Participation Token Design pt2
An update on the Dean’s List Network State Token Economy
Read this article first to get the full story (but you’ll still get the gist if you only read this article)
What are the Tokenomics
Current Circulation — 54,994,070
The mint authority is owned by a Squads 5/10 multi-sig: https://solscan.io/account/FAEYozsZVkxhXwG1HnVJn58Ks3dff31zjtA8b3KezFJ6
The token address is: Ds52CDgqdWbTWsua1hgT3AuSSy4FNx2Ezge1br3jQ14a
NFT staking rewards are currently releasing 50 $DEAN tokens per NFT. You can stake your NFT here
Total airdropped so far— 4+ million to over 5500 wallets
Token Market price — as of publishing this is $0.0015
The creation of a market was not expected, but it was also not preventable. We are preparing to issue the token directly from our own treasury at a pegged rate of $0.10 per token. DO NOT BUY THIS TOKEN IF YOU DO NOT HAVE A TASK YOU WANT TO PARTICIPATE IN!
Total Participation Tokens Received for Participating in Tasks over the last month: 186,964
Total Tokens Issued through NFT Staking Pool: 52,998
Having 3 times more tokens coming back into our treasury than leaving from our NFT staking is amazing! You can see a jump in the graph above that was lead by our “Case Study Task”; this job to create a case study for the Solana Foundation that pays out $3000 USDC to the team that completes this work. We have set the participation cost at 30,000 DEAN tokens; this USDC value is somewhere between $1000-$3000. As a community, we want the people applying to have spent time in our DAO; we do not want to read 100s of submissions and we know that the cost of those tokens is so high that only members that have been with us for quite awhile have enough to pay for it! This also encourages people to seek out teams; if you have the skills to work on the case study by yourself, but you don’t have the required token amount, you then go out and build a team to participate in this task. Currently 4 teams have applied, bringing in 120,000 tokens back to our treasury.
Another difference from the last article is that the token is slightly more involved in governance than originally planned; there are a few proposals with instructions that we have used on Realms. We still have council tokens that can veto if needed, so this is still very aligned with our original thinking; governance tokens should be used for polling and multisig councils should execute those decisions.
One of the challenges we hope to address in our ongoing token mints and airdrops it the accessibility of our token to new members. Some of the things we are doing to help bring more tokens to new members
- Reward for operational tasks paying out a duality of USDC plus some $DEAN.
- An Events Department with the prime purpose of emitting more $DEAN tokens through community events.
- Lastly, managers are being encouraged to foster a strong culture where they may tip contributions by new members for exemplary work via $DEAN
Our most recent airdrop targets active communities and friends of our DAO; the goal is to encourage highly motivated and skilled members of the Web3 community to come forward and contribute to our DAO’s present and the future. We currently have more work than we have leaders to help run the projects!
During one of our recent DAO consulting projects we had to start rejecting other requests because of this problem. Now we have active work in feedback, case studies, video editing, development, and newsletter content. With more members we look forward to fulfilling on our current demand and to start growing into new verticals.
Anatoly’s Tokenomics Tweet
I thought it would be interesting to share what we’ve done so far using this layout provided by Anatoly Yakovenko to compare and contrast some of our thinking
Projects needs to identify what KPIs it wants to maximise.
100% agree; you cant understand token utility without understanding the goal. Our main KPI is revenue earned from our consulting work.
Our token is predominantly used to pay a manager of a task for verification (more like an entry ticket/application fee). This helps with quality, since participation requires commitment. Recently , we’ve had multiple situations where managers charged 1/10 of the USDC amount in $DEAN token
Tokens should be rewarded for those who stake and maximise the KPI
100% agree; those in it for the long-haul are likely the ones that will contribute the most.
Our NFT is what people stake and it is how we issue tokens. The token staking pool is filled with the tokens we receive from participation in tasks.
Improvement #1: we currently emit the same amount per NFT. This will change to a dynamic emission amount using our reputation scoring
There should be no max supply or pre-mine, for anyone
Pre-mine token allocations are horribly bad; tokens allocated from inception destroy incentives.
However we are not sure about max supply; in our model, we acknowledge that we are still discovering what a network state token model should look like, and have not burned our mint authority.
This is a very controversial discussion that has many different perspectives. Below you can read the different arguments for and against burning the mint authority from 16 of our most active members
Improvement #2: Decide the triggers to burn authority (if ever)
Team should get a fixed % of the rewards that are maximising #2
100% agree; even though we do not have a designated team, rewards should always be connected to KPIs which should be constantly measured, expecting new people to emerge as recipients of those rewards. We currently issued most of our tokens based on the below formula, and will very likely do it again soon to recalibrate and realign ownership to better reflect active involvement and contribution
DAO controls need to be able to adjust #2, change which KPIs are incentivised and by how much and the market conditions change.
100% agree; this is a strong vote in favor of keeping mint authority active; however, because we use our NFT staking as the ultimate show of citizenship, we can use our staking pool to accomplish this! Adjusting participation fees on tasks and the release rate based on contribution metrics can allow us to tweak our KPI incentives without even touching the total token supply.
Because of #4, team can sell equity to private investors. This aligns team and early backers with the long term grind, and usually results with reasonable structures with vesting, etc…
100% agree; everyone should be able to do with their assets as they please. Since there is no team and we have already issued tokens, anyone can sell their tokens on the open market.
There is the potential that the DAO could issue tokens directly to an investor; the kind of investor that would want to do this is one that already has a large community looking to access our work opportunities; it makes little sense for anyone to speculate on our token! DO NOT BUY OUR TOKEN IF YOU DONT PLAN TO CONTRIBUTE!
Team reward of 30% is the upper bound of reasonable (apple tax level)
This is a very broad statement and I think its true in traditional team size/startup formation settings. 5–10 people makes this realistic, but if the starting group is 100?
The original participants should control as much of the token (in the beginning), allowing them to generate a high quorum. Over time, issue more and more tokens so that this same original group does not control as much. Wide distribution is good, but not at the cost of having inactive holders!
Thank you for reading about our new contribution to decentralised community theory, “Participation Tokens”. Now go out there and start participating!
Not sure what Dean’s List does? You can learn more in this intro to Dean’s List
And if you like digging into a DAO’s metrics, we have this amazing DAO dashboard we built with our friends at Top Ledger
