Episode 64: Building Web3 DAOs & ParagonsDAO with DeFi Ted

Ben Lakoff, CFA
February 28, 2022
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DAOs are all the rage right now. Decentralized Autonomous Organizations. DeFi Ted, was one of the founding core team members behind ParagonsDAO.

In this episode, we cover a lot about being anon in the space, ParagonsDAO, Parallel NFTs, misconceptions about being in web3 - devs and traders - the collaborative v. competitive nature of Web3 and building in the space.

What ParagonsDAO and Parallel NFT are doing in the space are incredible. Enjoy this conversation with DeFi Ted.

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Show Notes

0:00:00 Welcome and context

0:02:27 What is your background?

0:05:16 Ted's journey to crypto

0:07:35 DeFi Ted's pseudonymous crypto life

0:12:50 What ParagonsDAO is?

0:17:31 What is Parallel?

0:24:00 What is the PRIME proposal and what does that mean?

0:26:30 How does the PRIME Token accumulation for ParagonsDAO work?

0:31:20 How does the card bonding work?

0:37:30 How to use vesting capsules with the founders' tokens?

0:44:10 What's on the ParagonsDAO roadmap?

0:50:11 Where can people find out more about you?

Show Links


ParagonsDAO on Twitter

Follow DeFi Ted on Twitter

Connect with DeFi Ted on Discord

Helpful other Alt Asset Articles

Episode Transcript

[00:00:00] Ben: Welcome to the alt asset allocationpodcast, exploring alternative investment opportunities available to theeveryday investor. Here's your host Ben Lakoff.

[00:00:15] Ben: Hello and welcome to the Alt assetallocation podcast. Today's interview is with defy, Ted or Ted dowels are allthe rage right now.

Decentralized autonomous organizations. We've talked aboutthese a few times on the podcast before, but Ted was one of the founding coremembers behind Paragon stout, this launched at the end of January. And it'spretty darn cool. In this episode, we cover a lot about Ted being anonymous inthe space, some of the difficulties and intricacies of operating as apseudonymous or anonymous person.

Then we go into a lot of detail on Paragon's down the Dowitself, building it from scratch, parallel NFTs. These are the NFTs, the assetsthat Paragon's doubt owns a lot of misconceptions about being in web three.There's this misconception that they're all devs or traders and nothing else.Shocker. If you're a spoiler, if you are interested in joining the space.

Always teams looking for intelligent, passionate people to jointheir projects. That's for sure. We also talk about the collaborative versuscompetitive nature of web three and just overall building in the space. There'sa lot going on now. I say that a lot, but Ted really spends a lot of time inthese areas and I'm delighted to share his insight here.

All right. Before you listen, please don't forget to like, orsubscribe to the podcast even better. Leave. If you're watching this onYouTube, please subscribe to the channel or give it a thumbs up. This reallyhelps people find it. And as I told you before, I'm going to restart this thingin 2022. So excited to get more traction on the podcast.

That's. All right. What paragons Dow and parallel NFTs aredoing in this space are absolutely incredible. And this is just one littlepiece, but please enjoy this conversation with defect, dad, Ted. Welcome to theAlta asset allocation podcast. Excited to have you here today. Thanks forjumping. Oh, thanks for having me, Ben.

Yeah, it's been a long time coming, man. I'm super excited tosit down and these are the conversations. We've had a number of times, butbeing able to record this and share it with our audience, I think it will bereally good. You're deep in the community. We're going to go over a lot, butbefore we get there, let's start off just with a little background who you are,how you got into crypto and maybe how you came up with the pseudonym defy tent.

[00:02:46] DeFi Ted: Sure. Well, okay. You show, I mean,the pseudonym was actually really easy. I was, it was, so it was that it was in2019 and into 2019, I changed it. It wasn't in the and I wanted something thatrepresented who I was as a person, but maybe didn't get to be as like myindividual. And I've always been very outspoken, very direct.

Some people would say I lead with. Which means I'm, I'm happyto believe with my Juul, which means I'm happy to kind of get one or twoknocked on there. And, and, and that's how I've been, you know, my, my pasteyes, I run to the fire, but I've always been done it with a very smarthospitality and 10 kind of fit who I was at that at that time.

And I kind of like if the COVID. Being the COVID wasn't aroundyet, but my daughter had just been born. She was very premature Jewish at 10weeks premature. So we'll spend a lot of time in hospital. And I was reflectingon my time at hospital, around creating the Sudan. I was actually in the middleof redoing all my crypto stuff because I wanted to really spend more time inthat space.

I was very disillusioned from. From my current employment andI'd already been in crypto for two years at that point, but I just haven'treally thrown myself into it. So I was going through this change and it wasdefeated. So I originally had Ted and I was like, well, what can I make withTed? And I actually wanted to have the word as well.

We're being defaulted. So it kind of. Felt defeated. Causethat's how I kind of felt at the bottom. Oh yeah. You know, and I wanted likethat double kinda meaning that double entendre , but you know, almost likedefeated. Right. And it didn't really work out to stay that way because, youknow, putting like 2020 was, you know, we had defined some, I'd been early to alot of things and you know, and we went off and.

