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teleo-codex/decisions/internet-finance/metadao-compensation-proph3t-nallok.md
m3taversal c3dfbf12a3 rio: decision records batch 2 — backfill 10 MetaDAO governance proposals with full text 
- What: Rewrote 10 existing decision records with full verbatim proposal
  text, Summary & