What is the overall Commons Configuration strategy?
This is a version of the Entry into Orogeny proposal (shout out to Nate!) and is somewhat inspired by Zep's DAO Casino and Tam's push for a high Common Pool, another iteration of the 1 mil Entry into Orogony
This Proposal expects a strong community that can coordinate to pass both Tao Voting and Conviction Voting Proposals. The real things to note about this proposal is the >1 million dollar Common Pool, the Strategy around the Entry and Exit Tributes, and the low Reserve Ratio.
This proposal has a high entry tribute to attract value aligned participants that missed the Hatch and are smart enough to see that the low reserve ratio will still allow them to make a profit if they get in early. With this strategy, we should change the Tributes every month so that they gradually go from 26% and 0% to 2% and 12% in 6 months. This could be done every month by decreasing the Entry Tribute by 4% and increasing the Exit Tribute by 2%. This is important for our long term growth so that if the price is going down, more money is flowing into the Common Pool so that as a community we can provide more value to our token holders and the TE community.
If we are smart, we should make an agreement to set the Entry Tribute to 100% when we reach a 40 Mil Market Cap so that the bonding curve can act as a parachute if the Price crashes but we stop printing TEC once we are large enough and don't need the liquidity protection of the bonding curve.
The CV Params are set so that it takes a week to pass any serious proposal with 15-20% of token holders sitting with their tokens behind the proposal. This will make the Token holders have to coordinate (without having to talk) to pass proposals.... I can imagine that we will want to post the Passing and Leading proposals that have a lot of voting power behind them every week to aid voters in coordinating around advancing token engineering.
Considering the decent profit off the bat (35% / 100%) and the low reserve ratio which 2.75 years for the tokens to unlock seems fine. 9 months to get the economy going, 2 years after that to slowly vest... if someone had 10,000 tokens from the Hatch they would get about ~14 tokens a day.
Parameter
Value
Token Freeze
40 Weeks
Token Thaw
104 Weeks
Opening Price
1.35 wxDAI
Hatcher's TEC Release Schedule
This is the release schedule for TEC that was given to Hatchers. Their TEC will start out frozen and then slowly become liquid according to the graph above.
Token Release Timeline
Duration
% of Tokens Released
Price Floor of Token
3 months
0.00%
1.35 wxDAI
6 months
0.00%
1.35 wxDAI
9 months
0.00%
1.35 wxDAI
1 year
11.54%
1.19 wxDAI
1.5 years
36.54%
0.86 wxDAI
2 years
61.54%
0.52 wxDAI
3 years
100.00%
0.00 wxDAI
4 years
100.00%
0.00 wxDAI
5 years
100.00%
0.00 wxDAI
Module 2: Augmented Bonding Curve (ABC)
Strategy:
The Commons Tribute and Entry Tribute are set so that there is about ~1 mil in the Common Pool after the initial buy.
This gives us a nice runway to get a jumpstart on Advancing Token Engineering!
The Entry Tribute (26%) is extremely high.. but this is the only way to get tokens to start so I think it will not dissuade early contributors that are value aligned and if this proposal is chosen we should plan to reduce the entry tribute 4% and raise the exit tribute 2% every month until the tributes end up as 2% entry and 12% exit after 6 months.
This proposal has a low Reserve Ratio so that we can have high profitability for it to make sense to speculate despite the high entry tribute.
If we lower it 4% a month... we only have to sell ~40k worth of tokens every month for it to make sense to speculate on the token. I think this is very doable.
The Reserve Ratio is low but it's not a DAO Casino and with a long lockup we have a long time to grow beyond the Hatch.
The ABC mints and burns TEC tokens, the price of the TEC token is dependent on the funds that is held in the Reserve. This graph shows how the ABC's Price for TEC tokens changes with the ABC's Reserve Balance. The Initial Buy that will happen at launch is highlighted.
