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Solidified Basic Review

Project overview

Solidified Company is a renowned and respected smart contract audit platform with more than 200+ experts in its community; the compound market capitalization of its clients exceeds 400,000 ETH. The SOLID token is an ERC20 utility token that will power the Solidified new smart contract audit platform, as well as the Solidified bug prediction market that the company is developing. The company’s innovations aim to provide extra security and efficiency for the smart contract audit market.

Key information about the project is as follows.

PROJECT BRIEF

Name

Solidified

Ticker

SOLID

Project type

Prediction market; Blockchain infrastructure

ICO BRIEF

Pre-sale start date

No

Pre-sale end date

No

Public sale start date

23.07.2018

Public sale end date

23.10.2018

Private sale

No

Token type

ERC20

Total token supply

4,000,000

Token supply for sale

2,400,000

Part of tokens for sale

60%

Soft cap

No

Hard cap

ETH 32,400

Token price

ETH 0.015

Bonuses

20% during first month; available for 50% of the supply during the sale only

Lock-ups

3 years, with 1-year cliff for founders

Currency accepted

ETH

KYC

Yes

Additional emission

No

Restricted list

North America, China, Korea, Japan, Russia, Iran

TEAM & ADVISORS

Team member

13

Key member (executives)

  • Eduard Kotysh

  • Robert Hitchens

  • Alexander Rysenko

  • Robert Stone


 

Advisors

2

Partners

6

Documentation

Information about the project is available on the official website in the uploaded whitepaper and one pager. The team provides comprehensive information about the economics of the project and its mechanisms. However, the whitepaper is purely technical; business information can be found only on the website and the project’s social media.

All materials are available in English only. The following analysis is based on the aforementioned sources of information.

Conclusion

We note that the project has provided comprehensive information backing up the logic of the platform as well as its economics. TSE smart contracts are available for review on GitHub.

Business model overview

Solidified is already among the market leaders in smart contract audit services. The company has established partnerships with many big players in the crypto market, for example Gnosis. Nevertheless, Solidified sees an opportunity to improve the existing audit process, which is why they are introducing their Bug Prediction Market.

Solidified already has a working audit platform, and now aims to move to a new SOLID-based infrastructure aimed at solving the following problems:

  • At the moment, auditors do not bear any economic risks if they perform a poor audit.
  • There is no mechanism preventing auditors from exploiting a bug instead of reporting it.
  • There is no accepted security metric for smart contracts.

The new platform will function as follows. As was the case with the original Solidified platform, the author of a smart contract will post a task in the network featuring the smart contract code, a reward for the audit and information about the bounty program, but financials will be denominated in SOLID only.

After that, auditors may start bidding for the task and either the author will choose the winner, or this will happen automatically. Auditors will also stake SOLID, as the bug hunter reward will be paid using this sum. Auditors will submit their bug reports to the author.

Bug hunters are individuals who conduct audits simultaneously with audit experts. If a bug hunter finds a valid bug, he gets paid from the auditor’s stake. If an auditor’s stake runs out, he is excluded from the process and everything starts from scratch.

Here is a visualization of how it works:

The validity of this report will be justified by Jurors. These are a special type of platform participant; their role is to evaluate bug reports from auditors and bounty hunters. Their trustworthiness will be guaranteed by a Schelling scheme. Jurors will have to stake SOLID in decision making. If they make decisions in accordance with the group, they will get their stake back plus a reward from the pool of those who made a wrong decision. The Schelling game will be supported through a Bug Verification Oracle mechanism. There will be also a possibility of forking, if jurors’ behavior splits into two distinct groups.

At this point, a new bug prediction market comes into play. After the end of an audit, an author will be able to open a market where security experts will be able to bet on the possibility that bugs will be found by a certain date. This market will use two tokens: A bug-token and a bug-free token. Both have the value of 1 SOLID. You buy bug-free token if you believe there is no bug and vice versa. Therefore, the clearing price of the market will reflect market consensus on the probability that a contract has bugs, which is a non-biased security metric.

