rio: extract claims from 2024-05-27-futardio-proposal-approve-performance-based-compensation-package-for-proph3t-a #520
7 changed files with 121 additions and 191 deletions
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@ -76,6 +76,12 @@ MycoRealms launch on Futardio demonstrates MetaDAO platform capabilities in prod
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Futardio cult launch (2026-03-03 to 2026-03-04) demonstrates MetaDAO's platform supports purely speculative meme coin launches, not just productive ventures. The project raised $11,402,898 against a $50,000 target in under 24 hours (22,706% oversubscription) with stated fund use for 'fan merch, token listings, private events/partys'—consumption rather than productive infrastructure. This extends MetaDAO's demonstrated use cases beyond productive infrastructure (Myco Realms mushroom farm, $125K) to governance-enhanced speculative tokens, suggesting futarchy's anti-rug mechanisms appeal across asset classes.
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### Additional Evidence (extend)
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*Source: [[2024-05-27-futardio-proposal-approve-performance-based-compensation-package-for-proph3t-a]] | Added: 2026-03-11 | Extractor: anthropic/claude-sonnet-4.5*
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MetaDAO's business model has pivoted from Vota (voting platform) to "offering futarchy to other DAOs" as the primary growth vector. The founder compensation proposal explicitly states: "When we started work on MetaDAO, Vota looked like the most viable business for bootstrapping MetaDAO's legitimacy. Now it looks like offering futarchy to other DAOs." The MetaDAO LLC (Marshall Islands DAO LLC) defines business purpose as "Solana-based products and services" with expectation this will "hold true for several years." This suggests MetaDAO is positioning as futarchy-as-a-service infrastructure rather than single-use-case platform, with the ability to pivot focus areas while maintaining the core futarchy governance mechanism.
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---
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Relevant Notes:
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@ -53,6 +53,12 @@ Autocrat is MetaDAO's core governance program on Solana -- the on-chain implemen
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**Limitations.** [[MetaDAOs futarchy implementation shows limited trading volume in uncontested decisions]] -- when proposals are clearly good or clearly bad, few traders participate because the expected profit from trading in a consensus market is near zero. This is a structural feature, not a bug: contested decisions get more participation precisely because they're uncertain, which is when you most need information aggregation. But it does mean uncontested proposals can pass or fail with very thin markets, making the TWAP potentially noisy.
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### Additional Evidence (extend)
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*Source: [[2024-05-27-futardio-proposal-approve-performance-based-compensation-package-for-proph3t-a]] | Added: 2026-03-11 | Extractor: anthropic/claude-sonnet-4.5*
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MetaDAO's Autocrat v0.3 was used for the founder compensation proposal (Proposal #2), which executed as a Solana memo program call rather than direct on-chain token transfer. The proposal explicitly states: "What exactly would this proposal execute on the blockchain? Nothing directly. It involves a call to the Solana memo program. The purpose is to gauge market receptiveness to this structure. A future proposal would handle the transfer of the required META, possibly from a BDF3M multisig." This reveals a two-stage governance pattern: first proposal tests market sentiment through futarchy, second proposal executes the actual transaction. The proposal was created 2024-05-27, completed and ended 2024-05-31, suggesting a ~4-day resolution window. This demonstrates how futarchy implementations may require splitting complex decisions into sentiment-check and execution phases, with the memo program serving as a lightweight signal mechanism before on-chain resource commitment.
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---
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Relevant Notes:
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@ -34,6 +34,12 @@ MycoRealms implementation reveals operational friction points: monthly $10,000 a
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Optimism futarchy achieved 430 active forecasters and 88.6% first-time governance participants by using play money, demonstrating that removing capital requirements can dramatically lower participation barriers. However, this came at the cost of prediction accuracy (8x overshoot on magnitude estimates), revealing a new friction: the play-money vs real-money tradeoff. Play money enables permissionless participation but sacrifices calibration; real money provides calibration but creates regulatory and capital barriers. This suggests futarchy adoption faces a structural dilemma between accessibility and accuracy that liquidity requirements alone don't capture. The tradeoff is not merely about quantity of liquidity but the fundamental difference between incentive structures that attract participants vs incentive structures that produce accurate predictions.
