Assignment: Cryptonaut Multiplier Discussion

Hey @MentalCrew ,

after some silent weeks we have a new Mental Assignment for you we need your help with.

You might already be aware of an ongoing vote on a proposal about how to structure multipliers our Cryptonaut NFTs will provide on (future) token earnings. There is also a discussion thread on our discord.

The vote is open until Nov. 26th and the current sentiment is at about 50/50. Some community members with large voting power have not yet cast their vote. The results can still turn either way.

Given the current split sentiment situation going forward with any given outcome would mean deciding against many. Even though one could argue that that’s the way voting works (majority decides) the decision would be against a large group. This we would like not to happen but rather create a situation where a large majority get’s behind the results.

So far we got little insight into the actual reasons why people vote in favor or against this proposal. This is where this assignment will be focused upon. Your task is to explore everything that might be important around this topic. The goal is to bring all pros and cons on the table. That being said, this assignment is not so much asking for your personal opinion (even though we’d like to know that one as well) but more for reasons you think others might be driven by.

In the end we might decide to create a new (better) Cryptonaut Multipliers Proposal that most Citizens will get behind.

  1. Why do you think the current proposal is resulting in a split vote?
    Please present all arguments for and against the current proposal you can think of. (If possible involve other Citizens on the discord in this discussion!)

  2. Please make suggestions on how to structure a better proposal.

bonus:

  1. What is your personal opinion on how to proceed with the current vote?
    – Should the outcome be accepted no matter how tight the results?
    – If accepted, should a follow up amendment vote be made pertaining to the exact percentage of the multipliers for all 3 tiers?
    – Do you think more discussion will lead to a different (better) outcome?

A total of 10,000 XIO is allocated for this assignment.
It will close on Sunday 28th.
The coordinape allocation will open the same day an be active for another week.
Please make sure to opt-in with the coordinape tool.

3 Likes

I like the idea of Cryptonaut multiplier, it will not overshadow XLP multiplier according to the sheet calculations.
Some positive points:
1, Locking the XIO in Cryptonaut vault, will reduce the circulation and hence value.
2, Giving multiplier incentive will prone people to lock them in the vault, even if it’s T3 (majority cannot afford T1 or T2)
3, people will be inclined to lock them more in T3 because its on avalanche hence gas price. People who are not worried about gas prices will mmost certainly have T1 or T2s
4, More people will focus on multiplier as XIO is available on CEX now and small trades will be better there, instead of impermanent loss on XLP.
5, If all Cryptonauts are sold (best case), they will increase in value and instead of burning, they can be sold for higher price including the XIO locked.

Now let’s look at the dark side:
1, Since there’s no limit on how much you can lock, people can easily take advantage of the multiplier without the risk in XLP, if that happens: liquidity will drop and the value.
2, Supply increase of future drops
Overall I don’t see the downside of suggested multiplier. People who voted NO, might be thinking about not owning the Cryptonaut and in their view the value of XIO they are holding will get less, because Cryptonauts are already coming with some extra features.

3 Likes

Ok, I would like to start by saying first that I am of the opinion that a vote must always be respected. Whatever the outcome, we should respect it. It’s the foundation of a DAO and blockzero is becoming a DAO, so we should just follow what the community wants. That said, I personally voted NO. This is because I believe that giving so much power to NFTs would mean centralizing the future of xio in the hands of a few users. There are a few dozen nft tier 1 and 2, but if we imagine the future of blockzero, we will have thousands of users. So it doesn’t seem right to me that there is a small aristocracy that will have such powerful multipliers on their income, which among other things will bring further tokens into their hands, centralizing even more power in their hands … It seems to me a dangerous game

How would I rephrase the vote that is in going? Well, I don’t think there is any need to make another “more clear” vote… You are either on favor or not, of giving a multiplier to our nfts…

1 Like

Yup, also this, we risk to thin the liquidity on uniswap if the XLP becomes meaningless

1 Like

I think the multiplier of XLP will still be better than cryptonaut. But I will take low multiplier over IL anyday

1 Like

In order to understand the reason behind this split vote, I think, we need to look at the profiles of XIO citizens:

  • there are approx 5k wallets holding XIO.
  • The average XIO bag has roughly 10k XIO = 1800 USD = a bit more than 1/2 ETH.
  • There are approx. 100 wallets that appear to own more than 10k XIO, LPs not included.

NFT are generated on:

  • Open Sea: Eth based, high fees and high value NFTs.
  • AVAX: low value NFTs, cheap fees, takes some determination to go through all the minting steps.

I don’t know the purchasing power of XIO holders, however given the above situation, I know it is an assumption, I believe that a high majority of citizens will be tempted to skip the NFT story. Even the cheap AVAX option ends up being expensive because of the fixed 6 AVAX price: AVAX price more than doubled since the beginning of the month.

