This article was originally published on The Daily Chain, 14th April 2021.
“Vitalik Buterin stated in 2020 that prediction markets may be one of the most underrated categories of Ethereum dapps. Since he made that statement, little has changed…
We believe everybody has the right to market access, regardless of arbitrary factors like net worth, location, or job title, and we believe TotemFi will be a big step in the right direction for the democratisation of markets.”
Jolyon Layard Horsfall, TotemFi CEO, April 2021
TotemFi, the non-punitive prediction market for the masses which pays rewards in Bitcoin as well as its native TOTM token, has got off to a flying start.
A basket full of partnerships in hand, TotemFi’s growth is meteoric and it ranks as the most successful recent DuckStarter IDO. Despite the explosion in price the market capitalization is still very low compared to its competitors.
The interest in TotemFi should come as no surprise. They bring a novel twist to prediction markets (no penalty for bad predictions) which should encourage rapid adoption. More importantly, however, the team is young, dynamic, and talented.
The Daily Chain caught up with TotemFi’s CEO, Jolyon Layard Horsfall, to find out more. Known to his team as Jol, this young mathematics and economics University of Bristol grad has already accrued a lot of experience as chief financial officer for a charitable organization, corporate tax associate, and an ambassador for a global network of young entrepreneurs.
Why did you decide to make a prediction market?
The co-founder of Ethereum, Vitalik Buterin, stated in 2020 that prediction markets may be one of the most underrated categories of Ethereum dapps. Since he made that statement, little has changed; there haven’t been a great deal of new participants entering the space, and we hope to add an alternative offering with some exciting novel features.
My brother and I co-founded TotemFi to disrupt the space; we want to provide an accessible decentralised platform with minimal barriers to entry, which will reward both individual and collective users for their ability to forecast asset prices and events. We believe everybody has the right to market access, regardless of arbitrary factors like net worth, location, or job title, and we believe TotemFi will be a big step in the right direction for the democratisation of markets.
You graduated from university a few years ago and have been extremely busy since. Could you please tell us a bit about yourself?
I have a background in the traditional financial sector, having worked at a global accountancy firm specialising in tech, media, and telecoms (TMT) firms. Alongside my current activities I’m also the CFO of a mental health charity for students and young people, as well as being an ambassador for One Young World, a global network bringing together and empowering young change-makers from across the world to inform the next generation of leaders about responsible and effective leadership. I currently sit as Co-chair of the Finance & Business 2030 Task Force whose charter is to drive advocacy for the UN sustainable development goals (‘SDGs’) alongside industry wide change.
These roles have developed a number of key skill sets and more importantly a mindset able to addresses the challenges presented when creating a project of this nature.
TotemFi is unusual in that it does not punish or charge for bad predictions. This is great to encourage people to use the platform, but where will rewards come from, and are there possible drawbacks in a nothing to lose prediction market?
Our non-punitive predictions are one of our most innovative features. We’re able to offer them through a small 3% recall on entry to the staking pools which is returned to the admin wallet to purchase BTC prizes. This is the maximum amount of a users’ initial stake that is taken regardless of how accurate or inaccurate their prediction is.
There is also a 3% burn/recall function on selling the coin on DEX’s which will help generate funds for the development of the project, cover the operational costs for us to deploy the smart contracts and the purchase of further BTC prizes.
This effectively means the rewards are generated through the background trading volume of the token.Therefore if $TOTM is used to make predictions, users will gain the positive externality from the background volume funding the rewards.
The only draw back of the non-punitive staking is the lower risk does reduce the highest winner value but we are confident we can address this via alternative pools post MVP.
Where have other prediction markets failed?
I think other prediction markets have brought some very interesting and well put together projects, saying they have failed might be too strong.
We wanted to build a protocol on the Ethereum network that actually brought compelling use cases and functionalities which the community could use. One thing we were seeing with other prediction market platforms was a lot of promise about solving huge global issues on the blockchain; this could well happen, but not at the pace some of the projects were claiming.
The key problems TotemFi is seeking to address are accessibility to prediction markets and real value creation. In the first instance, other platforms on the market tend not to have very good UI, and are often quite complex and difficult to use and not to mention costly if you predict incorrectly. In the latter instance, TotemFi will be the first prediction market platform to offer rewards in BTC, as well as native TOTM, thereby ensuring that value is created through the benchmark store-of-value cryptocurrency, bitcoin, alongside our proprietary token.
