[PROPOSAL] Move RAD and USDC balances into the community-governed Radicle Treasury

abbey · February 28, 2021, 10:16am

[WIP] Move RAD and USDC balances into the community-governed Radicle Treasury

On February 25th, ~3.75% of the Radicle token supply available for interested parties within the Radicle community. It used Balancer a decentralized exchange and leverages a mechanism called Liquidity Bootstrapping.

Over 1800 new token holders participated in the event, claiming over 50% of the RAD tokens put on Balancer at the beginning of the event. This event raised ~$25M in the Radicle Treasury, a smart contract controlled fully and transparently by Radicle token holders.

This proposal is to move remaining RAD and USDC balances raised to the Radicle Treasury, so they can be managed by Radicle token holders to support the long-term sustainability of the network

This proposal will be officially created and proposed by the Radicle core team in the coming days.

jebba · February 27, 2021, 6:49pm

Sounds good. Maybe consider balancing out the stable coins one third among USDC, Tether, and Dai, for example, to distribute risk of holding just one. Dai is also a DAO.

onur · February 27, 2021, 11:37pm

I like the idea but would approach the risk distribution / diversification with a separate proposal. Lets move the RAD/USDC out first and lets then think about another proposal to diversify some of the USDC into XYZ.

Ethereum · February 28, 2021, 12:11am

I propose to burn the remaining RAD. It’s a better idea.

jebba · February 28, 2021, 12:14am

@ethereum Burning may be a better idea, but why is it a better idea?

Ethereum · February 28, 2021, 1:22am

Decrease the circulating, increase the value. it makes the supply more scarce.

viraptor · February 28, 2021, 1:55am

Apart from increasing the value for traders/speculators holding existing tokens (which I don’t believe should be the goal) - how does it help the project?

Destroying the tokens would remove them from the pool available for future sale or projects.

Ethereum · February 28, 2021, 2:08am

First, the reserve is remaining a lot, they just only sell ~1.8x% instead of ~3.75% because the LBP mechanism doesn’t allow them to sell all of ~3.75%.

Second, increasing the values for holders is increasing the values for the project. Do you see the other failed projects out there because of terrible token metrics?

It’s my personal thoughts, let open discuss

jebba · February 28, 2021, 3:29am

It increases the value, but how does that help community governance and the goal of making p2p git?

chuck · February 28, 2021, 4:51am

Totally agree!

Add liquidity on DEXs seems to be a better way to make RAD distribute more decentralized. Community treasure could hold the LP token and make profit from transaction fees. That will also help long term community treasure value growth.

jebba · February 28, 2021, 6:01am

If the tokens are moved into a liquidity pool with the idea of further benefiting the goal of p2p git, then that’s better, if that’s what it actually does. The treasury is in USDC. The main pool on uniswap is ETH/RAD. So the community would have to create a new USDC/RAD pool or convert over to ETH, which has a different risk profile. The project would potentially be at greater risk of people who manipulate the pools though. With the USDC just sitting in a wallet, less can happen to it. In a pool, it has greater risk. (I have RAD and am in the uniswap pool, fwiw.)

psixoz · February 28, 2021, 6:20am

For sure Coreteam would vote for their interest in RAD distribution, but i would like to notice that there were first digits of distribution wrote down at the start, where core team (for sure worthy of any reward) part was fixed, such as for other earlier community. Those ~3.75% supposed to be as liquidity from the start.
proposal lookks like: lets not even give RAD on the side and let it all home. its not kinda open and acessible as initiall idea of LBP and giving liquidity to community. isnt it?

psixoz · February 28, 2021, 6:28am

its better if after LBP you count some digits of availability and think its ok to burn down it will create once more lack of RADs. For now the price is big enought according to capitalisation of project, many traders watch for those values and wouldnot buy on their own at this points near 12$. it got risks on bear market.
i wouldnt rather advise to burn down RADs, and giving direct to the coreteam and community rather as would not be fair to one of the pointed sides. (maybe it will be splitted between coreteam and community as 50%\50%))). i wonder what will be chosen)

chuck · February 28, 2021, 8:13am

For IL, while price goes to double, you would have about 5.38% IL of your total liquidity. Since you can make profit with the txns fees at 0.3%, while txns volume past 18X to the liquidity, the IL will be covered. The current RAD/ETH pair has about 1.5 Daily volume / Total liquidity ratio. That means, after about 2 weeks, the IL risk will be covered. I think that kind of risk is worth taking.