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Author Topic: Funding Request for Multigateway Operations  (Read 2380 times)

VanBreuk

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Funding Request for Multigateway Operations
August 26, 2014, 09:34:29 pm

Hello committee members,

as you probably know, Multigateway is run by clusters of three servers (triplets). During this initial bootstrapping phase, the main cluster providing gateway for BTC has been operated by James, but migration to the three definitive production servers is in progress, with LTC being used currently for testing.

Soon BTC and the recently added BTCD will be moved along with LTC to three servers operated by Frohike, abuelau and domsch. At the same time, a second server triplet is being tested and will be operated by Cobaltskky, marcus03 and jefdiesel. Initially, this second triplet will be providing gateway for Viacoin, Blackcoin and Dogecoin (implementation order TBD), and soon other cryptocurrencies already in the waiting list will be added as well. Both triplets can run an additional number of coins after the corresponding testing and tweaking.

There may be other triplets, operated by other community members, providing gateway for other cryptos. This was the point of the Universal MGW daemon release (uMGW) - giving the operation of Multigateway to the community, thus progressively increasing the number of supported cryptos for trade in the Nxt AE.

The group of people that are soon taking on MGW operation, testing and website/GUI development (longzai1988, Frohike, abuelau, domsch, cobaltskky, marcus03, jefdiesel and myself, among others that might join in anytime) have decided to request funding for operation costs, details to follow.

James is not involved in this initative and he has repeatedly expressed he does not need any committee funding. We are not requesting funds for the core uMGW software development, past or future. Other developments already finished in MGW are not reason for this request either. The initial Lite MGW Beta GUI, and the starting Multigateway website (along with six months of hosting and maintenance) had their expenses already covered privately by James. However, with the current move towards a community run MGW, we are facing a series of basic costs.

Anticipating the question, MGW fees are currently minimal and are aimed to cover service expenses in Nxt transaction fees - sending assets, sending deposit addresses and other AM notifications for coin deposits and withdrawals. Funding all the operation costs with MGW fees would require a significant raise of the fees and losing a good deal of the service appeal for users.

I'm separating the funding request in three items. You can consider them separately if necessary. If the committee had issues with one item in particular, I expect that will not put the whole request in question.

1.- Server Costs Estimate (Monthly)

Main MGW cluster (Frohike, Abuelau, domsch): 80 USD / server * 3 = 240 USD
Main testing cluster (Frohike): 45 USD / server * 3 = 135 USD
Second MGW cluster (Cobaltskky, marcus03, jefdiesel): 40 USD / server * 3 = 120 USD
Second testing cluster: 60 USD

Total Monthly Server Costs = 555 USD
Conversion at approx. current rate (1 NXT = 0.03 USD) = 18,500 NXT / month

2  - Basic Testing Costs

Including coin and Nxt blockchain transaction fees and other minor items. My estimate considering the costs arised in the last weeks is around 3,000 NXT / month.

3 - Future GUI / website development bounties

This item includes bounties for the following points:
- Development and operation of an online client for the Multigateway website. This will allow people to use MGW without needing to install any software.
- Updates and development of the current Lite Multigateway GUI extension, according to NRS updates and coin/network needs.
- Other developments and server operators.
For the rest of 2014, I estimate conservatively 65,000 NXT.

At this moment, and for all three items, we request funding for the four remaining months in 2014, sep-dec. Totals as detailed in each item for this period would be:

Server costs: 18,300 x 4 = 73,200 NXT
Testing costs: 3000 x 4 = 12,000 NXT
GUI/website development costs: 65,000 NXT

Request total, rounded: 150,000 NXT

I will manage all the funds granted in a Multigateway Operations account.

Multigateway has a big potential and is a great tool for Nxt adoption. I believe it needs to be run by the community in order to achieve this potential, and so it deserves community support. If server operators have to pay servers from their own pocket, and future development efforts don't have bounties available, we'll seldom see new people interested in running MGW servers or working for the service. In the best case MGW fees would inevitably rise making the service less attractive to end users, and in the worst case MGW operation would progressively lose community support.

Please ask any questions you may have. For a description of the MGW service, you can also check http://multigateway.org and the MGW Service docs.

Thanks for your consideration,

VanBreuk
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TwinWinNerD

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Why is the Main MGW cluster double the cost of secondary? Does it need to be stronger?

VanBreuk

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Why is the Main MGW cluster double the cost of secondary? Does it need to be stronger?

This budget is based on server costs/required specs provided by operators. As I understand it, and due to the largest volume of operations and deposits handled by the main cluster (BTC gateway), the current specs recommended by Frohike (coordinator for main production servers setup) are higher - or you could rather say that the current server specs required by cluster #2 operators are lower.

