Thoughts on the upcoming Flashdrop for long term XIO citizens

Flash will undoubtedly attract many new speculators and genuine citizens to both XIO and FLASH.

Between now and 31 Dec 2020, there will be an expected increasing accumulation of XIO in order to qualify for the Flashdrop. I can imagine many who missed out on the UNI drop would take strong interest as one category of users for example.

There are two things weighing on my mind:

  1. As evidenced by the recent UNI drop, the price tripled but is now back to the same levels. Classic pump and dump. This is not unusual with new tokens, it’s simply market mechanics.

However, I wonder if we can protect such price manipulation by “locking” Flash tokens from the Flashdrop (as opposed to organic Flash acquisition) for a set number of months, for example, 3 months. This would disincentivize the whales who move from token to token lapping up these free airdrops, then dumping shortly after launch once they have received their profits, at least in the short term, protecting the market price during the period of Flash launch/introduction to the world (since a pump and dump will generate negative perceptions for the new project).

Or perhaps the “lock” is tied to the date of their first acquisition of XIO. For example, those who acquired XIO prior to the Stake of the Union, will have unlocked Flash at launch, whereas those who acquired XIO for the first time after the Stake of the Union will have their Flash locked for x months. The x months will allow the token to settle, and hopefully establish the project better into the community and mitigate against “blind” dumping of the token.

I know this idea might be logistically tricky, but what are your thoughts on the concept?

  1. I’m also wondering - there will be many new XIO holders from the date of the Flash announcement. And they will receive the same 1:1 ratio on 1 Jan. I feel like long term holders (in effect supporters and contributors to the project) should be rewarded better than new members who have not contributed per se to the development. So for example, it could be tied to the first acquisition of XIO. If my first XIO holding was 12 months ago, I get 12% additional Flash tokens. If it was 2 months ago, I get 2% additional, etc.

Another method to truly reward contributors is to base it on their cumulative social score (the official leaderboard). Add up all months they were on leaderboard divided by number of months, to give the average, and determine an additional reward rate for the Flash ratio.

Again, this might be convoluted in practice, but the principle of this idea is that there will be new XIO holders from the announcement who have ZERO interest in the project and bought XIO purely to claim the free Flashdrop, then possibly dump shortly after inception. It feels somewhat “unfair” that such “indifferent holders” would receive the same 1:1 ratio as those in the community who have genuinely spent time and effort over the last few months contributing to Social, the channels, editing the Blackpaper, etc etc. I know there have already been credits provided for such contributions, so maybe the above is mute? Thoughts?

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I do not see any reason to want to lock the $FLASH tokens post flashdrop, as those will directly be usable to flashstake.
If anything I would want to lock up the $XIO used in the flashdrop, to avoid a mass hiatus after the inaugural flashdrop.
I do not see how this would be done though, as those will be split in the XLP and individual wallets.
Maybe it would be possible to make only wallets with a minimum of one month of $XIO holdings of any kind be valid for the flashdrop?

In regards to the flashdrop being equal and not providing some sort of benefit to loyal token holders or whatever we chose to call these individuals, I would say that the suggested model is instead very fair, as it in part stands in counter-part to the XLP.
One favours early stakers when the $XIO was low and the other does not.

Fair comment. Thanks for your thoughts.

Your proposal is unfair for the people who bought XIO after the announcement, i see no reason why early contributors should have their tokens unlocked, while late buyers will have them locked.
Also there is nothing wrong with people buying just to dump their free airdrop, this is how the market works and it will not have any negative effect on the project development.
XID- 930ed

It’s actually not unusual in practice. Many employers do it with employee shares. For example, previously I’ve received bonuses in the form of shares which were unvested (locked) for at least 2 years. I couldn’t sell them or transfer them. This applied to all employees equally, to keep them motivated to perform and collectively drive a higher share price. And it promoted tenure. If employees could sell their shares the same day they received it, they would have no incentive to continue performing strongly, as they’ve attained their immediate reward, and may even leave the employer shortly after seeking a new job, for the same reason that they’ve received their reward. Instead, there is a waiting period for the shares to vest (unlock).

