• Proposal

  • TIP-09 Accelerating Ecosystem Growth

Summary

TreasureDAO is evolving to become a web3 ‘decentralised Nintendo’.

In practice, this means becoming the ‘base-layer’ for metaverse / NFT projects to build upon to create a vibrant ecosystem of builders and passionate communities. This will be underpinned by composable assets, modular primitives and bottom-up narrative/IP to create broad network effects that are all unified by MAGIC.

TreasureDAO’s role is to enable the above with infrastructure, tooling and resources to rapidly scale and grow. Revenue from Treasure’s services, GameFi products and marketplaces will be used to create a ‘flywheel’ that reinvests in and supports the growing network of builders.

The innovation and drive from the community to integrate and grow the ecosystem has been nothing short of phenomenal. New primitives and concepts emerge each day, moving far beyond what we could have imagined on day one. They have also forced a rethink on how best to balance scaling internally seeded projects with external partnerships.

It has become clear that current frameworks need refreshing to keep up with our collective ambitions. The Council proposes a targeted three pronged growth framework:

  1. Mining emissions from the Atlas Mine / Harvesters will be dedicated to internally seeded projects for the short-to-medium term. This will ensure incentives for participants across Bridgeworld, Life and Smolverse remain aligned and non-dilutive. MAGIC will be sourced from the ‘Mining’ token allocation (25% of total supply)

  2. Introduce a MAGIC Grants and Integration program for projects seeking to fold MAGIC and Treasure ecosystem NFTs deeply within their mechanics. These emissions will be funded from MAGIC received from the Treasure Marketplace royalties, Bridgeworld summoning and crafting and the Ecofund. This can be in the form of grants for:

    • Bootstrapping capital / operational expenditure to supplement and/or replace paid mints (see Medium article for Evolving stance on paid mints)
    • One-off / ongoing MAGIC emissions into their economy.
    • One-off / ongoing Treasure emissions for games that integrate Treasures based crafting as a core game loop.
      All grants would have strict assessment criteria and terms to ensure DAO MAGIC is used prudently and long-term aligned builders.

  3. Introduce a Treasure Divestment Bank where highly aligned projects looking to acquire MAGIC on market to participate in Bridgeworld / Life / Smolverse may buy MAGIC from the DAO via OTC at low discount (eg. slippage) as an alternative to buying on the market. This would greatly improve capital efficiency of the DAO Treasury to fund growth of core contributors and partner projects who require a MAGIC alternative versus divestment with funds who typically seek steep discounts. This MAGIC would be sourced from Treasure Marketplace royalties, Bridgeworld summoning and crafting, and, over time, the Ecofund.

Rationale

  • Refresh frameworks (including TIP-08) to align investment in community enablement with collective growth ambition.
  • Delineate MAGIC emissions for internally seeded projects that require balance (eg. manage dilution) from accelerating growth of external partnerships that build on Treasure.
  • Attract and incentivise the best builders and most engaged, passionate community members to scale ecosystem growth.
  • Bootstrap capital and liquidity while providing the foundational infrastructure / services for builders and communities to thrive.
  • Actively drive network effects to all participants and value back to MAGIC.

Proposal

Introduce a three pronged ecosystem growth strategy:

MAGIC Mining Emissions

  • MAGIC mining emissions are integral to the social coordination and game theory underpinning the broader Treasure-verse.
  • It is proposed that MAGIC mining emissions remain targeted to core, internally seeded projects in the short-to-medium term to ensure sustainable balance of the respective economies. For the avoidance of doubt, this includes Bridgeworld, Life and Smolverse.
  • Impacts to existing emissions and TIP-08:
    • Mining emissions comprise 25% of total supply and are planned to be emitted through the Atlas Mine and Harvesters under a halvening model.
    • TIP-08 proposed to bootstrap liquidity to one new project per quarter by diverting 50% of 2 weeks of MAGIC emissions from the Bridgeworld Atlas Mine and harvesters. Life and Smolverse were the Q1 and Q2 candidates respectively.
    • There are no immediate changes to TIP-08.