I was able to continue to, to put actions behind this unknownpersona and, and grow divided.

[00:05:00] Ben: Yeah. And how how'd you, so you got into cryptoin 2017. Walk me through kind of the

[00:05:06] DeFi Ted: journey there. Yeah. Easy. I had afriend of mine that was on Facebook, ranting and raving about digitalcurrencies. ICO's were starting to really take.

But it's still very early. So it was still before about thestart of 2017 and well, before the boom at the end of that year. So my firstForane was I participated in a thing called Komodo, which was, I think Bitcoindoc, maybe at the time. And it was being, that was doing an ICO for their newplatforms. And yeah, I had a friend tell me all this stuff.

I had no idea what he was talking about. And essentially I'llthrow some money into this. And I might a bit of money from this ICO and Istarted reading more about Bitcoin. I wasn't really on a theory. And back then,I'd spent a lot of time with this, cause I'd already seen this and there's notICO sells, implies bag, hold on to being early.

And I thought this was going to change the world, but then onceall the crash happened at the end of 2017, I was, I was in this, I was in thissituation where, okay, there's a lot less noise. There's a lot less kind ofpeople throwing stuff in your face all the time, where maybe you don't givingthe real information.

And it was actually that time afterwards, maybe. The middle of2018, did I start really, always able to start kind of getting through theweeds a little bit and, and reading some really valuable information andstarting to learn properly. And that was probably my best time, middle of 2018to the middle, to the end of 2019 in crypto.

Just, just, just slow learning. There was so little noise,everything that came out was pretty much alpha and you were able to actuallytype in. Really neat development without all of the, the shilling and theadvertising and all the money grabbing going on that was happening during that2017 period.

[00:06:53] Ben: Right? Yeah, that's incredible. 2018 alsowas one of those years of exponential growth for me, 20 18, 20, 19 as well. AndI think as soon as a lot of the hype and the mania goes away from like themarket, so you can actually get some real work done, which is important. Iwanted to talk to you. Being a non or pseudonymous in the space is pretty likeif you're kind of a small player, it's probably not that difficult, but likeyou, uh, being one of these core team members, a number of times, H how, how isthat like separating ha having this whole separate life online in the cryptosphere as a defeated, and then, you know, your, your normal life has whoeveryou are and you know, the beat space.

Talk to me a little bit about that because I think that'sinfinitely fascinating.

[00:07:50] DeFi Ted: Yeah. Yeah. So, so my previous rolewas always relationships. I want to say. So for those that are listening, I'mnot a developer. That is not my background. My background has always beenrelationships and, and process management.

So taking a financial processes and refining those operationalprocesses and. The, the thing that clicked with me was the whole, you know, howyou incentivize, but how you use with smart contracts to get the right, youknow, the right economic outcome each time for each player. That that, to me,everything kind of clicks for me when that happened.

So it wasn't too much that I had to, my biggest challengereally is not so much going from a meet space job and applying skills into thisrole. I found that actually quite easy on most people. They think that it'shard. I think that you just need to immerse yourself first and then the skillswill present themselves to you of what's relevant to you in the, within theroad, the project, you're a bottle.

But it was the, the, the, the, the diving in allowed me to kindof spend this time at home, on my computer and then, and then have this otherlife in the real world where I can just step away and no one knows. Right. Ijust kind of, but my family, even though you're like, what do you do? I'm justlike, I.

Magical internet beings. So like, it's so hard to explain. I'veexplained it to people. I've tried to explain it to people. And I just comeback with saying, look, I just, I'm just, I just do smart contract developmentbecause that is the easiest way to put up with it. But there is so much morethan that.

Like we're building communities, you know, we're building.We're actually building business relationships into, into the hour here. So alot of people would just align this to like devving and coding. But the, andunfortunately for most of us that are in this space, we kind of have that as.Like our fallback, when we say, what do we do?

Because that's just the easiest thing to kind of explain that.Right. But the truth is that we need so much more in this space. We need to dosome development. We need operational managers. We need, we actually needpeople from HR backgrounds. Right. We need, we need, so we need content,producers and content writers.

Educate. But the people that we need the most other people kindof like me a little bit in regards to, we got plenty of old, like, likeintroverted autists smart contract devs and Diane Wilson. You know, I, I workwith them all the time, but what I don't run into many or very often is someonethat's working on the team.

That's like me, who's completely extroverted. And the otherone. Boy shut up. You know, I can talk with a mouthful of marbles on the waterand I can also, but, but also has a passionate desire to want to keep talkingabout those things, which means you bring along those, those other types alongfor the ride with you.

So, you know, I employ anyone that's, you know, kind of abusiness development or even on light relationship management, especially, youknow, to, to come in play. Well, you know, it's a, there is a, is that, thatwill be transferable from the real world to crypto. I think suddenly peoplejust look at it at the coding point of view, but that is easiest way to kind ofexplain what you're doing.

[00:11:08] Ben: Oh yeah. Coding or a trading, right. Thepeople just assume it's one or the other. And the reality is,

[00:11:15] DeFi Ted: yeah, I don't like to use tradingbecause people can see my address and then they know that.