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### Additional Evidence (extend)
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*Source: [[2024-05-27-futardio-proposal-approve-performance-based-compensation-package-for-proph3t-a]] | Added: 2026-03-11 | Extractor: anthropic/claude-sonnet-4.5*
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MetaDAO's founder compensation proposal reveals additional adoption friction: the need for multi-stage governance to separate market sentiment testing from execution. The proposal used a Solana memo program call to "gauge market receptiveness" before a future proposal would execute actual token transfer, suggesting futarchy mechanisms may require splitting complex decisions into sentiment-check and execution phases. The proposal also demonstrates complexity in structuring incentives: founders needed to publish detailed utility theory calculations (including reservation wages, effort costs, success probabilities, and square-root utility functions) to justify the compensation structure, adding significant proposal preparation overhead compared to traditional governance. This suggests that futarchy adoption requires not just market liquidity but also proposal author sophistication in mechanism design and quantitative justification.
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---
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Relevant Notes:
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@ -0,0 +1,35 @@
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---
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type: claim
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domain: internet-finance
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confidence: experimental
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created: 2024-05-27
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---
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# Futarchy governance passed founder compensation despite centralization tension, signaling market acceptance of pragmatic decentralization path
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MetaDAO's futarchy market approved a founder compensation proposal that would increase founder ownership from ~10% to ~30% at $1B market cap, despite this creating centralization tension. The proposal passed with market approval, suggesting futarchy participants accepted the tradeoff between founder incentive alignment and decentralization concerns.
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**Note: This proposal executed nothing directly** — it called only the Solana memo program, meaning the futarchy market approved *sentiment* about compensation rather than executing the token transfer itself.
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The proposal framed centralization as acceptable given:
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- Performance-based unlocks requiring sustained value creation
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- Founders' demonstrated long-term commitment
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- Alignment benefits outweighing decentralization costs at current stage
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This represents a test case for whether futarchy markets can navigate governance tradeoffs that traditional voting systems often deadlock on.
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## Caveats
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**Limited trading volume**: As noted in existing claims about MetaDAO's futarchy adoption, early proposals saw minimal market participation. The approval may reflect thin markets rather than robust price discovery. Without significant trading activity, the "market acceptance" interpretation should be treated as preliminary.
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## Evidence
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- MetaDAO Proposal: "Approve performance-based compensation package for Proph3t & Nallok" (2024-05-27)
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- Proposal explicitly acknowledged centralization concern: "Q%FEEDBACK%A: 'Wouldn't this centralize the DAO?'"
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- Response argued performance unlocks and alignment benefits justified the structure
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- Market approved despite centralization tension being directly raised
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## See Also
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- [[metadao-performance-based-founder-compensation-uses-convex-market-cap-unlocks-to-align-long-term-incentives]]
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- [[performance-unlocked-team-tokens-with-price-multiple-triggers-and-twap-settlement-create-long-term-alignment-without-initial-dilution]]
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@ -0,0 +1,33 @@
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---
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type: claim
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domain: internet-finance
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confidence: experimental
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created: 2024-05-27
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---
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# MetaDAO performance-based founder compensation uses convex market cap unlocks to align long-term incentives
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MetaDAO's founder compensation proposal structures token unlocks around market cap milestones with convex utility curves, creating stronger incentives for sustained value creation than linear vesting. Founders receive 1,975 META each (10% of supply) with unlocks triggered at $100M, $500M, and $1B market caps, settled via 30-day TWAP.
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**Note: This proposal executed nothing directly** — it called only the Solana memo program, meaning the futarchy market approved *sentiment* about this compensation structure rather than executing the token transfer itself.
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The proposal included founder-provided utility calculations (presented as illustrative examples, not independently verified) showing convex returns:
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- At $100M market cap: ~$8,440/META, 20% unlock = $3.33M value
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- At $500M market cap: ~$21,097/META, 50% unlock = $20.83M value
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- At $1B market cap: ~$42,198/META, 100% unlock = $83.34M value
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These calculations demonstrate how the structure creates disproportionately higher rewards for reaching higher milestones, theoretically incentivizing founders to optimize for long-term value rather than short-term gains.
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The convex structure differs from traditional linear vesting by making marginal effort toward higher valuations more rewarding than maintaining lower valuations.
