Continuing the discussion what happens after VDP-11

While VDP-11 originally proposed to mint new tokens and how to use these, the proposal was reduced to the first part only.

This thread should provide the space to continue where VDP-11 left off, specifically the discussion around the use of these newly minted tokens - if VDP-11 passes.

What has been said previously in the comment section of VDP-11 beyond its current scope of minting tokens:


@PaulHaas (in VDP-11, revision 7):

VitaDAO could issue this to 5 select institutional and strategic contributors who wish to make large contributions directly to VitaDAOs multisig. The 5 contributors are confirmed by VITA holders. Multiple WGs believe that the expertise added by these entities far outstrips funding contributions. Enabling their contributions not only increases the DAO treasury but also its execution. Potential contributors have expressed that they cannot acquire VITA through current DEX smart contract systems or the community.

1) Contributors apply to 5 whitelisted addresses for a 10% vested fresh VITA mint.
2) Addresses choose between 1Y, 2Y or 5Y vest receiving v-VITA (earning APY, voting, but locked).
3) VitaDAO’s treasury and ability to fund research multiplies by an amt set by the 5.

Summary: VDP11 proposes to $VITA holders to include novel strategic contributors. Following approval and discussion, VitaCore could commence with 1) and define structure for 3). Should VITA holders decline, we would exclude incredible new enthusiasts who are unable to contribute via DEX systems. This is a strategic mint to include new partners, recognising that on a monteray basis VitaDAO has yet to deploy much of its treasury. However, Longevity WG may comment that it already has access to some of the best research worldwide currently searching for funding and a less conservative treasury approach would accelerate VitaDAOs impact.

@PaulHaas:

also, reasons why this is a bad idea:

  • dilution of vita governance
  • receiving more contributions than we can deploy for 12-18 months
  • distribution to new powerful entities who may skew governance

@Mads:

Great to hear there are expert contributors looking to get involved with this fantastic movement and community!
To better understand the rationale and impact of the proposed 10% mint, it might be beneficial to add some clarity around the following points:
Strategy:
1.Where does this group of contributors come from and what characterizes them?
a. What is to be expected apart from the capital contribution (if anything)?
2.What is the long-term intention with regards to anonymity?
a. Will it not be difficult to support the DAO in an advisory, network, or distribution capacity if they aren’t making their affiliation with VitaDAO known?
Tokenomics:
3.How does the size of the aggregate contribution compare against Vita’s current market cap?
10% of total supply is a lot, especially when compared to the circulating supply.
4.Is it correctly understood that the contributors will receive APY on their vita as it vests?
If so, what is the APY? Current token holders cannot stake for APY but must enter liquidity pools thus taking on risk of impermanent loss.
a. If this is a large, passive amount of capital, perhaps it could be put to use in a way that would provide $VITA more liquidity?

@NiklasTR:

I think this is a great opportunity for the DAO to gain more support from institutional and high-conviction members.
In order to ensure that the culture of the DAO is maintained while accelerating its ability to operate, I think the following modifications should be made

  1. all token holders should be able to lock in their VITA in a similar contract to earn staking rewards for a time horizon of their choosing
  2. all owners of these 21 accounts should be encouraged to identify themselves (anon accounts are okay of course) so the community can engage with them, or at least listen to their perspectives on social media / Twitter
  3. the VITA DAO governance tool should be expanded to include (a) a delegation option and (b) a no-vote penalty with (c) low gas voting. Details below.
    (a) is required so high-value passive account owners can empower active contributors with their tokens, (b) tokens that are not used for voting should be penalized (e.g. staked VITA that is not used for voting should not be able to earn staking rewards)
    (c) high gas fees are stopping junior members of our community from actively contributing. Building the tools to enable low gas voting with staked tokens (polygon etc.) is an important step to ensure continued shared decision-making within the community - especially when we decide to have more powerful members join us.
    I think VDP-11 is a phenomenal opportunity and should include an explicit mentioning of points (1), (2), and (3) together with subpoints a-c on-chain.