[00:11:20] Ben: Yeah. Yeah, exactly. Yep. Fair. Well, Imean that's yeah, cause everybody just uses one address for everything, youknow.

[00:11:31] DeFi Ted: Exactly. Exactly. No one would everhave multiple email addresses.

[00:11:35] Ben: Now it would make zero sense. I've runinto you. Just it's actually like a relatively small space, obviously withcover back in the day. But then more recently with Paragon style. Why don't yougive me like the TLDR on what Paragon style is and why it's important or how doyou explain it to newbies?

I guess?

[00:11:59] DeFi Ted: Hm. Well, I mean, so Paragon's Dowand you've been going through, I guess we've been going through the explanationprocess, even with the parallel group who are the, you know, they're the assetsthat we hold that back. This treasury to Paragon started out as being just a.Kind of like a club, I would say, like, we were just enthusiast to parallel.

I got a lot of people think that with some sort of bad rulesfor that, it can like economic structure coming to suck the life out of metaversegames. Well, that's completely not the truth. I mean, We want parallel and theytry kind games. You go as far as it possibly can because we're, that's wherewe, that's how we all came together.

Was we really enjoyed and like what these, these guys are doingthe game. Right. And think that they're going to make it. We're all superpumped to be wanting to play this. But the thing is, is that yes, a lot of ushad some, you know, some, some pretty high net worth assets from that gamebecause of our love of it.

And obviously a lot of us here in Perry wants to start off withEric to defy kind of either builders or traders. So obviously there are a lotmore than that, but there are other one of those two things and. The, and, and,and yeah, they've had some wins out of that. So we've been on a roll, a lot ofthose returned into this game and, and, you know, it's, it's allowed, um, Ipersonally think it's allowed maybe a little bit more exposure to what parallelis doing and maybe focus on their NFTs specifically, which can only be goodfor, for those holders that want to hold their an FTS.

But paragons wants to take what we've done with the mourningprocess. And created a community environment that has a professional players,has a place for guilds in professional players to kind of connect with eachother and is somewhere to foster relationships and, and discussion around allthings to do with those games.

So it could, at this stage, it's parallel and there'll be othergames in the future as well that are played. But the idea is. We wanted to givea place that would cater for people that wanted to be applied to earn player.All right. And the first liking of that we had was poker. So poker was one ofthe very first play to own car games.

There was a game that went online. It got made famous by a fewmassive tournament and everyone wanted to meet, go out and play out. Um, theproblem that happened there, that people didn't want to bank all themselves andstart to be a career player because they weren't told they were amazing. Butwhat happened is those that actually did make it fanned that they becameunbanked because there was concerned with some of the platforms that we'reusing around money laundering and some other things.

So. To me. I w we, you can almost see like a clear line as tohow this is going to apply out, because they're already looking to try. Yeah,clamped down on crypto. You see, just especially in the U S we just soheightened Adams, get them back by JP Morgan chase in regards to just, just beingterrifying. So, yeah, a hundred percent.

So we wanted to make sure that not only did we have this placewhere they could thrive from their skill and growing that and having a, like a,basically a group of peers, you know, people that are all aligned in the sameballpark to come and share. But also a place that they could have to make surethat they could hold and grow that well.

So they create, and that's by having things like just simplethings, like an access to be able to deposit funds to a savings account throughparagons, to be able to have, you know, uh, an IEP Y just to earn from your,your earnings. And that could be on prime tokens in the future where you don'twant to tell you Pronto, we shouldn't be on to having a vote that allows you toearn yield on that, but also be able to borrow against your assets and do allthe other things that well, anyone trading with that real assets in the realworld we get to do, right.

And that you have to type loans again. No, I have to sell themaccess liquidity to continue to grow yourself. Right. So these are the toolsthat we want to help unpack for these guys. So they can continue to growthemselves, grow their bankroll and grow, and basically be in charge of theirown.

[00:16:20] Ben: Yeah, that's really, really powerful.

Well, let's let. Talk briefly about parallel before we kind ofdive in a little bit more about Paragon style. So parallel. I think I gotobsessed with this after defy dad got obsessed with it and his, like hisobsession and kind of carried over to me. And it's my fault. Yeah, exactly.Somebody who hooked somebody else and like, you know, I'm just yelling about itconstantly, but what, what kind of drew you to parallel?

The parallel ecosystem, what makes that ecosystem so specialand what?

[00:16:58] DeFi Ted: Um, so to me, their ecosystem isspecial for, okay. So I want to start with the first reason and the firstreason that I really enjoy this. Right. So when I first started looking atparallel. It was February last year. I think that just released their, liketheir first lot of like psst in cards.

I wasn't involved in that initial round or the initial drop,but a lot of people had them, a lot of people had them in and then we got itrelatively cheap for what they were at the time. No one really knew. So I was,I bought my first few cards purely based off the art and that got me into kindof like, okay, when they started talking about the game and stuff and that,okay, what is this.

So I started to do a little bit more digging from, from literally,uh, from, from that point. And you know, it turns out that these guys arebeing, building this for the law, had been building this out from the last yearand a bit before this, the builders that are involved from the card gain itselfare X magic.

