AMA, June 30, 2021

Welcome to the first Effect DAO hosted AMA!

The notes written in this GitBook post include the community questions given to the team and the team answers provided prior to the event and summary notes of the responses provided during the event itself. These notes are not a transcription. A link to the recording of the event itself is provided should you wish to listen to the whole event.

Here is the formal recording of this AMA event: https://www.youtube.com/watch?v=Lgsq9gBtRhI&t=0s

Here is the link to the event pre-release: https://files.effect.ai/Community_QA_for_AMA.pdf

Jesse created a fabulous recap of this event. Thanks, Jesse! View here: https://www.youtube.com/watch?v=rA2pMy0QK4A

June 30, 2021 | 5 PM CET

DAO Hosts: AnaRiedel, Bree, DJSTRIKANOVA, Jehudah, mikel, Rochelle

Interview Guests: Effect.AI Team members, Chris Dawe and Jesse Eisses

“Never doubt that a small group of thoughtful, committed citizens can change the world. Indeed, it is the only thing that ever has.” -Margaret Mead

The EffectDAO is founded on the following core principles:

Growth of the Effect Network
Social Responsibility
Inclusivity
Openness and Transparency
Fairness

Effect DAO would like to thank Chris and Jesse for their time and willingness to participate in this AMA and we'd also like to thank all the team members involved in pre-answering the community questions. We had a lot of fun with this interview format and really appreciate the team's engagement in the whole process.

Additionally, we'd like to thank Rochelle for moderating and the interviewers for their part in making this event happen.

The following are some take-a-ways from this AMA:

There have been some serious learning curves experienced along the way.
The team will provide a means of transparently tracing the Foundation's funds from the ICO forward.
The team will provide a calculated estimate of how many funds are left to swap over to EOS based upon the number of codes issued.
The team will look into a second team connected community admin.

COMMUNITY QUESTIONS AND TEAM ANSWERS:

Community: How many people does Effect.AI BV staff in the Hong Kong office, and what are their roles?

Answer: Many across the globe are learning, thanks in part to the pandemic, that businesses, schools, and people, in general, can conduct many traditionally in-person actions virtually. While most of the Chinese operations are held virtually, we keep an office open locally at the ready for in-person needs. Specifically, we have 5 members who are directly responsible for the Chinese market operations. Some staff work from home in Hong Kong, Beijing, Amsterdam, and numerous other countries, covering marketing, community development, and administration execution. There is one person manning the office for administration purpose. There are two Chinese people on payroll in China. Velika is managing the Chinese office remotely. Most employees are working remotely.

2. Community: There is a major language barrier between China and the West. How does Effect.AI BV plan to overcome this and attract Chinese participants to use the Effect Network?

Answer: Many global projects face language barriers, and Effect Network is no exception. The Effect team is made up of people from all over the world. Velika, our lead for Asia and a native Mandarin speaker, is in charge of all communication in China. The team makes every effort to be agile in their marketing and public relations management. With the recent antagonistic government action on Chinese social media companies, the team is currently adjusting the strategy for Q3 and Q4 in order to maximize traction while remaining compliant with the new regulations in the area. Cultural differences are more challenging to navigate through than are language differences.

3. Community: How does having a physical office in China benefit Effect.AI BV? Are these benefits worth its cost?

Answer: Official business registration in China facilitates the application for official social media accounts and formal business operations. Without this, the Effect Network would be unable to legally operate in the Chinese market, so the benefits are clearly well worth the cost.

4. Community: Can you share some examples of what has been done in the Chinese market? Has any of it been fruitful?

Answer: We opened an office in Hong Kong, allowing the Effect Network to operate legally in the Chinese market and to gain approval for official social media accounts. Effect's Weibo and Zhihu accounts, for example, have a blue V icon, indicating that they are verified. In order to complete the verification process and receive approval, you must submit a slew of documents. The team communicates with the Chinese community through social media posts and videos, which furthers our visibility in China.

We have over 11k people following Effect's Weibo, and 33 news channels and 7 influencers sharing Effect Network's information, resulting in an estimated one million media exposures this quarter. Velika is certain that most or all following Effect on Weibo are real people and not bots, especially as there are quite stringent KYC requirements to join in these socials, due to government controls.

There has not been any Chinese requesters acquired at this time. However, there are plenty of tasks in Chinese for Chinese workers.

5. Community: Recently, the Chinese government has undertaken a stricter position on crypto influencers. How has this affected influencers of Effect Network and our Chinese marketing efforts?

Answer: Unfortunately, the answer is yes, there has been an impact. The Chinese marketing team is working hard to onboard more influencers and maintain traction with existing, high-profile influencers. However, on June 5, Weibo blocked almost all crypto influencers, including the most popular influencer that had over 1 million followers. The team is working hard to reconnect with all of them as they re-join the platform and maintain forward momentum in that regard.

The Chinese government frequently changes their policies, much of Velika's job involves keeping up with these changes and maintaining compliance with the government.

6. Community: With the Chinese government’s opinion of crypto being so volatile, is there a separate strategy for marketing in China? Is it more focused on crypto or blockchain? Who/what is the target for Chinese marketing? Are influencers being onboarded to help market Effect Network in China? What, if any, traction is being gained in the Chinese market?

Answer: As most of you are aware, China has strict crypto policies and opinions. Effect Network takes this step with caution and care. We consulted with a number of cryptocurrency legal, finance, and marketing experts before entering the Chinese market.

The marketing strategies of Effect Network target localization and technology discussion, with a focus on dApp service offerings, blockchain, and artificial intelligence developments, and ecosystem development.

The Effect Network is quickly gaining traction. This quarter, we have over 11 thousand followers on Effect’s Weibo account. Effect Network’s progress is actively being shared by 33 news channels and seven leading influencers, with an estimated one million media exposures.

7. Community: Since the first announcement of collaboration between Effect Network and Akon/Akoin, there has been a lot of interest with the hubs being built in Africa. Why hasn’t Chris been to Africa yet? Does he still plan to go? If so, when?

