DAO Proposal: Swap DAO BUSD and USDC/T For DEC
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The Proposal
This proposal is for the DAO to use the current BUSD and USDC/T reserves to purchase DEC. This swap will be handled by the DAO management team in a way that minimizes fees and slippage as much as reasonably possible. The max purchase price for DEC is $0.95 per 1k DEC (95% of par value).
Video Explanation
The Benefits
This proposal has 2 main purposes: 1) help DEC reach par faster and 2) increase the value of the DAO holdings by purchasing DEC at its current discount. The DAO currently owns just under $500k worth of stable coins. If all of the funds are able to purchase DEC that will give the DAO 10-13% of the current DEC supply. Because the DAO currently has no method of spending DEC, this supply will be effectively removed from the market and be a major factor in driving DEC back towards par value.
If DEC price jumps above 95% of par value before funds are depleted, this will also act as a barrier to help prevent DEC from dropping below this 95% again in the future, as the DAO will purchase DEC again if it falls below this threshold.
The Reasoning
It has been stated many times that getting DEC to par value and activating the "flywheel" is one of the most important things for the Splinterlands economy. This is a chance for the DAO to contribute towards that goal while also increasing the value of their treasury. Activating the flywheel will create a large use case for SPS (burning SPS to mint more DEC) that can help drive more demand for the Splinterlands governance token.
The Sponsor
This proposal and the video above is sponsored by Ethlas. This proposal was written up prior to and was not influenced by Ethlas or any other sponsors.
Thank you for participating in SPS DAO Governance @bulldog1205!
You can place or monitor SPS Stake Weighted votes for and against this proposal at the link below:
Link to this Pre-Proposal
Updated At: 2023-06-27 04:55 UTC
No brainer, easy to get behind this proposal,great thinking!
I will certainly vote for this idea. I like it very much. Good job @bulldog1205 !!!
I urge you to reconsider your vote on the basis of the other comments that myself and others have left on this post proposal now that it has progressed to the in-game governance system.
There are many comments so I don't see which one you are in agreement with. I'm happy to reconsider if I saw any that made sense to me. I'd like to hear your thoughts.
I will say that I don't agree with these stated negatives:
this will drain the DAO of funds and be the end of the DAO if DEC goes lower or we get hacked.
If that happened to any meaningful degree, then the 500k in DAO funds would mean nothing in relation to the roughly $100m in total assets across the board. In other words we are always open to this risk, the DAO funds are irrelevant.
people will sell into it, and buy back later and make a profit.
Meaningless in the overall system. If people buy and sell the same amount of the token, then it doesn't matter. In order for this to be negative, people would have to argue this will make people leave that otherwise wouldn't. With the token trading roughly 86% of par, I don't see how the DAO paying up to 95% would do anything more than give a few people leaving a few extra $s.
people that talk about SPS inflation creating and endless negative loop
I don't agree with this at all. I'm happy to explain if anyone wants me to, but I'm very confident that
On the positive side I think its good to tighten up the slack in the system by having the DAO soak up a SMALL amount of DEC. I certainly don't think its meaningful though, and really not a big deal either way. The only way our whole economy grows is by increasing demand for assets. Right now the game has determined that DEC is the priority, but in reality it doesn't matter which one they picked as they need more assets coming in than leaving.
Again I respect you @holoz0r and would be happy to consider your arguments, so feel free to either write them publicly here or you can also DM me in discord anytime.
This is my biggest concern. We will stand to "exit" $500k worth of assets from the game. Be this existing DEC, or people who may be about to sell cards into DEC who then have a lovely off ramp which would see the price of DEC plummet as these holders all ran for the doorway of the DEC "buy back".
This is all, in my most humble of opinions, a symptom of the community passing the DEC-B proposal. It never made any mathematical sense, now we have harebrained schemes like this which will "pump and dump" the DEC token, and the community is not only
A) Broadcasting this via a proposal but also
B) Using DAO funds.
The additional nuance and complexity here is that Bulldog is a respected member of the community and has delivered the message in a convincing and confident manner.
There has not been much depth in discussion on HIVE, on the governance proposal thread, where we should be discussing these things in an immutable manner.
I am all for people changing their position, but I want people to be able to justify, in coherent, and cognisant terms, why they change their views.
DEC is certainly a priority, but there are other ways we can achieve faster parity.
For one, we haven't seen the implementation of the additional DEC burn from market fees.
Once we see this, the next logical step is to fund leader board rewards from market fees, which ceases the issuance of any new DEC, outside of cards being burned.
Finally, we await the launch of land to act as a sponge to take up DEC as power sources.
If then, and only then, DEC is not at peg, we should consider further measures.
This proposal to spend 500K of DAO funds is a knee jerk manoeuvre that I can guarantee will only cause a temporary spike in the price of DEC and a slow bleed back to where it is, or even lower. We will not be able to measure the success of such an endeavour when other use cases for locking DEC are yet to be implemented.
It would be then foolish to state that this proposal is a success when the symptom bringing about a proposal such as this has not yet been addressed.
First I love your passion @holoz0r, to me that's fantastic even if there are some points I disagree with!
I do agree with many of your points, but I think your perception of the outcome is somewhat off from mine.
I agree this is an attempt to get DEC to peg in a bit of a kneejerk reaction. I also don't think that it will do a lot more than increase psychology, improve education, and take $500k worth of DEC out of circulation. None of those are huge deals, but they are all positive.
I also agree that some players will sell into this and get a little more. I don't think whether DEC is at 86% or 95% will be the reason for them to sell and exit. I think they have already made up their minds.