The gathering a hostile imply is and had some involvement withthose teams in the past. So I felt like we were getting. Game makers who werebuilding a game, bringing it to defile, bringing it to NFT, bring it to crypto.And I was super bullish on that because I've just spent the last six months. Ikept table talking to smart contract developers, learning how to make computergames.

And I'm like, this just isn't the right way to do it. Right?Like, like I appreciate you guys have all the smart contracts, give them theworld of ability at a trading card game or something. That's a skill in itself.I mean, that's an industry that's already been around for the last 20 plusyears and there are definitely white mold values in the rough succession.

So, you know, it's a really hard thing to do. So we thoughtthat looking. So when I thought about looking at the game itself, that, that,that was a big tick for me. The next big tick for me was the fact that they hadChad Haley from the YouTube Panda on the cap table, who was helping provide alot of the cinematics through his theories media.

And if you've ever listened to this guy on Twitter or anything,the gods he's a serious, like, like he's, he's a. And, and, and he's verydirect and I liked the way that he, I liked the way that he talks. He's, he's,he's a no bullshit kind of guy, any, any very, very bullish on this group aswell. And then we didn't know too much about the mechanics of it.

So, so the crypto side of it, wasn't the thing for us. We knewthat that would be good. It was the fact that for me, it was effective. Thegameplay, right? I'd been, that's where their focus was and that's where theirskills were. And then they had Carlos, who is a crypto, that kind of guy there,basically it does all of the mechanics and the token Onyx.

And then we've just had the PT release. I think we've been veryjustified in now showing this game because not only have they created what Isee now to be the premier trading card game, that it will be released. And, butthey've also got to stand in for how applied and it should actually work. Imean, th these, these P this prime proposal and how they're played, andmechanics work is so far deeper than anything anyone has ever done before.

And this isn't to annoy other people, but, you know, this islike a real game with real mechanics versus a click farm scenario, like ACCE.Right. You know, I love actually, I'm good at my daughter and I play. SLP canbe a bit expensive, but the, but the fact of the matter reads isn't, it is notas, as enjoyable, um, as it used to be.

And there's no, there's no one neither returns. And, and that'sbecause it's been very much broken down to clicking and they definitely need tofix up those, those mechanics. And to me, that's an example of a, again, thatis a good game, but was designed by crypto, right? The trading type of gainside of it.

I'm looking forward to now, I'm going to, I've had a very smallset of my own cards here, and I've tried to play it on my desk with parallel,just to kind of learn the mechanics of it becoming. And it does seem very busyto do on a, on a desk. I will say that. So I'm pretty much looking forward tothe digital version.

Yeah, it is. I've

[00:21:28] Ben: seen the physical ones that I've had.That's fun. Well, difficult. Sounds like,

[00:21:33] DeFi Ted: well, I think they need to be honestwith you. I think the feedback's advisors, I had a board, right. It'd be easyto do a little working out. I'm like what card is sort of like if you weresitting. Apparently I liked your guitar.

You've just got a lot of cards cause you do a lot of upgrades,right. So you've always got to remember what car do you use? Upgrade? Whatthing? So having, having a, having a board to kind of manage that wouldprobably make a lot of sense. So I think they're looking at that, but yeah, Imean, I mean, parallel to us was the was, was had the right combination of realworld game is with.

Crypto heads trying to bring something to the space that madesense, not just trying to smash a square

[00:22:16] Ben: peg in a round. Yeah, no, that makessense for the listeners like prime proposal, this is being recorded lateJanuary and the prime proposal just came out. But what exactly does the same? Imean, they were two massive documents, a bit of a hoping that you break itdown, I've read a couple of Twitter threads on it, but like what, what's thehigh level?

What is this? Why is it important for the ecosystem? Yeah. Whatdoes it mean?

[00:22:44] DeFi Ted: So, yeah, so the, the prime proposalis. It's basically a forest that's being put into paper, right. It's quitedeep. But for those that haven't read the whole thing, the primary product willbreak breaks down. The usage of all of the uses of will the assets within thespice.

So one of the things that I'm very impressed with is that ifyou're a holder of a parallel Cod, and then you've been included in the. Inthe, in the rewarding process for retrospective rewards for being a parallelparallel community member. So there's a, there's a percentage of those aregoing out to the prime tokens that are going out to everyone.

The other thing is that by being able to put a price on.Certain things. So they've been able to, you know, depending on what type ofcollector you are, there's a way for you to earn, which is what I love. So ifyou were talking to collector, just likes to earn sets, right? They're like,well, did you get a playing card set?

That's still like an, like an. Asset, right. They call themparasites. If you've got, you know, if you're particularly like, you know, highnet worth stuff, and you'd rather have a one-on-one, although what they call,most of those assets have been considered what they call cornerstone assets andthey're able to earn.

Well, the, the fees that are associated, but trading pro ordoing anything to do with the prime token or any token within parallel or whatthey call echelon. So the one thing that will break down into there's twothings, there's Exelon, which is the owner of prime token. Like they run theprime token in the prime ecosystem, and then within that ecosystem, it'sparallel.

So prime will actually be a governance token of multipleecosystem.

