Welcome, OHMies! Today we had our first AMA on our Discord server with some of the folks behind Magnet DAO, an upcoming Olympus fork to be launched on the Avalanche chain that has recently gained a lot of attention from the community.
Below you’ll find a transcript that summarizes both questions and answers from the event:
Q: Can you tell us a bit about Magnet? For those who still don’t know what the project is about
Justin Mahone: Essentially we are a OHM fork. OHM keeps its treasury largely in stable assets, we feel they are overcollateralized and could use some exposure to higher EV projects with their treasury. So essentially we are going to use 10% of our treasury to fund, incubate, and invest in new projects.
Since the innovation fund is fluid (still under a multisig wallet) we can also use it to farm LPs and earn interest on stables.
Q: The idea to incubate and invest in other projects really gives you a lot of opportunities for growth, right? How are you guys thinking about using it?
Justin Mahone: Correct. The Innovation fund has following possiblities:
- Build new projects: We can use the stable coins in the treasury to fund developers to create new projects. We will incubate them and help them gain exposure, then the tokens to the treasury. We are working on 1 project like this in house already.
- Invest in new projects: For example the harmony project artemis protocol gives us exposure to many projects. The method is overflow so extra money is refunded so it makes sense to invest larger portions (last project was almost 99% refunded). We can use the fund to invest in these launchpads.
- VC like funding to new projects. Instead of traditional funding were the supply goes into the hands of a small VC firm we can raise capital and gain exposure to projects which we can distribute in a decentralized way (e.g incentivized bonds were users can earn MAG + token y).
- We can use it to farm LP on projects like anchor or sushiswap for example. We are looking for liquid stable coins that earn yield as another low risk option to earn yield and grow the treasury.
Q: I’ve seen you have incorporated a lot of people into the project. How many people are currently working on the team?
Justin Mahone: We have around 5 developers working on the code. Me, Dexx and MB86 are in charge of managing the community and gaining exposure. We really focus on a community project though so we must have around 25+ people helping with creating content and supporting us grow!
Everyone who helps us out would be mentioned in the awards section of our discord.
Lilo Lefebvre: Yeah, the point is in the name Magnet DAO, it has to be a network of like-minded people who share the same goal. So we could have thousands of people as part of our team, people who believe and take part in what we do for the sake of making this a great project. A project worth a lifetime.
Q: Is the entire team going to determine which projects you’ll incubate?
Justin Mahone: The community will decide that. Anyone can suggest a project in project proposals (they just need to give a quick overview and description), we will then try to get a AMA done with the team and write a comprehensive overview about the project. Once our community gets a deeper understanding we will have a vote with the DAO to determine which projects we choose to incubate in.
Q: I see you guys like the idea of giving everybody a chance and I suppose that is why you are having a fair launch, right? A lot of people here seem really into the project precisely because there is no whitelist or barriers to be one of the first investors
Justin Mahone: Yeah! Ive worked in marketing before so i get it, the only way you they can make another OHM fork get hyped is force people to shill it to 25+ friends and family, so we wanted to do something unique that doesnt require that. Anyone can get a chance to invest into this project.
Q: Speaking of marketing, do you have any plans to market the project in the AVAX ecosystem?
Justin Mahone: 100%. We have connections within the avax ecosystem which we plan to leverage soon. We are just waiting to release the website and Dapp before we start marketing it with full effort.
Q: Since we’re close to launch and you mentioned the Dapp, when can we expect a small view of what the website/dao will look like?
Justin Mahone: I’m really really tempted to give you guys a sneak peak but I’ll hold off. Expect the website before Monday, I think we are almost done just waiting for a good time to launch it. We are almost done but optimizing it for mobile if I remember correctly.
Q: Have you guys decided what kind of accountability/security measures you’ll take before launch? (audits, multi-sig, liquidity lock, etc.)
Justin Mahone: 100%, we will implement a multi-sig at launch and add influential developers/figures in the AVAX ecosystem. Audits are planned but they are expensive and take a long time, maybe they will be a bottleneck for us so we need to confirm this (we are really pushing for it though). LP will be locked and team tokens are vested. We are even buying back the tokens for contributor airdrops so public sale buyers are protected from being dumped on.
Community Questions:
Q: I see that you are using your treasury to incubate certain projects. Do MagnetDAO holders get any kind of special allocation for these projects that you will incubate? Have you already lined up some projects to incubate? Thanks!
Justin Mahone: Essentially the MagnetDAO holders will benefit since the $MAG they hold will have a higher backing when the incubated project value increases. You can also gain direct exposure since we want to implement incentivized bonds were users can gain magnet+token x from the treasury. Instead of just getting MAG you can get both the tokens.
There is also the benefit of being in the community and participating in the AMA/reading the Medium that you can make a better informed decision to invest in the projects yourself if you want even more exposure.
Q: How will you manage risk of assets backing treasury going down massively in a bear market?
Justin Mahone: Good question. We can’t deny the patterns in crypto and understand we wont have bull markets forever. The assets in the treasury will probably be impacted negatively by bear market no matter how strong the project. However, we will be rebalancing the treasury during this bull market, the gains from innovation assets will be converted to stables when the innovation fund goes much higher than 10%. Since 90% of the treasury is in stables + we already add profits into the treasury we will protect holders from volatility even during a long bear market.
Q: Where the magnet-dao idea and name came from? Any cool story to share about that?
Justin Mahone: I actually dont know, LOL. Joined the project before there was even a Discord for it but the name was probably the first thing Dexx decided on. Probably has something to do with us attracting new projects to our innovation fund.
Q: With investing in and incubating projects, will Magnet DAO also be acting as a launchpad for suitable new projects?
Justin Mahone: I said before how we help investors gain exposure to these projects, but I think its cool to add that our team will have dedicated resources to help the dev teams and marketing teams of these projects to gain exposure. We consider doing something like Olympus Pro, and help these projects get their own POL (protocol owned liquidity).
Q: What sort of protections would Magnet funded projects have against rugpulls and other nefarious consequences that are unfortunately all too common in this space?
Justin Mahone: We will offer third party KYC to these projects. Instead of publicly doxxing themselves they can dox themselves to us, and if they rugpull/scam we will report them to the appropriate legal authority and manage the situation.
Q: How can I contribute to this cause?
Lilo Lefebvre: You can start by familiarizing yourself with the project via the Medium articles. I started out as a nobody in the cryptospace and joined the MagnetDAO server after doing a bit of research, answering questions and overall just pitching in with support. Anyone can help by just joining the server and interacting, making things and proposing ideas. If you’re someone who can make content too like our extremely creative @sha, then I’m sure you can help out the community tons. Don’t be shy, show the DAO what you can do. We also offer airdrops to people who help out, so that should motivate you a bit more as well!
Q: Would you ever consider raising the allocation of treasury funds to incubate projects from 10% to more?
Justin Mahone: We expect the treasury to grow above 10% naturally since the projects would have higher potential and grow in value. 10% is still massive if you think about it, with 100m treasury thats 10million to invest into startup and new projects. We could vote on it as a proposal but I think stability is also really important, 10% is more than enough in my opinion.
Q: Will the initial fair launch be through the Magnet DAO site?
Lilo Lefebvre: Yes! The team is working hard on making the site as usable as possible to ensure ease when buying, staking, bonding and whatnot.
Q: Will the incentivized bonds will discounted relative to the $MAG price, like on other OHM forks?
Justin Mahone: It would be discounted MAG + token Y, yes. Probably exactly the same as OHM fork with the bonus of the extra token.
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