Introduction

Since my last post a couple of months ago, interest in LinkPool showed no signs of slowing down, we had to close our Beta sign up when we hit around 15 million Link mark in mid February (meaning signups were only open for around 6 weeks) as we never expected so much interest. This, combined with the ChainLink team recently releasing the alpha version and their open source vision, we are evermore confident in future potential of ChainLink and viability of LinkPool although there is naturally still a long road ahead. The ChainLink project will evolve as it matures and we will evolve with it.

Many of you are aware of Jonny’s extensive technical understanding of ChainLink and he has become a great asset to the community and really helped give us some credibility. Because we are now asking for this capital, we felt the public deserved an in depth explanation of LinkPool further than a few medium articles, so we have produced our own Whitepaper containing an explanation of our solution, infrastructure, estimation of the oracle economy and a technical roadmap. (we’re aware it’s a bit like a whitepaper inception) which can be found here. We think we have been very conservative in our estimates of the Oracle economy in the whitepaper.

So, why do you need a crowdsale?

When we first started LinkPool we did not realise the interest it would generate, it was always intended to be a side project we could run alongside our day jobs but it quickly became clear that the scope of the project was far too large to be a part-time venture, it also became evident there was a lot more complexity to making the staking solution work exactly as we intended as well as properly setting up a node to make it profitable.

We now believe we must commit to this fully if we are to deliver true value to the network and make LinkPool properly viable for us and our stakers. We are in frequent communication with some of the ChainLink team to ensure to ensure our solution aligns with what they’re delivering and we hope to keep the channel of communication between us active for the foreseeable future, we believe this will no doubt evolve into a symbiotic relationship as it has somewhat done so already.

Alongside developing our MVP of pooled node staking, there is so much more we want to do to expand LinkPool and assist in the adoption of ChainLink because naturally, our success will shadow ChainLink’s. This is not our official roadmap but some of the things we would like to work on are :

Develop various open source external adapters for all node operators to utilize

Develop an adapter and Node listing service/marketplace

Custom external adapters for business’s specific use cases

Consultancy services for implementing ChainLink Oracles

Private nodes for individual stakers or businesses

Increased contributions to the ChainLink source code

Attend conferences to present and network

We both work full time jobs in non crypto fields and its becoming increasingly difficult for us to manage both, we are discovering an ever increasing amount to do and improve upon. Before launch we need to pay for a full contract audit, legal council, upfront AWS costs and various other miscellaneous overheads. And obviously make sure everything is well tried and tested, a time consuming process in itself.

This is why we need some up front capital, without being able give LinkPool out full attention it leaves exponentially more room for error. Something we see as unacceptable and also would if we we’re in a stakers position. We want full confidence in our own solution going ahead and the only way we see this is happening is by both giving it our full-time dedication and attention.

The Crowdsale

We discussed a few possible ways of raising capital to allow us to pursue this full time, our first was obviously creating our own token and doing an ICO, however due to the relatively small amount we are looking to raise, adding another token into the solution seemed unnecessarily complex and would likely seem like a money grab. Not to mention the difficulties in getting it listed on an exchange (note: the shares will in essence be “tokenised” but not in a traditional ERC20 sense, this gives us the ability for you to still exchange your shares of LinkPool in the future)

There were a few other avenues but we ultimately decided it would be the perfect way to utilise smart contracts ourselves and to do some dogfooding of own contracts that have already been baked into our staking and payout solution.

So how will it work?

At a high level, we have a contract for distributing the rewards that our ChainLink nodes earn; one part that deals with deducting and distributing our “Makers Fees”. Another part of the contract takes the remainder and distributes it between stakers based on the their percentage of Link tokens on a particular node (all our contracts will be entirely public and audited of course).

We are simply going to offer up a portion of our makers fees to anyone interested in owning a part of LinkPool. So, for example, if someone were to contribute 100% of the crowdsale amount (1000ETH for 25% of the makers fees), their address would be added to the smart contract and be hardcoded into the owners contract along with mine & Jonny’s addresses, they would then earn 25% of all LinkPool makers fee earnings, forever. This share will never be reduced no matter how profitable we become. Although the lions share of rewards goes back to the stakers, each staker only earns based on their percentage of Link on a particular node, where our Makers fee is across every node we operate.

Fee Reduction

When we first announced that our makers fee would be 30%, there was a lot of mixed feedback. Some were perfectly happy to let us take less than 1/3rd for doing all the work for simply depositing their tokens into a smart contract. Others were not so kind and some were astoundingly outraged and felt it was excessively high and should be more akin to a miner pool fee of around 2–3%.