Example Transaction Data
Tx
Reserve
Total Supply
Price
Amount In
Tribute
Amount Out
New Price
Slippage
0
326231.87
1956421.69
1.35
250000.00 wxDAI
65000.0
111622.33 TEC
2.0
18.55%
1
511231.87
2068044.02
2.0
5000.00 wxDAI
1300.0
1842.89 TEC
2.01
0.32%
2
514931.87
2069886.91
2.01
100000.00 wxDAI
26000.0
34616.35 TEC
2.27
5.78%
3
588931.87
2104503.27
2.27
3000.00 TEC
1758.26
5004.29 wxDAI
2.24
0.50%
4
582169.32
2101503.27
2.24
35000.00 wxDAI
9100.0
11329.02 TEC
2.33
1.90%
5
608069.32
2112832.29
2.33
38000.00 wxDAI
9880.0
11830.88 TEC
2.42
1.97%
6
636189.32
2124663.17
2.42
41000.00 wxDAI
10660.0
12261.51 TEC
2.53
2.03%
7
666529.32
2136924.67
2.53
43000.00 wxDAI
11180.0
12344.84 TEC
2.63
2.03%
8
698349.32
2149269.52
2.63
750000.00 wxDAI
195000.0
161009.17 TEC
4.39
23.69%
9
1253349.32
2310278.69
4.39
1000000.00 wxDAI
260000.0
136274.36 TEC
6.6
19.12%
ABC Overview
Reserve (wxDai)
Supply (TEC)
Price (wxDai/TEC)
Market cap
10,000
1,272,136
0.06
80,988.28
50,000
1,551,865
0.26
404,827.44
100,000
1,690,576
0.48
809,627.36
200,000
1,841,689
0.88
1,619,223.14
300,000
1,936,271
1.25
2,428,817.75
400,000
2,006,312
1.61
3,238,421.42
500,000
2,062,379
1.96
4,048,018.94
600,000
2,109,350
2.30
4,857,618.87
700,000
2,149,897
2.64
5,667,206.46
800,000
2,185,651
2.96
6,476,807.99
900,000
2,217,680
3.29
7,286,409.07
1,000,000
2,246,729
3.60
8,095,997.95
1,250,000
2,309,516
4.38
10,120,013.23
1,500,000
2,362,116
5.14
12,144,008.50
1,750,000
2,407,522
5.88
14,167,985.13
2,000,000
2,447,560
6.62
16,191,968.94
2,500,000
2,515,958
8.04
20,239,967.26
3,000,000
2,573,261
9.44
24,287,983.02
3,500,000
2,622,726
10.80
28,335,977.04
4,000,000
2,666,343
12.15
32,383,959.07
5,000,000
2,740,855
14.77
40,479,882.36
7,500,000
2,881,619
21.07
60,719,903.06
10,000,000
2,985,855
27.11
80,959,890.77
15,000,000
3,139,200
38.68
121,439,681.92
20,000,000
3,252,754
49.78
161,919,634.02
50,000,000
3,642,537
111.13
404,799,207.16
100,000,000
3,968,137
204.02
809,598,524.79
Module 3: Tao Voting
Strategy:
The Tao Voting parameters provide a voting system that requires a high amount of support (80%), and a moderate quorum (10%) of participation.... this is almost the same as our HatchDAO but higher quorum because we have delegation and lower support required because we are now an open community, not just the Trusted Seed.
The Vote Duration (7 days) allows a sufficient amount of time for community engagement. Delegated Voting (4 days) will end slightly before the active voting period, allowing community members (3 days) an opportunity to alter the outcome of the vote. If the voting outcome is changed, there will be a quiet ending extension of (2 days) for final community engagement. The execution delay (12 hours) is sufficient time for the community to prepare for voting outcomes for those that really care about exiting after a vote is determined given the quiet ending extension.
Parameter
Value
Support Required
80%
Minimum Quorum
10%
Vote Duration
7 day(s)
Delegated Voting Period
4 day(s)
Quiet Ending Period
2 day(s)
Quiet Ending Extension
2 day(s)
Execution Delay
0.5 day(s)
Tao Voting Timeline From Proposal To Execution
This shows how the timeline stacks up for yes/no time based votes that can change the configuration after launch.
Timeline Data
# of Quiet Ending Extensions
No Extensions
With 1 Extension
With 2 Extensions
Time to Vote on Proposals
7 days
9 days
11 days
Time to Review a Delegates Vote
3 days
5 days
7 days
Time to Execute a Passing Proposal
7.5 days
9.5 days
11.5 days
Module 4: Conviction Voting
Strategy:
With the conviction voting module, I set the Spending Limit at 12% ensuring that we can fund 40k-70k proposals if we need to given our large Common Pool (it would take 26.7% of the tokens 2 weeks to pass a 48k proposal). These are of course inspired by Nate's Orogeny params with a low Minimum Conviction (1%) and high Conviction Growth (60 days) ensures that it takes a lot of tokens to pass proposals quickly but minority token holders with patience and persistence can still fund projects and that the community has an opportunity to move their tokens between proposals without impacting their conviction too quickly.