This is how the market will work if a bug is found:

Conclusion: Such a system provides an incentive for auditors to report bugs and profit from this; it also creates a metric for security. Economic risks for auditors are created through a staking mechanism embedded within the platform. The description of all mechanisms and the economics is clear, though rather scientific.

Technical overview

The team does not provide much information about the technical architecture of the platform. It is known that the project will use an Ethereum ERC20 token. The market place will be governed by a network of smart contracts, enabling a stacking mechanism and all other features described in the previous section.

The team already has a working audit platform. Implementations of the SOLID token and the bug prediction market will be made on the existing platform.

Logical substantiation about how the Schelling game leads to correct decision making and how it is implemented in the SOLID token network is available in the whitepaper and is not the subject of our analysis.

The team has an MVP available here.

Conclusion

The technical architecture is not fully covered. However, major details and an MVP are available. It is known that Solidified’s prediction market will be built on top of the Gnosis prediction market, with certain amendments. The team is highly focused on building the Bug Verification Oracle contracts; they will be integrated in the Solidified existing platform.

Roadmap

The team provides the following roadmap:

 

Conclusion

We note the provided roadmap is purely technical and that it does not clarify issues regarding the marketing campaign or any other BD processes.   

Team & Advisors

Eduard Kotysh

Position

CEO & Founder

Total experience

10+ years

Relevant experience

Yes

Professional achievements

Founding member of Glassdoor; Formr head of engineering at Jibo Inc.

LinkedIn

Yes

Affiliation with project

Yes

Connections

500+

Endorsements / Recommendations

No

 

Rob Stone

Position

Lead Designer

Total experience

5+ years

Relevant experience

Yes

Professional achievements

Experience designer at Slalom consulting; Former mobile UX/UI designer at Jibo.

LinkedIn

Yes

Affiliation with project

No

Connections

500+

Endorsements / Recommendations

Yes

 

Alexander Rysenko

Position

Director of Engineering

Total experience

N/A

Relevant experience

Yes

Professional achievements

Former lead developer at Joyent and Jibo.

LinkedIn

Yes

Affiliation with project

Yes

Connections

299

Endorsements / Recommendations

Yes

 

Joao Carvalho

Position

Smart contract developer

Total experience

N/A

Relevant experience

Yes

Professional achievements

Winner of Solidity Underhand Coding Contest, panelist at Ethereum DevCon3 and top auditor at Solidified.

LinkedIn

Yes

Affiliation with project

Yes

Connections

204

Endorsements / Recommendations

No

 

Nick Munoz-McDonald

Position

Audit expert, researcher

Total experience

N/A

Relevant experience

Yes

Professional achievements

Helped secure 30,000+ ETH for projects such as Gnosis,

Melonport, Iconiq Lab & Polymath. Bounty winner for Gitcoin, Bankera, Melonport & BullToken, among others.

LinkedIn

No

Affiliation with project

N/A

Connections

N/A

Endorsements / Recommendations

N/A

 

Adam Kolar

Position

Audit expert, researcher

Total experience

N/A

Relevant experience

Yes

Professional achievements

Winner of Consensys MultiSig Bug Bounty, Monetha ICO Bug

Bounty and auditor of Jincor and Pally ICOs, among many others

LinkedIn

No

Affiliation with project

N/A

Connections

N/A

Endorsements / Recommendations

N/A

 

Oskar Triebe

Position

Machine learning expert

Total experience

5+ years

Relevant experience

Yes

Professional achievements

Former machine learning engineer at Merantix; Former head of BD at Luminovo artificial intelligence

LinkedIn

Yes

Affiliation with project

Yes

Connections

500+

Endorsements / Recommendations

No

 

Ilia Tokarenko

Position

Full-stack engineer

Total experience

0+ years

Relevant experience

Yes

Professional achievements

Has 4 years of Javascript experience in NodeJs, TypeScript, AngularJs, ReactJs, and Redux

LinkedIn

Yes

Affiliation with project

No

Connections

174

Endorsements / Recommendations

No

 

Julian Bauer

Position

Communications designer

Total experience

N/A

Relevant experience

Yes

Professional achievements

Founder of Overnice brand and product agency

LinkedIn

Yes

Affiliation with project

No

Connections

228

Endorsements / Recommendations

No

 

Tammo Mamedi

Position

Communications strategist

Total experience

N/A

Relevant experience

Yes

Professional achievements

Founder of Overnice brand and product agency

LinkedIn

Yes

Affiliation with project

No

Connections

221

Endorsements / Recommendations

No


 

Urlike Gregor

Position

PR director

Total experience

20+ years

Relevant experience

Yes

Professional achievements

Business director of C3; has worked in political insurance and PR.