[00:24:32] Ben: And it's so cool. And this just fits, Imean, listeners have seen the evolution of like, yeah, we get excited abouttokenization and real ownership with NFTs, but what a, what a cool convergenceof the two and hopefully this like actually fun game that people love and careabout as well.

And it's not just. You know, literally play to earn yourplaying only to earn these things as opposed to like actually enjoying it. SoI'm curious with like, Paragon's down owning a lot of these different assets, aquestion that has presumably come up is, you know, now with this primeproposal, knowing that there is a token involved, how is that token accumulatedby Paragon's Dow?

What, how, how does that work?

[00:25:24] DeFi Ted: So the idea around what we did withthe assets. So the, your initial assets in there before a bonding event wherewhat we consider high net worth assets that were untouched unattainable by theaverage person. Yeah. So the reason why we wanted to tokenize, I think you havean opportunity for anyone to hold exposure to them.

That was our first and foremost, there was a lot of people inthe parallel chat. They were like, oh, I've never heard about the piece. To behonest, it was that it was that kind of like kind of downtime in this intimate.That was a big reason for us wanting to kind of put this together. It was like,well, maybe there's a way we can do.

To this right. And access to the rewards that are in built intothat. And it's obviously flourished into a lot more than that, but like the,the assets that we have, there's two reasons for that one is they're going toeither have some sort of reward mechanic that we will then earn the rewards on.So you think about like on a prod keys, catalyst drive, you know, these kind ofproducts, assets are all going to a product, right.

And then the masterpieces earn one fifth of the. Realty from,from the, from, from the secondary marketplaces, which is old building for usto receive any of those masks that they use is that something green card,anytime it's sold, we receive a return on that. So it was really important toget those, you know, large reward return.

Acid, will you generating assets to be able to hold them in thetreasury because that's growth for us? The, the other, the, the reason why wewent off to the parasites was obviously there was another inkling that, that wewill go to receive prime or they'll tell me something around parasites. So we,we, we specifically wanted to bond a bunch of those.

So we've now got 150 Paris. Which is by far large, to be thebiggest collection that there is. And what we're going to do with these is thatwe're not going to just hold them and take them from the market and not letanyone hold it just for a valuable crew. I think that's probably the veryshort-sighted way that people see that with doing something.

Oh, you're just going to retire. You're going to have thelowest supply cards and force their prices up and make money that way. I mean,that is the very, you know, that's a very blinkers on located. And to behonest, you know, from the outside looking in that's maybe what it does looklike, but the truth is that's enough that, that can't be further from thetruth.

What we'll be doing is we'll be, we've got a number of audits.To ensure that we can provide an environment that's a better trading experiencefor those users. So, you know, one of the things that we've asked parallel isway that will edge line is where they see their layer two solution. And theycan't give us an answer at the moment.

And that's fine because they probably have so many other thingsthat they're working on that latitude might not be in their best interest rightnow, especially if the digital game plays not to be until the end of the year. Sowhat can we do to help that out? Well, in the interim for the rest of the year,we can take all of our liquidity in cards and turn them into ERC.

20 created, create a new unit swap tool, like an apple pay andsend them to an L two where the user can have a fast, cheap try to experienceonly eat gas costs. So they'll self up. When they unwrap it back on and whatthat allows then the user do is, is actually interact with, with the parallelecosystem before it's launched without parallel having to overstretchthemselves and add an L two capability just for that, you know, just, just fortheir users in this instance, before gambling.

So, you know, that's just, that's one example of how we'reusing those liquidity assets to actually give better experiences. To the wholecommunity.

[00:29:09] Ben: Yeah. That's pretty sweet. You'vementioned the bonding, the card bonding. This was quite innovative. I think,believe one of the first of its kinds, how did this work?

What was in the background? What was the intention? What werethe mechanics? Walk us through a little bit of that and kind of the idea behindit.

[00:29:28] DeFi Ted: Sure. So the. Yeah. So the bondingto the NFTs, I think there's definitely been other bonding in the past for NFC,but I think it'd being plus seven to ones that are obey.

Like I'm a financial Niger. So like, I mean, it's eitherrepresent, you know, Walmart or Google something, you know, on a very smallscale, but the, this type of money was absolutely a festival. The process thatwe took was more around, how do we get, how do we align our community with whatwe're trying to do, right.

With the people that we want in the community, the best way todo that was that ethics process. Right? So everything that we did was fixedprice. And I think that's, you know, bonds are generally off products. They're,they're generally a fixed price, fixed price product, and. Olympus has beenable to do some really cool stuff with a, with a, with a, with a decayingpremium, right.

And so forth to, to, to incentivize wanders. So we wanted tokeep it very simple. I, I, you know, a lot of people call it innovative, but itwas actually just a very simple process. So all we did was take the, we wantedto bond, you know, X amount of each native tape, and we wanted to give a fairprice for that in return for PDG.

That was. So PDT was placed at 34 cents fix. You could bewanting to offer that at the same price at all investors were at. And then wefixed the floor price, right. And added up to a full for gas for each asset.And then we, we, we converted that to a price and petty tape. And what we wereexpecting would be that the prices during that Bonnie event would fluctuate onthe floors.