Are there concerns regarding bets placed on a public ledger where accounts with better results can be tracked and copied by other participants?
The idea of copy trading is becoming much more common on top platforms — whilst this is not a direct feature of our MVP we certainly don’t see this as a negative thing. If an individual wants to match someone’s prediction, given the tie-breaker in our protocol in who entered first they will at no point be disadvantaged. As for the individual, they are using all publicly available information to them at their time to make a prediction which could have been researched through some other medium.
We’ve already thought about introducing this copy trading post MVP to help individuals gain additional rewards for providing their forecasts. This helps provide extra incentive for more experienced analysts and support for newer members to the space.
TotemFi will pay rewards in the native token (TOTM) and in Bitcoin (BTC). Can you talk about how this will be implemented?
On the platform, there will be two separate input wallets. In the dapp there will be a “my accounts page”, which will contain a function for users to attach their BTC address. Users won’t actually be able to make predictions without inputting this and linking it to their ETH address. The platform’s protocols then run a BTC node and automatically pay out users’ rewards when the staking pool they’ve entered reaches maturity.
Clearly as we expand the pools to other on-chain assets such as Ethereum these will be linked directly to users entry address. As with anything in crypto nothing is final as we’ll be working hard to achieve the best solutions for our users, maybe that includes some interaction with wrapped BTC.
Please tell us about the team and your investors, and how Totem came together.
TotemFi was co-founded by my brother, Harry, alongside two others. Harry got his first exposure to BTC whilst at uni in 2011. After he graduated he started running tech conferences, and hosted a panel discussion on Bitcoin. The first speaker he booked was Paul Gordon, who is subsequently a strategic investor on TotemFi (a long time coming!). Since then he’s worked in marketing roles across startups and FTSE 100 companies, and for the last 3 years he’s helped take a leading crypto exchange from 1 million to 7 million customers.
We’ve got a core team of 9, with a diverse skill-set ranging from developers to marketers and branding experts. Our CTO combines an academic background in Computer Science with full-stack software roles at start-ups and a leading cryptocurrency exchange to manage the technical oversight of TotemFi.
Importantly everyone coming onboard has a strong desire to hustle hard and create something that adds value to the blockchain ecosystem. They have a clear understanding of our vision and always bringing innovative solutions to any challenges faced.
We’ve got an incredible roster of investors, and we’re a tier 1 incubation of DuckDAO — the top decentralized crypto incubator in the space. Our other strategic investors include Nabais Capital, LD Capital, Alphabit Fund, Altvest, Moonwhale Ventures, and Bluenode Capital.
What can people expect to see in the first few months after launch, and when will TotemFi’s Bitcoin price prediction market open?
You can expect to see some big announcements and partnerships following the launch — we’re in talks with some really interesting projects about how they can collaborate and contribute to what we’re doing, and vice versa.
Our prediction market platform and dapp should be launching fully later this year. BTC will be the first instrument we’ll offer predictions to be made for, but eventually this offering will be expanded to any asset class or broader event (like elections, sports results, etc.) which the community decides they want to speculate on.
What are your long-term plans for TotemFi?
As stated, throughout the roadmap there is functionality being released which adds both on-chain asset classes and off-chain asset classes. This is such a wide field that we will be focusing on adding what the community wants to see and, more importantly, what the community will use.
We’ll also be bringing out a Decentralised Prediction Market (DPM) platform to allow the trading of Yes/No contracts. This will be an additional product to our prediction pools and hopefully widen our userbase further. We’ll be working hard to ensure the front end is industry leading as with our MVP.
The roadmap plans to provide additional features which will be engaging, fun, rewarding and great to use. We also have a keen focus on the accessibility of the protocol, which is where our items such as migration of chains and L2 scaling play a vital part. We have plans in place to introduce an L2 solution as soon as we possibly can, and there have been applications submitted for migration to adjacent blockchains such as DOT or ADA. We’ll keep in contact with the community, strategic investors, advisors to ensure the most logical decision is made.
Collaboration with other crypto projects is also of paramount importance, we want to deliver high quality and innovative solutions to our community. This will almost certainly be more easily achieved when working together with other players in the space.
Thanks Jolyon, is there anything you’d like to add?
I just want to finish by saying a massive thank you to our amazing community; we’ve had an incredible amount of support from our early adopters,and we consider ourselves very lucky to have them with us on this journey. We can’t wait to see what the future has in store!