LinkedIn

Yes

Affiliation with project

No

Connections

500+

Endorsements / Recommendations

No

 

Carlos Essus

Position

PR manager

Total experience

5+ years

Relevant experience

Yes

Professional achievements

-

LinkedIn

Yes

Affiliation with project

No

Connections

500+

Endorsements / Recommendations

No

 

Fabio Hildebrand

Position

Audit Manager

Total experience

15+ years

Relevant experience

Yes

Professional achievements

Former full stack blockchain/ web developer at independent; CISSP and CISA certified.

LinkedIn

Yes

Affiliation with project

Yes

Connections

500+

Endorsements / Recommendations

 

 

Advisors

 

Robert Hohman

Position

Business advisor

Total experience

20+ years

Relevant experience

Yes

Professional achievements

CEO & Co-founder of Glassdoor; Board member of T4A.org

LinkedIn

Yes

Affiliation with project

No

Connections

500+

Endorsements / Recommendations

No

 

Robert Hitchens

Position

Blockchain advisor

Total experience

20+ years

Relevant experience

Yes

Professional achievements

Exprt instructor at B9Lab; Advisor Volunteer at Cryptocurrency & Blockchain Rgulatory Task Force.

LinkedIn

Yes

Affiliation with project

Yes

Connections

500+

Endorsements / Recommendations

Yes

 

At time of writing, the project had established partnerships with the following companies:

Conclusion

The project has an experienced team developing Solidified, and has sufficient experience in blockchain projects and the audit market. Despite project advisors with great experience, the advisory board could have been larger to bring a fresh view and wider expertise to the project. We note that some team members such as the lead designer and the whole communication and design team, together with one of the advisors, do not reflect their affiliation with the project within their LinkedIn accounts.

Market outlook

On the project’s website the team provides the following information about audit costs. One standard contract audit may cost 8-10 ETH per one auditor, while for custom contracts this may grow to 15-20 ETH. On top of that, an author pays 10% to the platform and a bounty for hunters.

At the time of analysis, there is no comprehensive overview of the smart contract audit market, therefore market size is not easily defined. However, according to Coinschedule, in June alone new ICOs raised over $1.5 billion. For the last 1.5 years, ICOs raised the following average monthly amounts:

According to Etherscan a total of 34703 smart contracts were verified between 24.06.2016 and 09.07.2018. This is an average of 1264 smart contracts per month. Keeping this rate constant and assuming the audit adoption rate is currently 10%, and will grow to 15% by the end of the year and an average audit price of 13 ETH, we estimate the smart contract audit market at 22,060 ETH. We understand that some audits may cost 5-10x the price of a regular audit, however since their proportion of the total amount cannot be estimated, we do not consider them in our calculations. Taking this into account, ICORating’s market estimation can be viewed as conservative.

Total cryptocurrency capitalization was estimated by CoinMarketCap at almost $268 billion at the time of this analysis. All these assets are governed by smart contracts and their security is the guarantee that their owner has real ownership rights over their assets. Therefore, a smart contract security audit is essential for any ICO project, given constant news of hacks and exploited bugs in smart contracts leading to losses of millions of dollars.

Obviously, Solidified is not the first player on the smart contract audit market. There are other big players that we consider to be the project’s main rivals such as:

  • New Alchemy – the compound market cap of this project is estimated at $1.5 billion.

  • Coinfabrik – this project has built back-end infrastructure for Monero and Zcash.

  • Zeppelin – this project declares total value of its customer base to be $4.5 billion.