And, but there would even if the, even, even if the floor went.We always thought people would probably want to buy that and bring that in bondthat because there was potentially still more upside in the PDT and with thePCP or the primary project has dropped that they would want that upside toaccess to those tokens.

So what really happened in the end was we sell them in twohours. Which was great. And we saw a lot of people buy those from open sea anddeposit them to our contracts. So one of the things I was very confident in by,by this process would be, so we were trying to find a buying process, right?For these, for the, all these assets.

And the, the, the very first thing was we'd come up with theteam to come up with a committee, which I wasn't a part of since I'm doing.Contributed stuff. And they would make a decision on based on what they'regoing to buy and how they're going to buy it and stuff. So we had a level oftransparency, but not to the point where we could communicate that to, to thecommunity.

And that to me was, was a thorn in my side because I thought,well, we need to be able to do this in a way that, that has that transparent.

[00:32:10] Ben: Yeah. I think that the like FOMO wasreal, right? Like these things sold out in two hours, like triple the price ofsome of these NFTE assets. It was, it was pretty, pretty spectacular.

[00:32:22] DeFi Ted: Really. It went really smoothly and,and it, in the, in the behavior side of things was exactly how we had what someof us had that. Some of us had actually mentioned and said, Hey, this is justgoing to turn the market into our buying power. Right. Rather than having yourown compete against the market. And that, and everyone was like, well, youknow, everyone's going to know what we're priced, we're looking at.

And I'm like, that doesn't matter. Right. It doesn't matterwhere the biggest dog now, you know, in the pit in the yard. So why don't we betransparent? This is what we want to buy. This is how many, one in one to buythem for. This is the amount of PDT and this is a cost or. And at some point,if that's a fixed price yeah.

And the market will move around it and someone of them want tocome in an OB that prod. So at some point in the market will say, no, it'sbetter than. Picking it up from open sea, bonding it to paragons and taking thePDT. And that's exactly the, the behavior we wanted. Right. We wanted thosearbitrary guys to come in on the market for us, from the marketplaces.

Yeah. And deposit those, those NFTs with us. So we instantly,instead of having to compete against this whole market, We let them become abar. Yeah,

[00:33:34] Ben: that, that makes sense. But I guess theflip side of that is a constitution Dow type situation that, because it is sotransparent, you know exactly what the other person is able to bid and whattheir budget is, and you can just outbid them because you can't see.


[00:33:53] DeFi Ted: agree. I absolutely agree. I thinkthe difference in these instances, Is that both players are transparent, sowe're transparent, but so it's the player that's on the other side, couldn'trule based on blockchain. So everyone's kind of from a transparent point ofview can see, you know, where the alpha is in that scenario.

You know, you're not going to probably bond a car that you'regoing to lose 20% on just a bond. And then, you know, you might not see 20%upside in PDT either. Right. And go, well, I might have to wait too long, butat some point in the markets will fluctuate where that bond becomes attractive.And that's the.

Of kind of what we were doing. So we leave that level oftransparency so that those that are playing in the same space can just takeadvantage of it when it comes available. So, but yeah, I do agree with you,like in that sin God, where Ken Griffin was able to see exactly how much.Constitution doubt had and then just, and then just, and then just roll themsteam, rolling

[00:34:51] Ben: the villain.

[00:34:52] DeFi Ted: Great. I actually agree with that.So in that scenario, yeah. I definitely think there needs to be some sort oflike, if you could be like a potty down or something like that, that you foundlike a Zika where you can't see the balances would be.

[00:35:06] Ben: Yeah, you guys, the founding community ofParagon's Dow is pretty gigantic.

I mean, just looking at the list it's paradigm framework, tonsand tons of investors and kind of angels from the space, myself included fulldisclosure. Obviously a fan part of this is, you know, the token allocation wassplit amongst these early contributors founders, and then the available for thecommunity.

Talk to me. About using vesting capsules, charged particleswith the founder's tokens. And what kind of interested you with this and whatyou're doing

[00:35:44] DeFi Ted: with them? The vesting capsules havebeen playing around with your platforms for a little bit of time and anotherone. So I think you and I spoke in the past as another group.

So. We also do these best vouchers, which is actually acompletely different product to what you guys all thought. And, and we werehaving this chat and, and, and, and the vesting cash. I really liked the ideabecause one of the things I think that is really hot in this space at themoment without kind of like a rage function or anything, if you haven't been tolike a Mullock day, I'll set up or at least something that I mean has created.

I know he doesn't want to pull on, but you know, the guy's agenius when it comes to when it comes to stuff he honestly is. So you shouldalways not pass judgment. Just listen to what people doing, either smart ashell, but the, the. What I wanted to do. I didn't want to have that. One of thepeople that still be self silvering right in their own issue, you know, likethe audio is to try and make this as decentralized as we possibly can as earlyas we can.

The reason why we wanted to do it this way what's so thatpeople could be not fungible in their fasting schedules, but having the abilityto transfer them or leave if they want it. Right. So for the founders, Youknow, we've got 15 fan is sorry, 16 fan is across 18 different masterpieces. Sotwo of our founders have two masterpieces that they've donated or contributedto the Dow.

