[SNT] - MCD Application by Status

Hi everyone,

Firstly, great to see the progress being made with MCDs!

We here at Status would like to put in an application to have SNT accepted as collateral in MCD. I’ve included our application below - please do let me know if you have any questions.

Thanks for taking a look!
Ben


Technical Specifications

  1. What is the token contract address?

0x744d70fdbe2ba4cf95131626614a1763df805b9e

  1. Where can the source code be viewed? Please provide links to the source code for all contracts providing functionality to the token, including, but not limited to, transfers, freezes, whitelists, blacklists, transaction approvals/rejections, authorizations, upgradability, etc.
  1. Which token standard does your token comply with?

ERC-20

  1. Does the token have any special mechanics for handling forks? This may include forks in the token app or in the underlying blockchain. If yes, please provide a reference to more information on fork handling.

Yes - SNT implements MiniMe which allows for token cloning (forking): https://github.com/Giveth/minime

  1. My token fits with the following Dai Credit System adapter:

GemJoin1

  1. Has the token passed formal verification?

No

  1. Technical audit - Upload audit report created by qualified research personnel.

Financial Specifications

Overview Questions

  1. Please provide a short summary of your project.

Status Research & Development GmbH is building the tools and infrastructure for the advancement of a secure, private, and open web3. As a product, Status is an open source, Ethereum-based app that gives users the power to chat, transact, and access a revolutionary world of DApps on the decentralized web. With the high level goals of preserving the right to privacy, mitigating the risk of censorship, and promoting economic trade in a transparent, open manner, Status is building a community where anyone is welcome to join and contribute.

  1. Please list the founding members.

Carl Bennetts & Jarrad Hope

  1. What type of crypto asset is it (utility, work, governance, etc)?

SNT is categorised as a utility token

  1. If native crypto asset, which category (utility, work, governance, etc)?

Utility

  1. What is the token’s usage in the project? How is the token utilized?

SNT has multiple use cases - all of which are described in the whitepaper available at https://status.im/whitepaper.pdf. Below is a summary of some of those use cases:

  1. SNT is required by Stakeholders to select and receive push notifications.
  2. SNT is required to register a username on the Status Network.
  3. SNT is required to deploy a semi-public token-based group chats.
  4. SNT is deposited, and transferred from stakeholders to recipients upon receiving a reply from the recipient.
  5. SNT is required to opt-in for curation mechanisms.
  6. SNT is required to become a seller with the Status Teller Network. It is also required for curation and signaling in the Teller Network.
  7. Required for Curation & Signalling and Seller/Trader participation in the Sticker Market.

Issuance - Bearer Assets

  1. What was the date of the ICO?

20th June 2017

  1. What was the initial price and valuation? N/A

  2. How much capital was raised (in USD and crypto terms)?

~$100,000,000 (300,000 ETH)

  1. What was the token distribution breakdown?

Of the total supply of SNT, 41% were sold in the ICO to pubic contributors, less than 10% were given out in Genesis tokens to early contributors, 20% is reserved for Status Core Dev and 29% is in reserve for future stakeholders.

  1. Are any tokens on a vesting schedule? If so, what is that schedule? Describe any related vestiture limitations.

Only those that have been issued to employees - vesting schedule paid quarterly over 5 years.

  1. What are the circulating and total supply of the token?

6.8bl total supply with roughly 50% currently in circulation

  1. What is the wallet address of the treasury?

0xA646E29877d52B9e2De457ECa09C724fF16D0a2B

  1. How much of the ICO raise was converted into fiat (described in both terms of that fiat currency and the amount of tokens?

Majority of ICO funds were kept in Ether, currently approx. ETH 160k

  1. Were there any pre-ICO seed investors? Who and what were their respective allocations?

No

Fundamentals

  1. Please link to the whitepaper and/or pitch deck related to the token.

https://status.im/whitepaper.pdf

  1. Please link to the most updated roadmap for your project.

We don’t maintain a roadmap specifically (we manage development work through Wrike), however we do provide regular progress updates on our blog: https://our.status.im/

We also stream our bi-weekly townhalls via youtube - see link.

  1. How many employees and contractors does your project have?

~64

  1. What is the monthly burn rate?

~$750,000/month

  1. What is the strategy for treasury management?

Strive for diversification which hedges the project long term and secures enough runway to secure development of the high priority initiatives of approximately 6 month at all times.

Markets

  1. Which exchanges is your token listed on?

For a full list, please see: https://coinmarketcap.com/currencies/status/#markets

Major exchanges include: Binance, OKEx, Huobi, Bitfinex, Upbit, Bittrex, Gate.io

  1. Are you aware of any paid market makers for your asset?

We are currently using 1 market maker.

  1. Does your token have custodial support? Where/with whom? Please provide a copy of the custodial agreement if available.

No

Community

  1. Please link your email, Telegram, subreddit, Discord, Twitter, Medium.

https://twitter.com/ethstatus

https://www.reddit.com/r/statusim/

  1. What is the website of your project?

Legal Specifications

  1. Who is the token issuer (if any)?

Token issuance was done over a smart contract: https://etherscan.io/address/0x55d34b686aa8c04921397c5807db9ecedba00a4c

An analysis of the Status ICO you can find here: https://medium.com/the-bitcoin-podcast-blog/a-look-at-the-status-im-ico-token-distribution-f5bcf7f00907

  1. Do you have legal representation related (1) to the issuance of the token, (2) regulatory requirements regarding the token, or (3) otherwise? If so, whom?

Points (1) to (3) were covered with the General Terms and Conditions here.

  1. What is the regulatory status of the token? Please provide relevant documentation (e.g., legal opinions, prospectuses, public disclosures, filing documents, etc.).