Answer: The entire world has been in a state of pause, COVID-19 protocols have really interfered with progress. Our expected date of operation has been pushed back several times. Though the process is difficult and slow, we have had several advancements and are still very much committed to the partnership. Chris, Akon and the Akoin team are still very actively planning the steps forward. Chris received a recent message from Akon, "...are you ready for prime time? Travel restrictions reduced, political strength in place, universities on board, it's time to open the hubs! Big growth and updates. Let's go!" communication is consistently in process. There are some big updates to come for Africa, but these announcements will be made when they are fully ready to share, not in small bites along the way.

8. Community: How is the relationship going with the United Nations for new tasks? What happened to the bottle counting tasks we had before? Are they ever going to come back? What about more tasks for refugees and Effect Pieces? When/Can we expect more to happen with that dApp?

Answer: The bottle counting tasks were completed with great success. If the client wishes for more data annotation for these, we’re confident they’ll return as they were pleased with their results. We have some great things being planned for Effect Pieces and refugees in the future. More traction will be gained on this after the SDK/hackathon.

Effect.AI decided a long time ago that they will focus on NLP type tasks rather than AI training tasks. The relationship with the UN is ongoing, but more focused on NFT related tasks at this time.

9. Community: Is there any chance that Travala could be a partner with Effect Network or with Effect.AI?

Answer: Effect Network could be of great value to Travala, and other crypto projects, when it comes to data labeling of properties. We’re definitely open to discussing possibilities with them. If there is something really valid and that would contribute to the forward movement of Effect Network, then these partnerships are worth pursuing.

Pursuing partnerships with smaller crypto projects is not an active goal for Effect, however, we are not closed to the possibility should one arise.

10. Community: Much of the world is still under various restrictions due to the ongoing pandemic. What is the status of the hub in Georgia? What is planned for it in the future when it’s not restricted by the pandemic?

Answer: Georgia was hit very hard with COVID-19 restrictions. The Effect AI & Blockchain Centre is active with limited activities as the country is coming out of strict measures. But through the last several months we have been working in a virtual setting with the members of the Hub and many refugees in the region.

Effect has always held a great value on the social element of this technology and will continuously explore where our technology can help benefit others.

With COVID-19 protocols many of the workers using the centre were required to return to their homes. As these restrictions lift, these workers will begin to return to the centre.

Ivan on Tech's academy is still in place for the hub workers. Will his academy include Effect Force and Effect Network as part of his curriculum? This has not been discussed at this point. But this is something to consider. Though Effect Network will ultimately be featured in more than just Ivan on Tech's academy.

11. Community: Are there any plans to add more admins to the main Telegram channel so it can be monitored 24/7?

Answer: We see the value in getting more Telegram admins over different time zones. This is something we’ll look into. We may look internally to the current community for an admin, or we may look externally to a professional admin. We will actively begin looking into this.

12. Community: Taking a look at 2020, is there anything that, if given the chance for a re-do, what would Chris have done differently with regard to the ~~Effect Network~~ [2020]? (Chris is answering the question asked live. Sorry, my slip up that I didn't specify in regard to Effect Network and not just 2020 in general.)

Answer: Spending more time with family tops the list of things that in hindsight should have been differently. When it comes to business, there are many things that you learn about as one goes along, some things would have been done differently if the outcomes would have been known ahead of time.

13. Community: Currently, some workers are being paid by PayPal for tasks. Why is that? Are there plans for this to stop? If so, what are they and when can we expect this to end? [1:46:10]

Answer: Some translators receive payment through PayPal by Effect.AI, so that Effect.AI can get access to highly skilled translators that are not familiar with EFX. This system of translators getting their funds through PayPal and Effect.AI recovering the EFX was necessary to ensure quality translators quickly as the need was higher than the workers available. In this system, the tasks are still performed on the blockchain and EFX payments are still being registered. This is being scaled back. There have been guides and videos to help new translators set up through EFX and to coach current translators into switching away from PayPal. This has been successful and the number of translators using PayPal is declining and will be soon be phased out. Nevertheless, these translators are still needed, Kraft Heinz is still ongoing. We're receiving more and more work there. At the moment we are not expanding on the PayPal workforce. We are expanding on the EFX based workforce. This also makes our works much easier, as the amount of support and manual work involved in doing the PayPal payments is incredible, so we'd way rather people use the EFX payout. The plans within this year, and preferably within the next 3 months hopefully will be completely phased out, with education for new workers and those needed to switch out of PayPal. This is a big topic within the community, but it is really a small part of the workers.

14. Community: Is there an automated adjustment system that adjusts the EFX for the tasks as the price of EFX fluctuates? [1:51:18]

Answer: Task prices are being adjusted from time-to-time as the value of EFX fluctuates. Keep in mind that the task price is ultimately up to the requester. The capability to adjust it does exist and is utilized as needed. Future dApps creating tasks on Effect Force will also have the ability to adjust task prices as the price of the token changes.

This is one of the essential questions of Effect Network. The more we grow and the more work that is completed on Effect Network the more important this question becomes. At the moment we are really starting to feel the pain or benefit of having this fluctuating prices. and in the long term it's not very favourable for the Network to have a very volatile currency or reward to what the workers are doing. It needs to be solved, there needs to be mechanics in place. Liquidity Pools will help. More liquidity means more stability. We haven't solved this yet, but the fact that we experiencing this problem now means that we are doing well. It also means that we need to be smart and start solving it. This is a problem we can solve within the Effect Network and solve in a beautiful way. It's being worked on and discussed, but this isn't solved yet. This is an annoying part for workers and for requesters. But we are working on this.

[See July DAO weekly call notes for progress regarding liquidity.]

15. Community: When World Token started using Effect Socials, those of us who completed tasks were asked to provide our ETH address so we could receive some $WORLD. When are we receiving this? [1:57:08]

Answer: We’ve identified 7 workers who are eligible for the extra bounty from this completed campaign and will be in touch shortly with them about this.

WORLD token was based on the Ethereum blockchain, there were about 7 people who wanted their payout in WORLD tokens. There were not that many of these tasks, and the payouts were going to be far less than the transaction fees that it would have taken to make the payout.

