept of proof-of-work, where miners are rewarded for securing the network. When Ethereum launched a few years later, Lynch saw that he can create his own token, which gave him another “aha” moment.

“I had been toying with the idea of using bracelets to reward people, but while an attractive idea, it wasn’t practical, so the idea of rewarding people with a token was infinitely more compelling.”

And so, in 2015, Littercoin was born. In 2022, Lynch got his first funding from Project Catalyst from Cardano. 

“Mind you, Littercoin is not like other crypto. It won’t be listed on any exchange, and you won’t be able to buy it — it can only be earned by downloading the OpenLitterMap app and starting recording the litter.”

Lynch argues that there is a low barrier to earning the token and notes that it will only be spendable at pre-approved stores, and these stores will be in the zero waste stores in the climate economy.

“You earn the Littercoin by improving the environment, and you can spend it in stores that also improve the environment — it’s a virtuous circle.”

Since launching the app in April 2017, there have been 6,500 users, with new people coming on board daily. This growing community has been responsible for 500,000 tags and more than 350,000 photographs.

“And if you keep the map open, you can see the updates in real-time. So, if someone spots some litter and picks it up anywhere in the world, you can see it update on the map. We are creating a global community working to rid the planet of litter,” Lynch says. 

“We give the tools to create the knowledge, and that is a very empowering thing to do.”

To make the process fun, Lynch has created a global #LitterWorldCup with the countries all competing to be the top. Ireland was No. 1, but the Dutch community has since overtaken them. Maybe litter collection begins at home after all.

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Jillian Godsil
Jillian Godsil is an award winning journalist, broadcaster and author. She changed electoral laws in Ireland with a constitutional challenge in Ireland’s Supreme Court in 2014, she’s a former European Parliamentary Candidate, and is an advocate for diversity, women in blockchain and the homeless.