And then there's a number of these that have groups inside ofthem. Right? So, so we've got the AFI, the Dow, which is a founder, but there'slike a group of 20 of those guys that don't, that put in this, this masterpieceas well to be a fan. So I needed something that was transferable. So I contractwasn't going to work and I needed something that could then ha you know, just,just have things come and go from it.

Right. But it's still a founda identified asset. And that'swhere these capitals came in. So what we've done is we've created a Paragon'sgal founders capture. For vesting. And what that is is it's just a, it's alovely piece of artwork created by Dave Schick. Who's one of the, he's probablythe best fan. I know I've seen coming out of parallel, so he's not one of theiraudits.

He's a fan artist, but he could actually be on their team andhe's done it like and cool team. He will get the first one though, as a, as athank you. He has been paid for that service, but when he will get the firstone is a thank you because it is his art. So we would like him to own his ownpiece. And we'll give one of these to every founder.

Now these are going to contain firstly, their investing. Andthen any other allows us to do some other things. So, so because, so thevesting schedules we have are created as an 1155 through, so on finance andthey allow us to vest the PDT token. Now found is that to you yielding aschedule. So I didn't have access to those tokens until they, they investedlinearly so they can claim as they come per block.

But it allows that locking mechanism now because of something Isee 1155 and everything is governed by the same 15 schedule, it also allowsthem the flexibility to okay. So they could sell a transfer that vestingschedule to someone and everyone that received, uh, you know, if they've got ahundred thousand tokens that are vested and they won this in 40,000, there'ssomeone cause that's the shit, that person, when they received that 40,000 inthat ESL is still governed by the same vesting schedule that the other 60,000of them nothing changes.

So it allows you to kind of move those around, but keep themvested in keeping them out of the market. As you mentioned to that by thetoken, as we mentioned by the economics. The other thing is that that then justbecomes another contractor can contract that we can call when we're trying to alignreturns.

Right. And, and, and for governance. So, because those tokensare technically held in the contract, held by the user's wallet. It allows usto add those, ah, Well, I was asked to add those strategies, the strategy to coto look at those contracts for ownership of tokens in the snapshot. And itgives founded in cold team members, therefore white and voting, just likeanyone else has at the moment.

Sorry. It allowed that fairness to show. But it also allowed usto then have a vessel that we can continue to send returns to as well based offtheir weight. So when we start having the returns, the, the, when we havehaving the written yield returns built in, we'll be able to involve the vestedtokens as well in that process to earn the passionate returns as well.

So I think. The, the, the combination of the capsule itselfwill almost be like its own little wallet for our founders. And everything willgo into that, including all the tokens and anything that comes from ourtreasury. But it also gives a, it gives a point of reference where anyone cansee what Africanas are doing individually.

So you can see all 15 individual found, uh, vessels and, andanyone can watch what happens with.

[00:40:57] Ben: Yeah, and I think that's, that's what's,I mean, this is the open, transparent nature of all of this, but I really getexcited about the change of initial token Nomics. Having these shares, thesefounder tokens in, in custody of their rightful owners, undeniable.

Able to be able to be staked and earn rewards or have a say invoting and governance, which I think is really, really important and kind ofchanges the way that people design token Nomics from the beginning, knowingthat the founders actually have a say in their own protocol, which I think is avery, very, very important thing.

And, and then in terms of. Paragon's doubt overall, I guesswhat's, what's like the super secret master plan, big vision. Where do you wantto take this thing? The super

[00:41:51] DeFi Ted: secret master plan?

Well, if I had, if I told you, man, I wouldn't have what I wantto take this look. I think so. So a lot of people have kind of said like, like,how do you define what success. I think it's probably the best thing that I isprobably the best answer for these. And for me, success is, and I mentionedthis in this called not long ago, there's someone who said he's going to bedifferent to my end.

My markers for success are going to be very different to mostother people. And that's because obviously I've been building my grandpa, butit's got my markers of success is going to be when we sign our first program.When we hit our first hundred thousand members when we have a distributionhigher than 10,000 holders.

You know, none of these are financial markets, right? These,these are mine. These are KPIs that are outside of that. How many partners thatwe working with in this space? How much fee sharing do we have going on? Youknow, these are things that are important to me because I feel like these arethe things that if you take care of the others, take care of themselves.

So what I've done, what I don't focus on is the price of thetoken. And then things like. Well, you know, I don't focus on the things thatwill directly correlate the return in that price. What I focused on is justthings that have a, a longest staining or a longer impact on the value added.So value adds come from more people being a part of it.

Value adds come from. You know, being a very inclusive and, andsharing community. And I think the sharing pot is the bit that a lot of peoplemiss 70 people go out and build their own criticals or, or fork their own, or,you know, whatever it is they go, they're the only ones I can make it myself.Yeah. And that's fine.

That's a zero sum. That's you seeing it as well? We can't useactually go to you, do it ourselves. Otherwise we don't get the fake. What'swrong with knocking on their door and saying, well, why don't we share the fee?If I can give you X amount of volume, why can't I get something in return?That's how it works in the real world.

Right. So I, you know, and we already beat down the road with anumber of places where we're talking fee sharing. So I, I hope to maybe showhow that can work. More often in this space. And these are some of thebehaviors that we would like to change. This space is showing morecollaboration between protocols at a field level.