16. Community: When the Effect Socials tasks debuted, some tasks said, ‘major bonuses for high-quality work’. Have these bonuses been given out? If not, when can we expect them? [1:57:08]

Answer: We reviewed 46k+ tasks and identified around 30 workers who are deserving of a bonus. We’ll be in contact with those workers soon with details.

17. Community: How many workers are currently earning $50 or $100 per day from tasks? [1:53:54]

Answer: We don’t have these statistics at hand, so cannot provide the exact numbers.

That being said, when there are large quantities of tasks on the platform, there are dozens of workers that earn $50+ a day, they can make serious money. When there are fewer tasks available (like last week), there are days when no one earns more than $50 a day. Additionally, it’s also ultimately up to the worker on how much they make, as it’s directly tied to their individual abilities and how much time they spend completing tasks on the platform.

This is something that is not consistent enough. Consistency is really key for this, and currently we are simply not consistent enough, but we are working to improve this. We are looking to scale the platform horizontally rather than vertically with the SDK and by bringing in new requesters.

18. Community: Are there any plans to provide options to swap EFX directly to FIAT or other cryptocurrencies directly from the worker interface of Effect Force? [1:49:21]

Answer: There are plans for an EFX / FIAT gateway and integration with a debit card. Although we are excited about it, it’s too early to share more details at the moment.

This would be one of the most convenient things that could happen in Effect Force. Perhaps the holy grail would be the ability to buy your groceries and pay your rent right out of Effect Force. A direct payment gateway using EFX are things we are working on. We are very excited about this. we are working on this, but in case it doesn't work out we don't want to make promises. But we are definitely working on this, as this fits really well with the Effect story.

19. Community: We’ve heard talks about the new Effect Force mobile app, and most recently, Chris mentioned it again on the newest episode of The Weekly Effect. When can we expect this app to be released? Will there be a beta test that people can participate in? [2:00:29]

Answer: We are working on a new, more decentralized Effect Force. That version will also have a mobile app released with it. This new version of Effect Force will be launched by the end of this year, and will have many more changes besides just the mobile app. It will be way more decentralized and the DAO will be more involved, as well as the new virtual Effect Account system, supporting both the EOS and BSC chain in a decentralized way.

The mobile app is being built and will be released in both Android and IOS by the end of the year. It will have a built in wallet and will support Anchor and all the major wallets.

20. Community: Currently, workers earn EOS-based EFX. Will they have the option to earn BSC-based EFX? If so, what will that entail, and when can we expect that to happen? [1:55:28]

Answer: Yes, in the coming update of Effect Force, which is scheduled for Q4. This update will allow workers to earn in either EOS-EFX or BSC-EFX. The tech team has come up with a beautiful solution to this. Every task will still be recorded on one blockchain [EOS], but people can use their BSC wallet to post proofs to the BSC blockchain and get their earnings when ever they want. Because the fees are higher on BSC, we'd expect that people would wait to cash out in bulk. Their BSC account and private key gives them ownership of their EFX on the blockchain. So this is a really beautiful cross chain solution. This will be seamless for either blockchain.

21. Community: When the new Effect Force mobile app launches, will wallets be integrated into the app? If so, which ones?

Answer: We expect to support all major mobile wallets on both the EOS chain and the BSC chain, as well as a way to use the app itself as a wallet.

22. Community: Does Effect.AI BV have a list of clients they will approach over the next 3, 6, and 12 months? Does the BV offer a commission for referring clients? If so, what is it? [2:01:17]

Answer: Effect.AI no longer speaks publicly about its contracts with specific clients. The new approach for getting more requesters is to attract them to build their applications on top of the network, without having to be clients of Effect.AI BV.

For the same reason, the BV also doesn’t run a referral program anymore. Effect Network is going to be simple to access for any business soon, and a commercial referral program does not fit well in that decentralized model.

Community contributors can now use the DAO to submit use cases and receive rewards. This is not the business model that we are actively pursuing, but if someone were to bring in a client there is definitely a commission that would be paid out for anything that made its way onto the Effect Network. But officially we do not have a referral program.

Our main focus for this year is to build out the best decentralized task platform in existence. We've already proven that this can work in a significant way. It really doesn't matter if we're decentralized, if we work with a cryptocurrency, or if our work force earns a cryptocurrency and it's distributed. Our platform works. And our main objective was to validate these systems. So we built products and services, for various reasons, but the main and most important reason was to validate if this was going to work. It works.

Our main focus now, clients if they come in and we are able to on board them we will, but this is not our main focus. Our main focus now is to ensure that there are more tasks on the Effect Network and to make sure that this scales in the way that we envision it to. In a way much beyond the Effect.AI BV, that people are able to build out products and services on our platform. We have already proven that this can work, now we need to make sure others can build on it and have it work for them. We have lots of clients in our list that we can reach out to when this is ready for them.

23. Community: At the beginning of 2021, Chris stated that he would spend 80% of his time on sales to bring in new requestors to Effect Force. For the past 6 months, has the attention on requestor acquisition happened? If not, what instead has taken up so much of Chris’ time?

Answer: While we have brought in several big and successful clients, we are shifting focus from a centralized model where Effect.AI B.V. is the only entity bringing in clients to Effect Network, to a more decentralized model where Effect Force is more accessible and open to external companies through the SDK, attracting new dApps and requesters to Effect Force.

24. Community: When will all requesters need to purchase their own EFX directly from exchanges for tasks they put onto Effect Force?

Answer: Requesters already have to purchase EFX in order to post tasks on Effect Force, but at the moment, Effect.AI acts as a proxy requester for its clients.

In the new release of Effect Force at the end of the year, every requester has to manage their own blockchain account and it will be more transparent where EFX flows from.

25. Community: Why are there no new requesters or tasks on Effect Force at the moment other than translation, NFT, and social media tasks? [2:06:50]

Answer: The NFT, socials, and translation tasks come from applications made by Effect.AI BV. This has been the primary source of tasks over the last year. This only scales to a certain point. We realize that as a decentralized project, we must make the product more accessible to external companies.

NFT tasks do come from more than one requester. There will be many more of these type of tasks to come.