If DEC was at 50%, then I could see that being an issue, but at 86%, its definitely not a factor in my opinion.
Having said that if we have $500k leave, it will happen anyways. All this will do is pay them a small amount more. It will also be arbed by the trader types, that can buy at 86 and sell at 95 too. This too is not material as it has no negative impact on the effective supply as they are DEC neutral.
Its $500k out of $100m in total assets in the game. But having said that, I don't think its a net negative either. The DAO would soak up out of circulation 500m DEC and to replace that then the so-called "flywheel" will be closer. At this point, I don't think many people even understand it. So from an educational perspective, getting there will have a positive affect simply because people will understand how it works.
I don't think this will make SPS run. Nor do I think it will do much either way. I definitely don't think its a miracle solution for getting more buyers than sellers.
And for that reason I do agree very much with your last statement as well!
If you don't think that it would do much either way, then why vote to support it? Would you not feel more confident with the DAO holding a stable coin. The way I often (perhaps mistakenly) look at the DAO is to understand my percentage of stake in the DAO in the form of staked SPS as a form of "ownership" of the assets in the DAO.
I then consider that if this were the money in my very own back pocket, would I be comfortable contributing those funds to that specific DAO proposal. In this particular case, I can't open my wallet, and I want to ensure that others come to the realisation that a proposal like this would more than likely, in spite of all my passion for this game see me walk through those exit doors never to return again.
I'd still post on HIVE and hold my SPS, because I believe in SPS and Splinterlands, but I can't stand to see something I love so much hurt itself in so many potentially crippling ways.
Apologies if I seem manic or hyperbolic about this particular issue, but I do not know how to express myself in any clearer terms regarding my fervent passion for this game to succeed.
When SPS first dropped and the air drop was announced, my reaction was "here begins the best four years of my life". Now, about 2.5 years into this, I think "Look what they have done to my boy" in the vein of the Godfather.
I think the way you are looking at it is great. I look at it the same way,
Re: If you don't think that it would do much either way, then why vote to support it?
As I said above, there are 3 small positives: 1) increase psychology, 2) improve education, and 3) take $500k worth of DEC out of circulation. And I really don't buy any of the negatives I've seen, its a drop in the bucket to the overall size of the game.
Re: Would you not feel more confident with the DAO holding a stable coin.
No. My faith is in the @yabapmatt @aggroed and the community. Whether the DAO has a few extra dollars in it is irrelevant to the overall big picture. If the game doesn't work out, then it fails and I lose my money is my thinking. I have millions of dollars worth of value in the game, and this is worrying about maybe $1000 worth max. So its truly not significant to me. One day I think it will be, but not yet.
Having said that, I do think the goal should be to increase the value of the DAO. And I do look at it exactly like you do in terms of me owning a slice. I just think that you protect yourself and diversify when things are going crazy to the upside, and you take chances and consolidate your position on the downsides. IE buy low, sell high. If we follow this mentality, then I'm excited for the possibilities for our future.
I've done what I can to make my "Please vote no" be heard. I'll close on the point that its 1:21 AM here, and I need sleep to be able to function coherently.
I appreciate your level headedness in the face of my passion for this.
i think if we buy dec it should not be until .0095 but maybe buy it low and sell at that level and when holding it put it in the dec busd and dec dai pools to earn lp rewards in sps and cake from pancake swap. Then take it further and take say half the dao assets create a cash flow warchest by taking half and making them geared toward income production and non releated spl assets to allow the dao to survive any adverse impacts of news which will likely hit tokens like this hard compared to say a hedged btc lp postion shooting streams of btc out and principle is protected or a bunch of stable coin lps, staked tokens , interests in real estate and possible paxg for gold and use that to deposit on defi platforms whihc can be hedged with a short 10 oz gold future use it to generate cash flow on gold whiteites hedged. Also look into say a traditional tax lein fund one i looked at provides monthly distributions no leverage at 12-15% and that will provide steady cash flow as well as the other postions that is not impacted by spl asset prices and we can then survive even if spl did not do well for a while and gain a huge benefit if it does as we can take the income and distribute some creating percived value bc it is adding extra income as well as retaining half to say dca into strategic purchases of spl assets such as nodes if they are low, underpriced cards that rent well to get high rois , maybe runi andland as well as buy a bunch of card packs to hold incertain assets that are likely appreciate as well as create a maxed deck to rent out to a nfty player and have the accout schedule to play 24/7 and start a guild and have all the accounts outsourced to nfty to generate cassh flow from daily battles, brawls and tournaments as well as soulbound cards it can keep and unlock and then either sell or rent. Maybe the dao should buy a tract as well and max out a tract with runis and legendary cards to farm roi from land for everyone who owns sps. SPS dao can be used to allow ppl to get exposure to profits from activities that some may not be able to do via the dao and though little effort. All these cash flowing activities will add significant value to the dao by reducing uncertainty by keeping it more diversified in the begining while it builds a war chest and only keeping 50% in spl assets so the dao will always survive as at least a investment club in many assets it can continue to manage even if the game did not do well we could position it to alwayscome out on top and keep growing. Everyone here has a significant amount invested in sps and many other spl assets so it would prob be good to use various high yield strategies which are no more risky than holding mostly sps which makes are war chest dependent completely on one game and token. Once we build up a unbeatable stream we can invest in different opportunities such as vc funds like parterre capital to be exposed to early stage start ups etc and expand are market making operation via the dao to many different markets not just tribal dex. Runing the dao like a hedge fund type thing would diversify it and create a strong cash flow arsenal not dependent on one game or asset for all of its roi. ONce built a portion can be usd to purchase in game assets in bulk to help development and then flip them for profits which go to the dao unit holders.
and love your last quote. I realize you are concerned and you have good reasons to be. But at the same time I think "your boy" will get through this and be STRONGER as a result of going through it!