MAGIC Grants and Integration

  • A dedicated Grants and Integration program is proposed to help bootstrap and accelerate projects seeking to build on Treasure. These projects typically look to integrate MAGIC and Treasure ecosystem NFTs deeply within their mechanics / design.
    • A detailed assessment framework has been developed to support the Grants and Integration process (see ‘Treasure Ecosystem Integration Framework’)
    • DAO approval will ratify the execution of this framework; as such, approval for individual projects is not required
  • There are three broad kinds of grants and integration:
    • Bootstrapping capital / operational expenditure to supplement and/or replace paid mints (see Medium article for Evolving stance on paid mints)
    • One-off / ongoing MAGIC emissions into their economy
    • Integration on the Treasure Marketplace (and thus royalties in MAGIC).
  • Conditions
    • Projects must submit an application under the new ‘Treasure Ecosystem Integration Framework’
    • There are six assessment criteria each applicant will be assessed against
    • The process may take between 2-4 weeks contingent on volume of interest
    • There are terms for applicants to align long-term interests and de-risk bad actors / impacts to the DAO, this includes:
    • MAGIC (or other tokens) supplied by TreasureDAO will be vested and released at agreed milestones and design choices (ie. MAGIC emissions must be used in a thoughtful way, not simple farming and dumping mechanics). Ongoing emissions will be subject to periodic performance reviews (eg. token design, user engagement) to ensure alignment
    • If the project has or intends to launch a native token, the project commits to:
      • Token X <> MAGIC as their primary LP
      • Listing on a Treasure AMM
    • The project will provide TreasureDAO a commensurate value of NFTs / native tokens (eg. akin to a Treasury Swap) to align long-term interests. These will be subject to vesting periods. They can also be used as rewards in Bridgeworld, Life and Smolverse through codesigned game mechanics - this would require approval from the respective project
  • MAGIC grants will be paid from the Ecofund (incl. Marketplace royalties, summoning / crafting and existing Ecofund tokens).

Treasure Divestment Bank

  • There is a growing segment of aligned builders who seek to accumulate MAGIC to actively participate / play in Bridgeworld via the Atlas Mine / Harvesters - becoming pseudo project / guilds (an innovative approach to social coordination)
    • Emissions from the Mine / Harvesters are then fed into the gaming economy of the underlying project (eg. as rewards or incentives)
  • This initiative proposes to offer MAGIC to these highly aligned builders via OTC at minimal discount (eg. accounts for slippage) as an alternative to buying on the market
  • Rationale:
    • Greatly improves capital efficiency through significantly better MAGIC to stable conversion than divestment via venture capital or funds
    • Allows more rapid scaling of core contributors and partnerships with people / projects who require ETH / Stables
    • Puts MAGIC into the hands of builders who have the long term interests of the ecosystem at heart
    • The Council proposes strict terms and vetting to prevent market manipulation, bad actors and governance attacks
  • Conditions
    • Must pass the same ‘Treasure Ecosystem Integration Framework’ assessment criteria
    • Transparent OTC with minimal discount; all individual proposals over $1M USD will be put to DAO vote
    • Limited accumulation and parcel size - no project may accumulate more than 1% of total supply or 5% circ supply via this initiative (if there is no lock/vesting)
    • If the project has a native token, the following requirements apply:
    • token x <> MAGIC pair
    • listed on the MAGIC AMM
    • liquidity mining incentives will be directed at Treasure’s AMM
    • Treasury Swap (contingent on arrangement) - The DAO will negotiate an agreed amount of NFTs/native tokens to ensure long-term alignment. These will be subject to agreed vesting.
  • MAGIC will be sourced from Ecofund, royalties and summoning / crafting.

Polling Period

The polling process begins now and will end at 07:00 UTC on 15 March. If quorum is reached, a Snapshot vote will be put up at (EDIT time) 10:00 UTC on 15 March.

Indicative Poll (MOVED TO SNAPSHOT)

For: Approve Ecosystem Growth Framework
Against: Reject and reconsider

Indicative Poll

Approve Ecosystem Growth Framework
Reject Ecosystem Growth Framework

    About time for this proposal!