The BV is really focused on the translations, socials, captions, and NFTs. Previously, a lack of focus held us back. These will continue to be our focus as we move closer to the release of the SDK and the Hack-a-Thon, and beyond. The goal is that other business will build and add to the task pool.

26. Community: In Q1 2021 Chris hinted that a big new client was coming our way. Is this still in the works? If so, can you reveal who yet? Any timeframe on when tasks get on TEN? [2:05:30]

Answer: There have been several conversations with some major organizations over the course of the last months. These larger organizations have their own internal processes that take time and are according to their own fiscal schedules. There are also very strict privacy policies with these entities. Be assured there are talks going on with larger companies, however, they do not move as quickly as KH. KH does seem to have a very efficient system comparatively. Until these companies are fully onboarded, it is wiser to not share bits and pieces, but wait until they are at the point where there is something tangible to share.

There has been some major clients that we've been talking to and what we've learned is that KH works faster than any other company that we've been dealing with. There's a major process to on boarding these guys and I've spoken out of turn previously and pre-maturely thinking that they'd move as quickly as KH. We are still in talks with some pretty big requesters, I have no additional news on that. I apologize to the community, but this is taking much longer than anticipated. We are in the process of a couple of things that we may or may not be able to release publicly.

27. Community: Right now, how many clients currently use TEN? How does their work directly benefit those who stake in the DAO for shares of network fees? [2:07:53]

Answer: There are several clients of the dApps on Effect Network. Some clients are using Effect Network on a daily basis, such as Linus Tech Tips and Kraft Heinz. Others are time to time users or one-off clients. With the maturity and technical advancements of our services, we are confident in scaling the client base year-on-year.

With every task there is a portion that goes to the DAO, so the more the merrier. We have several task type tasks that are done for clients.

We found over the last few years that it is better to have fewer clients and scale them to a lot of tasks. There is about 5 or 6 clients they have plenty of tasks that are fueling Effect Force right now. To scale it horizontally, to actually get more requesters, that's in the end how we can scale past this point. How we can get even bigger and more consistent, that's the goal. The Hack-a-Thon is an important part of it, but attracting more companies to build upon the network, these companies will have their own clients. That's where we want to go. At the moment we have a few clients who are producing quite a bit of tasks and this is ongoing, so at least every month there are tasks coming in. This serves as a base, but we do know and realize that this is a decentralized project and we want to grow way beyond this point. For a decentralized project we have quite a bit going on, but we want to scale way beyond this and our strategy now will be to have more companies build upon this technology.

28. Community: When Effect Socials (debuted as Effect•ive) started, we had a few clients and were told many more would follow after Chris’ presentation during BlockDown. Why hasn’t the dApp gained traction? What can we expect in the next 6 months for the dApp?

Answer: Many elements of the Effect Network dApps are being restructured, and detailed documentation of what each product is and how they work on a technical and fundamental scale is now the focus.

All hands are on deck to have an incredible showcase for the Effect Network hack-a-thon at the end of the year. When dApp developers see and understand the structures of building products and services on the Effect Network, then we are very positive we will see much more activity on the platform.

That said, we still have all services active, but a much less focus on the service-seeking clients and more focus on the builder-clients at the moment.

29. Community: Are there any insights that can be shared about upcoming tasks or new clients/requestors that plan on having tasks on Effect Force? Are there any new opportunities for workers to earn additional income from working on Effect Force?

Answer: The current ongoing tasks are from Effect Translate (document translations and subtitles), Effect Social, and NFT labeling.

At the same time, we’re releasing the developer SDK that will allow any company to easily place tasks on Effect Force. This will greatly increase the number of tasks available for workers.

KH is really happy with the results of the work. This has now spread out to several different departments. There are many departments in KH. And we are now working with more than just the original department we started with.

30. Community: A few years ago, there were a lot of tasks where we labeled buildings in satellite imagery for Australia/New Zealand. What happened to those? Are they coming back?

Answer: The project with this client is finished successfully (the dataset is complete, as all images are labeled). We’re positive they will return if they need more data labeling.

31. Community: Over the past few months, the number of tasks overall has declined. Is this due to winding down for the crossover to BSC, or is there a client growth issue or something else?

Answer: The number of tasks fluctuates as client projects from Effect.AI come and go. There are no tasks happening on BSC, so that’s not related.

The strategy for the rest of the year is focused towards attracting more requesters and tasks to the network.

32. Community: We were told that Effect.AI BV buys tokens for their clients like Kraft Heinz for tasks. It appears that team buys on KuCoin seem to have slowed or are not apparent. Are buys still happening for tasks? When can we expect to see the next phase of tasks for Kraft Heinz? [2:13:08]

Answer: Buys are still happening, depending on the amount of throughput our clients are putting in. We expect the next phase of tasks to start again in the next couple of weeks. KH has given very positive feedback to the team and are moving forward with other departments to make use of Effect Translate.

All the tasks are recorded on the blockchain. If there are a gap in tasks on the blockchain it could mean that a client is done and doesn't need the service any more, or it could mean that there is an adjustment being made or a change to the service being provided.

33. Community: January 2021 the Dashboard showed total EFX payments of around 6 mil EFX. After 6 months, it’s showing close to 7 mil.

What time frame did that initial 6 mil EFX cover? Why has only approximately 1 mil EFX been paid out over 6 months for tasks? Chris previously stated in a video that Kraft Heinz spends millions of dollars on translation. What is, so far, the amount that Kraft Heinz has paid for tasks that have been completed on Effect Force? [2:13:30]

Answer: We can’t discuss the details of what clients are spending on services. But you can see all transactions happening on the blockchain and the tracker on the dashboard indeed shows the amount of EFX transacted on Effect Force.

The dashboard shows 1,1 million EFX was transacted over 6 months. As a project, it’s our goal to increase this number, which is why we’re working on a better foundation for scaling the number of tasks horizontally (as in more requesters, instead of more tasks per requester).

34. Community: Who on the team is currently in charge of marketing? Is it one or many? Is there a CMO (Chief Marketing Officer)? If not, is there a plan to hire/designate someone for that role?