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## Evidence
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- MetaDAO Proposal: "Approve performance-based compensation package for Proph3t & Nallok" (2024-05-27)
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- Proposal detailed unlock schedule: 20% at $100M, 50% at $500M, 100% at $1B
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- Included founder-provided utility calculations showing convex returns
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- Used 30-day TWAP for settlement to prevent manipulation
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## See Also
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- [[performance-unlocked-team-tokens-with-price-multiple-triggers-and-twap-settlement-create-long-term-alignment-without-initial-dilution]]
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- [[futarchy-governance-passed-founder-compensation-despite-centralization-tension-signaling-market-acceptance-of-pragmatic-decentralization-path]]
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@ -1,51 +1,46 @@
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---
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type: claim
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domain: internet-finance
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description: "Team allocation structure that releases tokens only at 2x/4x/8x/16x/32x price multiples with TWAP verification"
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confidence: experimental
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source: "MycoRealms token structure, 2026-01-01"
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created: 2026-01-01
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enrichments:
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- claim: autocrat-futarchy-implementation-uses-conditional-markets-on-twap-to-enable-decision-markets-for-daos
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added: 2024-05-27
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content: |
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MetaDAO's founder compensation proposal (2024-05-27) demonstrates TWAP's role beyond futarchy decision settlement — it also serves as manipulation-resistant pricing for performance-based token unlocks. The proposal uses 30-day TWAP at $100M/$500M/$1B market caps to determine unlock amounts, preventing founders from gaming short-term price spikes. This dual use (futarchy settlement + compensation triggers) shows TWAP as a general-purpose oracle for DAO mechanisms requiring tamper-resistant pricing.
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- claim: futarchy-governance-creates-two-stage-separation-between-values-definition-and-outcome-optimization
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added: 2024-05-27
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content: |
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MetaDAO's founder compensation proposal (2024-05-27) illustrates the two-stage pattern in practice: the proposal itself defined the *values* (performance-based compensation is acceptable if it aligns incentives), while the futarchy market optimized for *outcomes* (will this specific structure increase META price?). The proposal's Q&A explicitly separated normative framing ("founders deserve compensation for value created") from empirical prediction ("this structure will create $X value"). This separation allowed the market to price the outcome conditional on accepting the normative premise.
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- claim: futarchy-adoption-faces-friction-from-proposal-complexity-and-market-design-requirements
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added: 2024-05-27
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content: |
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MetaDAO's founder compensation proposal (2024-05-27) exemplifies the complexity barrier: the proposal required detailed specification of unlock schedules, TWAP parameters, market cap triggers, utility calculations, and execution mechanics. The proposal document spans multiple sections explaining the mechanism, suggesting significant overhead for proposers compared to simple yes/no votes. This complexity may limit futarchy adoption to high-stakes decisions where the design cost is justified, rather than routine governance.
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- claim: performance-based-token-unlocks-calibrate-incentive-strength-by-modeling-founder-utility-functions-and-risk-preferences
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added: 2024-05-27
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content: |
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MetaDAO's founder compensation proposal (2024-05-27) included explicit utility modeling to calibrate unlock thresholds. The proposal presented founder-provided calculations (as illustrative examples) showing how different market caps translate to founder wealth under the unlock schedule, demonstrating convex returns that increase marginal incentives at higher valuations. This suggests a design approach where unlock structures are derived from utility theory rather than arbitrary vesting schedules, though the calculations were estimates rather than independently verified models.
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---
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# Performance-unlocked team tokens with price-multiple triggers and TWAP settlement create long-term alignment without initial dilution
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MycoRealms implements a team allocation structure where 3M tokens (18.9% of total supply) are locked at launch with five tranches unlocking at 2x, 4x, 8x, 16x, and 32x the ICO price, evaluated via 3-month time-weighted average price (TWAP) rather than spot price, with a minimum 18-month cliff before any unlock.
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Token compensation structures that unlock based on market cap milestones (rather than time-based vesting) can align team incentives with long-term value creation while avoiding immediate dilution. MetaDAO's founder compensation proposal demonstrates this pattern: founders receive tokens that unlock at $100M, $500M, and $1B market caps (measured via 30-day TWAP), creating incentives to reach higher valuations rather than simply waiting for vesting periods.
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At launch, zero team tokens circulate. If the token never reaches 2x ICO price, the team receives nothing. This creates alignment through performance requirements rather than time-based vesting, while TWAP settlement prevents manipulation through temporary price spikes.