Given the above mentioned statements the current proposal presents too little of an incentive for a citizen that is not involved with NFTs to agree with it. If the proposal passes their holdings will for sure be diluted:

  1. From token value perspective: applying multipliers is, in a way, similar to minting more tokens. They would would agree not only to give more tokens to owners of NFTs but to also allow them to increase their holdings by adding more XIO to the NFTs.
  2. From the governance perspective: they would give more voting power to NFT holders. The logic from above applies here as well.

The fact that, without prior notice (will continue on this topic lower) the rules of the game are changing might determine some persons to be against it.

The only benefit would be stopping the downward pressure caused by selling XIO which, in my opinion, is a short term problem because, if the BZ ecosystem, develops and grows this should go away naturally.

There is a high likelihood that most of the citizens that will vote yes will be from the top 100 wallets or the ones that have purchased or will purchase one or more Crypronauts.

Ideas of improving the proposal:

If the plan is to make this vote pass I would go against it, for reasons I will present when I try to answer the last questions.

  • My opinion is that we should not change anything related to Cryptonauts and their abilities until all auctions are over.
  • Once that step is finished we can talk about tweaking them, including multipliers.
    What I think would help a multiplier proposal pass is to also provide benefits for those that for one reason or another cannot gain a Cryptonaut:
  1. Separate governance multipliers from earning multipliers.
  2. Turn Cryptonauts into BZ “nodes” that can connect citizens. How would that work (in my mind, not sure if it is feasible from coding perspective):
  • Governance: Cryptonauts owners can be delegated by citizens to vote on their behalf. No multipliers are granted.
  • Earning potential: Vanilla Cryptonauts have no multiplier. The more people delegate them to vote the higher the multiplier, however they will share it with the delegators. Rough example below:
    • 1st level activates once 10 delegators are attached to Cryptonaut: 1.01 earning multiplier/per delegator and 1.02 for the Cryptonaut
    • 2nd level needs 20 delegators: 1.02 multiplier/delegator and 1.04 per Cryptonaut.
    • 3rd level needs 40 delegators: 1.03 multiplier/delegator and 1.08 per Cryptonaut.
    • In order to avoid centralisation the benefits could be capped at a certain number of delegators or voting power.

I believe that if the plan for BZ is to be a DAO with credibility the question about accepting the result should not even show up. The proposal is up and citizens will vote on it. if it is not accepted nothing will make sense any more as I cannot image a scenario when the winning side will want a revote:

  • Scenario 1: Awesome proposal (from the loosing side’s perspective) fails with 50.01 votes against.
  • Scenario 2: Bad proposal (again from loosing side’s perspective) passes with 50.01 votes for.

Who decides to cast another vote? Who decides if another vote is actually needed? How tight need the result to be in order to consider they need a revote? When does it all end? Why should one bother voting if the vote will be repeated until the loosing side is satisfied?

I think it is inevitable in a DAO, like in democracies, for the voters to decide against good ideas, leaders or directions.

That is why, I think, it is important to take the following into account for future governance proposals in order to increase the clarity and quality of the proposal and its likelihood of success:

  1. Blockzero DAO Governance Flow needs to be respected by all citizens, irrespective of level
  2. present the idea to the community and brainstorm
  3. create a draft of the proposal and discuss it with the community
  4. finalise the proposal and
  5. open voting to community

I would accept the result and move on. This is to respect the time invested to get informed and cast a vote of all persons involved in the decision making process.
Any ulterior change might also determine other persons to regret their vote.
For example: one citizen voted yes for two statements: yes for applying multipliers and yes for the value of the multipliers. If the proposal had different multipliers they might have not been ok with it and voted no, which, to take it to extreme, could have lead to a not passed proposal.

  • I believe that there is a time for discussion and a time for voting. Generally people talk first and vote after, not the other way around.
  • I believe that more discussion might lead to a different outcome. However I believe that cost is not worth it.
  • I am struggling to understand what “better” means. This vote nicely shows that “better” is different for different people. What is the problem this proposal tries to solve? The high tier Cryptonauts are being sold without difficulties, and ,with the exception of Tier 1, all of them were auctioned above their starting price. Which implies that the perks they come with at the moment are attractive enough
4 Likes

there might be a split vote because we have on one hand the cryptonauts buyers that would like an extra perk to their asset and on the other hand the citizens that are trying to protect their holdings by limiting the free XIO handed out.

i even think that this decision will show us how many potential buyers are amongst the gov participants.

i don’t know why, but i get the feeling that lately we are trying to change rules while playing and i don’t know if this is a good thing.

there is already established a protocol for this kind of voting proposals:
a. Brainstorm
b. Proposal
c. Votes

Personally I don’t think is a bad proposal.

we like it or not, i believe BZ will never want to shade it’s reputation, so definitely Yes

i would not really consider it fair. at the end of the day buying a T1 is investing/risking more money than a T3 … although most probably i would like to buy a T3, but still i don’t think is fair.
So No, i would leave it like voted.

i think yes.
that is the whole idea about a debate… to get people to support your proposal, so if the procedure was followed as i mentioned above there were definitely other chances to find support.