Answer: Chris divides his time on marketing activities. There is a long-term vision of building relationships in the industry to leverage further into the project. In addition to these relationships such as BlockDown, United Nations, Akon, and others, Chris has a team that is exploring many aspects of marketing through various opportunities.

There have been several hires this year that have added great value to the project. Clearly, there is more growth to come, and one very important member would be a Chief Marketing Officer. That said, with every hire is a process to find the very best candidate to fill the role. With a CMO, it’s not just about finding a great marketeer, it’s vitally important to find someone who has a great understanding of the crypto and blockchain space in regard to marketing.

If you happen to know a great candidate, then please send them our contacts.

35. Community: Ivan on Tech was supposed to be an influencer/endorser of Effect Network. What happened to this? Is he still an influencer for us?

Answer: Effect Network and Ivan On Tech Academy have worked on some social initiatives in collaboration with the UN and have plans to continue with our partnership to help provide resources such as education, training, and work opportunities in developing countries.

We are in a bearish downturn at the moment, that may last for some time, is there any plan in place with any of the influencers such as MDX Crypto, Ivan on Tech, or other that we might see soon-ish? [2:20:45]

Yes. Definitely. And others that you don't expect will certainly be there. It's a big part of this and we understand it. I was recently with MDX Crypto is a big supporter of the project and the team behind the project. There are others that we know well. We will have things come out. There is a way to structure this, better than we've done before. I've been meeting with MDX Crypto recently and with others, putting things together.

36. Community: Previously, it was said by the team that there would be a press release coming out about Kraft Heinz using Effect Translate. Has it been released? If not, why?

Answer: Effect.AI no longer discusses its contracts with specific clients publicly.

37. Community: When can we expect to see a large marketing effort, and who will be the main target of these marketing efforts?

Answer: Currently, there is a large marketing effort ongoing for the Chinese market. For the West, you can expect to see traction once the SDK has been created and the upcoming hack-a-thon has commenced.

It seems that there is a solid plan in place for long-term marketing with building relationships and participating in events. We know that there has been a strong marketing effort in China. We know that there is a lot riding on the SDK and the outcomes. However, many people in the community feel that waiting on the SDK to arrive is not the best approach to bring awareness of Effect Network to the greater crypto community. While the SDK is being developed, will there be an increased promotion to bring in requesters to Effect.AI's Apps, in and out of the crypto space? Or will there be a campaign for educating people outside of our community about Effect Network, about how they can get involved? About bringing more general awareness to other projects, reaching out through other communities, Twitter, etc. Something more short-term and more pronounced. [2:16:38]

We are always in the process of building. Waiting for the SDK? I'm not sure where this question comes from. We are always doing marketing. We are always pushing forward. We're always getting this done. I think this question comes from me [Chris] talking about a mass marketing push. [my audio is quite static over the next two sentences, I'll leave out as it's not very clear for me] I promise there will be marketing efforts that will create attention. It's at least my biggest thing. It's the only thing that matters. Jesse and Laurens build things, I understand that there needs to be attention for the project to be able to grow. I will continue to work forward on that and come up with different examples. I will not listen to the noise and static of opinions. I will obviously take into consideration many of the things people are suggesting, but many of these are a waste of money and time. I promise that my only objective is to give this project and token the attention it deserves and I will do what I think is right for the project, short, mid, and long-term.

As has previously been addressed there is a marketing push in China. Will the SDK have multi-lingual support? Will the SDK also be marketed to Chinese developers? Or is it mostly going to be for clients on the requester side or workers in China? [2:18:52]

The language barrier is important. We have been in communication with Chinese developers and have been exploring this. We would need to have a multi-lingual SDK and also have translators involved in the hack-a-thon event. We are exploring this as an option, we are trying to set this up. We do have a Chinese community and Velika is really in connection with these developers as well. SDK will initially be in English, but we do want to be able to expand and include Chinese groups into the hack-a-thon and to use the SDK. We are aware of these steps, but we are still mapping out the effort to make this happen.

38. Community: During the last episode of the Weekly Effect, Chris said it may end up being a monthly thing. What’s the reasoning behind this video series? What does this segment set out to accomplish? Is each video’s view count relevant, and what does this add to the marketing for Effect Network?

Answer: The Weekly Effect is a fun way to communicate the ongoing progress of the Effect Network. YouTube is a great medium to engage our widely diverse community and keep everyone up to date.

There are many weeks where the team is in deep development of the Network and doesn’t have YouTube-worthy content to share. Especially now, as the core team is highly focused on the end-of-year hackathon. A weekly show might not be so fulfilling. So we will do video updates a minimum of once a month.

There is going to be a revamp of this video.

39. Community: How does a high price of EFX benefit TEN?

Answer: This is backwards. Price is the result of market supply and demand; the success of Effect Network will affect both and thus influence price.

40. Community: How does the success of Effect Network impact the price of the token?

Answer: The price of the token is created by supply and demand. The reason EFX exists is to have the network operate; to have clients put tasks on the network and to pay workers to get the work done.

So the more clients putting tasks onto the network, the more workers are paid. Some workers will cash out their tokens putting more into the supply circulation to create liquidity and some will stake their tokens removing tokens from the supply circulation.

Success for TEN would mean that there were an incredible amount of tasks being placed on the network, by governments and large corporations. This would place a great demand on the token. These requesters would need to get their EFX from someplace. The demand would be high, but the supply is limited and its isn't always easy to access these tokens. There are only so many tokens, some will be staked, some will be lost, some could be burned, and some will be in circulation. As success of TEN grows, the more demand on the token, the higher the token price will rise.

41. Community: What are the reasons for the price drops of EFX?

Answer: EFX has struggled with effective liquidity and token attention. We clearly see many factors that have played a role in this subject. The lack of popularity of EOS projects, lack of effective marketing and poor market making are a few of the variables that are in play.

We could understand if a lack of transparency is a reason as well. The new release of Effect Force in Q4 of this year will definitely help with that, as it will make the Effect Network more decentralized and more transparent, and less dependent on the entity Effect.AI B.V.