    Really like how we are evolving into 1) a Metaverse PaaS/IaaS provider, combined with 2) a decentralised Venture Capital & GameFi incubator. Full support!

    I think it would be great if below points are also mentioned in the proposal.

    1) Will there be any changes in mining emissions for stakers apart from the proposed 2 weeks once a quarter 50% emission diversion to core projects?

    2) Clearly specify the percentage of discount these projects could get via OTC deal? 1%/5%/10%? Slippage example is vague. Slippage could be 0.5% or 50%.

    3) Since we are looking to offer huge amounts of discounted Magic to some projects, it is time we discuss what are the value addition previous OTC deal with VC has brought to the DAO/Community. If I remember correctly around 20% or more discount were given to VC when Magic was trading at 20 cents. It will be great if we can share with the community what those VCs have contributed apart from the run away capital.

      I support the proposal

      I have read the TIP again and have few more points to raise. If I have missed any details that is already mentioned, please pardon me.

      Any project could buy up to 1% of total supply of Magic which means they can get almost 3.5 million Magic at discounted rates. Now, based on above, I could think of below points, please advise if any of them is based on a flawed rational.

      1) The project is not buying Magic from the market, it will have no impact on price. In other words, this will not result in an increase in Magic price directly.

      2) The project is looking to participate in BW which means summoning, crafting, questing and staking. Most of these activities are beneficial to the community but what if the project dumps ALL of their Magic, up to 3.5 million into Atlas mine/Harvesters and rake in a big portion of mining emissions which they can keep for themselves or share with their community. The community in turn could keep or sell it on the market, This could result in negative price appreciation. Bear in mind since they haven't purchased their Magic from the market they didn't contribute to positive price movement.

      Also, existing Stakers will see noticeable reduction in their emissions if this happens.

      3) Magic price is currently the strongest motivator for any individual or project to invest in Treasure but if the circulating supply of Magic will keep going up as more and more projects continues buying from DAO rather then market, which is expected as the time goes by, but it has to be countered by increase in Magic price otherwise it could be detrimental to long term price of Magic. Projects must contribute to positive price movements.

      4) Will the Magic received by these projects is going to be vested? If Yes, for how long? If No, then why not?

      I do understand that having a utility for Magic in projects outside Treasure ecosystem is a huge plus but that utility is subjective and needs to be maintained to make sure the community of other projects continue to invest in Magic otherwise, they will buy it one time, complete their task and dump it.

      What if?

      • We strengthen our liquidity depth through Balancer Crystals so that slippage issue is dwarfed.

      • We reduce the amount of Magic any project could buy from DAO to let's say maximum 0.5% of total supply and rest they can source from market(They can buy in batches)?

      • The purchases are staggered and voted on by DAO if the project has proven to add value to the baseline i.e. price of Magic and not simply farming and dumping. For example, if the project wants to buy 2 million Magic from DAO, we allow 25% of buy at a time, the project then implements and proves it's advantage to Treasure ecosystem and then next 25% buy is allowed. If we simply give them 2 million Magic in first go and they fail to add value, there is nothing we could do.

        UA9G1 Really good points and appreciate the protective mindset! It's impossible to control what these projects will do with their magic once they receive it, so it's critically important that there are controls in place to discourage bad actors.

        Vesting and tranches are a must imo.

          UA9G1 great questions fren.

          1. Mining emissions will remain as per TIP-08 (ie. no further dilution of mining emissions). The original intention was for mining emissions to be split temporarily for 2 weeks per quarter to assist in bootstrapping a new project. On closer review, this was not sustainable and does not allow us to scale as fast as we'd like.

          2. The OTC deals would be as close to marketprice as possible. It is essentially a more capital efficient alternative to buying / selling on market. The intention is to minimise the discount received. For any material amount (over $1m) we would put amounts through the DAO.

          3. There is no intention to give mass discounts through the proposed mechanisms. The grant system is used to help bootstrap and slowly emit MAGIC into partner ecosystems to grow demand for the game and overall, the network. This will be quid pro quo via the terms that we are setting - balance and diligence is key to ensure we maintain long term interests while making Treasure a pleasure to build with.

