At KRYPTONITE1 we look for new blockchain based applications and services that aim to solve big and intractable problems. Through cryptography and proper incentive designs a blockchain has the ability to create systems, which can solve age old issues of trust. We look for trustless products and services that operate at scale.
Melonport is a great example of scalable trustless crypto innovation. It is an exciting new fund creation platform for new digital and eventually traditional assets to be managed on the blockchain. Melonport uses the blockchain to enable trustless decentralised management of assets with the rules of each fund can set in code. Trustless means the code and rules that are set cannot be tampered with nor circumvented. Funds are buckets of assets and traditionally have had heavy setup and running costs and restricted smaller niche types of funds to be created and managed. Melonport solves these issues and also has other disruptive potential including contract execution (by code and rules) and reporting without interference and a layer of costly administration. Fund managers’ reputations are based solely on performance, and now with Melonport reputations can be made with full trust. In short, Melonport will revolutionise fund management.
Melonport collapses the time, cost and complexity of creating and managing a fund. Currently to get a fund launched it will cost you six figures and several months. In fact, it’s very hard to set up a fund for less than $1 million in the first year. Thus, running a fund always incurs a heavy management fee and performance bonus. With Melonport, fund managers could set new ways of being paid 0% management fees and more performance fees could become a new reality. The technology driving the platform is the Ethereum blockchain, the advantage of using the Ethereum blockchain is that it allows for much more development to be done. The Bitcoin blockchain is not set up to run decentralised applications but Ethereum is.
In the short term, Melonport will initially focus on blockchain-based digital assets, which is 700 tokens and worth $15 billion combined at the moment, and then move into tokenized traditional assets. Some examples beyond just digital assets funds could be funds in commercial property, ‘ethical only’ funds, wine or music catalogue (remember the Bowie Bond) funds. These example funds could become a reality once those assets are tokenised in a trust-less way and added onto the blockchain and then managed through the Melon protocol developed by Melonport.
Melonport has given itself a headstart to be ready for the tokenisation of equities and bonds onto the blockchain, a revolution for those industries. Melonport will be a major disrupter, it will in its fans and face friction from incumbents but it, and platforms like it, will change the way assets and wealth are managed.
Melonport’s plan is to open source the code so it will be community based and its set for a two year length with a live test platform out by the end of the year. Within that, Melonport will work with solutions for interoperability to allow transferring of assets and interacting with smart contracts from private and public blockchains to find a way of allowing data to go back and forth easily across networks. Melonport are working with Dr. Gavin Wood from Parity, who was one of the core founders of Ethereum.
The token on the Melonport platform is called the Melon Token. The founding team behind Melonport are two great people: Mona El Isa, ex start trader at Goldman Sachs and Reto Trinkler, a respected Ethereum developer.
As well as supporting Melonport we are also in part of the tests to look at testing a decentralised fund, and we are very excited about the potential.