42. Community: Now, with the implementation of P22, are there any plans to change the tokenomics of EFX? If so, what kind of changes, and when are they expected?

Answer: After proposal 22 there are no current plans to change the tokenomics. When it comes to fee distribution and collection, these are things that the DAO will be able to adjust.

The DAO will be able to make adjustments to smart contracts. Jesse wrote an article last week that this question overlaps with. https://medium.com/effect-ai/6-month-anniversary-of-effectdao-bd655cc96241

The DAO itself is created out of smart contracts, specifically 3 smart contracts. These smart contracts define how fees are collected, how proposals are created, how votes are done, and how the fees are distributed. The DAO will be able to change the settings of these smart contracts. So for example, the DAO can change how much of the fees can to out to distribution and how much can go to the treasury after every cycle. The DAO will also be able to propose how many tokens get burned. They will be able to do this autonomously. There will be no interference required, as the logic will be embedded within the smart contract. People will be able to vote and make these changes as guardians.

There will be changes that people will want that will not be in the abilities of the smart contract and would require the smart contract to be changed. ATM, the Effect Network Foundation are in control of the smart contracts and would need to approve changes to the smart contracts.

Where we are going is move the authority over the smart contracts from the Foundation over to the DAO. This means that is the DAO will be able to author these smart contract changes. This means that fee collection and any type of tokenomic changes can be authored and approved by the DAO. We are likely a year at least away from this change though, but this is the goal.

So this will mean that the DAO will be able to to fully operate the scope of the smart contracts and be able to author changes to the smart contracts. These can all be done through the proposals itself.

Exceptions will be when a proposal requires programming, such as P17, but once the programming is implemented then it would be automated based upon vote results.

43. Community: During the time of the first BlockDown conference, Chris mentioned that there would be a market maker. What happened with this? When will there be a proper market maker? [1:14:31]

Market makers have been in place for some time, and we feel they are doing their best with what they have to play with.

Finding an effective market maker for our project needs has been very challenging. In the beginning, we had hired GSR and they were charging us a hundred seventy-five grand a month, and this was ridiculous, and this was also not legal for us to participate in. We have gone through several market makers since. We will not release the name of our current market makers. The current hire is satisfactory, but the job they are able to do is not enough to really do the job that needs done. However, they are not the only factor in why they are having challenges to perform better. We are in constant communication with them to try to figure out what needs done. This has been a struggle for us to learn how to manage. We are a team dedicated to building tech, creating pump and dumps, or pushing volume is not what the team is about, so we need to learn how to make things better in the markets. So we are constantly talking to our market maker to see how we can make improvements.

How do you refuel the market maker? It looks to be horrendous. So people want to say that [the market maker] are doing the worst job. It's not just them. It's us. It's marketing conditions. It's the past. It's the potential future. There's a lot that impacts what the market maker is able to achieve. We have not done our best work in this area. Admittedly, we ignored this in the beginning, we didn't see it's significant importance until fairly recently. We are still learning. We will get there. We can tell you about the facts of what is market making, but we are still learning the ins and outs.

44. Community: Does the team endorse P17 as a model for making EFX deflationary?

Answer: Once P17 has been programmed into the smart contract, the burning of network fees will be something that can be decided on by the DAO, at which point this decision is no longer up to the team.

45. Community: Now that rollups are available on Ethereum in layer 2, can EFX also be on ETH since it further reduces the gas cost? [1:12:02]

Answer: Effect Force could be on ETH in the future. There are some disadvantages to optimistic roll-ups and a migration is far from trivial at this point, so this is more of a long-term option.

With layer 2 solutions, moving over to ETH is getting closer to being possible, and especially with Ethereum 2.0 just around the corner, we are getting closer to the point of affordable dApps like Effect Force being run on Ethereum. At this moment it is just not there yet, it's exciting, but not feasible yet.

It is feasible to just bridge over to to ETH, but we are learning from BSC that there needs to be more than just building a bridge to make this successful. There needs to be more love, more input, more liquidity, more support from both the team and community to make it successful. So at this time, it is just not practical until we really learn about what needs done. This needs time investment and attention.

46. Community: Who controls the ICO funds? How have the ICO funds been managed? How have they been put to use since ICO, and how are they being used now? [1:27:0]

Answer: The token sale was conducted by The Effect Network Foundation, and The Foundation is managing the funds. The funds have been used to build Effect Network.

The written answer is very broad, very general. We get that Effect.AI BV is a private company, but why is the Foundation so secretive about their funds? We don't feel that the Foundation is secretive, but it's like all deeper levels of involvement in projects, there are elements that simply aren't broadcast. The Foundation ran and managed the ICO, which was done with 100% KYC. Everything was done appropriately. It was done the best way we could in compliance with our laws in the Netherlands and abroad, and was modeled after other much larger and successful projects. The Foundation is there to fund the in--?-- and stability of the Effect Network and that has what it has always done, and that is what it will always do. Effect.AI BV is the operational company that is building out Effect Network, and the funding to build out the network comes from the Foundation's ITO collected funds. There are no secrets there.

We are not going to disclose all the financials, and neither do other projects. If they do, good on them. But we will not and neither do other major projects. We are not trying to hide the fact that we burned through money at the very beginning on being over staffed with people who didn't work out, we aren't hiding that we've had a lot to learn since ICO. But we grow and move forward. We are building the Effect Network, and it is happening.

So if you are not going to disclose financial details will you provide a pie chart that will general show what is in the foundation with different sections that identify categories of where spending has occurred and about which percentages of the tokens were spent? A rough estimate from the very beginning and a trajectory from what was there at the beginning to what is there now. In this way an estimate of if funds will be enough for the future. [1:30:45] We could to this. be assured there is enough there to carry on forever, we are self sustaining. It was important for us to create a self-sustaining business, especially with the operational BV. All of that money was sunk into development outside of the foundation.

The BV is your private company, so we can't expect it to sustain the foundation. So the foundation has to have its own reserves, right? Yes, this is true. Our [catch all?] positive stuff that's being produced by the BV will always go into development for the Effect Foundation. The Effect Foundation will always be at the heart of what we are doing and are well funded. So we can certainly put [a pie chart] or something together.