@Clepp:

I really like Niklas additional points. Identifying at least via anon account would be helpful. That way interactions can be started and the community can actively collaborate with them.

@zachobront:

I love the idea of both bringing in strategic partners and raising more for the treasury.
A few questions that come to mind:

  • I don’t know exactly how current tokens are structured. I assume that these are being minted from the pool that’s allocated for treasury, not increasing the total supply cap. Is that right?
  • What price would these people buy in at? Is it the market price, a set discount, or some other mechanism?
  • How do we choose who these 21 people are? Is it open to anyone who is willing to buy at such a large quantity, or is there some selection process?
  • What’s the thinking for the anon piece? It seems like a huge benefit is the strategic input and collaboration — it seems like this may be wasted with anons.

@Ariella:

After talking to some people, I think I’m starting to get it… but if someone could phrase things more simply for all of us here in the tokenomics n00b club, that might really help get more support.
Some suggestions:
We are giving {person? org?} X in exchange for Y.
X = 10% of tokens that are currently inaccessible on exchanges? 10% of all tokens? APY based rewards (somehow?)?
Y = Funds/USD? Expertise? Holding tokens without the option to freely sell in order to {stabilize token price? Something else?}
We {do/do not?} already know who/what these 21 entities will be. The reason they need to be anonymous is :record_button::record_button::record_button:, not because they’re super shady or ashamed or be associated with our community.
The major risk is :record_button::record_button::record_button:, but that is unlikely to be a problem because :record_button::record_button::record_button:.
The more realistic downside is :record_button::record_button::record_button:, but this is more than compensated for by the upsides, which are :record_button::record_button::record_button:.

@Clepp:

Agree
From the initial post I gathered that these 21 contributors are anon/unknown right now, but by the time the proposal goes to a vote, all voters would at least know who those contributors are (twitter anon or otherwise) to be able to confirm them. Not sure if I understood it right, though. Might need some clarification.

@keepx:

rom my layman’s view, I think this is a good idea, you don’t want to restrain capital and (does it have to be always mandatory) expertise inflow.
“Receiving more contributions than we can deploy for 12-18 months” => is a good point.
The 4 major pitfalls in my opinion for this are:

  • Governance issues.
  • Diluting or giving the impression to dilute the token with new tokens.
  • Be absolutely certain about the Lockup period and a yearly allowance (see Jed McCaleb and Ripple).
  • Regulatory clarity (securities).

But I guess you don’t want either a single organisation or few individuals to have a too big of a pie of tokens, especially if you consider the price is still low, it can become a drag in the future. This could still be acceptable if they bring recognition through their funding or expertise.

@PaulHaas:

This was a really good comment Ariella! My initial proposal was a shot in the dark to spark a conversation - we’ve now come up with a much better structure. Really appreciate your input.

X = 10% of all tokens

Y = treasury funds + expertise from those entities

We should know their identities, but I propose we do a twofold mechanism 1) institutions with known identities that join the DAO and 2) an onchain whitelisted auction

The major risk is changing our community culture through additional entities, but that is unlikely to be a problem because the community should align and vote on those entities.

The more realistic downside is change in our processes, but this could be really positive as VitaDAO professionalizes itself into an industry facing organisation, attracting more talent, capital and resources to democratize longevity.

– Thank you! Loved this thinking style

@papa_raw:

Agree. I think raised funds should go to regular core contributor payments at market value, and ideally be in a stablecoin. Re-iterating this opinion as I think it’s important.

A bit of a shameless plug here for PrimeDAO’s “Seed Launch ” module (Curve Labs built this). If you want to organize a whitelisted round of vested tokens instead of selling to each group individually this is a pretty fantastic mechanism for doing so.

@RUM:

Pro:
It will increase DAO treasury, it allows vitaDAO to fund more and larger projects.

