How I will vote in Season 4 [Grants Committee member]

Grants/Funding
1

As one of seven elected members of the BanklessDAO Grants Committee, I would like to signal to the DAO how I will be voting on funding proposals during Season 4. It took a full season of reviewing proposals and hearing fellow GC members’ theses about what the DAO should be incentivizing before I could form my own convictions about the Grants Committee’s purpose and responsibility to the DAO.

This is what I believe:

  • BanklessDAO is the world’s premiere Labor DAO. We may be in a better position than any other DAO in the world to build a valuable ecosystem of products and services around our native token.
  • The Grants Committee is the only elected body that makes funding decisions on behalf of the BanklessDAO’s treasury. As such, the GC has more power over the BanklessDAO treasury than any other entity in the DAO.
  • The GC’s power - through funding decisions - can strengthen or weaken the value of the BANK token. Releasing BANK to fund a project will increase the supply of BANK available. Unless there is a corresponding increase in the demand of the token, the value of BANK will fall when more BANK is made available. (note: the BANK token is a governance token.)
  • The strength of BANK is crucial for the success of our DAO’s mission because - as we saw during Seasons 2 and 3 - the growth, engagement, and retention of bDAO members rises and falls with the value of the BANK token.
  • With power comes responsibility. When the GC funds bad projects, the GC is weakening the DAO. When the GC funds great projects, the GC is strengthening the DAO.

With these lessons learned, I believe that the Grants Committee must embrace its power over the BANK token’s value. No other individual or group that I have seen in the DAO has the potential to positively impact the DAO’s growth trajectory and long-term viability.

So, I will be voting only for proposals that aim to directly and positively impact the value of the BANK token. To receive my vote, proposals will need to aim for at least one of the following three criteria. I am a relatively new student of tokenomics and I recognize that there are more and potentially better ways for a Labor DAO to positively impact the value of a token. Please let me know what you think! I am eager to continue learning.

For now though, I’ll be focusing on these priorities during Season 4:

  1. Liquidity | Generate revenue and contribute a portion of the revenue to the BanklessDAO treasury. This provides liquidity to the bDAO treasury and provides a backstop for the value of the token.
  2. Demand | Create new demand for BANK - either through the product/service being proposed or by using the revenue generated to buy BANK off the open market. This reduces the supply of BANK on the open market and should increase the token’s value.
  3. Utility | Create new utility for BANK by giving individuals or organizations a reason to hold it or spend it. By giving people more reasons to spend BANK, this will make people believe it is valuable to have.

Every guild and project already is or could be aiming for one of these three objectives. Products and services from Metafactory or IMN could be priced in BANK in addition to USD, USDC, or ETH. Writer’s guild and Marketing guild could offer discounts for payments in BANK. Analytics Guild and Legal Guild could charge bDAO members, projects, and other guilds in BANK to use their products or services.

By directing our collective energy towards generating liquidity, demand, and utility for the BANK token, we are making our BanklessDAO stronger and more viable over the long term.

This is how I will be using my vote in Season 4.

6 Likes
2

I certainly welcome the transparency, and the nudge in this direction, and agree that increasing the usage and demand for BANK will be what seriously unlocks the potential in this DAO.

For projects, your voting preference makes sense. For guilds, this concept is a new one. I believe most guilds will struggle to meet this bar for the upcoming seasons. Something to keep an eye on.

4 Likes
3

Same thought here. :slight_smile: I will be in front of the GC on Tuesday with the PM guild.

2 Likes
4

I’m also relatively new to tokenomics, and I’m consistently confused when it comes to the DAO’s insistence that the BANK token is purely a governance token. Why do we need to build the token’s value if it is for governance?

4 Likes
5

We agree on a lot, @chuck25, but ultimately I feel that the token is simply a tool to help create an environment of contribution rather than an end in itself.

I’ve definitely been using this mental model myself lately, which has some interesting implications. In this model, our media activities are the top of our funnel - attracting contributors to our Discord. Our Guilds are responsible for talent retention and development. Our projects create opportunities for people to earn their way to a Bankless life.

This means we need to be able to split funding across all of these streams - each one is important. I agree that we are missing “opportunities” (which should be the domain of projects), but I don’t think our funding approach should prioritize them over everything else.

I like to think of Grants Committee as a shepherd for each of our BANK-consuming entities - we can provide guidance to these groups to help them (and by extension, BanklessDAO as a whole) succeed over the long-term. Given our role and capacity, I think that for each entity, we should focus on the following areas:

  • impact on our mission - how is this group furthering the BanklessDAO mission?
  • self-sovereignty - how prepared is this group to stand on its own?

Around that second point, I think it’s less important for some groups in the DAO (i.e. Ops, Treasury, GC), but for most groups, including many guilds, it’s a relevant and worthy pursuit.

Anyways, I look forward to developing our funding framework together with you on the Grants Committee, and appreciate your transparency.

3 Likes
6

Yes @links you’re right that each of these is important to the vitality of BanklessDAO. I believe that the media activities at the top of the funnel, talent-coordinating guilds in the middle, and value-producing projects at the bottom can orient themselves towards BANK-positive actions. It will require making changes but these changes will be insignificant compared to the upside of having a more valuable token to incentivize contributions across the DAO. Compare the growth, energy, and optimism of the DAO in December 2021 when BANK was $0.15 compared to the chaos and contributor attrition in March 2022 when BANK was $0.03.

Some rough brainstormy examples of what each level of the funnel could do:

7

The low token price isn’t all bad. It has allowed us to identify our “bear-market builders” (@hirokennelly ‘s words). These are our purpose-aligned contributors who can weather the storm.

If we can set up our systems around these people, we’ll be ready to scale when we push our token price back up. So in a way the low token price is an advantage - it’ll allow us to make the kinds of changes you’re talking about more easily.

And on a personal note, I just have more fun working with these people as well. WGMI!

9 Likes
8

I really like this, I’m holding BANK for now, tiny levels, half L1, and I’m wondering whether more visible purpose will help more folk stay and hold during rough patches. Bull markets are always finite.

I do think the inferred point about value metrics in proposals that frog made before he had to take time off is important, and something that external observers will want to see from Bankless.

There’s a good forum focus for proposals here, but does that filter down enough into Discord?

Is there any way to test all these great suggestions, guild by guild, or project by project?

I like the work @ernest_of_gaia does in DAOlationships, again I worry about the huge work levels for you guys, and would mentoring others help take some pressure off by having someone to delegate to.

But maybe DL is a place to start testing?

Also, where do hustings play a part? Folk in Bankless need to be aware of what voting is needed and what to vote for.

9

This was a serious question - does anyone have an answer?

I’m also relatively new to tokenomics, and I’m consistently confused when it comes to the DAO’s insistence that the BANK token is purely a governance token. Why do we need to build the token’s value if it is for governance?

2 Likes
10

I imagine people are reticent to take on the liability of answering that question in writing. I suggest you try to talk to someone in the Treasury Guild to get a verbal explanation.

2 Likes
11

My personal understanding is it’s also a trading token.

Folk advertising work can put that work up on DeWork, and use the exchange quoted BANK token as payment for work received.

And I’d say the same about Layer2 BANK, which can also be used for trading.

However, it may become an issue when the SEC gets involved in the US, about token usage, which would need a Legal Team member to explain.