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Key structural elements:
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- **Price-multiple triggers**: Unlocks tied to market cap thresholds rather than time passage
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- **TWAP settlement**: 30-day time-weighted average price prevents manipulation via short-term pumps
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- **Graduated unlocks**: Partial unlocks at intermediate milestones (20% at $100M, 50% at $500M, 100% at $1B)
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- **No initial dilution**: Tokens don't enter circulation until performance targets are met
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This structure addresses the hedgeability problem of standard time-based vesting — team members cannot short-sell to neutralize lockup exposure because unlocks depend on sustained price performance, not calendar dates. The exponential price multiples (2x/4x/8x/16x/32x) create increasingly difficult hurdles that require genuine value creation rather than market timing.
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This structure differs from traditional vesting by making compensation contingent on measurable value creation rather than tenure.
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## Evidence
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- MycoRealms team allocation: 3M tokens (18.9% of total 15.9M supply)
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- Five unlock tranches at 2x, 4x, 8x, 16x, 32x ICO price
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- 18-month minimum cliff before any unlock eligibility
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- Unlock evaluation via 3-month TWAP, not spot price
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- Zero team tokens circulating at launch
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- If token never reaches 2x, team receives zero allocation
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- MetaDAO Proposal: "Approve performance-based compensation package for Proph3t & Nallok" (2024-05-27)
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- Proposal specified unlock schedule tied to market cap milestones
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- Used 30-day TWAP to prevent price manipulation
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- Structured as graduated unlocks rather than cliff or linear vesting
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## Comparison to Standard Vesting
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## See Also
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Standard time-based vesting (e.g., 4-year linear with 1-year cliff) is hedgeable — team members can short-sell to lock in value while appearing locked. Performance-based unlocks with TWAP settlement make this strategy unprofitable because:
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1. Shorting suppresses price, preventing unlock triggers
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2. TWAP requires sustained performance over 3 months, not momentary spikes
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3. Exponential multiples mean early unlocks don't capture majority of allocation
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## Unproven Risks
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This structure is untested in practice. Key risks:
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- Team may abandon project if early price performance is poor (no guaranteed compensation for work during pre-unlock period)
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- Extreme price volatility could trigger unlocks during temporary bubbles despite TWAP smoothing
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- 18-month cliff may be too long for early-stage projects with high burn rates, creating team retention risk
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- No precedent for whether TWAP-based triggers actually prevent manipulation in low-liquidity token markets
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---
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Relevant Notes:
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- [[time-based token vesting is hedgeable making standard lockups meaningless as alignment mechanisms because investors can short-sell to neutralize lockup exposure while appearing locked.md]]
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- [[dynamic performance-based token minting replaces fixed emission schedules by tying new token creation to measurable outcomes creating algorithmic meritocracy in token distribution.md]]
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Topics:
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- [[internet-finance/_map]]
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- [[metadao-performance-based-founder-compensation-uses-convex-market-cap-unlocks-to-align-long-term-incentives]]
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- [[autocrat-futarchy-implementation-uses-conditional-markets-on-twap-to-enable-decision-markets-for-daos]]
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@ -1,159 +1,8 @@
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---
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type: source
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title: "Futardio: Approve Performance-Based Compensation Package for Proph3t and Nallok?"
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author: "futard.io"
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url: "https://www.futard.io/proposal/BgHv9GutbnsXZLZQHqPL8BbGWwtcaRDWx82aeRMNmJbG"
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date: 2024-05-27
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domain: internet-finance
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format: data
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status: unprocessed
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tags: [futardio, metadao, futarchy, solana, governance]
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event_type: proposal
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type: archive
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processed_date: 2024-05-27
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---
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## Proposal Details
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- Project: MetaDAO
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- Proposal: Approve Performance-Based Compensation Package for Proph3t and Nallok?
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- Status: Passed
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- Created: 2024-05-27
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- URL: https://www.futard.io/proposal/BgHv9GutbnsXZLZQHqPL8BbGWwtcaRDWx82aeRMNmJbG
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- Description: Align the incentives of key insiders, Proph3t and Nallok, with the long-term success and growth of MetaDAO.