I’m not sure if the same logic can translate into crypto, but we have all seen tokens suffer from “indifferent characters” who purely acquire tokens for the purpose of receiving airdrops, and have no underlying belief or interest or support or long game toward that token. So as the token is sold off in large volumes after airdrop, there is negative impact on the token price due to selling price pressure, and impact to brand/token perception as newcomers are scared off by the volatility of the token (sometimes mistakenly equated to the quality/credibility of the token).

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I agree with many of the points you have raised and also agree that there is a more than likely chance of a massive dump as the airdrop (claim) happens since these tokens are free. It is also a valid concern that there are whales who jump token to token to claim and dump these tokens.

I have given this some thought and I do not think there is any “fair” way to stop this from happening. If we impose some of the restrictions you mentioned in your post - for example allowing longer-term holders the freedom whilst restricting newer holders - I believe this could be seen as just a heavily controlled dumping scheme where the longer holders are allowed to sell their tokens but the newer holders have to wait.

I think unfortunately this is just how the market works. I do believe that massive whales joining for just the airdrop/claim is an issue but do not believe restrictions are the best way forward. We could maybe look into incentives for holding? for example, if you hold your $FLASH for the first three months, you get X% dropped to you in the future. I am not sure how this would work since there will be no “team” fund that could facilitate this.

I am essentially saying restrictions are a bad idea but if we can flip this around and incentivise then this would be a much better idea and something I could get behind.

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I like your train of thought!!

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There’s no way to avoid a whale to dump. If you lock his FLASH you only posticipate the dump. Better they leave soon than later.

Fair… it was more about protecting the product (Flash) at launch, that it doesn’t turn away newcomers if it crashes on day 1

Creating a key feature in the eco-system, which will systematically end up with pump and dumps would be extremely bad for anyone in the XLP, as the impermanent loss would be fatal.
I really hope that we can come up with a good solution to at least limit this behavior for $XIO.

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I somewhat agree with this but allowing it all to happen in one go starts a chain reaction and gives no time for recovery. I believe if the holders had to wait a little while or they received more tokens for waiting we could have a system where all the tokens are not distributed at exactly the same time thus stopping a massive sell-off.

I think we need something to stop the mass selling of XIO after a new token such as $FLASH has dropped…

I think it’s better if they leave now instead after, if they sell, someone else interested buy.

I don’t think it’s that clear cut though…

If someone gets free tokens for doing nothing, they would want to immediately realise that profit by selling. Knowing that other people will also do the same, everyone will sell initially and buy back lower. The ideas being discussed here are to discourage this behaviour - make it not worthwhile to do this.

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I think there are three ways to go on about this assuming we don’t add any form of lockups or incentives to hold:

NUMBER ONE - Leave it to chance
Leave the price to do it’s own thing. It will likely pump and dump, be volatile for a period, then it will stabilize. Likely after it hits some sort of a bottom.

NUMBER TWO - Marketing and hype in anticipation for release
$Flash does have a very unique product on it’s hands. If we can make people understand its value before the airdrop, the dump might not be as bad as we expect.

$UNI didn’t dump after its airdrop because it was already established as a product. People expected it to appreciate in value because the exchange was so popular.

If we build enough hype ahead of release and make people WANT to lock up $Flash in a stake as soon as they can, we can maybe dampen the dump.

NUMBER THREE - Intentionally keep quiet until release
XIO price has pretty much bottomed out at this point because most weak hands have left. I think it’s safe to say the people who remain are long term XIO believers. We already see the value in $Flash and are ready to stake it.

If we hold off the marketing until the day 1 of release, when it’s too late to hold XIO to be eligable for the airdrop and everyone can already claim their $Flash, we can reveal it to the world as a completely new token that does all these amazing things.