I can't wait to revisit this conversation in 5 years. I think we will have it because I believe we survive. Then we will look back and realized everything we went through were things that made us great together (the good and the bad)!
One thing that Aggy said on a recent town hall kinda haunts me "its my job to make those who leave regret it as much as possible".
I've left once before. I sold two full Alpha sets, you read my previous post, you know. I didn't regret then. I think that I wouldn't regret now, either; especially when a sale of my collection would put in a mortgage free position at the age of 35.
In real life I am a financial advisor. My main function is to make sure people are "comfortable" in what they have invested in. If they have too much then they panic on any drops, if they have too little then they FOMO unreasonably into any upticks.
I try to explain to them that if you are comfortable then you can invest your capital based on your conviction and have much less fear. Fear and Greed are two emotions that drive most investment decisions and they are the biggest reasons why people lose.
Conversely, if they can manage their own minds by making sure they are comfortable with the risk/reward then they can be much stronger and improve their chances considerably.
I tell you this because I think you are in the mode where you are going back and forth in your mind. That is almost always a sign in my experience that you should evaluate truly what you think.
What happens if we go to $0? How will you feel with what you have on the line?
What if we go to the moon again? How will you feel if you sell some (or all)?
When you look down and evaluate, and look up and evaluate, then you can make good decisions. Most people only look one way.
After doing that, then make a plan. How much do you want if it moons and how much can you stomach if it tanks and fails?
As I told you in the previous convos, you are a good guy @holoz0r and I want you to be successful. That means you are happy with the outcome either way. I want you to be part of the community because I believe you are part of the community (no matter what you do with your assets). How many assets you have is not relevant to me, just the fact that you are here!!! :)
Much love to you my friend
Great proposal, you have my vote
This is a very dangerous road we are going down.
I am all for using DAO funds for economic reasons but all we do here is put gasoline on ember.
I copied this from my comment in the #tokenomics section. Might be easier to read there:
Reasons for the "DEC to PEG flywheel" to fail and create a new Dilemma
1) guranteed offramp
In short, everyone that ever bought DEC will eventually know that 0.001025 is the absolute end of it.
the heavy lifting act of pushing DEC back to peg has to be made by player demand, speculators demand will be near zero.
I like to remind people that DEC has been below peg (roughly where it is now) prior to the SPS airdrop. The only real documented time where DEC stayed at peg or way above it was due to good market conditions and extreme speculators demand - not playerdemand.
The playerbase will not be able to lift and hold DEC at peg partly because DEC demand fluctuates with everyday operations and secondly because the speculators turn into scalpers from now on, buying DEC below 0.0009 and selling at 0.00099 going forward forever.
We eliminated a major demand source (speculation) and expect the playerbase to do something they haven´t been able to do in way better market conditions before. That is economical madness
2) overall inflation
my rough estimation is that there are currently 31.85M SPS handed out into the open market on a monthly basis according to the whitepaper. That translates to the following DEC equivalent at SPS prices
0.01 $ = 310M DEC
0.05 $ = 1.5B DEC
0.10 $ = 3.1B DEC
we bruned 410M DEC in the last 30 days with the big event we had. The 30 days before that we burned 70M DEC.
now there is no doubt that burning an entire month worth of SPS supply will increase the price of SPS, but we´re going to see a downward spiral afterwards.
DEC reaches peg eventually
People start burning SPS since it is profitable
DEC supply increases, which reduces DEC price
scalpers get in to buy DEC below 0.001
SPS burning stops, DEC slowly burns until demand outplays supply and we hit peg for a moment again
the system we have is not going to stabilize anything. It will be an exploit feast for bots. Not to mention that even if SPS goes back to 0.05 $, the DEC inflation is multiplied by 5.
What we do is change the status quo for a very unstable and fast changing enviroment where we make ourselfs even more dependend on good external factors. A market shock at the wrong time might lead to a thumbeling downfall of DEC just shortly after a massive new DEC supply has been created which will put us into the same situation we are trying to get out of right now
while on the other hand we limit positive external events by increasing the DEC supply exponentially with the SPS price. The exact same hyperinflation issue we had in 2021 where "markets gonna market" made us get into deep shit due to missing economic common sense
I think you are using "BOTS!! SPECULATORS!!" to create a knee-jerk emotional response from a community that mostly has Bot-related PTSD. But calling it economic madness doesn't make it so.
RE: GUARANTEED OFFRAMP
Economically, DEC Speculation is not a demand source on a net basis - the only reason speculators are holding IS TO SELL AGAIN. Bulldog's proposal doesn't change that demand source at all. DEC is already held by speculators, many of which are only holding DEC because of the efforts to re-PEG.
There are also already PLENTY of market bots and they are already active in DEC. It's not like they can sell more DEC than they buy, in the long run. So who cares if those bots start buying more, when it's farther below peg - even if they sell near peg? ...All that does is create a stabilizing effect under the Peg and dampen volatility - which is something what you would want from any "so-called stable coin".