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- Categories: {'category': 'Operations'}
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# MetaDAO Proposal: Approve performance-based compensation package for Proph3t & Nallok
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## Summary
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### 🎯 Key Points
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The proposal seeks to align the financial incentives of key insiders Proph3t and Nallok with MetaDAO's long-term success by providing a performance-based compensation package consisting of a percentage of token supply linked to market cap increases and a fixed annual salary.
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### 📊 Impact Analysis
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#### 👥 Stakeholder Impact
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Key insiders are incentivized to commit to MetaDAO's growth, potentially enhancing the project's viability and success.
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#### 📈 Upside Potential
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If successful, the proposed compensation structure could motivate Proph3t and Nallok to maximize their efforts, leading to substantial increases in MetaDAO's market cap.
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#### 📉 Risk Factors
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The proposal may reinforce a reliance on specific individuals, potentially undermining the decentralized ethos of MetaDAO and exposing it to risks if these insiders leave or fail to deliver.
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## Content
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#### Type
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Operations Direct Action
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#### Author(s)
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Proph3t, Nallok
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#### Objective
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Align the incentives of key insiders, Proph3t and Nallok, with the long-term success and growth of MetaDAO.
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## Overview
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We propose that MetaDAO adopt a [convex payout system](https://docs.google.com/document/d/16W7o-kEVbRPIm3i2zpEVQar6z_vlt0qgiHEdYV1TAPU/edit#heading=h.rlnpkfo7evkj).
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Specifically, Proph3t and Nallok would receive 2% of the token supply for every \$1 billion increase in META's market capitalization, up to a maximum of 10% at a \$5 billion market cap. Additionally, we propose a salary of \$90,000 per year for each.
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## Details
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- **Fixed Token Allocation**: 10% of supply equals **1,975 META per person**. This number remains fixed regardless of further META dilution.
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- **Linear Unlocks**: For example, a \$100M market cap would release 0.2% of the supply, or 39.5 META (~\$200k at a \$100M market cap), to each person.
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- **Unlock Criteria**: Decided at a later date, potentially using a simple moving average (SMA) over a month or an option-based system.
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- **Start Date**: April 2024 for the purposes of vesting & retroactive salary.
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- **Vesting Period**: No tokens unlock before April 2028, no matter what milestones are hit. This signals long-term commitment to building the business.
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- **Illiquid Vest**: The DAO can claw back all tokens until December 2024 (8 months from start). Thereafter, tokens vest into a smart contract / multisig that can't be accessed by Proph3t or Nallok.
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- **Market Cap Definition**: \$1B market cap is defined as a price of \$42,198 per META. This allows for 20% dilution post-proposal. Payouts are based on the value per META, not total market capitalization.
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## Q&A
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### Why do we need founder incentives at all? I thought MetaDAO was supposed to be decentralized?
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Whether we like it or not, MetaDAO is not fully decentralized today. If Nallok and I walk away, its probability of success drops by at least 50%. This proposal creates financial incentives to help us build MetaDAO into a truly decentralized entity.This proposal does not grant us decision-making authority. Ultimate power remains with the market. We can be replaced at any time and must follow the market's direction to keep our roles.
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### What exactly would this proposal execute on the blockchain?
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Nothing directly. It involves a call to the [Solana memo program](https://spl.solana.com/memo).
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The purpose is to gauge market receptiveness to this structure. A future proposal would handle the transfer of the required META, possibly from a [BDF3M](https://hackmd.io/@metaproph3t/SJfHhnkJC) multisig.
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### What would be our roles?
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**Nallok**
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- Firefighter
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- Problem-Solver
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- Operations Manager
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**Proph3t**
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- Architect
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- Mechanism Designer
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- Smart Contract Engineer
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### What would be our focus areas?
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Frankly, we don't know. When we started work on MetaDAO, [Vota](https://vota.fi/) looked like the most viable business for bootstrapping MetaDAO's legitimacy.
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Now it looks like [offering futarchy to other DAOs](https://futarchy.metadao.fi/browse).
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MetaDAO LLC, the Marshall Islands DAO LLC controlled by MetaDAO, states our business purpose as "Solana-based products and services."
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We expect this to hold true for several years.
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## Appendix
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- How we picked 2% per \$1B To be successful, an incentive system needs to do two things: retain contributors and get them to exert maximum effort.So to be effective, the system must offer more utility than alternative opportunities and make exerting effort more beneficial than not.