The takeaway is that the team will put together a chart of some kind that will show the flow of tokens since the beginning at the community's request, correct? Yes, that is more than correct. I think that some of the community members who have been around from the very beginning remember being told that we'd be the first project to fully release all financials of everything we do. But this turned out to be a horrible idea. I understand why people were expecting full disclosure, but it just isn't feasible. It shouldn't be a cause for concern. Though I understand it is. So yea, we need to put something into play, with input from some of the DAO members to help provide something suitable.

47. Community: After the ICO, what happened to the NEO. Was it converted to another crypto or a FIAT currency? [1:35:30]

Answer: These funds are managed by The Effect Network Foundation. They were stored on exchanges and are diversified to different currencies.

Why are the ICO funds stored on exchanges? Are they on exchanges long-term? We store tokens on the exchanges, especially our corporate exchanges, so that the funds are readily available. There are many business who contribute to building out Effect Network, the core of that the BV. We request funding to perform what is needing to be done via proposals to the Foundation. There are many, a huge amount of tokens in cold storage, tokens on the exchanges are to be for quick access to fund building out TEN. This is all accounted for. To clarify you have crypto currency reserves that you use to convert into the fiat to pay for services. Yes. It is also it isn't wise to keep it all on NEO, so for it to be useable it needs to be in other crypto currencies. There is a small reserve in fiat, but we feel strongly that crypto currencies are safer than fiat.

48. Community: In February, there were 5 different EOS accounts that received swapped EFX of several million, which appear to originate

from the team NEO account ending in ...qPno. From there they were sent to NEO account ending in …mWg3, then in turn sent to the NEO account ending in ...cGmy. These tokens were then swapped out to the 5 newly created accounts, and then immediately all were sent to the same two KuCoin accounts (ending in 4683 and 6820 - one of these accounts also receive tokens from x.efx)

jw1szwjogj1a ga3oe2ymvafa pgswc2eepg13 wgktt4iac1wi llfo45pqqsxc

These EOS accounts were created immediately prior to the swap happening. The swaps occurred on consecutive days, February 22 March 3, 2021. Swap codes restricted swappers to receiving codes 7-14 days after creating an account. This did not happen in this case. Between each swap, swappers were required to wait a week, but these swaps occurred consecutively or in short time. The reason for the delay in the swaps was to avoid token dumps on the exchanges and help stabilize the price of EFX.

This movement of tokens from the original account to swap to multiple accounts to KuCoin has brought about much wild and angry speculation. This speculation includes team designed pump and dump and other hidden agendas.

Please, explain the rationale for the token movement as such.

Why was the swap from the original NEO account not done on one transaction, or through one code, as community accounts were required to do?

There was a market pump going on during this time, was this a contributor to the decision to move the tokens quickly, without the wait time and over multiple accounts? If not, please explain. [1:20:10]

Answer: There are several accounts that received a swap code for tokens with an open EOS account. After their funds became available, they could swap them over, also to a newly created EOS account.

The addresses mentioned are managed by an external market making service. According to this service, the market conditions were dangerous at that time, and they suspected a pump-and-dump was going on that had to be mitigated. Funds on both sides were used to provide liquidity and more healthy order books.

This goes exactly with question 43. We have more than one market maker in place. Through the past, we have had some pretty ugly charts going on, what looks like pumps and dumps, such as the buy ins after Ivan on Tech secret gems pump. There are other pump and dump groups that have approached us before, we have definitely been targets for pump and dumps, and we are an easy target due to being a really low cap. These need to be mitigated.

When things started to go crazy again around February, our market makers discussed with us about how to best manage this so it didn't become super out of hand. We believe this was ultimately managed very well, and protected us against some actors. So additional funds were needed very quickly and they needed to be large enough to mitigate a large pump in price and were there to protect from a large fallout dump.

So the swap over the 5 accounts expediated the swap process and the move into the 2 different KuCoin accounts were to the different market maker accounts.

Have you considered trading competitions on KuCoin to encourage liquidity? Of course we have. These trading competitions are for KuCoin to make money for them. They will ultimately will win the trading competitions. This would ultimately be a waste of EFX that will end up on the open market anyway.

49. Community: Looking at the existing valid swap codes, how many more NEO tokens can we expect to be swapped over to the EOS network? [1:39:0]

Answer: We haven’t mapped back how many of the currently available EFX on the NEO blockchain still have a valid swap code, but suspect that swaps will be less and less every week, and the majority of what is now on NEO will probably stay on NEO. Laurens has the exact numbers. There is no problem sharing these numbers with the community. We'll have Laurens give the numbers to the community in a few short weeks. We see a real slow down of the numbers already.

50. Community: Are all Team tokens transferred from NEO to EOS? How many of the team tokens still need to be swapped? [1:42:50]

Answer: Not all of them have been swapped yet, the team tokens that are still being swapped are subject to the weekly swap limits. Laurens has the numbers for these. There is no way to know about past team members tokens.

51. Community: Have any BSC developers/projects reached out and showed interest in building on TEN now that we’re also on BSC? What plans are there to foster partnerships or otherwise attract BSC developers to Effect Network?

Answer: The bridge is initially intended to serve as a tool for workers and community members to hold and use EFX tokens in the BSC ecosystem. Unfortunately the launch of the bridge was not as impactful as everyone would have liked. It is however in place and is usable for making EFX in BSC more accessible.

So, at present, there have been no developers from BSC reach out to us.

The upcoming updates to Effect Force will make the network usable from BSC and will be a good moment for BSC developers to come aboard. the technology isn't ready yet for BSC developers, ATM the bridge is just making the token available on BSC. The upcoming tech package (including the SDK) will see Effect Force on BSC and will provide developers with the open source tools they need to start building on Effect Force.

The SDK will allow for the hack-a-thon being planned to be for both BSC and EOS developers.

52. Community: Will there be yield farming on BSC? For instance, a syrup pool on PancakeSwap? The DAO recently agreed to use part of the treasury funds for a reward program to encourage liquidity providers to contribute to the BSC pool, how will this relate to yield farming or a syrup pool?