In my opinion, if there is some natural resistance at 99.99% of PEG, before we get to the SPS burning stage, that is beneficial: I expect the first time we exceed PEG, this community will be really excited and probably burn way too much SPS too quickly... so a bit of resistance at 99.99% is healthy to make sure demand for DEC is really there before we light the torches.
As long as the community keeps burning DEC, or storing for long term (for gameplay, guilds, etc), there will continue to be net buying pressure over time - and will most likely correlate with promos and events.
RE: OVERALL INFLATION
You are arguing against yourself here?
These can't both be true - SPS won't be meaningfully burned for DEC if it's below Peg, so SPS inflation will mostly just stay as SPS inflation until the fundamental DEC demand creates a situation where the SPS is worth burning.
While I agree with your point about the high rate of SPS distribution; hopefully the team continues to add utility to SPS and other uses for DEC. The SPS league requirements and DEC on Land are a start, but we will need more. Whether there is enough to deal with overall SPS inflation remains to be seen.
I'm not sure what you are talking about, but the objective of the SPS:DEC mechanism is not to pump any token. DEC is meant to be the transactional token and should be worth some % of peg, the game will honor the value of this through the distribution of their products (like packs for 4000 DEC for instance).
Any overflow of demand that requires more DEC will then require SPS to be burned to get more DEC. So there should be no "inflation" of DEC like the past (assuming the market is rational). In other words, players will only burn SPS when they NEED DEC. If they don't need DEC then they won't burn SPS.
When DEC gets to peg that doesn't mean it will stay there either. The point of this whole economic shift was not to pump anything. The point was to steer excessive demand into the SPS token, and trying to keep the DEC token more stable and backed by the company's products at $0.001.
I'm happy to discuss further if you like, you can DM me on discord anytime.
All for it.
At some point we need to find an exit strategy for the DEC that doesn't again flood the market with it. Maybe the team buys it for SPS to keep their DEC stocks up. It would stop them from burning for a bit but if we hit a bull market, 500 million dec will be burned through in a hurry.
But it does make you think, at that point they'd get a lot less SPS for the DEC as they would if they just took that $500k and bought SPS now. Something to think about.
Ultimately it depends on what you want to do with the DEC down the line. If you plan to sell it, I still think it's more valuable to buy now, expedite the flywheel, and the sell higher later.
But I personally wouldn't want to exit DEC at all. At least not this quantity. I'd rather use it down the line to fund the DEC liquidity pools so we can remove the SPS LP rewards and cut SPS emissions (because we have to do that anyways at some point).
Of course that is all a separate debate that is for another time. I think it's best to just hold the DEC for now to keep it off the market and reach par faster.
For me, I'm completely against the DAO being in the LPs. Any place where the DAO competes with players and investors for rewards is a giant no. But that's not what this is about.
I still like this proposal but as I think more about it there is a potential problem. If things get tight for the DAO, its likely going to be during a time when the game isn't doing well. If they have to fund something with USDT, that's fine, but if they only have the DEC and have to dump a bunch on the market (or pay someone with it who dumps) when the game is weak, that could be bad. Just thinking out loud.
Why would we not want to compete the dao should do every thing to create increeased nav for unit holders ppl dont want to intentionally sandbag the dao units they own to not compete with other ppl most of the players own alot of dao units why keep downward preasure we need to throw gas on it and increase cash flow pay distributiions and in years this thing will be able to run even without a game for cash flow since it will have built a war chest of non correlated spl assets for at least 50% and gaming assets that produce cash flow like nodes, cards to rent out, staked sps it delegates to players to earn money , hive and hbd to maximize curation by voting on dao unit holders posts based onthere stake weight which lets ppl benefit from all the author and curation votes bc the dao nav increases by the curation and author vote from probably a large amount of hive especially if we run a wittness which would deff get the votes bc who would not switch form a wittness they get no income from to a wittness node that all income goes to increase the nav of the sps unit. Getting a cash cannon in this thing will be the best thing bc it can then support any proposal or game tweak with out breaking the bank or huring a return or basic income for investors. If it competes it competes it will be better for many ppl who dont know howto do some of the things and gives them a way to benefit from it and support the dao that beneifts them indirectly rather than give profits to other ppl i would rather give it to the dao bc it increases my nav
Sorry for being blunt, but this is a terrible idea. Why would you swap something stable, for something unstable? (please no flywheel BS)
You are stating that the DAO will step in to buy DEC when it is at 95% of PEG so it does not go lower, does the DAO have unlimited funds in order to buy up every sell pressure there will be?
The DAO should be diversified when it comes to it's holdings.
This will help really a lot to the game ecosystem! i vote for yes!
Makes perfect sense to me. Just voted 1.4M worth
Those funds not only give the DAO financial security and independence of the game but also protection from other wider crypto and economic events. We would lose that security and risk the DAOs future for a short term gain for a few. I'm interested in long term growth, not quick wins and think about the consequences later plays.
I'm not sure I see the value in "independence from the game." If the game fails then I see no value in the DAO. If the possibility of such an event arises the DAO should be doing everything in it's power to keep the game economy alive. Doing so is far more valuable than having half a million in stables to fall back on after a game collapse.
But if we hold those stables and the company has issues they can be a safety net, or a safety net for any other event. If it is in DEC it is unstable and low liquidity and would provide a very small, if any, safety net as people would front run the DAO selling.
To put it another way, it is a popular opinion a diversified portfolio is more resilient to market conditions.
I'm somewhere in the middle of supporting this and not. This all seems to me to be a mix of a stock buyback and the formalization of the DAO as the Central Bank of DEC. Very interesting and fun stuff. However, I'm definitely more in the "no" camp due to a few reasons.
