The design of the Cardano blockchain allows the development of innovative ideas with real utility.
The Proof of Stake (PoS) consensus participation model proposed by the Cardano protocol is known as ‘liquid staking’, which means that the funds in ADA, delegated to the stakepools of the network, have no blocks, no minimum time, nor slashing (monetary penalties on the funds), and the amount to delegate can be minimal (you must cover the network fees and ₳2 for pledge to create a first delegation).
This model allows a liquid and constant flow of money that transits in the network, with different investment destinations.
The crowdfunding model is a collaborative project financing mechanism, which unites a large number of investors so that each one contributes money in various amounts, seeking to atomize participation.
This model is better developed on the basis of new technologies, and dispenses with traditional financial intermediation, putting project creators who demand funds in contact with investors who seek a return on their capital.
Venture investments are ideal for this type of model, since it allows to raise funds that promise high returns, and since investors can distribute their funds in different crowdfunding proposals, where some will fail, but others will succeed, the model is presented with a theoretical reduction in risk exposure.
The team presents its project as follows: “Teiki is a decentralized crowdfunding protocol on Cardano that fosters innovation. Powered by AI technology, creators can effortlessly raise funds and build a community, whereas backers can “water the seeds” of innovation by delegating ADA. Teiki connects great minds to co-evolve.”
Teiki is a crowdfunding protocol, using the low transaction fees of the network, and seeking decentralization, initially built on Cardano and IPFS, InterPlanetary File System is a protocol, hypermedia and file sharing peer-to-peer network for storing and sharing data in a distributed file system.
Teiki integrates AI (Artificial Intelligence) models with the following functionalities:
- for the creators: names, taglines, keywords, logos, cover images, image text, and summarized texts can be automatically generated in projects. The integration of Grammarly, an AI-based cloud writing assistant, improve creator writings
- for the sponsors: automatically summarizes and recommends content and generates podcasts to enhance the browsing experience
- for the ecosystem: content moderation to eliminate the need for a lengthy review process
The team promises that in future generations, Teiki will integrate even more AI to generate one-pagers, community management chatbots, and much more.
You can read about AI integration on Teiki.
The Business Model
Teiki’s crowdfunding mechanism is a subscription model based on Cardano’s liquid staking, where backers delegate $ADA to smart contracts to generate rewards for project creators.
In exchange for giving up their ADA delegation rewards, sponsors get $TEIKI once the project reaches a fundraiser and the rewards promised by the invested project, which typically offer more rewards and benefits to their community to remain competitive.
Creators control the delegation of ADA contained in their sponsors’ smart contracts, or to reduce friction, creators can leave the task to Teiki, which commits to delegating ADA to single stakepools.
Backers can withdraw their participation at any time, especially when a project is not progressing.
A tax advantage, which this crowdfunding model presents in most countries, is that since rewards are not withdrawn before payments are sent to creators, backers avoid income tax.
All funds are secure, transparent and verifiable on the blockchain.
The developer’s proposal is to seek innovation, and also the decentralization of block production, since Cardano’s liquid staking model allows smart contracts, which contain blocked ADAs, to be delegated, and thus certain developments that use smart contracts help maintain network consensus with those ADAs that were invested in DeFi.
I couldn’t find details about how the development will be made economically sustainable, and I asked on the project’s Discord server, and its founder replied:
LiberLion: “Tori, last questions, please, What is the profit of Teiki?, Is there a fee for Teiki to use the platform? How will the business model for Teiki be sustained over time? Thank you.”
Tori: “There are different fees like project creation fee, sponsorship fee, etc., with the primary one being 2.5-4.5% of the total capital raised by a project. Even better, Teiki will raise funds on Teiki too”
How It Works
Their protocol is based on other open source projects: Helios, Lucid, and Ogmios.
The roadmap for the publication of the code will be like this:
- 2022 Dec: Teiki Protocol
- 2023 Jan: Teiki Index
- 2023 Feb: Teiki Backend
- 2023 Mar: Teiki Frontend
- 2023 Apr: Teiki AI
- 2023 May: Teiki Protocol Gen II
To launch a project, the creator must have a wallet compatible with the Cardano blockchain, with more than ₳500 to lock as a pledge, paying transaction fees, and of course, the project must not violate the Teiki rules, which prohibits scams, impersonation, political activities, NSFW content, among others. If the rules are violated, the project will be closed, and the pledge will be fined.
The creator needs to fill in the project details such as description, logo, milestones, and social media. Teiki AI will help in generating names, taglines, keywords, logos, cover images, image text, and summarizing texts.
Once created, the projects are sent to the Cardano blockchain and IPFS, which stores project details with absolute transparency. New projects get built-in functionality via parameterized scripts on Cardano and are ready to raise funds and build a community.
The goal is to reduce this project creation process that takes weeks on traditional platforms, to just days on the Teiki app.
Backers only need an ADA-enabled Cardano wallet to interact with the Teiki protocol.
The development is currently running on testnet since mid-January of this year: https://testnet.teiki.network/.
At the time of writing this article, the team announced that in a few days the feature set will be extended to complete the first scope of the protocol, and then the protocol will be ‘frozen’ to perform the audit and complete the AI integration and UX improvement in parallel. The expectation is to reach mainnet beta in three weeks.
$TEIKI is the governance token. The developer presents it with a fair and high-utility model that represents the contributed effort of the protocol, projects, and sponsors.
$TEIKI will be a native Cardano token, it will have a fraction of 6 decimal places, it is not pre-mined and it does not have a maximum supply. The protocol will only mint $TEIKI when a project meets a fundraising milestone, and $TEIKI is shared equally between the protocol treasury, project, and backers.
The minting of $TEIKI is related to successful funds in the protocol, and therefore the number of $TEIKI tokens is proportional to the total values created in the protocol.
Only the backers’ holdings are liquid. The protocol treasury locks in the tokens until Generation II, with the project portion gradually burning over a year.
Locked tokens are eligible for governance.
The development team informed that it will first establish the rules before decentralizing the process to chain voting. In later generations, Teiki will provide built-in governance functionalities for projects, which can only be joined by sponsors and project token holders.
The founder of the project is Hai Nguyen Quang “Tori”, who on the Discord server introduces himself as “I am an ambitious, driven, and hard-working bird. Doing everything I can to co-grow Teiki with the community”.
He tells us that he lives in Hanoi, Vietnam, he is Entrepreneur, Software Engineer, 6 years of entrepreneurship experience with Kikai, MELD, and Shinka Network, 5 years on Cardano (Hachi, Indigo, Plutus) and Blockchain (Hyperledger, Polygon), 6 years in AI (Vizgard, Nobi, demoing intelligent defense systems to the UK Army), and 9 years of professional experience in technology and software engineering. LinkedIn.
Tori is also CEO of Shinka Network and Advisor of MELD.
. . .
Nice review! Pretty novel project idea, like kickstarter meets AI meets Cardano Smart Contract Liquid Staking. I’m also wondering where the economic sustainability will come from, and the extra rewards from backing above the staking. Also i’m not sure how the tokens get value from the projects themselves. We’ll see I guess!