In case you missed it, we've got a recap of the recent AMA between Peter Danihel (Sigmadex) and Ray Reijnders from Hillrise group. Check it out below!
Ray Reijnders (Hillrise Group): Welcome to our AMA with Sigmadex. Today we are joined by Peter Danihel, founder of Sigmadex. Everyone in the room is welcomed and encouraged to ask questions, don’t be shy! We ask that you please be patient and do not spam questions. The Hillrise Group team are here to moderate and this event is scheduled to be approximately one hour in duration. Let's begin.
Ry Reijnders (Hillrise Group): Hi @pdanihel, thank you for joining us today🙌
Peter (Sigmadex): Hello guys 😀
Ray Reijnders (Hillrise Group): Welcome Peter and thank you for being here.🙌 We have been planning this for a while and we know you’re busy with preparations for TGE, so thanks for your time.
Could you start with an introduction to yourself and what you’re building at Sigmadex?
Peter (Sigmadex): I am a self-taught software engineer, having been in the crypto space since early 2012.
At Sigmadex we are building a unique liquidity protocol which is powered by game theory and is solving market manipulation issues which currently plague other protocols.
Ray Reijnders (Hillrise Group): Lets jump right in.
At the core of almost every crypto-product already lies some components of game theory. What is unique with your project is game theory is very much at the forefront of your messaging.
What are the core components of your game theory implementation and why is it important?
Peter (Sigmadex): We believe the biggest differentiating factor with Sigmadex vs. others is that we have taken several elements from traditional finance and have combined them to create the ideal ecosystem for individuals (both retail and institutional) to provide liquidity.
Creating appropriate incentives and balancing the economics is part of our core foundation in Sigmadex.
Ray Reijnders (Hillrise Group): To build on that, at what point do you think the addition of more robust game theory mechanisms become “too much”, where it begins to limit participation?
Peter (Sigmadex): As you guys probably know, game theory can be very complex. Integrating the right amount and using the proper formulas are crucial and there is definitely a point where it can hurt the project. It's not really a matter of how much game theory is added, it's more about what components were gamified and how they affect the overall "play-ability". The last thing we want is for people to be repelled because the elements are too complicated or offer no benefit to the users.
Ray Reijnders (Hillrise Group): that makes sense, looking forward to your future implementation and finetuning.
To go a different direction. Since you have created a foundation that is developing a protocol with a vision to decentralized governance, could you elaborate more on the structure of Sigmadex? The (legal) parties involved in development and the road ahead to true decentralisation.
Peter (Sigmadex): The ultimate goal for Sigmadex is ownerless. Sigmadex isn't in the business to generate revenue. We are creating infrastructure that is supposed to last forever and governed by its community (token holders). The overall structure is actually quite simple, we have developers contributing on the daily to improve the protocol and with steady adoption and development our team will be able to continue to scale the project from awareness and token appreciation.
Ray Reijnders (Hillrise Group): Is your foundation registered anywhere legally? And what role will this Sigmadex Foundation play once the protocol is live and community governed?
Peter (Sigmadex): We are registered in BVI and have developers in Asia, Europe and Canada.
The foundation itself will continue to explore growth strategies for the protocol and continue to invest (both time and capital) into creating more compelling assets for the DeFi community.
Ray Reijnders (Hillrise Group): Many projects including yours are being built on Polkadot. All the while, Polkadot has seemed to lose a lot of steam lately with uncertainty in their development.
Do you see this as a problem? Are you considering any alternatives?
Peter (Sigmadex): We have prepared for delays in the Polkadot roadmap by having our first iteration deployed on Binance Smart Chain. A lot of our smart contracts are already written in Solidity and will enable us to have a version of Sigmadex running prior to Polkadot’s relay chain launch with Parachain support.
Ray Reijnders (Hillrise Group): We’ve found a very clear and easily digestible explanation of Sigmadex’s unique constant function market maker algorithm - utilizing an order book where all liquidity is pooled into one to solve the problem of having an asset market with changeable liquidity pools consisting of many limit orders which would leave too much discretion in the determination of the liquidity parameter. Could you walk us through the development and thought process behind this model?
Peter (Sigmadex): The thought here has been to simplify things. Managing an on-chain orderbook isn't a very efficient way of doing things. Instead what we have proposed here is measuring liquidity from several sources in order to regulate the amount of liquidity available to each individual asset. This is actually even better for security and makes it more tough for market manipulators.
Ray Reijnders (Hillrise Group): This approach seemingly comes with its own challenges - notably with regards to non-optimal arbitrage and front running. Proposed solutions are minimum orders and gas fee restrictions.
Could you elaborate on the specifics and considerations made with regards to participant accessibility (small orders) and trading experience (speed/gas restrictions)?
Peter (Sigmadex): Front running can be solved with gas fee restrictions and shouldn't be a problem on Polkadot. Since DOT doesn't require an insane amount of computational power, the fees will be much less than traditional PoW consensus.
We will continue to experiment with small orders and what limits to place. Its tough to say at the moment because we do not want to place limitations on order sizes if we don't have to. Since Polkadot's network fees are very small in size we can foresee people using DEXs more than CEXs in the future.
Ray Reijnders (Hillrise Group): Platforms like yours propose providing incentives for users to provide liquidity, which has become very common.
How are you designing the emissions system to keep liquidity incentivization sustainable?
Peter (Sigmadex): A large portion of the tokens (40%+) are dedicated to network incentives. Early protocol adopters will have the opportunity to earn more rewards and have more incentives which will benefit users as we continue to build out our infrastructure.
We also have a deflationary monetary policy in place to ensure our token remains strong while we continue to expand our game theory elements and make our protocol more attractive when compared to the competition.
Ray Reijnders (Hillrise Group): This message concludes our AMA. We thank Peter for his time today and for being open to this unique dialogue with the community. To everyone who joined us, thank you for being here... we host these events for you, the community.
Ray Reijnders (Hillrise Group): Thank you for your answers today @pdanihel 🙌 Looking forward to the future developments of Sigmadex. Thank you for your time today Peter,, we look forward to seeing Sigmadex evolve over time.
Peter (Sigmadex): Thanks for having me guys!
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