Why use all the stable coins? Perhaps only use 20% and see the impact. Based on that impact, we can make some extrapolations before using up all the stable coins in the DAO.
The effectiveness of doing something like this should be somewhat empirical. I haven't pulled all the on chain metrics and done a deep dive on the tokenomics of DEC to tell you exactly how to go about this, but based on the current DEC demand and supply, we should be able to figure out the impact and if it's meaningful enough to carry out ahead of time. At the very least, having the hypothesis and testing against it is useful. For anyone interested, I would start with using the Equation of Exchange.
If it goes through, how will the DEC be repurchased? Is it one market order on a DEX? Or two on Uniswap and Pancake? Or three if you throw Tribal Dex? Carrying out a trade that you know will move the market is a different animal that topping off your DEC holdings. Having some clarity on how the purchase will be carried out would be useful and ensure if all the DAO stable coin funds are used, they are used as effectively as possible.
@swarminvestment's comments are super insightful as well. His comments made me do a hard reset on my reading of this.
Also - why the hell aren't the stable coins earning some yield somewhere? Curve perhaps?
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i'm tentatively for this but worry that the people proposing and voting on what is essentially monetary policy don't understand any of this well enough to be able to accurately predict outcomes
vejo que desconhece a proposta de governaça, nao é por especialista e sim por qum esta com a pele em risco com ativos SplinterLands
Your comment was hidden because apparently you're muted, yet it is about the most sensible thing I have read all day
A few months ago I commented that someone who dramatically edited their proposal mid vote shouldn't be allowed to do so and got a single downvote from that OP who is a whale and that's led to my account being de facto censored ever since.
Seems pretty reasonable, basically boils down to the community comes together and uses our DAO stables to buy and burn (temporarily for now) DEC to reduce the oversupply.
It's a no from me. I won't repeat what the others who have not supported this have said in the comments, but I've upvoted their replies.
Time to add more comments. This is a bandaid on a limb that needs a tourniquet.
Damn, that was a long sponsor video XD
I like this idea, I see no downside.
Either the game succeds and the dao keeps its value or the game fails and the dao loses money.
But if the game fails who cares about what the dao holds, everything will crumble down regardless.
So, lets do it.
If you see no downside, perhaps you should read the other replies from the community. There's a lot of downsides that incredibly well spoken people have outlined.
Not if we have a significant amount of assets not related to spl giving the dao the ability to just become a investment fund and distribute profits if spl fails it will take a loss but say it builds a war chest of 50-75% of cash flowing assets not related it can still go on and keep growing and pay actual returns and if spl does well then some of the cash flow can support the game etc and some can be distributed weeky and make the token very attractive bc if it can survive with out a game to it decreases risk since it could always keep functioning as a dao by having strong investments
I vote 100% against.
It's an extremely dangerous gamble that could spell the end of Splinterlands, should the DEC be faced with a major hack or flaw.
It's a short-term solution to an old problem.
Buying DEC with some of the stablecoins available, yes, why not, but certainly not all of them.
DEC's recovery is certainly long and difficult, but let's not forget that it didn't collapse in a short space of time either.
Ongoing efforts and long-term initiatives need to be put in place.
I see this the same way. I'm a heavy handed no for this proposal. Unfortunately, it doesn't look like anyone is engaging with each other in the comments on this matter.
How can it be in the best interest of the dao to spend its modest reserves on something that has no value to it?
In your own wors "the DAO currently has no method of spending DEC"
I think the proposel is made with good intentions and has potential but i also think it is incomplete. If you add that the dao would also sell DEC at 1.05 for stablecoin then we would have a balence here. Dao would make a small profit and it would also replenish the stablecoin in the Dao.
I would also set a $ limit equal to roughly 20% of the dao's current holding of stable coin rounded to the nearest $100k so that it retains its diversification.
As it stands i will vote against it as i think it is to one sided as proposed.
Stupid question: isn't this proposal introducing an easy way to speculate on DEC price? With enough liquidity someone can crash DEC price, wait for the DAO to buy them back, and repeat.
To me having a DAO voting on this is too much manipulatory.
DEC dont have a peg and never will be stable coin. Sorry.
Thank for your imagination
I don't get why it seems there is only you and me that understand this obvious truth (because it isn't backed by the dollar). Nearly all the rest of the community are brainstorming all these ways to achieve the impossible. It's laughable. The thing has barely been near peg ever and never will be. It's utterly stupid.
Considering that stable coins are the next one to either fail or get attacked by SEC IMO, I personally never trusted stable coins and fear they will be the next one to fail.
So since I would rather we have 500k$ worth of DEC vs 0$ worth of a dead coin that have many reasons to fail in the near future, this could be a good argument to vote for it.
But again I'm just not sure that doing so now in order to "activate the flywheel" gives any value to the DAO since to gain value, the DAO will have to dump on us at one point to gain back this value unless we vote for the DAO to burn it completely.
I'm still on the fence and will read everyone's take on that before taking a final decision
I have 791k SPS and I'm voting no, because that is the community sentiment.
I really dislike this idea. It seems incredibly short sighted and to be frank feels like a rug pull of value waiting to happen. We are basically saying, as current DEC holders, give us the $500k that the DAO has so we can dump our DEC on it.
Obviously your intent isn't malicious but that intent does exist out there.