          Re participants from the prior divestment, we meet regularly with several of the members to discuss strategy, scaling and other operational issues. Many are subject matter experts that we can tap into for specific questions. 1kx in particular, we catch up on a regular basis to walk through priorities, key issues, where they can help etc -- including introductions to other talent and capability. They have been an invaluable resource through out this journey.

              UA9G1 So first off, thanks for taking the time to think through this and provide questions.

              We have multiple layers of controls to mitigate against bad actors and a couple of different ways to execute (such as stage gated release, capping supply acquired etc). I would say though generally, your rationale is very centred on price action, not fundamentals. I would warn against using price action, and in particular, short term price action as the drive for these types of decisions outside of giving people large discounts with instant liquidity - which we of couse will not be doing. A few comments:

              1. We will be reviewing diligently any project seeking large OTC. I dont believe there will be many that fall into this bucket due to the dilligence we will be taking.
              2. There is already a cap on the max they can acquire through this mechanism (on total and circ supply outlined in the TIP), and we will asking them to disclose other holdings and what they will be using it for
              3. Your points re 1 and 2 are somewhat moot. Price impact of buying on market should not be the driver of this decision. The long term impact of participation and growth of their game economy and the network effect it has on the whole Treasure ecosytem is far more important than fleeting short term price action. Re point 2, they could dump their whole stack on the market either way. Acquiring via OTC makes no difference at all - and not sure where you got the 3.5m number from either...?

              I think generally you are conflating the means of acquiring MAGIC with what they will do with the MAGIC after they acquire it. OTC is an alternative for them acquiring MAGIC - and it gives the council a very capital efficient way to divest MAGIC to continue to scale the team (as people generally will not accept MAGIC as payment - ie they want stables, particularly in a bear market) without giving large discounts and, if vetted well, puts MAGIC in the hands of long term builders. The alternative is trying to divest through funds which will demand a very high discount - something we will try to avoid unless they provided extreme strategic value.

              What projects do with it there after - whether they buy OTC or on market - will not change if the cost to acquire is more or less the same. If they buy the same amount on market, they can still do all the things you raise as a risk; dump, put it all in the atlas mine (which they most likely will do - and there is nothing wrong with this tbh) - weave it into game mechanics etc. What their community does with the MAGIC if they receive it in game again is moot. It makes no difference whether acquired OTC or on market. We will work with partners to ensure there are native token sinks to prevent farm and dumps - and in fact, we have more ability to influence this via OTC than we did if they bought on market - but ultimately, the means of acquiring has no impact. Also, we can't and should not control what community members do with their rewards. We can design incentives and release schedules, but the actions they take thereafter is up to them, as it should be.

              1. Re your point 3, we will be modelling the release of emissions and encouraging projects to release MAGIC over time (gradually) and as the end game reward, not early on as a farm and dump. This will manage impact on circ supply. Again, price should not be the driving factor this decision, but more broadly, supply and demand linked to overall growth of the projects and broader ecosystem.

              2. Re your point 4, for grants, the MAGIC will be vested / released over time likely with stage gates based on milestones hit. We can 'turn off the tap' if things aren't successful / panning out how we hoped, or if they turn out to be a bad actor. Re broader divestment, if someone is acquiring at close to market price, there shouldn't be vesting as the alternative is buying on market and being fully liquid - no one would do it. Again, we will be putting in place rigorous review to ensure alignment. Another option is releasing in batches - but it needs to align with the collective direction of both the DAO and the project itself as they have options.

                Gaarp - Thank you for your response. It's great to hear from you 😃

                I now have better understanding of these questions and believe we are doing all the due diligence from our side to encourage a positive outcome from these initiatives.

                Once the TIP is ratified, may I request to please add details about how long the vesting would be for OTC deals and the controls in place to maintain quid-pro-quo, staggered release of MAGIC into the partner ecosystems?

                Appreciate all the work the team does behind the scenes!

                    UA9G1 No, thank you for the questions.

                    We will look to share details of all partnership arrangements made

                      Integration is huge for the future of this ecosystem and I am excited for this proposal. Great addition.