I'm pointing Frohike to this thread so he can give precise information if needed.


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EvilDave

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Reading...nodding.
Looks good, need to discuss with InfCom boyz.
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chanc3r

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So how does this eventually become sustainable or are MGW server always run at a loss?

Basically if there is no clarity when MGW servers become self supporting should we end it now?

Otherwise a few frequent traders get a free ride to make money while the servers are funded elsewhere.

Please don't take this the wrong way I am seeking to understand and these are the questions that jump into my mind from your OP.

MGW is a private business venture and whilst I have been involved and am supportive I need to think about how this fits with the intention of the inf-com to drive long term benefits and ensure this is of equal benefit to the whole community.
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VanBreuk

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Thanks for the comments.

about your points, chanc3r:

So how does this eventually become sustainable or are MGW server always run at a loss?

Basically if there is no clarity when MGW servers become self supporting should we end it now?

MGW infrastructure becomes sustainable in the moment that volume of operations/fees in a cluster, or the subsequent (and reasonable) raise in fees allowed by the existing volume of operations/number of users, covers server costs and progressively also leaves returns for operators.

But in order to reach a cluster volume of operations that makes that possible, we have to walk the way there. And in the beginning, there is some deficit. Then you can ask, why not stay funding that privately? Well, that was not James' plan. And specially...

MGW is a private business venture and whilst I have been involved and am supportive I need to think about how this fits with the intention of the inf-com to drive long term benefits and ensure this is of equal benefit to the whole community.

...because we don't want it to continue as a private venture, as explained in the OP. The first move has been made in James' side, now we want to see if that move is continued by the community. Benefits are summarized in two words: adoption and promotion. Nxt is on its way to become a true platform and MGW is a great step for other crypto communities to transfer value into the AE, and to talk Nxt.

I believe we're asking for a modest sum to give it a push and allow people to work more relaxed. This could be an excellent tool for adoption and PR, among others. And we want to use it as such, not as a money making venture for frequent traders. For that, we need to be in the community side.
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jl777

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MGW is running as non-profit now

Once InstantDEX is live, MGW will get revenue sharing from InstantDEX commissions and be able to pay for operating costs and even dividends to assetholders

I cannot continue running, maintaining, customer supporting the MGW servers anymore, so as of now they will be running at dgex response times for any issues. I planned to unplug the MGW servers end of this month, but with the production servers ETA unknown, this is not a viable thing.

My productivity has been cut by 70% due to my needing to be running the MGW servers. So, fund the production servers or not, this is your decision. But if you dont, do not rely on me to continue running MGW on my dev servers

I gave away over half the MGW assets across the community sold all but 10% at 50% off, used what little that raised for out of pocket expenses. Now it is the time for the NXT community to take over MGW. I cannot continue my role of MGW server host, maintenance and realtime customer support.

James

P.S. I am unplugging from nxtforum for the weekend, all the recent issues are just preventing me from concentrating when I need to the most. If you really need to contact me, email me
There are over 1000 people in SuperNET slack! http://slackinvite.supernet.org/ automatically sends you an invite

I am just a simple C programmer

EvilDave

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I think that MGW is potentially one of the gamechanger projects within the NXT eco-system.
You've all heard it before, but trustless, semi-decentralised trading is a brilliant feature.
It is pretty much Ripples only feature, for example....... ;D

James (and you've all heard this before) has contributed massively to NXT, and to crypto in general.
He concieved and built the MGW, and now is a good time for the community to step up and assume responsibility for the further development and operation of MGW. Thanks, mate, btw.

I therefore vote to fund this request, with a few important changes/additions:

InfCom funds items 1 and 2 immediately: Server and testing costs.
That's 85,000 NXT in VanBs  cost estimate, I vote to bump it to 100,000, just in case of cost overruns.

Item 3: Bounties for GUI and website. Lets wait on these. I approve in principle, but lets not commit to bounty amounts yet.

The biggie: As MGW is ultimately intended to be a profit making operation, I would like to make the funding from InfCom in the form of  a loan to the MGW project. Repayment of the loan to community funds should begin once MGW begins to generate profit.

Last point: as it seems clear that J wishes to step away from MGW, I'd like to see a reasonably well-organised group take over MGW operations, it will be an important community asset and needs to be looked after properly.
You guys do seem to be fairly organised, but I'd like to see some formal group organisation...maybe along the lines of the committees: duties, voting procedures, ....etc. Dull stuff, but this group will be running an important exchange, so you need to take this seriously. In a few months time the MGW could be handling very large sums of other peoples money.

Thats my lot, the TL:DR version is;

Yes, here's 100,000 NXT. It's a loan.
Wait on bounties. Organise (very seriously and openly)
Yay! James!
 
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VanBreuk

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EvilDave - thanks for both your reply and your suggestions.