If this does pass I'm going to dump my DEC and start dumping my SPS over time as it will ahve taken what outside value the DAO has and eradicated it removing all stability of the game. Keep in mind the dev team right now is really struggling. I doubt the SPL team can support ongoing operations at their current cash burn rate for more than a year, if that.
This is the exact danger we face if this proposal passes. I wrote a few weeks back about how the DAO keeps voting against its own interests, and I fear this proposal too, will be one of those.
Exactly, its constant short term bandaid type voting. People are not looking to stay in this game long term any more and their votes seem to prove it.
It's always trying to push the flywheel effect when it really doesn't need it. I wonder if any of the yes voters even know how much DEC is currently available for purchase? Because if they did, they would quickly realise we are one decent DEC purchase away from peg and flywheel effect...
We should only buy it when it is at a favorable price so the dao can later re sell it at a higher price ifanythign but should really diversify to other non spl assets to ensure the dao can last and eventually pay distirbutons and grow that into a cash cannon to distirbute or retain for activities that add value only to the game for things that are important or mostly in monitary value to futher strengthen the dao until its basically a endowment with so much cash flow it can pay distirbutions and fund development etc and be in a very strong diversified postion instead of all in spl assets which is fairly risky. We deff need to get cash flow coming in and put are assets to use and that would increase the unit price bc ppl would see a point in owning it as it would show a path to it providing serious cash flow at some point.
Perhaps it should be set as a stabiliser, much like the HBD stabiliser.
Agree we should only buy DEC at favourable prices when it concerns the DAO, but using the DAO as a failsafe for DEC/PEG will give bad actors a benchmark to work with. That is in essence what the proposal is trying to do and in a bull market would be a safe bet. Your ideas are warranted but that is not what this proposal is about. We are not in a bull market and bad actors will exploit the failsafe of this proposal until it breaks. Then we go down due to the overcreation of DEC through SPS burning and buy-resell from bad actors outside of market demand. 500k is alot of money with even more SPS still to be minted and once we break it, we end up devaluaing the DAO and relying on playerbase to once again fight through natural demand to slowly creep back to peg again...This may not happen immediately and maybe land staking would delay such effects but outside of a bull market we will place a huge risk against a predicatable tumble and that is a risk anyone with meaniful investment should not entertain.
Stablizer is good if the fees are all going to the DAO. Depends with SPS i knowwhat you are saying that if no innovation or additional players are onboarded it will slowly decline. Like i expect GLX to decline a lot unless the game is launched anda hit since it is a 200M and has 2 billion total. I expect sps to decline at a much slower rate unless land is a hit and a few other things happen then sps can increase and sustain the supply. GLX has more of a issue since it will get riskyer for a decline as moretokens are minted sincethe supply is much lower. I wish i couldjust smack all the scammers in the head andask what thefuck were they thinking they erased millions in vlaue to gain money ll to them by fucking everyone. Why cant we as a community get together and demand he shows up to answer for it and also pay it all pack with interest. If he says no we will have a list of things thatwe will do (dont have yet) Needmore info on weaknesses, vulnerabilities to exploit to make him cooperate and do the correct thing. I mean i would love the 4Kbackwhich is what it declined in glx for me and another 2-3K in packs. Lucky overall im in thegreen but another 7K i deff did not want it in his pocket
How about we take that 500k and give it to Splinterlands team so that they can hire more people in order to accelerate features instead of trying to manipulate market since it won't have much value if most of the great important features are not yet delivered, rendering impossible the flywheel to get in motion? Just saying
I agree. I do not think that "humans" are the problem here, but rather the technical debt being paid off through the migration to the new codebase that is occurring via tech modernisation. I don't believe that more devs would solve the problem until after tech modernisation is finished.
Wht not sureup the cash flow stream so we can consistantly pay for things not just blow 500K and have no way to replace it. We needto invest based on our expected cash needs and get it in investments that produce that
Sounds like some DEC bag holders may be trying to cash out. I can forsee this scenario. This passes the price of DEC immediately pumps to .00094 and stays there until the DAO is drained. Why would anyone sell for less with the limit price already set by the DAO. Then sayonora suckers I got 95% of peg the rest of enjoy the price fall.
This is the most dangerous element of the proposal. I'm sure some bad actors are salivating at the potential of this proposal passing.
This is a terrible idea. Short term pump and then the inevidable dump. I cannot believe this is passing atm. I would sooner back the 500k to go to the DEV's to support operations than vote for this obvious attempt to force pump and dump the market and leach easy money from the Dao's actions. Can people not see this is a bad, bad idea as this is forcing a market effect that relies on market demand that just isnt here atm, I'll be readying my DEC to dump the pump on the Dao too once the Dao purchases and buy it back for 30% less when the dump finishes. Why can't we just be patient and wait for Land Staking which has the potential to remove 150K X 10k X 5 DEC from the market in card staking alone let alone future building, item and spells sinks (Go do the maths - I'll give you a hint we dont even have close to that kind of circulating supply of DEC)..............Let the team create new DEC sinks and remove DEC creation E.G Leaderboard and card burning and LP's etc. and let the playerbase ease us into the peg. Not send out an open invitation to crash the security of the Dao.
Thank you for seeing this!
If the proposal had said SPS, I would have considered it far more heavily. I really hope some big whales in here really think hard about the quick gain verses long term security. If we just stay patient we are looking at achieving something quite remarkable. We are little more than a few K close to triggering peg in a bear market without the need to really push for it even under such terrible world market conditions and a depleted playerbase post bull market. The event was a success, the expected drawback has come, but we are on the cusp of 1.5 land and staking and my goodness watch the flywheel take off without the need to throw the Dao's weight at it. At any moment someone could snap up remaining DEC and push us to peg...And once land 1.5 staking drops, there are going to be players everywhere looking to purchase DEC. And then the hype of SPS climbing as people start burning for DEC. This is as solid a no I've ever given and I'm a regular no guy.