Conclusion

Despite market huge potential and strong competition, we believe that the SOLID token has some prospects, as none of the above-mentioned competitors have their own native token. In addition, we have not found any analogues for bug prediction market solutions. Despite Token Market having some similarities in terms of bug hunting, according to available information Solidified is the only major smart contract audit company to implement a decentralized infrastructure. However, taking into account that the project’s hard cap is larger than our conservative market estimate, project economics may be a subject for consideration.

ICO details

The team has announced the following token distribution scheme:

  • Token sale – 60%

  • Team – 20%

  • Community & Audit training fund – 10%

  • Liquid reserve – 5%

  • Partners – 4%

  • Airdrops – 1%

For team tokens, a 3 year lock up with 1 year cliff will be imposed. Also, after the end of the token sale, all tokens will be non-transferable for 6 months.

Attracted funds will be allocated in the following manner:

40% will go to software development, 15% to security and DevOps, and 40% will be equally distributed between community outreach, marketing & BD, audit training fund and legal issues. The remaining 5% will go to customer support.

The team announced that it will hold no other bounty program other than a bug hunter bounty program that is a part of the smart contract audit.

Conclusion

The team has a clear token distribution scheme. However, only 10% will go to marketing, which is questionable. Positive factors include the lock ups for the team and all other tokens, and reservation of funds for security issues, as well as the allocation of 40% for development.

Token economics

Demand for tokens will be incentivized in different ways. First of all, SOLID will be needed to access the network. Authors, auditors and jurors will have to stake SOLID to enter the platform. Authors will also have to provide SOLID to launch the bug prediction market. Lastly, security experts will stimulate demand by participating in the bug prediction market.

Token supply will be limited to 4,000,000 SOLID, with 60% available for sale at TSE. There will be no additional token emission.

The staking system used for the project guarantees that users will hold SOLID and will not treat it as an inventory, buying it only when it is needed and selling it when no longer required, thus reducing token price due to increased velocity and a large free float.

Conclusion

The project’s economy is sufficiently justified. Smart contracts are available for review on GitHub.

Social media analysis

Solidified uses its own social media accounts to promote the SOLID token; the token does not use any additional promotional media.

At the time of writing, the project had 1078 followers on Twitter, 599 followers on Facebook, 279 participants on Slack, active GitHub, Medium and Reddit accounts.

Similarweb and BE1 do not provide information about https://token.solidified.io/. However, information about the Solidified website is available.

According to Similarweb, the project has the following traffic sources:

33.7% of traffic arises from searches, 25% comes via direct links, 22.43% comes from referrals, 10.54% - from social media and 8.27% comes from mail.

Search traffic comes from the following keywords:

Main sources of social traffic are YouTube, Reddit and Twitter.

According to BE1, the project’s traffic geography is as follows:

  • UK – 20%

  • USA – 15.2%

  • Brazil – 12.5%

  • Vietnam – 11.4%

  • Serbia – 6.4%

  • Others – 35.5%

Conclusion

The project does not have many followers on social media, but their number is constantly growing. 47% of social traffic comes from keywords not featuring the project name, meaning that it is associated with the industry, which is a good sign. Also the project uses a variety of channels to attract traffic, which is positive.

Conclusion

Taking into account all available information about the project and in accordance with our analysis we have identified strengths and weaknesses for the project.

Strengths:

  • An experienced team

  • A clear understanding of the market

  • Presence of competitive advantage over rivals

  • Well thought-out project business logic

  • Clear token economics

Weaknesses:

  • A highly competitive market

  • Low community/marketing indicators

  • No business roadmap

Contacts

The team can be contacted through the following channels:

Website

E-mail

Facebook

Twitter

Medium

Slack

GitHub

Reddit

The information contained in the document is for informational purposes only. ICORating received monetary compensation from the entity rated in this report for completing the ratings report. However, the entity rated in this report did not have the opportunity to approve this rating report before the report was published, nor did the rated entity have the opportunity to edit or remove this report once it was published. The views expressed in this document are solely those of the ICORating Team, based on data obtained from open access and information that developers provided to the team through Skype, email or other means of communication. Our goal is to increase the transparency and reliability of the young ICO market and to minimize the risk of fraud. We appreciate feedback with constructive comments, suggestions and ideas on how to make the analysis more comprehensive and informative.