PoolTogether

Looks like the momentum is picking up for PoolTogether, including someone who put in $200K this morning. I think we'll see a pool of $1M Dai before the end of the month.

People have asked me: how is PoolTogether a DeFi primitive? Well, there is actually an academic term for it: Prize-linked Savings Account. PLS has been researched in academia, including this paper from Harvard & Oxford researchers....

If you're short on time, here are the paper's takeaways:

- PLS is attractive to all demographics
- People who use PLS increased total savings on average by 1% of annual income
- There is causal evidence that PLS substitutes for lottery and is also a complement to savings

I hope this provides some good food for thought on why PoolTogether is a DeFi primitive. Just because it's a substitute for the lottery doesn't mean it's actually a lottery! As studies like this show, PLS benefits users' financial health — that is the goal of DeFi after all.

PoolTogether built on Ethereum has a neat lottery concept. People purchase tickets & all funds go into a smart contract earning interest. At the end of the pool everyone gets their funds back but one person gets all of the interest earned on the pooled money.

I found CryptoKitties the most interesting cryptocurrency-related project of 2018. PoolTogether the most interesting of 2019.

I dunno what I will find interesting in 2020, but it will probably be built on Ethereum.

Cryptokitties surprised me; I wouldn’t have predicted people would pay so much for digital collectibles. It made me think, which is why it is interesting to me.

PoolTogether is interesting to me for a different reason— it is a great example of ethereum as a platform for composable, interoperable smart contracts.

Pool-linked savings are an unprecedented and crucial DeFi primitive that will bring financial empowerment in ways that weren't possible before. ConsenSys is excited to support the PoolTogether team as they build out their platform for the benefit of users worldwide.

There is gambling and then there is gambling. Negative sum is Vegas, dice, cards. Arguably positive sum is startup investing (wealth creation). Arguably zero sum is trading public stocks.

If PoolTogether's lottery mechanic gets more people to save, may be a net good. Will see.

[PoolTogether] is really interesting. They pool funds in DAI, collect interest on the pooled funds, and randomly award the interest to a user while everyone gets back their principal. And because it’s a smart contract, it doesn’t need a cut to pay for management. It’s a positive sum lottery.

Many good ideas here:

- DAI provides stability so no principal risk
- Positive sum so it can be done repeatedly
- Payout increases with pool size giving incentive to invite others
- Zero loss may mean less regulation

If it works, one of the best things I’ve seen in defi.

An app like this is only possible now because of the last few years of defi infra. Among other things:

- MakerDAO and DAI stablecoin
- Interest apps like Compound

It’s a great example of composable finance. Take individual primitives and pipe them together. We’ll see more.

I for one am happy [that PoolTogether is] centralized. Otherwise, as anyone with any history in the BTC or ETH space knows, it would be gamed by everyone because nothing is random on-chain and also everything on-chain is public meaning a reveal scheme is necessary to even hide it....

Randomness is hard in general. On-chain randomness is harder.

The risk of bad randomness on-chain is greater than the risk of PoolTogether team fucking everyone.

Ergo, PoolTogether using centralized oracle is safest solution for users for now.