Exactly my thoughts. Wait for the roadmap to deliver, assess, then think about making further tweaks or proposals like this.
I am so glad you are able to articulate these facts clearly.
I just hope the rest of the community can come around to our ideas. I've tried to convince as many people as possible in replies in this post's comments.
We should just get on allocating a portion to invest in many types of assets for the sole purpose of creating value and roi for unit holders either though the ability to buy spl assets at rockbottom [prices like cards and rent them out over time for roi, buy up cheap nodes for sps and glx and get a top validator postion to get those excess returns for the dao benefiting more players and members can possibly join in the daos hosting to ensure the top validator returns get allocated to the dao and anyone adding there nodes which will give excess roi to more ppl. The dao could also buy up a land track and get in on that as well as go in on outside lps like btc and eth to generate roi from that aswell as alot of high yield stable coins to generate more predictible postions. Possible look at offering staking as a service and running a hive wittness bc it can get likely all of the ppl who own the dao to vote and no other wittness node provides distributions. Maybe run a few wittness nodes based on how many votes ppl get bcif we could run 10 that would increase the income 10X not sure if that would work but if it does why not as no nodes benefit us now so whynot use are votes for nodes that actually pay dividends to us
These might be viable options but that is not what this proposal speaks of. At least not what I can see in OP. No one here disagrees with the need to diversify and everyone is aware of the current risk of continually holding stable coins given the current assault on crypto by 'The powers that be' but the risk of throwing the Dao's stable coins for DEC is too great and the exploitation too easy. Why would anyone here with who identifies their contribution to SPL as a significant investment from them risk part of their future insurance policy in this game on a quick gain that will only invite bad actors to participate is beyond me. I would prefer the notion of using stablecoins to buy limited availability assets like tracts, SPS, cards or nodes etc as you mention. But that's off topic with the proposal here.
I can totally believe this is passing, because frankly DAO governance is utterly batshit crazy stupid. Governance is determined by the votes of the economically illiterate or the self interested bot farm whales. So I no longer expect anything other than complete idiocy from the DAO
I'm sure you all know I am a huge fan of getting DECs to peg, but I'll have to vote no on this proposal as I don't think this is the right way to do it.
Among the many reasons others have listed, my biggest concern is: this proposal does not create a permanent and sustainable supply of funds going into burning/using DECs, this simply uses the DAO's funds as exit liquidity for users who are selling now.
I also agree with many other comments people have stated before me.
Edit: As a relatively large DEC holder, I can assure you I will sell it all and buy it back later at a cheaper price when the DAO runs out of funds. This proposal will only act as exit liquidity and a quick trading opportunity for users, this doesn't do anything to help the game in the long term!
Upvoted own comment for visibility
EDIT 2 (my thoughts copy pasted from my reply in Discord):
In response to the tags I got regarding this new proposal, I just wanted to expand a bit more on my opinion. For starters, I have already told a few people why I am against this proposal and it's mainly to do with exit liquidity. I don't want to use all of the DAO's stables as exit liquidity for people selling now.
Furthermore, I believe if this passes, we will see an instant increase in DEC price to near peg, then as the DAO starts buying people will sell into the DAO's buy pressure, essentially giving users the option to front run the DAO and forcing the DAO to buy at a higher price.
Another big issue is diversification. We currently have a nice portfolio of crypto (ETH/BTC/BNB) and stables along with SPS in the DAO's treasury. This is good. I would hate for the DAO to transition more and more into holding only Splinterlands assets. If this proposal passes, we are one step closer to using all the BTC and ETH to buy SPS which might be good in the short term, but adds literally no value in the long term.
The solution: after speaking with Yaba about why I am against this proposal, he came up with an idea I do approve of. Instead of using all of the DAO's stables to buy DEC at market price, simply only start buying when the price falls below a certain zone. For example, if the price falls below $0.0008 the DAO will start buying until it is above again. This safeguard should in itself be enough for the community to buy DECs near that price since there is limited risk (until the DAO runs out of funds). This creates value in stabilizing DECs without the DAO losing out on funds from a frontrun opportunity. The number doesn't have to be $0.0008
EDIT 3 (in response to why not let the DAO buy up cheap DECs now?):
I personally like to think about it this way, if DECs reach and stay at peg we are all winners, we don't need that little bit of extra money the DAO can make from buying DEC now.
However, in the worst case scenario the bear market gets worse and Splinterlands continue to bleed players, I would far prefer us to have a safety net in this case than the missed out gains in case DEC reaches and stays at peg again.
One example is the SPS airdrop. I love SPS and wanted to hold onto all my SPS, even at $1. However, against my better judgement at the time I sold every airdrop because I thought to myself even if SPS goes higher, I'd be happy even if I sold now since my other assets will appreciate anyway, my only risk is if it went down. I think we are at a similar time now with DECs, I truly believe it is guaranteed to go up to near peg but what if I'm wrong? I'd rather have a safety net in case I'm wrong than just throw everything into it and gain like 20% if I'm right
I agree entirely. This proposal is not only the DAO shooting itself in the foot, but dropping the gun on its foot, then in the act of picking up said gun, spraying the loyal bystanders with a volley of bullets.