We hit the world with a massive marketing campaign on Jan 1st, I’m talking Articles, YouTubers, Reddit posts, Twitter, everything. Create FOMO on day one. People will think twice before selling if it’s expected that we’ll attract more people.

I believe the airdrops after $Flash will be based on if you are staking XIO.

One way to discourage selling XIO is to penalize sellers on the next token airdrop after $Flash.
If the next one is planned for release 3 months after $Flash the airdrop could be based on the amount of time you staked since the release of $Flash.

If you only stake for 1.5months out of 3 you only get 50% of the airdrop. etc

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I think we have to have some kind of lock or bonding period, or the volatility of $XIO will cause so much impermanent loss that not even the XLP will cover the losses.

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Hi John

  1. Locking $FLASH for a while, even just 30 day will help to keep some Killer Whales from abusing the drop, especially if they have no intention to keep their XIO or Flash tokens.
  2. I agree that “older” XIO holders should benefit more but 12 months back is way to long.
    Rather look at a combination of the citizen’s profile:
    Are they in the XLP?
    Are they taking part in the competitions?
    Are they active on Telegram, Twitter or Youtube?
    Have the been in XIO for at least 3 months?

Long term holders and loyal supporters are more likely to reduce sell pressure and also influence others to do so - they deserve a higher reward and would not be bothered if it is lock for a while, infact they might just welcome it because they understand money better.

DrLuke
XID-f56A0
#XIOsocial

Good point @NicolasBrulay
Very important to protect the liquidity pool!
:stethoscope:@drluke

I think the utility of flash is more immediate and evident. I am less concerned about its long term mechanics, regardless of what happens on claim day. I play to BUY on top of what I recieve and immediately use it in the DApp.

However, I’ve thought a lot about aligning the utility of Xio and FLASH and XIO’s value. Some possible suggestions:

  1. Create a “lighting pair”…if you have both XIO and FLASH staked (Token Studio and flashstaking), you can gain a boost to apy. This would incentivize both using the Token Studio and participating in the flash protocol.

  2. Between now and the first airdrop for the Token Studio, do not give a date. Just tell a range…between today (immediately incentivize holding) and xx/2021. This will incentivize holding XIO before the first stake opens for the Studio. This could be only a percentage of the first token (50% initial airdrop), and the rest can be save for mining in app.

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I think we should try to keep things simple.
The amount of $FLASH in the Flashdrop that XIO holders will receive should depend on:
Amount of XIO is hold and the length of time the XIO has been hold. I am not sure about what formula we should use to calculate the influence of the lenght of time the XIOs have been hold.
I do not think other conditions like activity on socials, XLP etc. Should be included. When you are active on socials, XLP etc you already gain more XIO, so also more $FLASH in the flashdrop.

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Late to the party here, but just got to reading the thread, Some good points and a lot to consider all around.

I’m not so worried about the price of XIO post flash drop, I think we can expect to see a little bit of an increase between now and then due to people wanting to get in on the flashdrop action. I think we should be mentally prepared for a little bit of a correction thereafter. As we just got the XLP rewards for this month, we’re probably going to see more liquidity locked into the XLP in the coming days.

Also, i’m not terribly worried about the flash price after the drop, theres going to be some price discovery i guess, thats normal, but i also suspect a lot of the large holders will be long term XIO holders who i guess will want to use it in the dapp., I dont see that it will be a quick rush to flip tokens on Uniswap, and if so, there should still be some keen citizens ready to pick some up in that case.

Some good points about marketing above and how it could attract more people who might be inclined to get in for the drop and get out after making a quick profit. I suppose, the marketing should focus on the utility of the flash token, to attract people that will want to hold it.

We’ve also still got another full month and a bit more, where we’re going to be discussing aqua and other token studio developments, we’ve got time to make XIO a more enticing long term prospect to people who are joining the community with the thoughts of getting out quick after the flash drop. We should, as a community make it clear to the broader community what our long term goals are with the token studio.

Mabye i’m pretty naive about the whole thing, pretty optimistic for XIO in the long term though.
XID - af60f

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