Economics is the study of human behavior involving scarce resources — and the effects those behaviors have on those resources, explains Roderick McKinley. Tokenomics in crypto is a related but different field. Tokens are a way for projects to raise funds and build communities, and designing the way they work can be much more complex than traditional equity raises — and potentially much more problematic.“In tokenomics, the token or digital asset is the scarce resource. But we can now design features for these programmable digital assets, influencing how people behave and interact with each other, often creating new possibilities for exchange altogether,” McKinley says. He explains the distribution of tokens and the outcomes of that distribution are key matters for investors and for how the business ends up operating.Roderick McKinleyMcKinley has worked on a range of different projects, including ParallelChain, GBC AI, Avarta, Fluid, ShopX, Terona and Kasta. But what is it that a tokenomics expert provides to projects?“I typically deliver a range of services to projects. These include a design of the token’s supply alongside other economic features that make the token useful, so it attracts demand, helping clients to understand how to use the technology in ways that fit their business and, finally, how to make a compelling fundraising case,” he says.There are two parts to every token’s value equation: supply and demand. Yet an internet search for “tokenomics” is likely to take you to colorful fan charts that only deal with the supply side of that equation: describing how a project plans to release its supply of tokens to stakeholders, over time. Making sense of how tokenomics is applied on the demand side is harder because each case is different and potentially unique.The dark art of tokenomics underpins the entire crypto economy.A few examplesEthereum’s ETH token was designed to be the only way that users could pay miners for the computational resources supplied to run the blockchain — aka gas fees. As long as there is demand for computation to be performed on the Ethereum blockchain, a finite supply of ETH has value.Synthetix’s SNX token was designed to make up the collateral that backed the issuance of synthetic digital asset derivatives (tokens that follow the price movements of other known financial assets). Stakers receive SNX token rewards while the project is in the early stages, as well as all of the trading fees collected. Synthetix also popularized “yield farming” by giving users SNX rewards to provide liquidity on Curve and Uniswap. As long as there is demand for the synthetic assets that Synthetix builds, a finite supply of SNX has value.Helium’s HNT token is used as a reward payment paid to users who provide wireless coverage capacity to support Helium’s decentralized wireless connectivity platform, and the token is burned for every dollar fee paid by users who connect to this network. As long as there is demand to connect to this decentralized wireless network, a finite supply of HNT has value.None of these examples describes a fully automated process. In every case, humans are making free choices in response to incentives, and that is why the consideration of human behavior is fundamental to tokenomic design.Influencing people’s behavior has always been the holy grail for economists. Source: PexelsHuman behaviorBut real-world facts often diverge in surprising ways from classic economic theory. For example, numerous experiments and papers point to the fact that people will not always work harder for more pay. So, how can incentives reliably work to alter people’s behavior?“When designing tokenomics for a project that then goes live, it’s like conducting mini experiments into people’s behavior. We can learn from what people actually do instead of what theory tells us they will do,” he explains.“We’re not into manipulation. People join these communities on a voluntary basis, and they can choose to opt in or out of the project. If the project has collectivized governance, they may be choosing these rules for themselves.” “This is very different to what we get with something like China’s social credit system,” he adds. “This is dystopian, as there is no choice — everyone must take part whether they want to or not.”Instead, McKinley compares behavioral change directed by tokenomics as little nudges, like putting the cookie jar out of sight when you want to eat fewer calories. “Influencing behavior does not have to be malicious,” he says. All these incentives and interactions are built from freely programmable and endlessly configurable code. That poses a dilemma of choice when the possibilities are so open-ended.Tokenomics is one of the most important aspects of CryptoIf you don’t understand tokenomics, you’re not gonna make it.Here’s everything you need to know about Tokenomics?— Covduk (@Cov_duk) July 15, 2022 “It’s important to be clear-eyed about the value exchange that each project creates, and who the actors and beneficiaries are in that exchange because the possibilities for applications are really diverse. We may be using the code to allow people to trade honestly and transparently with each other. Or we may be using code to automate business logic and processes so that they no longer need to be done by expensive and error-prone humans.”Once these users and the exchanges they make are defined, tokenomic design is applied to create rules that define how those exchanges take place while keeping an eye on the total token supply and the token balances held by different user groups. “All of these elements are going to interact to influence the token’s price, and that has repercussions for the ability of your token to work as an incentivizing instrument as intended,” he explains.Ponzi-nomics and yield farmingOf course, while influencing behavior using tokens can be a noble aim, on the flip side, there can be the complaint that tokenomics often ends up being a glorified Ponzi scheme. Anya Nova with Power Ledger grapples with this concept, sharing McKinley’s views to an extent. “Incentives are part of a business model that generates value, and that value can be defined as enabling a person to complete one of their life’s ‘to-dos’ faster, better, cheaper, or more enjoyable — similar to the way Uber allows us to catch a taxi easier.”  