We do have a working structure as you say, but we'll sticky it clearly in the uMGW board as it consolidates.

About voting procedures, they might not apply to every MGW decision in the same way they work in committees, basically because duties are quite varied. Some of the decisions to make will belong to a particular cluster; MGW fees for specific coins, for instance, can be determined by the corresponding cluster operators. However, if for some reason a group of operators decided to abuse this power by raising fees beyond a reasonable point, competition might arise in another cluster, or their gateway might cease to be promoted... point is, some events that initially might appear as needing consensus may be regulated by the MGW infrastructure itself as it develops. Regardless, some decisions are already taken by consensus and everything that applies is and will be voted.

Although I hope that the third item in my application will be finally considered, your loan offer for infrastructure costs is reasonable and (of course) I'll run it through the six initial server operators for feedback. There's some considerations to keep in mind, such as NXT price volatility and the expected up trend in NXT, and considering how that goes with the fact server costs will be covered monthly in NXT following the current fiat equivalence (plus a small % to cover conversion fees, for as long as servers cannot be paid directly in NXT).

Right now, this would be my proposal if the other committee members agreed with yours:

We should define the debt amount in fiat following NXT / USD in the day the loan is made. Debt payments should be also accounted following the NXT / USD rates in the moment of the payment. Otherwise, we might end up paying a huge interest as NXT climbs. Now, since I will pay server costs to operators monthly, this is to make sure I won't make any profit from the loan:

a) If by december 31 no debt amount has been returned: any unspent funds will be sent back to the committee as a first partial repayment of the debt. Remaining debt will be returned by the MGW crew in a monthly % (TBD) of revenues, Optionally a loan extension may be decided.
b) If, by december 31, revenues received by operators have managed to repay the loan completely: unspent remaining funds will be invested to fund future MGW infrastructure and development, following needs of the platform and the MGW crew.
c) If, by december 31, the loan had been partially paid by MGW revenues: unspent funds will be used to do a partial payment to the committee (any remaining debt to be covered as in a)) or, if there's enough, a full payment (any remaining funds to be invested as in b)).

* PLACEHOLDER * (proposal for repayment monthly rates, to be discussed with server operators)

Loan installments will be paid in the end of each month through a specific MGW Operations account for this loan, and I'll keep a public spreadsheet with monthly balances and payments.

Note that this proposal might be rejected by the current server operators, but I believe it is fair; it incentivizes everyone to get volume in MGW quick, which is good for both Nxt and the MGW server operators.
« Last Edit: September 04, 2014, 12:55:20 am by VanBreuk »
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VanBreuk

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Okay... So two months later, after many tests, operator/server changes and a lot of configuration work around this beast of a piece of code MGW is, the Multigateway production servers are ready to start rolling.

The MGW section of the SuperNET GUI is being customized by longzai with the parameters we just sent him, and while launching happens (a proper announcement with simple migration instructions will be posted along with SuperNET v0 release) I'd like to request the server & testing costs loan, so we can pay expenses assumed by operators in these first months.

We decided to wait until production servers were ready for launch to request the loan. It hasn't been a very profitable wait in this aspect since NXT price against fiat dropped a third, so an adjustment towards current NXT/USD rates would be much appreciated. In any case, now the need for funding is clear - operators are online and deserve this push. In the meantime, weeks ago, team Starbuck already launched adding DOGE, Blackcoin and Viacoin to coins supported by MGW. I look forward to send volume their way as MGW recovers visibility.

The transfer of the loan amount can be made to NXT-WTRL-FR4P-JHNY-7U6C8.
I keep this MGW operations account so I will take care of distributing the required funds. Every money transfer will include an unencrypted message with the concept for the payment, so every transaction is clear for public auditing.

Following the terms, when MGW servers start to generate profit (this is, when revenues in service fees exceed infrastructure costs raised by hosting and operation fees) this profit will be split monthly and one half will be transferred to the MGW operations account, that will send the total NXT received as loan payment to the required committee account. This will happen monthly for as long as debt remains.

Currently, the MGW fees are adjusted so low that making profit operating MGW seems hardly viable. But as James suggested there's developments in the pipeline, so this might change in few months.

This is today the staff in the Multigateway operations group:

MGW Developer: jl777
Junior MGW Developer: to be determined
Project Management: VanBreuk

Multigateway cluster #0 (Production Servers)
Operators: Frohike, abuelau, coinomat
Supported coins: BTC in the launch, LTC soon afterwards. BTCD to be enabled as soon as recent BTCD core modifications can be reviewed.

