Melon is currently sitting right above Hive on coinmarketcap, ranking at 173 - and the cute (and rather silly) name caught my attention so I had to investigate further.
With a marketcap of $57.5 Million (1.45 million coins valued currently at $39) MLN has a very similar valuation to Hive, albeit with significantly fewer tokens.
What is Melon? Melonprotocol.com
Melon is an ethereum based protocol that allows people to create crypto-funds consisting of several crypto-assets which other people can then invest in by simply sending Wrapped Eth to one address.
Melonprotocol is aimed at asset fund managers and the whole point of it is to allow them to set up and manage an investment fund easily for a relatively low cost, for an initial set up fee of only a few hundred dollars.
To quote from their web site, which sums it nicely:
Melon isn’t a wallet. It’s a platform for decentralised asset management. It performs the functions across the entire value-chain of an investment fund; back office, financial intermediaries (eg. custodian, fund administrator & transfer agent), and so on….. Melon is a protocol that natively and multilaterally connects-links-integrates DeFi protocols at a smart contract level.
Investors maintain control over their individual assets in the fund and can withdraw them at any time, it's 'centralised' fund management with decentralised ownership, it seems!?!
The Melon Terminal
I recommend you check out melon terminal, it’s pretty cool. You can log in with Metamask and browse existing funds and invest in said fund, after simply wrapping some ETH.
You can also set up your own fund, but at a cost of hundreds of dollars per fund, that's a bit of my price range!
At time of writing the assets in each of the funds seem to be mainly limited to the wrapped versions of BTC, ETH, UNI, REN, DAI, MLN itself and a few others, but the percentage weights vary.
There is quite a limited range of coins you can currently invest in.....
Governance
MLN isn't a governance token, governance takes place on the Aragon network, via the Melon council, 20 people who each hold one vote by the looks of it, and I can’t find any obvious information on how MLN ownership is (or isn’t) linked with governance.
The governance model seems rather opaque to me - the inflation of the token is controlled by the Melon council which seems to be one member one vote, 20 people only have governance tokens, through the ant network.
What can you do with the Melon token?
The MLN token is used as “asset management gas”, which is charged when setting-up a fund; investing in a fund and; claiming any fees
Whenever an interaction takes place on the MLN protocol, the gas fees in ETH multiplied by MLN gas fees which is then used to buy MLN tokens which are burned, which links the MLN price to the usage of the network.
A fixed amount of 300,600 MLN tokens per year are created every year, but inflation can vary depending on the Melon Council's decisions.
MLN - worth more than Hive?
I quite like the idea of being able to bundle cryptos and offer them as a fund which I can then buy easily with just one click, while still having control over my assets, that’s NICE!
And as the amount of options of asset-bundles grow this will only become more attractive, and with a limited amount of tokens to be printed, that bodes well for the price.
However, I'm not clear on how the gas fees are calculated on the MLN network which is something that puts me off buying any!
I guess whether you invest in this one or not depends on how much you like the idea of decentralised asset-management and how much you trust the Melon council to keep that inflation low.
And it is linked to a very useable interface - anyone can invest in a fund with nothing more than a metamask wallet and some ETH - and the more people who do so, the more the value of MLN increases!
It’s difficult to say whether this coin is worth more than Hive - this is a pure finance token, designed to oil the wheels of decentralised asset fund management - so maybe it has the potential to go NUTS.
However, there's something of 'what's the point of the token itself' about it - I can use the MLN protocol as an investor without having to even buy MLN itself, except that which is bought and burned IF I were to invest in anything.
So I can't personally see the point in buying the token, I can't use it to do anything, I can't see any clear link between owning it and governance rights, and I can't see that I've got any control over the MLN gas fees OR the inflation rate.
So, it's an interesting protocol but I don't get the point of owning the token itself, other than pure speculation on how much use I think the platform is going to get in the future.
And you know what, I can't believe there aren't alternatives to MLN out there ALREADY!