One of the things I think that is we can go back on is thatthese mergers don't work very well. Someone gets like gets ranked. Right?Right. So, so it's like, well, why, why, why merge, treasuries and so forth?Why don't we just merge the product and both take a cut of the fee that wayyou're both incentivized to push.

Right. You'd like to, to have a push the right thing whenyou're already holding the token, you just feel.

[00:44:52] Ben: Yeah, a hundred percent. And I thinkyou're very much focused on people and building, but this, this point aboutcollaboration first competition, I think is very, very important. What I'm kindof driving forward, that, that thought within the space, what can the averageperson do to kind of ensure they're thinking more collaboration versuscompetition or kind of spreading that, that thought to more and more

[00:45:16] DeFi Ted: people.

So I think, well, I actually think the first point of call whenthinking of collaboration is when you're thinking about designing something,thinking about designing it with tools that already exist, don't think abouthow I'm going to build it. Right? So if your first processes, so the way Ipicked your paragons, I think I've told you this boy is that, you know, we likethe master Lego to be able to use from the Lego movie, right.

Or we can just smash everything together and make new stuff.Well, all those pieces of Lego and the other pieces of the protocols that weuse, right. And we'd rather do it that way then Joe, and build the Lego itself.Yeah. By having that first approach, what that makes us think of is, well,where are we? So where is the user volume for us?

Like where is the real products yeah. For us. Yeah. And thenwhat do we need to build that product? And the first part of it is, well, whatexists already today that we can work with, right. That we can just build ontop. That makes so much more sense. And then the moment we identify that wereach out to those people and say, Hey, we think we can do this.

These are the things that we would like to do. This is where wefeel like it can go from a volume perspective. These are the percentages offees that are being done. This is what we think will increase. What if we canactually get that to happen in two, on 10 X that, you know, a fee sharing modelwould probably more, better be beneficial than trying to swap tokens.

[00:46:38] Ben: Right. Totally mate. Yeah.

[00:46:42] DeFi Ted: So I've always been a big proponentof applying the KPI or the return to the KPI or the outcome that you need. Notjust one that might, that, that is in like lower hanging fruit. Yeah. No, Ilove that. Like, TBL is low hanging fruit. I'm sorry. You know, anyone can justput money and it's TBL, right?

That's a low hanging fruit, but say no, no, no, no. I wantincrease upon increase in my volumes. Right. That requires.

[00:47:08] Ben: Yeah. And real, real use. Right. Which isstill lacking in a lot of these protocols out there. That's for sure. Well,Ted, this is, this has been a very, very interesting conversation. We'vecovered a lot.

I mean, what kind of last thoughts do you want to leave thelisteners with? Or where can they find out more about you or paragons? Wherewould you want to send them?

[00:47:34] DeFi Ted: Well, you could send it, you couldgo to my Twitter, which is that defines. I'm going to ping the message thereabout a lot of the ethos that I just spoke about earlier, which was about ameritocracy and what crypto is.

So I'm pulling anyone to read that. I wrote that over a yearago and pin that still there. I still very much believe in that. So if you, ifyou're thinking that I want to be in this space or a writing, then you need torethink your mindset and go and just start asking questions, become anonymous.Right.

Feel like that you can make mistakes and not feel retribution.I think that's probably one of the best things about being a non-IT learning inthe space. Most people too afraid to put their hand up cause they don't want tobe wrong. Right. Well, guess what, you don't using your face anymore. What doyou got to lose?

So, so if you ask questions, be prepared to be told that you'rewrong and this is the right answer. And then you can learn and come along forthe ride with the rest of us, but you need to break down that barrier. None ofanonymity, at least allows you that freedom of not being judged and kind ofrecall with freight in regards to your level of understanding or not.


[00:48:42] Ben: And I love that that pinned post and I'lldefinitely link it. It's very, very important. And, yeah. Thanks for sharingthat for sure. No problem,

[00:48:51] DeFi Ted: Ben, and I appreciate you having meon of course,

[00:48:54] Ben: Ted, we, we appreciate all that you do.And you're, you're, you're doing some amazing stuff in the space and certainlyParagon style is, is just getting warmed up with the crazy, innovative, coolstuff that is coming down the pipeline.

So really appreciate it, brother.

[00:49:09] DeFi Ted: Oh, and I'm happy to be here. Allright, there you

[00:49:12] Ben: go. First off. Thank you very much forlistening all the way through. I hope you got a lot of value out of thatconversation. As always, you can find show notes, links, [email protected] Please share this with anyone you think might beinterested in derive any value from this conversation.

And as always, you can reach out to me for any feedback orquestions. Please give the video a like, or even better subscribe on YouTube oryour podcast player of choice. This really helps others find the podcast or thevideo as well. Thanks a lot. Hope everybody has a fantastic day and stay safeout there and invest wisely.

Ben Lakoff is an entrepreneur and finance professional. He has developed strong global finance experience through 10 years of international assignments in the US, Brazil, Afghanistan, Southeast Asia, Czech Republic and through the award of his Chartered Financial Analyst (CFA) certification.