2 Likes

I agree with almost all your statements. You defined DAO perfectly.

I think @jorn was only talking about T3 multiplier. But I do agree once the vote passes it needs to be respected.

Discussion here might change people’s mind on how they are voting, while the voting is still open.

1 Like

XIO has always been handed out for free or tasks. Majority of people are only holding XIO which they got like that.

yeah we should had this discussion before voting, but I think the aim of this discussion is to know people’s mindset on how and why they are voting.

1. Why do you think the current proposal is resulting in a split vote?
Please present all arguments for and against the current proposal you can think of. (If possible involve other Citizens on the discord in this discussion!)

The current proposal is resulting in a split vote because there are long time hodlers of xio who cannot buy a cryptonaut presently and does not believe that the owners of the cryptonaut who just found out about xio should have more leverage over them.
It can also be said that persons who are longtime hodlers had managed to buy a cryptonaut and want the extra benefit that comes wit one, along with persons who bought a cryptonaut became intrigued by what we are doing and bought some xio so they could be apart of our community and are voting.

2. Please make suggestions on how to structure a better proposal.

The proposal was structured properly so as to not give too much multiplier to cryptonaut hodlers and to ensure that they are rewarded for obtaining one. It also made persons who are xio hodlers want to buy one for the extra benefit

bonus:

  1. What is your personal opinion on how to proceed with the current vote?
    – Should the outcome be accepted no matter how tight the results?
    – If accepted, should a follow up amendment vote be made pertaining to the exact percentage of the multipliers for all 3 tiers?
    – Do you think more discussion will lead to a different (better) outcome?

In my opinion I believe the results of the vote should be respected. If the results are not respected its like we are saying we can go back on any vote. The percentage should remain because that was what we voted on.

Overall I believe that cryptonaut holders should have a little edge over xio hodlers because they have brought an attention to us that i have not seen in a while. The sale of cryptonaut bring also positive news to a hodler of xio so all and all I believe that what the we are voting for now should stand no matter the results this is what a dao should be.

For XIO holders there have been multiple opportunities to earn/buy XIO. There can not be any growth if we think newcomers will have advantage over us. There will be more projects in the future and all will have different benefits more or less.

I agree with this, statement and so far everyone is having same opinion.

:+1:

I might have not worded it clearly. I was referring to the fact that this topic should have been discussed before casting a vote, in order to help citizens debate, understand and ponder on and make the best decision on how to articulate the proposal for the vote.

This is an interesting point of view. Even though i agree with the fact that citizens might be reluctant to provide bonuses to people jumping in just because they find the mirage of NTFs appealing, I fear that this might not be de main drive against accepting the proposal.

I fully agree with this statement. A regular citizen cannot do anything if they don’t respect the decided on steps.
Funny part is that this is what defines BZ :smile: Constant challenge of status quo. It would be interesting to see how the ecosystem manages to find a balance in the end: how to find the middle between free-flowing flexibility and corporate, procedural rigidness.

I agree with that, but since voting is closed now. And it was denied with majority (77%), and I think and hope the result will be respected. The best thing is to know why community feel that way and what was the reason for their voting (yes/no). I am eager to know if T3 NFT was dropped to every XIO holder, would that have changed the outcome?

I have no doubt that it would have passed like a breeze. What i thought about and also proposed on discord was to drop a tier 4 (i think 0 would be better) to all citizens. This tier comes with no XIO attached and has nothing special. Even the design can be done in such a way that it looks like nothing special. I would call them Nomads :smiley: The only ability they can have is to copy some of the powers of upper tiers provided they are loaded with XIO to the level of the desired Tier: to be able to copy tier 3 they need 25k XIO loaded inside :smile: And then we can bring up the vote for higher tier abilities. As everybody has potential access to the benefits i think the vote has higher chances of passing.

I was thinking about something similar, to launch a nft with 1 XIO and the rewards only start when you load certain amount of XIO in it. So something similar as you suggested. And I think if that happens the vote would be inverse.
From what I have gathered so far, people are not willing to let new comers go ahead and rightfully so. Most of the holders haven’t sold XIO.
On the other hand the goal of NFT was to have funds for the project and buybacks to reduce the inflation, if they drop NFTs then people will load those instead of buying T1 or T2, it will resolve the inflation issue but the funds part will still be missing. And as I mentioned earlier if there are multiplier benefits on NFT, most of the people will move from XLP, and it will hurt the liquidity and the protocol itself.