Most proposals asking for 1-4% of the Common Pool will take 8-15% of tokens holding conviction for 1-2 weeks to pass a proposal.
Parameter
Value
Conviction Growth
60 day(s)
Minimum Conviction
1.0%
Spending Limit
12.0%
Minimum Percent of Voting Tokens Needed to Pass Funding Requests
This shows how the minimum percent of tokens needed to pass proposals after 2 weeks varies with the percent of the Common Pool funds being requested.
Token Freeze: 40 weeks, meaning that 100% of TEC tokens minted for Hatchers will remain locked from being sold or transferred for 40 weeks. They can still be used to vote while frozen.
Token Thaw: 104 weeks, meaning the Hatchers frozen tokens will start to become transferable at a steady rate starting at the end of Token Freeze and ending 104 weeks later.
Opening Price: 1.35 wxDAI, meaning for the initial buy, the first TEC minted by the Augmented Bonding Curve will be priced at 1.35 wxDAI making it the price floor during the Token Freeze.
Augmented Bonding Curve (ABC)
Commons Tribute: 74.13%, which means that 74.13% of the Hatch funds (934991.70 wxDAI) will go to the Common Pool and 25.87% (326231.87 wxDAI) will go to the ABC's Reserve.
Entry Tribute: 26.00% meaning that from every BUY order on the ABC, 26.00% of the order value in wxDAI is subtracted and sent to the Common Pool.
Exit Tribute: 0.00% meaning that from every SELL order on the ABC, 0.00% of the order value in wxDAI is subtracted and sent to the Common Pool.
Tao Voting
Support Required: 80%, which means 80% of all votes must be in favor of a proposal for it to pass.
Minimum Quorum: 10%, meaning that 10% of all tokens need to have voted on a proposal in order for it to become valid.
Vote Duration: 7 day(s), meaning that eligible voters will have 7 day(s) to vote on a proposal.
Delegated Voting Period is set for 4 day(s), meaning that Delegates will have 4 day(s) to use their delegated voting power to vote on a proposal.
Quiet Ending Period: 2 day(s), this means that 2 day(s) before the end of the Vote Duration, if the vote outcome changes, the Quiet Ending Extension will be triggered.
Quiet Ending Extension: 2 day(s), meaning that if the vote outcome changes during the Quiet Ending Period, an additional 2 day(s) will be added for voting.
Execution Delay: 0.5 day(s), meaning that there is an 0.5 day delay after the vote is passed before the proposed action is executed.
Conviction Voting
Conviction Growth: 60 day(s), meaning that voting power will increase by 50% every 60 days that they are staked behind a proposal, so after 14 days, a voters voting power will have reached 75% of it's maximum capacity.
Minimum Conviction: 1.0%, this means that to pass any funding request it will take at least 1.0% of the actively voting TEC tokens.
The Spending Limit: 12.0%, which means that no more than 12.0% of the total funds in the Common Pool can be funded by a single proposal.
What is the overall Commons Configuration strategy?
This is a version of the Entry into Orogeny proposal (shout out to Nate!) and is somewhat inspired by Zep's DAO Casino and Tam's push for a high Common Pool, another iteration of the 1 mil Entry into Orogony
This Proposal expects a strong community that can coordinate to pass both Tao Voting and Conviction Voting Proposals. The real things to note about this proposal is the >1 million dollar Common Pool, the Strategy around the Entry and Exit Tributes, and the low Reserve Ratio.
This proposal has a high entry tribute to attract value aligned participants that missed the Hatch and are smart enough to see that the low reserve ratio will still allow them to make a profit if they get in early. With this strategy, we should change the Tributes every month so that they gradually go from 26% and 0% to 2% and 12% in 6 months. This could be done every month by decreasing the Entry Tribute by 4% and increasing the Exit Tribute by 2%. This is important for our long term growth so that if the price is going down, more money is flowing into the Common Pool so that as a community we can provide more value to our token holders and the TE community.
If we are smart, we should make an agreement to set the Entry Tribute to 100% when we reach a 40 Mil Market Cap so that the bonding curve can act as a parachute if the Price crashes but we stop printing TEC once we are large enough and don't need the liquidity protection of the bonding curve.
The CV Params are set so that it takes a week to pass any serious proposal with 15-20% of token holders sitting with their tokens behind the proposal. This will make the Token holders have to coordinate (without having to talk) to pass proposals.... I can imagine that we will want to post the Passing and Leading proposals that have a lot of voting power behind them every week to aid voters in coordinating around advancing token engineering.
FORK THIS PROPOSAL (link)
Summary
Module 1: Token Freeze & Token Thaw
Module 2: Augmented Bonding Curve
*This is an output. Learn more about the Reserve Ratio here.
Module 3: Tao Voting
Module 4: Conviction Voting
Module 1: Token Freeze and Token Thaw
Strategy:
Considering the decent profit off the bat (35% / 100%) and the low reserve ratio which 2.75 years for the tokens to unlock seems fine. 9 months to get the economy going, 2 years after that to slowly vest... if someone had 10,000 tokens from the Hatch they would get about ~14 tokens a day.
Hatcher's TEC Release Schedule
Token Release Timeline
Module 2: Augmented Bonding Curve (ABC)
Strategy:
The Commons Tribute and Entry Tribute are set so that there is about ~1 mil in the Common Pool after the initial buy.
This gives us a nice runway to get a jumpstart on Advancing Token Engineering!
The Entry Tribute (26%) is extremely high.. but this is the only way to get tokens to start so I think it will not dissuade early contributors that are value aligned and if this proposal is chosen we should plan to reduce the entry tribute 4% and raise the exit tribute 2% every month until the tributes end up as 2% entry and 12% exit after 6 months.
This proposal has a low Reserve Ratio so that we can have high profitability for it to make sense to speculate despite the high entry tribute.
If we lower it 4% a month... we only have to sell ~40k worth of tokens every month for it to make sense to speculate on the token. I think this is very doable.
The Reserve Ratio is low but it's not a DAO Casino and with a long lockup we have a long time to grow beyond the Hatch.
*This is an output. Learn more about the Reserve Ratio here.
TEC Price vs ABC Reserve Holdings
Example Transaction Data
ABC Overview
Module 3: Tao Voting
Strategy:
The Tao Voting parameters provide a voting system that requires a high amount of support (80%), and a moderate quorum (10%) of participation.... this is almost the same as our HatchDAO but higher quorum because we have delegation and lower support required because we are now an open community, not just the Trusted Seed.
The Vote Duration (7 days) allows a sufficient amount of time for community engagement. Delegated Voting (4 days) will end slightly before the active voting period, allowing community members (3 days) an opportunity to alter the outcome of the vote. If the voting outcome is changed, there will be a quiet ending extension of (2 days) for final community engagement. The execution delay (12 hours) is sufficient time for the community to prepare for voting outcomes for those that really care about exiting after a vote is determined given the quiet ending extension.
Tao Voting Timeline From Proposal To Execution
Timeline Data
Module 4: Conviction Voting
Strategy:
With the conviction voting module, I set the Spending Limit at 12% ensuring that we can fund 40k-70k proposals if we need to given our large Common Pool (it would take 26.7% of the tokens 2 weeks to pass a 48k proposal). These are of course inspired by Nate's Orogeny params with a low Minimum Conviction (1%) and high Conviction Growth (60 days) ensures that it takes a lot of tokens to pass proposals quickly but minority token holders with patience and persistence can still fund projects and that the community has an opportunity to move their tokens between proposals without impacting their conviction too quickly.
Most proposals asking for 1-4% of the Common Pool will take 8-15% of tokens holding conviction for 1-2 weeks to pass a proposal.
Minimum Percent of Voting Tokens Needed to Pass Funding Requests
Example Funding Request Data
FORK THIS PROPOSAL (link)
Parameter Definitions
Token Freeze and Token Thaw
Augmented Bonding Curve (ABC)
Tao Voting
Conviction Voting
Advanced Settings*
*Learn more about Advanced Settings on the TEC forum
FORK THIS PROPOSAL (link)