Financial Community Update (June 2021)

Hey Pangolin Guardians,

I’ll be starting a monthly series detailing a financial update of Pangolin as well as lessons learnt.

These will evolve over time as we mature and more people join our burgeoning community.

Expenses

Below you’ll find the totals of our expenditure to date. These figures are from our first 6 weeks of operation. Please note All figures are shown in PNG.

If we look at that, we can see by far the biggest expenditure has been Marketing. This was mainly due to the marketing costs that we needed to pay to Gate.io.

If I’m being totally honest, I don’t believe we received value for money for this expense. You can see the performance of the PNG/USDT pair here. So let’s look at both the benefits and lessons learnt from the Gate listing:

Benefits

  • Easy on and off ramps for users wishing to buy PNG via fiat
  • Increased visibility of Pangolin to a broader audience

Lessons learnt

  • We rushed the listing. When the core team was voted in, we were desperate to provide good news to the community and with the CEX being so highly sought after, we wanted to deliver it asap. In hindsight, we should have waited.
  • Why should we have waited?
    • Currently we are waiting for a legal advice to allow PNG to be sold to US citizens. So we’ve excluded a large market share from purchasing
    • We didn’t list with a Market Maker. We can’t formally engage a (reputable) market maker until we have a Legal entity. Listing without a market maker is clearly a bad idea.

So we are remedying this. We are busy formalising our legal entity and will hopefully have it established in the next 2 weeks.

We have also met three different market makers to compare costs and benefits. We have made a decision on which one we will be using, but will only formally engage, once our legal entity is operational.

Then for the securities advice, we have engaged a legal firm and are just waiting for it to be finalised before we submit it to Gate and all subsequent CEX’s that we’ll list on.

Burn Rate

What is burn rate?. I’m going to quote Investopedia here:

The burn rate is used by startup companies and investors to track the amount of monthly cash that a company spends before it starts generating its own income.

It’s important to track burn rate to ensure the continued existence of Pangolin. Without capital, Pangolin can’t afford to pay people and would turn into a ghost project, so it’s an important metric to track to ensure our continue survival.

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From the above, you can see that at the current rate of spending, we have a very bright future. This doesn’t mean that we won’t increase spending as we scale up the team, but as more of these monthly updates come out, you’ll be able to compare our burn rate against our Revenue.

Currently our only Revenue source is swap fees, which, currently the plan is to distribute to PNG holders. However we have some cool features coming up that will provide some extra revenue sources.

Upcoming big ticket items

We have some big ticket items coming up over the next 6 months that I’d like to mention here.

Please note We’re not contractually allowed to mention the exact amount of money we’ve been quoted from these firms. So I’ll include the total at the end but I won’t be able to divulge too much without breaching contract.

  • Market Maker
  • V2 Audit
  • AVAX validator (required for V2 subnet)
  • UX Designer

These are going to cost us approximately 400K PNG at 1.13 USD/PNG.

There are revenue sources however associated with those items.

  • AVAX validator will earn staking rewards and allow us to start diversifying the treasury
  • The Market makers earn profit on our working capital. This profit will accrue to Pangolin.

As always looking forward to feedback and healthy debate.

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