Haven Protocol: The Path Ahead
The aim of Haven Protocol was always clear. Solve an ‘unsolvable’ problem, build the product, gain mass adoption — and then set it free. Now that a range of xAssets are live, this is the perfect opportunity to focus on the path ahead and give our community further details about our long term priorities.
Haven’s journey consists of three phases:
Phase 1: Launch
Following the community take-over (see: Team History), where the current team took control of the project, we can confidently say we have hit all of our targets. We’ve launched a working product formerly labeled ‘impossible’, integrated with key exchanges and partners, raised awareness amongst early adopters and started the Haven Foundation. The genesis block has been laid for the path ahead.
This simple statement does not give justice to the magnitude of effort and achievement at play. As this Launch phase comes to an end, we are incredibly proud of our success. The community and contributors alike repeatedly expressed gratefulness for the work from the core team, volunteers, and all previous contributors that changed the project’s course and have taken Haven Protocol to where it is today.
The core team currently consists of a few full time members, volunteers and part-time contributors. This structure has served us well, for this phase, but will need to be ramped up for the path ahead.
Project funding has come from 5% block mining rewards and a selection of conversion fees, as well as donations and at times loans. As a new project gaining traction, we’ve had to pay our way in the absence of venture capital, pre-mines, or an ICO.
Mining fees and conversion fees are annoying features of PoW projects and decentralized exchanges, but simply put, the project would not exist without them. While the team has always implied that operating the project has substantial costs, this serves as an excellent time to illustrate some of the expenses involved in building and maintaining the project to date.
It’s important to note that the team was paid most of their income when XHV was between $0.10 — $0.40. This means that they only earned between $200-$800 per month until recent price increases.
Remuneration agreements were in XHV, but adjusted down as the value went up, to keep them reasonable. Some contributors quit jobs to make this dream a reality for all of us. But like participation in any viable start-up, their risk has paid off.
The table below shows the project income to date.
The volatility of XHV makes it particularly difficult to interpret these figures. To help put this into context, we’ve supplied a monthly breakdown of XHV income, with a US Dollar value based on the mean average value of XHV, as the time.
You can see from these figures why the Launch phase was financially constrained. Income in the early days was very low for a cryptocurrency project and therefore spent very quickly.
As the price of XHV has increased, the project now has a much larger budget, allowing it to move much faster in the next phase.
Phase 2: Growth
The xAssets launch on 12 April 2021 marked the completion of the Launch Phase. The viability of the technology and market acceptance was positively demonstrated and additional resources can now be acquired and deployed. The project has advanced into the Growth Phase.
As xUSD becomes a key player in the $75 billion stablecoin market, rapid growth can be expected. Network effects increasingly bring contributors and partners into the ecosystem, strengthening resilience, establishing brand and market footing, growing community and liquidity. This increases the focus from future collaborators to the Haven project. The current bull market will provide a constant challenge to keep up scaling the project with a torrent of new opportunities.
Equally important to growth in this phase is the continued drive towards decentralization. While building an ecosystem with multiple private assets, a certain amount of centralization has proven itself to be advantageous. Problematic economic parameters were solved, bugs and protocol errors were quickly fixed and/or mitigated. Further decentralization in this phase would have significantly slowed down Haven’s development and deployment. However, with increasing technological maturity this advantage continuously diminishes and the anti-fragility offered by decentralization comes into focus.
Technological steps to decentralize are a work-in-progress, as are governance changes for Haven. The ultimate long-term goal is to empower the Haven community to run this project without the input of a core team or the supply of a developer reward. This need for a transition from the technology-based lead of the core team into a governance-based decentralized protocol resulted in the creation of the Haven Foundation.
Funding and Foundation
The Haven Protocol Foundation was legally incorporated in the Caymans Islands on March 16th 2021.
Its primary function is to provide governance and funding for Haven to thrive in the future as one of the major cryptocurrencies. As a not-for-profit organization based in the crypto-friendly Cayman Islands, it can provide project guidance and grants at arms length.
Haven’s governance wallet is being moved into the foundation in May 2021, at which point, the foundation will start to fund the project.
As the value of Haven’s network grows, the size of the team can be expected to meet new demands, as we put part-time contributors into full-time positions and address current bottle-necks in resources. New developers will be assigned new projects as we forge new partnerships and features to support growth. Marketing spend will also be increased significantly.
Funding will continue to be generated from the block reward and swap fees, and other community contributions in addition to a $1m pledge made to the Haven Foundation, and other smaller donations we’ve had along the way.
To ensure each team member is properly incentivized to commit their time for the entire phase, remuneration will be based on a static payment in xUSD while also including a modest bonus element. The bonus value will be held in XHV, making it performance-related and aligned with the community’s desires. As this incentive structure is native to many cryptocurrencies — especially minted tokens — the positives for the networks are sufficiently tested. Regarding the negatives, catastrophic over-incentives that come with most projects where a majority of coins are automatically held by investors, team and foundations is not possible by design. This is just a partially delayed payment with mandatory vesting in XHV.
Given the project’s ambitions, the core team will focus with laser-like precision on the presented growth objectives. These include platform capability and stability, scalability as well as key partnerships, such as exchanges, third party wallets, on-ramps & off-ramps. We are currently working with a leading FinTech consultancy in the UK to define this part in detail.
The community will also continue to deliver to increase the value of Haven — and as the transition progresses the community will be enabled to gradually replace the core team by the sum of their contributions.
We are aware that there are many stakeholders involved. Therefore we will be recruiting experts to take control of this process, so we’re keen to hear from anyone with experience. Our friends at THORChain and Monero both provide interesting decentralization plans, which we are following with interest. Other sophisticated projects like Bitcoin, Ethereum and Decred also offer unique approaches to governance, which we will take into account.
Phase 3: Decentralized
To ensure the long term success of the Haven project, the team and the protocol must be decentralized at the highest viable level. We can call this “fully” decentralized, meaning comparable to Bitcoin. This is the target for the decentralized Haven network, and this is what we’re aiming for.
However, given the challenges associated with Haven’s focus on privacy and the light-speed technological progress of the crypto space in general, nobody can reliably predict a clear road to this target at this time.
Core team members may still be involved, but the concept of a core team won’t. The community will take over again, this time in a broader scope. It won’t be team members all over the world, it will be teams all over the world. The exact shape of this decentralized future is yet to be determined.
We would be interested to hear the community’s thoughts on these plans. Let us know your thoughts in Discord #ideas and we’ll publish additional views and progress against these goals in official channels.
Each core team member and contributor joined Haven at some point because they believed in our shared values of financial freedom, privacy, and autonomy. Haven will continue to grow stronger in the future because these values are shared by so many more people throughout the world who have yet to discover the solutions Haven has created.