Preparing PAL transferability event

General Research
1

Summary : Elect a dedicated committee, prepare liquidity options, decide on budget and enable PAL Transferability

Context :

Paladin Lending has been live for four months and Warden for a week. Combined, the dApps are now managing 15M$ + of governance token. While the offer side of our marketplace has been a relative success, the DAO is yet to create stable and large volume demand for its loans and boosts.

Enabling the PAL two months ago and creating a liquidity mining campaign were supposed to contribute to this, but non-transferability has proven to be a thorn against widespread adoption. Without a market price, we cannot display APY when distributing PAL tokens, this prevents us from attracting mercenary capital.

Warden has the potential to be an extremely powerful money lego in the Curve Wars but will need Liquidity Mining with a market pricing to compete with other yield optimizers on top of Curve.

Rationale :

By opening the debate on PAL token transferability we hope to make it extremely clear that Warden is the best source of optimization on the market.

This event has to be owned by the DAO and become the genesis point of its contributor groups. As such, we’d like to open an election for a 5-person committee (number can be changed if deemed unfit) with one member of the core team that will take the operational lead for this event. All strategic decisions (bootstrapping option, budget, timeline) will be made by the DAO.

PAL is 3 months old and thanks to its non-transferability has filtered a lot of mercenary holders. Case in point, the DAO treasury will get back almost 850,000 PALs from the airdrop, which we’d like to allocate to bootstrap liquidity. Several options are being studied and the community will decide which one the elected committee should put in place.

Please do take into account that selling tokens on the market should not be understood as a fundraising mechanism but rather as a strategy to acquire Protocol Owned Liquidity, benefit from extra-revenue and make the DAO the first power-user of its own present & future products.

Means :

  • We believe the community should choose its committee via cumulative voting in a PGP that will swiftly be posted after community approval.

  • The treasury should allocate all non-distributed PALs to the bootstrapping effort, with an eventual top off to reach 1,000,000 PALs. Half would be used for distribution, half to pair with assets obtained and paired as an LP.

  • The PGP will have to include a budget to compensate the committee for ~1 month of part time work.

Sustainability :

The elected committee will manage the allocated budget in the name of the DAO to obtain assets to create the bootstrapped liquidity and will lead discussions with potential partners for this event.

In case of malicious behaviour detected, the DAO can remove a committee member at any time via a governance proposal.

Next steps

  1. Community debate on the validity of this roadmap
  2. Creation of a PGP to elect committee members
  3. Elections on Snapshot
  4. Creation of a PGP to decide on budget and bootstrapping strategy
  5. Bootstrapping event
  6. Enabling transferability

The goal is to have POL and competitive APY live by end of February

Voting Options : Yes / No ;

Please not that employees of Mithras Labs (company building dApps for Paladin DAO) will not vote on proposals concerning token transferability)

  • Yes, proceed to the election of a committee to manage the Transferability event
  • No, I believe PAL is better as non-transferable for now

0 voters

5 Likes
2

Seems like a no-brainer to me.

Transferability and increased utility of the PAL token will lead to greater protocol growth and awareness.

3 Likes
3

Imho, given the current market conditions, it may be sensible to reconsider. I agree with your statement that “transferability and increased utility of the PAL token will lead to greater protocol growth and awareness,” but if the market is unfavorable, everything else will suffer, including the project. In red days, protocol growth and awareness may be overshadowed by market conditions, and hence growth and awareness may not last long.

When we’re talking about growth and awareness, it’s best to reveal this significant news when the market appears somewhat stable, with no insane volatility like what’s been going on for the past few weeks.

3 Likes
4

Market conditions doesn’t prevent us from creating a committee wich then should decide within the next few weeks what the best options are

5 Likes
5

Yes. I was just referring to the “transferability event” that was mentioned in the headline of this thread. Should there be a separate thread for forming a committee and another for discussing token transferability/tradability?

2 Likes
6

Yes a PGP will be created to elect the committee, and another to decide on the process

3 Likes
7

This is a good point - market conditions can overshadow these upgrades.

I am less interested in PAL for speculation but more so as a governance token and wider distribution of voting power. This comes through transferability and incentives in LPs.

It may be difficult to “time this” and waiting til the market turns a bit more forgiving may be a while.

2 Likes
8

Agree. It’s important to have the infrastructure in place to make the decision when necessary

2 Likes
9

I agree there is a risk that because of the recent downturn in the market that visibility and awareness of Paladin can suffer. However, don’t forget that big projects like Aave formed in 2018 in the middle of the long crypto winter.

The crypto industry, like many others, have shown that market downturns are where innovation is made and the noise from speculators is cut out. I think there’s no better time than the present to get the infrastructure in place and enable transferability.

My thought is that when the market does turnaround we will be in a very favorable position.

3 Likes
10

Totally agree with Alejandro here. This is the best time to execute this roadmap. Team members should have most of the committee seats to get started unless the DAO already has strong community members. Decentralization will happen over time and the team is the most informed to push the DAO during its infancy

Moreover, saying that the team won’t do something if community members don’t step up is a bit extreme. Let’s move forward as fast as possible. Especially since this proposal is going to unlock much more community participation because we’ll now have financial incentives aka skin the game

11

3 Likes
12

:+1:

Where I agree that there is a risk of leaving the DAO at this stage in the hands of community members, I fear more of a danger that moving forward that the core team will be criticized for holding too much power and being yet another protocol that has not come through with their promises.

Two points:

-Would love to hear from other core team members on this.

-On a positive note, we already have a few really awesome contributors that have been with us since last year and even before our mainnet launch.

So, short term centralization could be very efficient and swift but could endanger long term goals.

Overall, I am still in favor of the proposal as is.

2 Likes
13

Thanks for opening this discussion !
I’m in favor of this proposal, display an extra yield in PAL will bring a lot of users and will help the project to grow considerably.

Creating a community multisig to handle this is a really good idea, however maybe 5 members (Or 6 if the core is not included) might be too low, how about a 5/8 ?

Finally, the initial liquidity would be created with ETH or stables ?

1 Like
14

It makes sense. The DAO has to find a decentralization equilibrium to be able to execute rapidly without the downsides you mentioned

2 Likes
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Dear Knights, the poll has passed 50% of previous PGP turnout, we will now proceed to the election in the following PGP : PGP 5 : Elect a Transferability Committee

Please continue the discussions there.

Quick answer on the side of liquidity, I think we should focus on ETH for now as it is a better pair for volatile asset, and PAL will likely be a lot of things but not a stablecoin :innocent:

3 Likes