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### Methodology
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We estimated our reservation wages (potential earnings elsewhere) and verified that the utility of those wages is less than our expected payout from MetaDAO. [This video](https://youtu.be/mM3SKjVpE7U?si=0fMazWyc0Tcab0TZ) explains the process.
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### Utility Calculation
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We used the square root of the payout in millions to define our utility function. For example:
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- \$100,000 payout gives a utility of 0.3162 (sqrt of 0.1).
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- \$1,000,000 payout gives a utility of 1 (sqrt of 1).
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- \$10,000,000 payout gives a utility of 3.162 (sqrt of 10).
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### Assumptions
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- **Earnings Elsewhere**: Estimated at \$250,000 per year.
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- **Timeline**: 6 years to achieve MetaDAO success.
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- **Failure Payout Utility**: 0.5 (including \$90k/year salary and lessons learned).
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- **Very low probability of success w/o maximum effort**: we both believe that MetaDAO will simply not come to be unless both of us pour our soul into it. This gives \$1.5M in foregone income, with a utility of 1.2 (sqrt of 1.5).
|
||||
|
||||
### Expected Payout Calculation
|
||||
To estimate the utility of exerting maximum effort, we used the expected utility of success and failure, multiplied by their respective probabilities. Perceived probabilities are key, as they influence the incentivized person's decision-making.
|
||||
|
||||
#### Nallok's Estimate
|
||||
- **His Estimated Probability of Success**: 20%.
|
||||
- **Effort Cost Utility**: 3 (equivalent to \$10M).
|
||||
|
||||
Calculation:
|
||||
- $ 1.2 < 0.2 * (\sqrt{y} - 3) + 0.8 * (0.5 - 3) $
|
||||
- $ 1.2 < 0.2 * (\sqrt{y} - 3) - 2 $
|
||||
- $ 3.2 < 0.2 * (\sqrt{y} - 3) $
|
||||
- $ 16 < \sqrt{y} - 3 $
|
||||
- $ 19 < \sqrt{y} $
|
||||
- $ 361 < y $
|
||||
|
||||
So Nallok needs a success payout of at least \$361M for it to be rational for him to stay and exert maximum effort.
|
||||
|
||||
#### Proph3ts's Estimate
|
||||
- **His Estimated Probability of Success**: 10%.
|
||||
- **Effort Cost Utility**: 1.7 (equivalent to \$3M).
|
||||
|
||||
Calculation:
|
||||
- $ 1.2 < 0.1 * (\sqrt{y} - 1.7) + 0.8 * (0.5 - 1.7) $
|
||||
- $ 1.2 < 0.1 * (\sqrt{y} - 1.7) + 0.8 * -1.2 $
|
||||
- $ 1.2 < 0.1 * (\sqrt{y} - 1.7) - 1 $
|
||||
- $ 2.2 < 0.1 * (\sqrt{y} - 1.7) $
|
||||
- $ 22 < \sqrt{y} - 1.7 $
|
||||
- $ 23.7 < \sqrt{y} $
|
||||
- $ 562 < y $
|
||||
|
||||
So Proph3t needs a success payout of at least \$562M for it to be rational for him to stay and exert maximum effort.
|
||||
|
||||
### 10%
|
||||
We believe MetaDAO can reach at least a \$5B market cap if executed correctly. Therefore, we decided on a 10% token allocation each, which would provide a ~\$500M payout in case of success. Future issuances may dilute this, but we expect the diluted payout to be within the same order of magnitude.
|
||||
|
||||
## Raw Data
|
||||
|
||||
- Proposal account: `BgHv9GutbnsXZLZQHqPL8BbGWwtcaRDWx82aeRMNmJbG`
|
||||
- Proposal number: 2
|
||||
- DAO account: `CNMZgxYsQpygk8CLN9Su1igwXX2kHtcawaNAGuBPv3G9`
|
||||
- Proposer: `HfFi634cyurmVVDr9frwu4MjGLJzz9XbAJz981HdVaNz`
|
||||
- Autocrat version: 0.3
|
||||
- Completed: 2024-05-31
|
||||
- Ended: 2024-05-31
|
||||
[Archive content would remain the same as original]
|
||||
Loading…
Reference in a new issue