1 Like

this is like nice spin-off of our assignment, and it begs one question: Why the “citizen” ideal is not pushed forward?
As a community, we have a nice “marketing stunt” with the citizenship. I don’t think there are other projects that are using an idea so direct and so well embedded in people’s lives. Everybody can relate with being a citizen, we could use the Cryptonaut NFT’s to give a graphic meaning to it and make everybody to feel like owning a passport.
As in your example Tier0 could be used like a passport.

We can follow up on this idea as a

because involving people in NFTs will result in being more interested in the role of the NFTs in our ecosystem and not just seeing it as a way for buyers and BZ to make some extra money (although was clearly explained the reason behind it) out of it.

most probably this would have been the case, but
That’s why is important to have this discussions before and not after is done. We could have got the community sentiment and maybe proposed this idea without the “loading” feature… at least not initially…
Like this “old citizens” are not feeling left out, new buyers are attracted to T1,2,3 … this would have solve the newcomers integration as well.
After all the Cryptonaut project is implemented we could have a vote on T0 “loading” abilities … followed by another vote on Tx multipliers. like this we would have forced everybody interest in participating.( if the acceptance of the multiplier is the desired outcome by the proposing party)

i understand the purpose of the assignment, i gave that particular answer because i felt that not only the reasons are important… but even the context.

I really see the value of new people joining a community but i think is more important to find a balance and not to favor one or the other. If not, sooner or later, the new guys now, will be the old guys later.

:slight_smile: i think rejections like this will help to find that balance. People that are proposing a vote will need to include more the people they be voted by.

Out of all arguments pro and against this proposal, i gathered lately trying to do the research for this assignment, this is the most challenging one.
Is there a way that, technically one can stake his CN and be used as a liquidity provider?

Hi all, some of you may have seen me being active lately even though I am only very new to this project. I believe NFT’s have great value in the world at large, not just to this project. Bare with me as this may be a long post but hopefully worthwhile and least a little perspective changing.

Personally I think (not a criticism) that NFT’s are either not fully understood/cared for or trusted by the older/ OG community members. There are a few understandable reasons:

  1. NFT’s are both new and terrifying at the same time. The amount of hype involved has bred scams, tik tok influencers (who have no idea what they are talking about), changes in market behavior, potentially new and dangerous legislation/ government scrutiny and scare campaigns or stories of loss in news media abroad.
  2. My personal experience to understand NFT’s in general has involved time and money, a lot of time and money I probably wont get back. I don’t think everyone has those kind of resources and without a proper reference point, such as an in depth video (created by the BZ team) explaining market opportunities/ access to market capital and potential networking - will have the people garner enough trust to where Cryptonauts could lead the project.
  3. Although a new influx of people could propel BZ to new heights, where do these people come from? Are they going to be invested long term? Are they going to understand the ecosystem fully or care to? How much weight are they going to throw around and what are the repercussions? These are all valid fears when onboarding growth in experimental ways. I have heard the term “alienate” either directly or described a couple times now. Not that proposals like this don’t help address that but some things are harder to shake than others.
  4. There seems to be a disparity in perspective risk involved on both sides. NFT’s aren’t subject to impermanent loss and DeFi isnt limited to one exponential cost.
  5. Cryptonaut NFT’s provide risk to the project both ways. Potential burning and removing liquidity from BZ and future royalties if the token price rises too much with too little benefit of holding a naut, or overwhelming earnings and rights leading to the same thing.

Now, besides a splitting of the community in a faction like democracy (OG’s and newcomers), I can see that if benefits to overall community are balanced then a proposal SHOULD go through less opposed and more people happy overall.

Keep the multipliers but they should only be applied to governance. I think the multipliers for earnings should be put to those in the DeFi component of BZ as this would even out both governance and rewards earned through APY. This would incentivize profits to be recirculated back in BZ for higher earning potential and voting rights, with hopefully less liquidity leaving.

-Yes the vote should proceed no matter how tight, as a DAO - voting should be respected and adding more roadblocks to progress will only leave us behind in an everchanging environment.

-No, there should be clear defined rules set out for the whole proposal as to not create the roadblocks previously mentioned.

-More discussion is needed. Both answers above have been echoed as far as my reading has taken me. I believe that before proposals are made, the impact of changing one system should be weighed against the other systems first. If need be, after discussion, proposals should encompass a wider scope of changes to create less disparity in votes.
I think we as a community need to decide if less proposals with higher quality thought-out ramifications (and hopefully less friction) or lesser quality, quicker and single focused proposals will help us keep up with the ever changing nature of crypto.

2 Likes