Please rally folks so that we can stop this proposal
I am in full agreement with @cryptoeater and @holoz0r but also...
Side note first: I didn't realize we had over 300 ETH, we need to stake that somehow...
I'm voting no. I think this is potentially a good idea but given the choice of experimenting with a smaller % (20%, heck 50%) of the stable coins versus 100% is a no brainier for me. If it's going to work we should see that function without 100% of the liquid funds but we can keep some dry powder that way.
I think Bulldog makes a good point (the DAO is tied to the game for the foreseeable future, all our eggs are in the splinterlands basket so to speak) but putting all our eggs in the DEC basket/doing so all at once isn't a good idea. Keeping some liquid funds for other projects/buybacks/whatever is critical.
wehave 300 eth in thedao why are we not staking it or putting it in liquid staking and putting those in lps to earn fees and the apr on staking. We should probably be figuring out ways to deploy any idle assets into things that generate apr so we can grow it create a massive cash flow war chest from spl assets and a huge portion in non spl assets so we can survive as a investment gorup even if the game does not and if it does it will add a nice bit of cf to use to buy and dca into in game assets for the benefit of thedao
Exactly, no idea why someone would downvote that.
My vote doesn't mean shit but it's a NO for me.
just because of the symbolic effect the dao should do this. most people have the feeling that we have to bleed a lot last time to bring dec to peg and the dao prefers to trust in foreign stablecoins instead of helping even though the dao would not lose any value in the process. very bad signal !!!!!
The only thing this proposal does is devalue the Dao which we need to be as healthy as possible down the road once sps stops being distributed. This is a quick gimmick in the "peg at all costs" approach. This will only serve to be exit liquidity for the ones who bought dec far below its current rate. Why are we so hell bent to get to peg at all costs? Haven't we been told over and over about how much land and other things will "soak up dec". I just don't understand the logic behind this besides a method to extract value from the Dao. It's a no from me for sure. Get dec to peg organically, not by gutting everything and anything. If you care about the future of this eco system, I hope you can see the long term detrimental effects this could potentially have.
well the dec to peg at any cost attitude will remain anyway we will not be able to change that. what we can decide now though is whether the dao will now do its part or whether it will be forced by us in some unnatural way.
i mean just look at yaba's suggestion of how much dec we should burn to be able to use our soulbound cards on land. what do you think how much more of such things the game can take. until splinterlands dies completely and the dao is worth nothing anyway?
We should also run a wittness node for hive or a few wittness nodes bc it would be pretty easy to get votes and who would not vote for the dao node bc it is the only node that would benefit them financially by providing any net profit to the dao and from what i saw witness nodes can be pretty profitable and we should also run both sps and glx validators,swap some sps and replace it with a few btc and deposit those into btc wbtc lps , buy some eth add that to staking and eth / weth lps that can be hedged with short futures contracts on the traditional financial mkts which de risks the position substantially and the only unhedged btc would be the fees earned. Also we should use the DEC we buy solely for lps to beef up liquidity and get more income for the dao. I think we should really be creating a cash flow war chest now before the DAO may need it and being at least 25-50% in assets not related to spl to start will allow us to weather any storms and if spl assets drop further it will be good to have non correlated cash flow that can be used to buy into the lower prices with a stable cash flow stream not impacted by spl specific swings. having all assets or most in sps is risky when we can easily make it much more sustainable and even pay a small distribution which would likely boost price as ppl see distributions as a income source in addition to the staking but the distributions would come from actual cash flow that can be retained and distributed and having that will be looked very favorably on by ppl looking at buying into the token.
The holdings of the dao should basically be set up like a investment fund with say 50% at least diversified out of spl assets geared toward growing a cash flow war chest and using a portion of the cash flow for gaming stuff and a portion is always retained to increase future cash flow so eventually this thing once the 3 billion units are done will be able to consistantly gorw the nav and eventually provide a large distribution on top of all the other benefits but if we do enough this could be a nice source of income and increase the tokens price bc it has a real NAV with clear assets that have value. I could see it interacting with the game providing funding and also providing investment returns that is a meaningful amount and potentially enough to really make a dent for ppl who hold large amounts of sps and would deff increase demand if the distributions' are large. Thats one way to force sps to go up is get the nav in the dao to appreciate which will inc price regardless of the flywheel. We should hold some dec in the lps but i would diversify outside spl assets and use the income to interact with the spl assets. Just need to make sure we build the war chest early so the dao is always funded and is in position to provide a bunch of cash flow to unit holders. The dao should be ran like a investment fund and business.
Why is this passing? Are we dumping DEC now? As long as there is no viable reason to hold dec as it is now, this is just going to be a pump and dump scenario where the DAO will be the loser of this proposal.
Let the economy do its thing. Forcing it will have an equal negative reaction.
Time to buy some DEC for a quick buck to trade when the pump happens before the dump
I voted no mostly because this proposal was not well defined. In essence a proposal should be written similar to a contract, and leave nothing vague or up to the imagination in its implementation.
Who is going to manage the funds? How long do they have? Which markets will they buy from, and what is a reasonable amount of slippage?
These are just starting questions, once answered new questions may arise. One must have a practical understanding of how this all works instead of an idealized version left to their imagination before they can use their stake to authorize such a commitment.
I guess, if this one fails, create another one with $0.90 because I am more inclined to $0.9 than $0.95.
Benefit:
Even tho I voted for I am more inclined to $0.9
Kudos to @bulldog1205 for putting out this proposal. Regardless of the outcome it has brought about a much needed discussion.