Multigateway Cluster #1 (Team Starbuck)
Operators: Cobaltskky, marcus03, jefdiesel
Supported coins: DOGE, VIA, BC

MGW User Interface: longzai1988 (SuperNET GUI)
https://multigateway.org website: VanBreuk, Vakarian
Multigateway docs: VanBreuk
Server Hardening and Security: Frohike
Server Setup Documentation: marcus03, Frohike

In MGW server operation, decisions are to be made by operators consensus. If consensus within a group of operators couldn't be achieved for some reason, other members of the staff starting by myself could chime in to help. For general questions regarding the MGW service, such as which coin to add next, or which server feature should be developed first, decisions are made in a group discussion including everyone involved in that particular issue. It's difficult to define a "weighed voting process" inside of Multigateway, because people have completely different profiles and functions. In some discussions, longzai may have the last word. Or Frohike. Or cluster #1. Or James. It really depends on technical aspects, agreements with other communities and timing.

I can guarantee that I will do my best to announce and report relevant changes, answer to questions and do things properly. Everyone involved in this wants to hand a good tool to Nxt and other crypto communities.


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Request for MGW loan to Infrastructure Committee - VanBreuk 12-11-2014Token
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5q6ooq3juuls2rn1os7t1bkpl924d3seqto1jpal9d8reu65q351ee5ou2fnj6818ua8b2ece4s5dua76opnfftkkm0hsdglpf4jbiikuoh0loltto6mdjbl9tbuqit0nacd15u0durbj80j0jj4f5q606mj5itf
« Last Edit: November 12, 2014, 01:25:35 am by VanBreuk »
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EvilDave

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My first instinct is to say yes immediately, but I'll wait and get the votes of the rest of InfCom.

MGW is a very important project, and while I'm not usually that keen on funding (semi-)independent projects out of community funds, I beleive that a loan to MGW to cover initial costs is worthwhile.
The original loan amount was proposed to be 100,000 NXT, but with the recent nasty smelly bear market, i think that needs to be pushed up to 125,000 or so.
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ChuckOne

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Looks goods to me.

chanc3r

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ok
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_mr_e

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Didn't the mgw asset raise enough money for this? What happened to all that?

VanBreuk

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Thanks to the committee members for the quick responses.

Didn't the mgw asset raise enough money for this? What happened to all that?

Besides the cost of his development servers, James invested in Multigateway around 100,000 NXT from asset sales for expenses in the first months: testing costs, bounties, and development of the MGW website. That money is almost exhausted, and operators have been covering their costs for a couple months.

Regarding dividends and future ways of revenue through the MGW asset, the results for share holders, and how that might produce an item to cover MGW server costs, you'll have to ask James. I don't know much about the plans for the asset, nor the connection it may have in the future with MGW operators.
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EvilDave

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Thanks for the quick replies, guys, I'm voting yes, so we have a solid majority even without chasing up our less present colleagues.
I'll organise the funds transfer over this weekend, providing there are no serious objections.
Gotta stress that this a loan...and so we do need to work out some sort of repayment protocol before the handover.

We could choose to keep it simple: no interest, no fiat calculations: NXT InfCom loans MGW 125,000 NXT now, gets 125,000 back in the near future, or we could choose to peg the loan value and repayments to fiat in some way. Ideas?



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VanBreuk

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Honestly I'd love to forget about fiat, but I think pegging the amount to USD/EUR would make more sense. Not because the majority of the loan will be used to refund basic server costs that operators paid in USD (we can assume most infrastructure costs still need to go to fiat regardless) but for another reason.

it is possible that MGW operators take a while to have any overhead to start to repay the loan. Note that MGW operation and the evolution of the MGW asset are different things; asset holders might begin to receive dividends from MGW assets (from InstantDEX as planned, or from other items) while MGW volume/fees keep servers breaking even at best. Of course other sources of revenue for MGW operators might appear and speed things up, but if they don't, and we're facing bullish months, operators might end up having to pay a huge interest if loan amount is counted in NXT. I'm thinking about them here.

In the loan transfer, the attached AM could include the USD or EUR / NXT rate or the equivalent amount in fiat currency of your choice.
 

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EvilDave

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Swift, late night kick. Lets figure out a loan structure quickly.......I'm happy to peg the loan to fiat, with the provision that if NXT value massively increases before repayment, then some of that price rise should be included as interest, say 20-30%.
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VanBreuk

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125,000 NXT in concept of loan for initial Multigateway operations costs has been received today - http://mynxt.info/blockexplorer/details.php?action=tx&tx=8279484278337299648

I'm getting in touch now with the MGW operators to do first refunds on server costs. All the movements in the MGW Operations Nxt account will be added to the following gDoc:

https://docs.google.com/spreadsheets/d/1IfDMTMwrtLPSArE2NOGepp03SdnTwQ8ysCUp2Wp4H6w

I will keep posting updates when necessary.

Thank you, guys :)
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