We’re thrilled by the excitement from the community about ELONN.AI. We’ve already seen some fascinating discussions and, naturally, there are some questions. So that’s why we’ll be delving deeper into your queries over the next week with an FAQ.
Today, we’re kicking things off with 10 questions around the governance of ELONN, the role SMART VALOR plays in the project and how SMART VALOR will benefit from its engagement.
1. How is ELONN.AI governed?
The contemporary landscape of AI is fraught with challenges, such as monopolistic control of leading IAI corporations, lack of transparency, and potential misuse of the technology. ELONN.AI addresses these issues by championing a model where governance is progressively decentralized and driven by the community. This approach ensures that AI's transformative potential is harnessed for the collective good, rather than serving the interests of a privileged few.
Decentralization is the process of distributing and dispersing power away from a central authority. In the context of ELONN.AI, it means that decision-making, governance, and ownership are not confined to a single entity or group but are shared among various stakeholders. This approach fosters transparency, inclusivity, and collective ownership, aligning with the democratic principles that underpin the broader blockchain movement.
The progressive decentralization of ELONN.AI is a deliberate and phased approach. At first, a small group of initiators guides the project, ensuring focus, alignment and swift decision-making. As the project matures, more stakeholders will be involved, and the governance structure evolves, becoming more open and participatory. This transition may eventually lead to governance under a foundation and later on a certain type of Decentralized Organization or DAO.
2. How does this set up compare to current Web3 governance models?
While the ambitions and overarching goals of ELONN.AI are new, the fundamental set up of the project is not. In fact, we are following a well-trodden path for establishing the architecture of successful projects. An example of this would Polkadot, set up as a foundation in Switzerland, along with Parity Technologies which was the initiator and main contributor of the Polkadot ecosystem.
The separation of financial ecosystems from the companies that initiate them is neither new nor surprising when you take into consideration the principles of decentralization baked into most digital asset projects. For example, MakerDAO was formed in 2014 by Danish entrepreneur Rune Christensen. Four years later, the Maker Foundation was created and run from Copenhagen. The Foundation acted to boost the ecosystem and finetune it in the critical stages of development. A few years later, the Foundation dissolved and responsibility for the ecosystem transferred to the decentralized Maker community.
Though our exact roadmap is not set in stone, SMART VALOR, a publicly listed and fully regulated company headquartered in Switzerland acts as the initiator in the early stages of the project, while a foundation could be established in the same territory. This structure has proven to be highly effective and we believe it to be a sensible starting point.
3. Why this set up?
ELONN.AI is created as open-source project because we believe in the fundamental principles of blockchain and digital asset technology. We follow the example of many great decentralized projects, such as that of Ethereum, now arguably the most innovating and exciting place in the entire Web3 sector, and share the conviction that breakthrough technologies are most successful when developed in a collaborative, open-source way.
The role of the foundation is to allocate resources for the development of the ELONN.AI product and associated services, as well as to accelerate the build-up of ecosystem. The foundation will fund both developers and entities involved in development and stimulate community participation, a core part of our mission: building a better, decentralized AI.
We also believe that technology as powerful as AI should not be kept in private hands, but belong to community that builds it, serving both to distribute the benefits, but also to keep checks and balances on potential misuse. A foundation also acts as a legal wrapper, enables the project to engage with outside entities and establish contractual relationships.
While a foundation is steered and supervised by its board, DAOs provide the means for even broader and more direct community involvement by enforcing rules via smart contracts. As the project evolves, we expect the DAO structure to gain become more prominent.
4. When the foundation will be created?
Currently, the initiator of ELONN.AI - SMART VALOR AG – is stepping in to organize and provide the initial development of the project. It also acts as counterparty in contractual obligations, however, those responsibilities are expected to shift over to a Switzerland based ELONN.AI foundation in Q1 2024, in tandem with the launch of services.
5. What is SMART VALOR’s role in the ELONN.AI project?
SMART VALOR has been instrumental in the conceptualization of the project and, at this stage, is the core driver of the project on a course towards initial production readiness. The company’s contributions extend beyond technology into laying the groundwork for community engagement and establishing the first strategic partnerships.
SMART VALOR also funded the initial marketing and development activities, while also setting up the current governance structures. Prior to the creation of the foundation, SMART VALOR also acts as the core developer of ELONN.AI’s underlying technology.
Technical services are provided through its German subsidiary, SMART VALOR Services GmbH, a company focusing on IT development services at the intersection of Web3 and AI. As ELONN.AI transitions to a decentralized model, SMART VALOR's role will evolve from primary driver to one of multiple contributors, each offering unique expertise.
6. What is the corporate structure of SMART VALOR AG?
Smart Valor AG is a Swiss-based public company, listed on Nasdaq First North. Its subsidiary in Liechtenstein is an authorized digital asset exchange and custody provider – serving both retail and institution clients. A second subsidiary, SMART VALOR Services GmbH in Germany, provides most development services.
7. How will ELONN.AI benefit from SMART VALOR as its initial core developer?
ELONN.AI stands to benefit in two specific ways from having SMART VALOR as both initiator and core developer.
The first concerns the technical capabilities required for such a project. Smart Valor Services GmbH is a software company focusing on development of blockchain-based technology and providing development operations services. Since its establishment in 2017 the firm accumulated a wealth of both talent and experience in building and operating complex software-based platforms such as an exchange, API platform and trading platform. The company has also maintained a spotless security record its 8 years of operation. Today the platform is used by customers from 120 countries, as well as banks and retailers.
The second benefit relates to regulatory capabilities. ELONN.AI can take an advantage of delivering its services in a fully compliant manner if and when capitalizing on the exchange and custody licences that Smart Valor AG Liechtenstein holds will be necessary. This capability is particularly important during our current time, in which regulatory compliance is growing significantly in importance.
8. How will SMART VALOR be rewarded for its contribution to ELONN.AI?
Much like every other developer or development entity, SMART VALOR will be rewarded by the ELONN.AI Foundation through the funding of core developer salaries and delivery organization as needed. The economic and governance model of the ELONN.AI Foundation and DAO are being finalized, fundraising activities are slated for Q1 2024. Further details will be announced by ELONN.AI in Q4 2023.
9. What role does the native cryptocurrency of SMART VALOR, Valor Token, play and how will ELONN.AI impact its utility?
VALOR Token is the native currency of SMART VALOR. Its utility today focuses on the usage of SMART VALOR exchange, custody and staking services. With SMART VALOR initiating the ELONN.AI project, Valor Token utility will grow to include services outside the centralized SMART VALOR exchange.
The new services the company provides in ELONN.AI ecosystem include but are not limited to financial or regulated services such as on- and offramp, KYC/AML and custody, along with technical services such as development, data provisioning and model training. Further details will be announced on the SMART VALOR blog and ELONN.AI communication channels as the project advances.
10. Current contributions and milestones achieved
- Conceptualization: the first iteration of the ELONN.AI whitepaper and expert peer reviews. A summary of the whitepaper has been published in the form of a concept paper (link here).
- Funding: Necessary initial funding and resources secured to launch the early phases of ELONN.
- Team Assembly: Construction of a multidisciplinary team of experts in AI, blockchain, engineering, finance and trading, regulation, community engagement, and growth hacking.
- MVP Development: Scoped and initiated the development of the first MVP prototypes and agents, following feasibility assessments.
- Community Engagement: Formulated a comprehensive community and growth plan, including announcement events, PR campaigns, and conference presentations.