Answer: We would like to see that happen, an EFX Syrup pool would be fantastic. There are several plans being actively discussed by the DAO to make this happen.

First thing is to have a much healthier liquidity pool on Pancake Swap. To qualify for a Syrup pool requires meeting some stringent criteria, primarily the basic LP needs to be really healthy and attractive. This is the first thing that needs to happen.

There is also an incredibly high payment amount required to register as a syrup pool and there is a long wait list to be accepted. While this is a challenge, we will figure it out.

53. Community: The 2021 Roadmap states that a liquidity competition will be announced. Now that we have the option to provide liquidity on PancakeSwap, when will the competition start?

Answer: There is no definite date yet for the competition. There will be a smart contract needed to distributed. The best thing would be for us to host our own smart contract which still needs to be created. While there is a lot of tech building going on at this moment, we recognize that increasing liquidity on Pancake Swap is a priority. The DAO has been discussing a proposal for setting this up, it looks like an update can be expected this month, before the end of July.

54. Community: The community has been dumped on a lot by swappers and through KuCoin dumpers, would there be risks to DAO funds by people using Pancake Swap to quickly exchange out large amounts of EFX? Because there is no order book in a swap, it is like an open order. How can DAO funds be protected from dumpers?

Answer: The stronger the pool the better to create stability and safety. So ultimately the pool size needs to be increased to create a counter measure for large swaps.

55. Community: The DAO receives PancakeSwap liquidity pool rewards. Will the DAO also receive rewards from DeFiBox liquidity pool?

Answer: The Effect Network Foundation will not distribute LP rewards from Defibox. If the rewards turn out to be significant at some point, the foundation is open to discuss some kind of donation to the DAO.

56. Community: What are all the sources of rewards that participating guardians receive? Are there additional rewards planned in the future?

Answer: This is a very essential piece to the DAO.

30% of left-over cycle budget [active] This is nice and is the largest reward ATM. But this is not the point of the Network rewards.
LP rewards from the PCS pool from the foundation [planned Q3]
Network fees for Q1, Q2, Q3 2021 [planned Q3] We need to figure out an exact date and figure out a mechanism for figuring out the distribution numbers for each member. Most likely this will be as we did previously where we built an open source agrop script that manage to snapshot the EOS blockchain and calculate the exact amount of fees and distribute them out to the guardians.
Ongoing network fees [planned Q4] This is the primary purpose of the rewards and will be part of the upcoming major update.

57. Community: Is there a way to see how many network fees are generated on the Effect Network?

Answer: ATM there is only one requester account, so you can look at each transaction in this account and add them up. However, once the fees are automatically being collected there will be many different stats that will be able to be shown as the collection of fees will be done live.

Transparency is important, everything is auditable because it is on the blockchain, but we don't yet have the tooling in place to make this easy to access.

58. Community: In November 2020, it was announced on Facebook that Genesis Guard members would have exclusive access to special features, promotions, and gifts. What are these special features, and have any promotions and gives been given? If not, what will they be, and when can Genesis Guard members expect them?

Answer: The Genesis Guardians received an airdrop of the 2020 network fees. We intend to reward Genesis Guardians in the future with special NFTs, early access to the new Effect Force, access to online events. There is a chance they will get a special place within EffectDAO as well.

59. Community: P17 was accepted for the creation of a toggle to burn half of the network fees that are released. What is its status? What needs to happen in order for it to be turned on/off? Will this be enabled before or after the manual distribution of network fees?

Answer: This feature has to be programmed in the fee distribution smart contract. The core team has not yet been able to implement this feature, but community contributions are encouraged. This will end up being built. It is not a priority, the tech builds for the next update is. With the increase in network fees, of course this will become a priority. This is part of the technical design for the future of the DAO treasury, there should be more done with network fees than rewards to members, such as burning and/or add to the treasury.

60. Community: Have all fees from Distribution and Distribution II been awarded? Is there anything from either phase left to be distributed?

Answer: All fees from Phase 0 have been distributed. The fees for Q1 and Q2 2021 are scheduled for distribution in Q3.

61. Community: When will the embedded fee mechanism for transactions taking place on Effect Force be implemented so that network fees owed to the DAO are collected automatically?

Answer: In the coming update of Effect Force scheduled for Q4.

63. Community: Is the Effect DAO fully autonomous right now? If not, what factors prevent that, and what needs to happen for it to become fully autonomous?

Answer: The DAO is fully autonomous at the moment, as it can autonomously distribute cycle funds and fee rewards.

64. Community: Currently, the DAO has a High Guard, which consists of non-elected members. Many view this as a form of centralization in what is supposed to be a decentralized organization. Are there any plans to phase out the High Guard? If so, what needs to happen, and when can this be expected to start?

Answer: The High Guard is part of the EffectDAO design. There will be an election method for High Guard members. This is an important part that’s still missing in the DAO.

The HG meets once each week to discuss proposals and special circumstances with the goal of protecting the network.

In time, the DAO should not be needed as everything should be automated. A proposal is made, it passes, then it is automatically acted upon. The HG is there as a back-up.

After operating for 6 months, now is a good time to think about how certain members will be removed and new members added. This has been a point of discussion in the High Guard and DAO meetings.

---Final Remarks from Chris---

I'd just like to say thanks to everybody involved. We've been here since 2017. We've been through ups and downs. I think a lot of the community members who were there at the very beginning are still here right now. We all appreciate you, especially me. A lot of my lonely nights have been on Telegram with you cats. The Effect Network journey is just started. Any business in the world doesn't accomplish anything in the first few years unless it's a complete outlier. We are doing our best work and we will continue to do our best work. We will do it with you guys with the release of the DAO. As one of the most exciting things, I'm a little disappointed that there wasn't way more emphasis on the DAO and the future of the DAO. This is a major future for us. And this year and all the things we accomplish will lead us into a very bright future. I'd just like to thank all the speakers and the people who were participating with the questions. Appreciate you guys and we will continue to rock!

Note from the DAO: Get involved!!!! This is the heart of the Effect Network and it is the Effect Community!

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