She points out that one of the key incentives in crypto space — i.e., staking for staking’s sake or yield farming — does not actually create any value. “I’m not talking about staking as one of the mechanisms of securing the PoS chain, but staking where you put x into a smart contract and get x+rewards sometime later, but your x actually performed no role in consensus,” says Nova.Anya Nova of Power LedgerThe staking model Nova singles out is the “stake for rewards” scheme that many projects have used to lure new users to buy their token. This reward model can be economically sound when early supporters of a community contribute something more to a project by joining it in its early stages. Consider the early users of Facebook or YouTube — it was their presence and activity on these platforms that helped create early content that attracted other users and helped these platforms scale. Today, these platforms are already so large that new users no longer make this kind of special contribution when they sign up to these platforms.  The trouble is that many projects used staking rewards for projects, which never stood to benefit from those kinds of early network effects. The rewards offered were simply used as a promotional device to bring in new users. The 20% interest offered on UST deposits on Terra’s Anchor Protocol was a notable example. This incentive was launched to accelerate user adoption of UST. The promotion was a victim of its own success and flawed design, with UST deposits growing at a much faster rate than the uses of UST in Terra’s ecosystem. These kinds of promotions are routinely and successfully used in ordinary retail marketing. But in that context, a known, defined product is being delivered to consumers at a discount. In the blockchain case, what is being delivered is a token whose value depends on long-term demand for its utilities and the token supply, which is increased by the very promotional rewards users are buying.The net result was that these rewards — which were being paid to speculators and individuals with a genuine interest in the project — flooded markets with supply without a commensurate increase in demand for the services delivered. Once speculative tension is removed by a large market event or a shinier token elsewhere, the price collapses.But then again, Nova wonders if everyone sees it that way and if it really matters:“If I’m being my own devil’s advocate, then I’d say that ‘capital gains’ or selling more tokens on the market is a sort of ‘value.’ In the eyes of a crypto yield farmer or crypto trader, it’s the ultimate value, and who are we to say that it’s not? They don’t care if it’s a Ponzi or not a Ponzi — as long as they sold a token for more money than what they bought it for or same money but more tokens.”Tokenomics is a balancing actTom Serres, co-founder and managing partner of Warburg Serres Investment Fund, which focuses on Web3 projects, views quality tokenomics as a balancing act.Tom Serres, co-founder of Warburg Serres Investments“In every economic situation, there is supply and demand, and when supply is equal to demand, then you have perfect equilibrium. Every company should be trying to achieve perfect equilibrium from an economic principle,” says Serres.“If there is more demand than supply, then I’ve not built in enough supply, and I’m losing out on potential revenue. Conversely, if my supply is greater, then I’ve overbuilt, and I’ve a lot of sunk costs and extra overhead.”The concept of extracting value from open-source software is not a new one, but it was harder to do before crypto. An example might be the company called Red Hat in the United States. Red Hat consultants built software on top of Linux, which is one of the original open-source projects. Red Hat took its expertise and hawked it around to big companies, such as FedEx and Merck. “So, while the software was free, this specialized consultancy was very much not. Afterward, the company was bought by IBM for a staggering $34 billion.” “But what if you could have tokenized Linux, and so rather than charging a consultancy fee, you add more features, and the software paid out in return? That was, the token is incentivizing good behavior.”Getting into the weedsMcKinley has worked with more than 20 projects over the past two years. He references ParallelChain, a new layer-1 blockchain smart contract development platform. The founders wanted to design incentives that would sustainably reward behaviors and actions to secure the state of the ledger.“I couldn’t just copy other layer-1 designs because ParallelChain has a consensus process that is unique, with three tiers of authority. The three groups remain decentralized through balanced voting powers. I had to take an approach which took those objectives into account and design a reward system that always offers increasing rewards to smaller nodes as they grow to rebalance governance towards the desired state, and caps rewards that are paid to nodes once they reach a certain size, forcing that node’s rewards to be spread more thinly if they grow any further.” Other examples include GBC.AI, which is creating a whole suite of products and services for the blockchain space using machine learning and AI. The team wanted to fundraise using a token sale, so McKinley worked closely to understand the core capabilities of the team and its technology to come up with a broad array of products that could be accessed using the project’s utility token, which would provide demand for it. McKinley also structured their revenues to be denominated in a stablecoin in order to decrease the project’s reliance on using its own token to fund ongoing expenses.GBC.AI is creating a suite of products for the blockchain space using machine learning and AI.“But then, I still link this key business driver back to the scarcity of the project’s utility token by using a policy mechanism to commit a share of stablecoin revenues collected to buy back and burn the project tokens,” he says. Another project he worked on is Iconic, an NFT marketplace and social platform that serves esports and gaming communities. The team had just completed its core product: allowing users to record their gameplay, publish it and mint it as an NFT from within their gaming console.“In this project, I needed to think about the end users, the gamers who have a very specific profile. I asked myself relevant questions about what these users wanted, what they needed, and what would get them excited. Ultimately, I could see a great opportunity to build out the token utilities in a social direction that would allow the gamers to support their favorite esports star or content creator,” he says.  “One experience designed to support this is a recurring lottery event that allows users to vote for their new favorite new content using the native utility token. The content with the most support wins and gets showcased on the platform, and all the backing supporters receive the total token contributions made to the lottery reward pool.”Love it and list itOnce the tokenomics has been designed and the capital has been successfully raised, the next step is to list the token on an exchange. The benefits of following a “token sale plus listing” approach to fundraising over an early-stage equity sale are the speed and lower costs it offers projects, regardless of market conditions. The downside can be that there is an expectation of early returns, which puts sell pressure on the project token and interferes with the project’s success. This was the opinion of many observers as to what precipitated the enormous 95% crash visited on the high-profile initial listing of Internet Computer’s ICP token in 2021.“At the moment, I don’t think there is enough patience in general. People want to get returns very fast when building a new business still takes a long time. I do not take that to be a critical fault with the token sale mechanism,” he says.  “Rather, I think we will see terms and controls for token sales evolve in ways that retain some of their attractive advantages over equity fundraising while better aligning investors’ actions and expectations with the project user community and the realities of growing a startup.” Keep it simple but not stupidMaarten Ectors, commercial director with Pollen DeFi, a DeFi 2.0 platform, feels the secret of tokenomics is to keep it simple, and he sees utility as key. Pollen’s tokenomics operate in a pragmatic utility fashion.Maarten Ectors of Pollen“Pollenators” (users of the site) create virtual portfolios and stake the PLN token each time they rebalance. Pollenators can also delegate PLN into following the top Pollenator’s virtual portfolios to benefit from any appreciation, while the creator of the trading strategies gets 20% of the profits. There’s also a governance token called vePLN given to long-term stakers, which boosts rewards by 20%. “It’s about bringing utility to the project and to the utility influencing the token’s value. That’s where it all boils down to. Because too many projects talk up their token’s value, a lot of marketing money is spent,” he says.  “Really, it should only be about, like — Are any of us actually using it? And if ’re using it, does that really bring win-win situations? So, it’s all about finding those types of things. You can do a lot of maths; you can do a lot of modeling and so on. But it’s all about the use, the utility,” says Ectors.Nearly a new stablecoinThere are also times when tokenomics is used to incentivize behavior to generate a whole new token. In the aftermath of the collapse of UST, algorithmic stablecoins have come under the microscope, but it hasn’t dampened the ardor other layer-1 platforms have for stable assets. Many of the layer-1 protocols are now looking at creating stablecoins, each with its own tokenomic design. Scalable Ethereum smart contract platform Telos is doing stealth work looking at a new native stablecoin, Force. Meanwhile, Near Protocol, a layer-1 competitor to Ethereum that’s looking to be the fastest blockchain on the block, is also gearing up work on its native stablecoin, USN. Mark Sugden, formerly of the Near foundation, is helping with growth. He tells Cointelegraph that he reckons this is the way forward for all layer 1s:“Near Protocol has a vision of becoming a trillion-dollar ecosystem with applications, protocols, marketplaces, etc. all built on top. And the Near token is simply designed to be the transfer or value mechanism for the gas — for paying for transactions on the network,” says Sugden.“In many ways, the Near token is not a good medium of exchange, as it’s too volatile, so in the future, we’ll need something to transfer value across the ecosystem that is maintained or pegged to something we know like the dollar.”Near’s Mark Sugden believes tokenomics is hollow without genuine use cases.Sugden says that rather than work on an expensive integration of USDT or USDC, it’s better to leverage the skills of participants in the ecosystem to put together a stable native coin. “And it’ll be better than an EVM copy,” he says. Sugden is part of an independent team called Decentral Bank (DCB), which is a DAO set up to organize the stablecoin. He explains that USN is over-collateralized, “It’s basically wrapped Tether on a one-to-one basis. When you mint USN with USDT, the reserve fund is made up of Tether so that if anyone wants to redeem their USN they will always get USDT.” In order to mint USN, you need USDT. USN has a 1:1 relationship with USDT. No Near tokens are involved in the minting process. USN holders are then eligible for yield provided by the rewards of the staked Near that the DCB has in its reserves. The DCB holds a reserve of Near tokens, from when the protocol required Near to mint USN, which is no longer the case. Sugden says being over-collateralized and avoiding unsustainable yield help to avoid the clear issues with the design of the failed Terra UST project.“First of all, the infinite supply for UST created a false economy with regards to the market cap, and then some 80% of the coin was locked in Anchor and getting huge and unsustainable yield. Stablecoins are made to be used not to be staked for an unsustainable APR in what turned out to be a kind of Ponzi scheme.”Sugden also explains that the decision to peg USN to USDT is aligned to the bear market and does not rule out changing monetary policy in the future by adding in future assets. He says building in use cases into a thriving ecosystem is key and that tokenomics without them are just hollow.“We did our soft launch at the same time that UST collapsed, which taught us some lessons — and also highlighted core differences — not least the fact that we have already a strong ecosystem and the stablecoin is coming later — not the other way around. It’s transparent, run by the DAO, and, if God forbid, it hits a crisis, the Near ecosystem will keep on chugging along.”USN will incentivize holders by taking advantage of the Near proof-of-stake ecosystem. The validation rewards from participating in that ecosystem will be distributed to holders of the USN coin, taking advantage of the Near consensus mechanism, while affording optionality to the stablecoin holders. It’s not simple, but maybe the trials and tribulations of algo stablecoins will help foster more robust solutions going forward.