SNT is considered to be a utility token. Legal assessment can be shared where required.

  1. Are there any rights associated with the token that do not follow from its technical implementation or technical ramifications of the system in which the token is used? If so, what are they? How are they enforced? Please provide documentation memorializing these rights.

Not that we’re currently aware of.

  1. In what jurisdiction(s) was the token issued?? Please provide all filings and public documents related to the token’s issuance.

The token was issued over a smart contract. Status has a tax ruling in Switzerland.

  1. Was the token issued as part of a regulatory process (e.g., securities offering)? If so, under which law, rule and/or regulation was the token issued? Please provide all documents related to this regulatory issuance process (to the extent not already provided in response to the above).

No

  1. Was the token issued as part of the fundraising process for your project? If yes, who are the investors and how much equity do they respectively hold?

Yes, however, since it was done over the smart contract and (almost) without KYC/AML at that time, Status does not know who invested. An analysis of the ICO you can find here: https://medium.com/the-bitcoin-podcast-blog/a-look-at-the-status-im-ico-token-distribution-f5bcf7f00907

  1. Please describe the corporate and legal structure of the project/system/product in which the token is used.

The Token currently can be used to get an ENS name as well as in the voting Dapp. More use cases for the users will follow later this year as we are on the brink of launching v1. All the use cases and are described in the whitepaper: https://status.im/whitepaper.pdf

6 Likes

In your opinion why should MKR token holders prioritize SNT above the other current collateral candidates?

I don’t really see @Ben_Morris asking for priority above other collateral candidates here but I might have missed something. Will review this material later when time allows. @Ben_Morris: please be aware that the collateral review process is still a work in progress and if you do not get a response or not the response you expected there is no ill will involved, just community members asking questions that might or might not be informed. Also be aware that your application coincided with the launch of multi collateral Dai and Devcon5 so focus is most likely elsewhere right now. Please bear with us - I am sure the community will respond at some point.

1 Like

Hi @ginworkflow - thats for your message. We aren’t asking for priority - we are asking to be considered.

@Planet_X thank you - that is no issue at all. We understand that this is a new process so we are flexible and happy to help wherever we can.

Hi. Sorry my previous message were not so clear. I would like you to give reasons why MTH should prioritize SNT above other collateral types (if you don’t mind). Firstly because I think this would be interesting to hear and secondly a more “sales pitch” kind of statement would help MTH judge if they should spend time looking into SNT or one of the other collateral candidate tokens imo. With TUSD I kind of know what the value proposition is with SNT I am not so sure because I don’t know your project that well. Hope this made a bit more sense :slight_smile:

1 Like

Dear @Ben_Morris,

I have looked over the SNT project and parts of the provided documentation. I am by no means an expert on SNT so please correct me if I am wrong about anything.

My concerns are mostly centered around the present lack of technical audits for the soon-to-be-launched V1. The existing technical audits are not so helpful as they date from mid 2017. But I do note that audits are ongoing for the V1 codebase.
Based on this I would kindly propose that a review of SNT as potential CDP material is postponed until

  1. V1 audits are passed
  2. V1 launch
  3. some time is allowed to pass after V1 launch for a slightly more realistic market value and some user base

A bit of the problem with SNT is that it is very much influenced by network effects. In other words it is likely to be a bit of an all or nothing type project. In the Maker community I have a tendency to be a bit gung ho about adding collateral but this is too much even for me.

If the community decided to include SNT at this stage the debt ceiling could have to be crawl space for this to pass.

My position is that we take a more thorough review of SNT sometime Q2 2020, with the upside that the debt ceiling could potentially be much higher if the project turns out to have real value.

Hey @Planet_X,

You can find more information and status of the current V1 audit at https://discuss.status.im/t/v1-audit-information/1330.

There have been other audits done more recently on sub-protocols such as Usernames which was completed and deployed a year ago.

You can also find more audit related information from the Status home page under security. I would post them but new forum user I’m limited to the amount of links I can add to this post.

@ginworkflow I’ll attempt to make the case for why SNT makes a good candidate for MCD below.

For starters I suggest reading the original whitepaper. It lays out the broad vision for why such a network should exist, the types of users it appeals to and how they will interact with it. In short it describes a social network that departs from the incumbents that are operated by an owner, and instead proposes a network owned and governed by the users that preserves user privacy and is censorship resistant.

In order to achieve this artifacts of traditional social networks are built as protocols. For example usernames are no longer issued by an authority but rather a contract that will mint an unclaimed username in exchange for locking up some SNT, making the user the owner of the username asset. The lock up is there to disincentivize and prevent bad behaviors such as name hoarding but also creates a value accrual mechanism to help sustain the network overtime.

In the case of Usernames, it has already been deployed and has use while Status is in beta. You can track the usage of Usernames and the other use cases as they come online at:

analytics.status.im

Status also has a page that describes some of the use cases and crypto-economics here: https://status.im/snt-utility/

These use cases are different in their appeal and usage from DeFi networks and as a result the value accruals to SNT should overtime have a low correlation with the value accruals of other networks. Having a basket of low correlated assets is an established method of reducing the total volatility of a portfolio and adding SNT to the collateral pool should bring the diversification benefit that reduces the total risk of the collateral pool.

Finally I created a series of interactive notebooks to model the economic value of some of the use cases. You can change the assumptions in the combined notebook or individually to see how it might impact the value. You can find a link to it from the SNT utility page.

Again, sorry for not posting all the links, I don’t have permission to post more than two.

2 Likes

Hello,

Below are some of the links that were mentioned.

Further details on security:

Interactive notebooks: