BanklessDAO - Tokenomics 1.0

Title: BanklessDAO - Tokenomics 1.0

Authors: Icedcool

Squad: Icedcool, 0xBaer, Jamesmontgomery.eth, Links

Date Created: 10/25/22

Date Posted: 1/15/23


TLDR:

  • Tokenomics 1.0:
    • Guest Pass Revision - Increased value to BANK - Blockboy, Links
      • Reduces availability and utility of guest pass to support value accrual to L1 and Season Passes.
      • Encourages earning enough BANK to purchase a season pass.
    • Time-Locked BANK”(tlBANK) - Long term hold pressure and utility - Iced, Baer
      • Additional BanklessDAO primitive, to give projects, guilds and departments additional base layer utility. (examples below)
      • Identifies long-term BANK token aligned holders.
      • To be used in season pass, and other utility.
    • L2 Requirements - Reputation roles on chain with conditions - Bpetes
      • Requirements for BanklessDAO Social Roles
        • L2 members must maintain L1, and contribution to the DAO or lose L2 status.
    • Season Pass - Economic Reclamation(Revenue) OR Lock up - Someone!
      • Paid for in BANK or tlBANK lockup.
      • Possible Specifics (in debate):
        • 30K BANK for 3 month season pass - 100k Yearly
        • 100k tlBANK locked up for 1 year, for 1 year pass.
        • Replaces L1 access at the DAO.
      • L1 Access deprecated.
    • BANK Utility - BanklessHQ and others
      • Additional utility coming soon!

Summary

BanklessDAOs economy and tokenomics have done an amazing job in enabling work and distributing BANK. We have seen a huge amount of growth as a DAO, through working contributions that have been enabled through the distribution of BANK. Additionally, as we distribute BANK, we have increased decentralization of holders of the BANK token, and subsequently leadership of the DAO.

We now have the opportunity to develop an economic ecosystem that better supports the token, has a larger range of utility that supports growth and better aligns contributors to the DAO.

We propose a modular multi-initiative approach that is mutually independent and supports the next evolution of our tokenomic ecosystem. This initiative will support the long term viability of the DAO, accrue value to our contributors and the BANK token, and grant additional utility to BANK.

Each of these initiatives will require coordination, a team, and work to ensure the best implementation.

The five verticals are:

  • Guest Pass Revision - Increase value accrual to BANK and access to the DAO
  • Time-Lock BANK (tlBANK) - Long term hold pressure and utility
  • L2 Requirements - On chain reputation, with criteria validation
  • Season Pass - Economic Reclamation or Lock up
  • BANK Utility - Multiple initiatives
    • Including BanklessHQ, Writers guild, Bankless Consulting, etc

This post is meant to align the DAO around these initiatives, increase awareness, and collect feedback and sentiment.

BACKGROUND

BanklessDAO has had a high degree of success in its mission since its inception. It has onboarded countless members into the web3 space, created opportunities for people to learn & work in crypto, and trained just as many in governance, coordination, and tokenomics - all in a decentralized fashion.

As BanklessDAO has grown, we have found the edges of the current tokenomic models around BANK. Namely that it is distributed, doesn’t have strong value accrual, and is not reclaimed.

I’m calling the tokenomic model of this up till now BDAO tokenomics 0.5, because it doesn’t have all the required components to be a complete economic system.

This proposal is to enact and align around the next phase of tokenomics, which develops a more complete ecosystem around BANK.

MISSION & VALUES ALIGNMENT

The Mission of the DAO is to help the world go Bankless by creating user-friendly onramps for people to discover decentralized financial technologies through education, media, and culture.

This proposal supports the development of economic infrastructure that supports contribution towards BanklessDAO. As such it is mission critical, aligned directly with the DAO, and of the highest priority.

As mission critical priority, it is important that this work is done with review processes built in because, while not perfect, the current tokenomics are working. People are accepting BANK for work, although the value of the token is being distributed in a manner that degrades it over time.

SCOPE OF WORK

This proposal is to align around the larger initiative and aim of developing the tokenomics at the DAO. Each initiative will be independent, and move toward supporting a more comprehensive ecosystem at the DAO.


SPECIFICATION

Guest Pass Revision

Challenges:

Guest pass has approximately the same amount of utility as normal members of the DAO. This decreases the overall value of the DAO by enabling people to ride on guest passes as long as possible.

The Solution:

Guest Pass Temp Check

Details:

Through implementing an extended Guest Pass timeframe, while limiting Guest Pass renewals, and potentially some of its access can lower the utility of the guest pass to encouraging earning and holding BANK, thus increasing the value of DAO membership as a whole.

Time Locked BANK - tlBANK

Challenges:

Currently we have limited capabilities with BANK, in that we can only identify holders.

The Solution:

tlBANK (formerly veBANK)

tlBANK - Proposal draft (posting soon!)

Details:

Through the implementation of tlBANK we get an additional core primitive of the BanklessDAO, that allows identification of long term holders. This gives different organizational units within the DAO different opportunities.

This can be used in novel ways such as:

  • Requiring tlBANK to sponsor a project for funding
  • Requiring tlBANK to vote on governance
  • Requiring tlBANK to obtain project benefits
  • Requiring tlBANK to participate in Guild governance
  • Gamification
    • HAVING A NFT THAT LEVELS UP AS YOU RE-LOCK YOUR BANK
  • And more!

L2 Requirements

Challenge:

L2’s are a socially recognized and special role at BanklessDAO that is attributed to contributors that are strongly aligned to the DAO. As the DAO operates, some L2’s have decreased their contribution, or left for different reasons.

This decreases the value of the role, as over time the saturation of L2 members doesn’t properly identify contributors that are still aligned to the DAO.

Solution:

Season 6 Otterspace Badges

Details

Through this implementation of Otterspace Badges, we will be able to require that all L2 members have requirements that are enforced through on-chain badges and collab.land.

The requirements are:

  1. Holding the Level 2 Badge
  2. Holding 35k BANK
  3. Holding an unexpired Season X Participant Badge

This initiative is in the works at Ops.

Season Pass

Challenge

Currently there is no reclamation mechanism for BANK, and we have constant access to the DAO with the BANK threshold of 35k. This creates challenges that we only have emissions into the ecosystem, and a linear economy.

Solution

BanklessDAO Season Pass (PROPOSAL COMING SOON)

Details

Through this implementation of a season pass system, we will be able to create a circular economy for BANK. This reclamation of BANK will go back to the BanklessDAO Multisig, to replenish emissions, as a source of BANK revenue to the DAO.

The DRAFT specifications are to either require seasonally:

  • 30K BANK to purchase a season pass
  • Lock up BANK through tlBANK of 100k for a year
    • There are more complicated implementations worth exploring.

Additionally, this implementation will work in tandem with tlBANK to decrease the circulating market supply.

We believe over time this decrease in circulating BANK will reduce sell pressure, and support the valuation of BANK.

Considerations

This will need a team to implement. If you are interested shoot me a dm :slightly_smiling_face:.

Thankfully we have some pretty good tech infrastructure that can be put in place.


FINANCIAL IMPLICATIONS

Funding for this will be specific to each initiative, and will be requested by each project champion, with work breakdowns and requirements clarified.

NEXT STEPS

This proposal is meant to raise awareness and generate discussion!
It is also meant to gain support for and alignment around these ideas.

Next steps are to get involved in the different working groups, and engage with people if you want to help out and pitch in.

What is most important with these initiatives is that they provide the DAO with more options and tools to create tokenomic policy that can support contributor alignment and create a healthy tokenomic ecosystem.

Would love to hear all thoughts and feedback. Also if any of this is unclear, please do join us in #tokenomics at the weekly BANK utility call, Thursday at 10am EST.

BANKLESSDAO STRONG! :muscle:

POLL (temp check)

  • Approve
  • Dispute (with comments below)

0 voters

2 Likes

Thank you all for finally shipping this proposal. Much needed tokenomics update in the current context.

A couple of question:

a. Do we have any idea on how much BANK will these changes cost?
b. We often see ‘where are the test results’ feedback on many ideas that folks post in forum. Do you have any simulation suggestions?

Some suggestions:

a. In addition to the guest pass renewal limit. Can we make guest passes as a NFT which folks can mint at will be the access expires after ‘x’ days?
b. Can we boost governance power as a function of time in tlBANK?
c. L2 and the associated unlock parameters should be a function of ongoing contribution. While Otterspace badges are a good start, can we quantify contributions [eg with thrive] and set a threshold which resets each season to auto upgrade/downgrade L2?
d. In early seasons we saw that when many folks jump into the discord, we are unable to service all of them. Most of this is a function of our OS. Can we identify the max capacity of our OS and limit Season passes to that number? In this case folks can bid on passes as opposed to paying a fixed fee.

5 Likes

Fully support this proposal, long time in the making to give the BANK token more utility and to better align the DAO members/contributors with the long term mission of BDAO.

3 Likes

I fully support this long-expected proposal, and congrats that Icedcool and the squad finally made it!

I would suggest to clarify two things in this proposal:

  1. For Season Pass, it would need to clarify what “purchase” means here. Is it to spend BANK (tokens will be spent and won’t be returned to the pass holder) or deposit BANK (token will be returned to the pass holder after season pass is expired)
  2. The required amount of BANK for purchasing a season pass should be much less than the one needed for L2. In the current proposal, they seem too close: 30K per season vs 35K lifetime. It would make sense for new members to spend much less BANK experimenting with the DAO. Or in another word, we need to make all the components in the tokenomics consistent with each other.

Overall, I think this proposal would be a big step forward for our community. Awesome job by the squad! Thank you for the hard work. bDAO Strong!

3 Likes

The current figures regarding membership and locking take account of the current environment. But should the token price rise in future, we may risk pricing us out of the market. Is there a possibility to adjust the required BANK going forward by conducting a regular review, lets say monthly, and defining parameters which would automatically adjust the respective levels, e.g. by linking the BANK threshold to a stablecoin. I am aware that this would cause problems with legacy holders. Same though easier to deal with the other way around: people have locked at a high price but the token price goes down.

Was also wondering whether the bDAO website could play a role by creating a members access to tlBANK to adjust their levels.

Also the system would be more paltable for members if it allowed such locking on Polygon, Optimism etc. given gas prices and would also provide utility for BANK on these chains.

2 Likes

100%
These are meant to be knobs that the DAO has, can and should adjust.

I was thinking likely seasonally(?) but that is an operations decision that can be adjusted pretty easy.

Yep, that is part of the proposal plan(INCOMING) and yes, I actually think we can deploy tlBANK across all chains.
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2 Likes