Con: (I think that’s what the telegram members will tell me)
10% of tokens to 5 investors, this is not going to participate well in the decentralization of governance.
Increase the market cap without increasing the token price.

Question:
At what price will the tokens be sold? Will there be a reduction from the market price?

@timrpeterson:

We don’t need funds from others. We have a plentiful treasury. What we are interested is growing our network and top end signals. Thus, I propose the on-chain version of VDP-11 should include the following parameters and nothing more:

  1. # of institutions: Rather than specify a number of tokens that will be sold, I think it will be better to specify a number of institutions we will accept into VDP-11. I suggest that number is 5.
  2. Minimum token purchase: I suggest we also make a minimal amount of tokens in USD that each institution buy is $100K USD. This will make the offering not overly exclusive to account for individuals who may not be especially wealthy or who are conservative to allocate much to a nascent project like VitaDAO, but whose ownership of VITA tokens would represent a particularly strong signal.
  3. Discount on current market price : I suggest the discount is capped at 25% on current market price. The exact % can be a soft governance decision at a later date but I think many agree it shouldn’t be substantial discount (> 50%).
  4. At least one year vesting period : To ensure alignment, it should ideally each participant’s tokens should have at least a one year vesting period ensured by social contract. This will match the genesis social contract vesting length as well as the vesting length in the putatively VDP-21 soon-to-be Phase II (i.e., Discourse) 123 year VitaDAO budget plan.
  5. Use existing Genesis tokens rather than minting new ones . I propose we sell genesis tokens unlikely to be used by used by SPs and WGs before the VDP-21/123 year plan (or offshoot plans) is enacted which will have to be before July 2022. This will be when the one year vesting of the genesis tokens occurs. Using existing tokens will be most compatible with the VDP-21/123 year plan. In this plan I set it up so that future VDP-11-like institutional buy-in can be part of either the annual Community Auctions or Research Auctions. These two auctions are offset by six months, so people will have two chances a year to buy VITA at a discount to market price.

@Mads:

Fantastic input! My 2 cents:

Adding additional funds to the treasury : I don’t have insight into the deal flow working group, so I can’t say whether the DAO has sufficient deal flow to effectively deploy significantly more capital.
In general though, I would think that adding more funds would give us more options in terms of projects we can engage with and drive more awareness about the DAO, as we can ramp up the number of projects funded. Moreover, we don’t have a cost of capital / hurdle rate we need to meet, so I would think there’s little or no downside to bringing in additional capital to the treasury?

# of institutions/#of tokens sold : I think either approach could work. I’m not sure there’s a need to have a low cap on the number of strategic contributors though? All things considered, having multiple noteworthy institutions and individuals join VitaDAO’s mission with a vested interest seems to be a good thing.

Discount on market price: I’m not sure why there should there be a discount in the first place? It was my understanding that a significant part of the reason for these parties not market buying was that token price would then increase dramatically - if we can confirm that they will get the tokens at market price, that should be a strong value proposition in itself.

Vesting period: Agreed - minimum one year vesting, potentially more.

Using genesis tokens : Very interesting idea! Limiting the number of tokens needed to be minted seems beneficial.

@YMChoi:

10% of the token for strategic contributors makes sense to me.

Just hope the DAO to clarify in coming stages, thanks :slight_smile:

  1. Eligibility on 5 WLs
  2. Distribution mechanism among those 5 WLs
  3. Lock-up/Unlock mechanism

@vincentweisser:

The idea behind this proposal is to allow for follow-on proposals related to getting specific strategic partners onboard as well as resources to fund more research

One follow on proposal for example could be related to getting strategic partners onboard or another public auction for example, with a fraction of this mint… so it would last for multiple of these initiatives and ensure further funding for more research.

I’d propose staying with a 10% mint, and having these in a separate multi-sig controlled by the same multi-sig signers, but separated just dedicated for this purpose.

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