Unfortunately I think there is also lot of confusion around this area as they really work nothing alike to mining pools and neither do they to typical PoS pooling, there is a lot of work to be done behind the scenes and things we wish to do to benefit the ChainLink community as a whole. A Reddit user by the name of Omisebro provided an excellent defence to our fees and need for a crowdsale here that I couldn't have worded better myself so I would like to paraphrase

In regular pool staking, all we do is stake our tokens on a contract, and let the normal validation process take place. The work is completed automatically by our computers. So the guys at LinkPool have to do all the work of not only setting up a staking environment, but also finding the type of data to provide, picking the best data providers, getting the best servers (with plenty of backups) to assure they are providing the quality uptime they need to provide to be top level oracle. Basically, running LinkPool will be way more active and work intensive then simply staking your tokens on Ethereum, thus the need for extra money.

That being said, our justification for having the high fees initially was to ensure overheads were covered and that we could lower them in time. But we severely underestimated how much time and money was to be involved upfront. However, now, by lowering this fee it is not in any of our crowdsale participants interest and we have decided to meet somewhere in the middle and by lowering our fee 5% to 25%. Stakers are still earning 75% of all profits LinkPool generates for putting their Tokens into a smart contract. Tokens are only held within contracts where you retain ownership, like any decentralised exchange. And they are withdraw-able anytime. For free.

Remember, our target market is to those who’s tokens would otherwise just be sitting in a cold wallet. If you are technical enough to run your own node then we wholeheartedly encourage it and are aiming to support the community through open sourcing our adapters, disclosing any lucrative data sources we find and just generally supporting node operators where we can. The whole point of ChainLink is that it is a decentralised network, and we do not want to monopolise it.

How much are we raising?

1000 ETH

We are looking to raise an amount of 1k Ethereum to support Jonny and myself full time, hire at least one more person, up front AWS costs and various other overheads as mentioned earlier for for 2–3 years. (Bearing in mind a large chunk will be converted into Fiat soon and capital gains tax paid on the converted amount).

We will be putting up 25% of our makers fees for the Crowdsale and as these are the people who will be providing us the most trust and taking the biggest risk, Crowdsale participants shall get first staking priority on the nodes, should they wish to do so as well. In the future these shares in LinkPool will also benefit from future events such as airdrops and voting rights, something stakers will not receive.

Remember this is not 25% of everything LinkPool earns, but 25% of everything Jonny and I would earn, what we reffer to as the “Makers fee”.

This means of all the profit (operational cost derives from GAS cost of node operation) LinkPool nodes generates:

75% is returned to the stakers proportionally

18.75% Is split between Jonny & myself (and any future shareholders, i.e new employees, will be deducted from this amount only)

6.25% Is split between crowdsale participants (25% of 25%)

This may seem like a small cut for the crowdsale participants, but they receive income from every single public node we operate, which we hope to one day be in the hundreds if not thousands. Where as stakers only receive passive income from each node they’re staked on.

Whitelist / KYC

Unfortunately due to the SEC we cannot allow US citizens to participate. We will be opening our whitelist immediately for a period of around 4 weeks. The whitelist procedure will work like normal, we will require people applying to go through a simple KYC procedure which can be found on our website. You will need to provide photo ID and a non-exchange Ethereum address (This address will also be the one your future link rewards you withdraw to). If accepted you will be notified and this address will be added to our Crowdsale contract.

Once we have finished the KYC period, we will provide the contribution address and provide a utility on our website that will let you check the percentage of LinkPool fees you will earn. As an Ethereum contract, it will be entirely public and you will be able to see your address there. If you try to send funds from an address that is not whitelisted, they will be rejected.

Minimum contribution: 0.2 ETH

Conclusion

Thanks for taking the time to read, we understand this may not be everyone cup of tea and that there is a lot of risk involved investing into a trust-less staking platform based on another un-released project. It goes without saying this is a long term investment, but we believe the API economy for Blockchains will become an incredibly large market and we’re both extremely excited for the potential of ChainLink, and based on all the information we know around the project, we’re ready to dedicate our careers to the adoption of smart contracts and oracle platforms (One in-particular).

We hope by now after making our identities very public (Twitter, Linkedin, Slack etc) and being present in the ChainLink community as well as developing a trustless solution to staking, that we shouldn't need to address the concern of this being a scam. So we won’t.

If you have any questions or are interested in contributing a larger amount please contact us at contact@linkpool.io. We will keep an eye on Reddit and aim to answer any questions should some posts about the crowdsale arise. But we’re extremely eager to see the communities response to this (especially the unfiltered sentiment of biz) as we have so far received some very mixed support for the project. We do not shy away from criticisms (as long as its at least somewhat constructive)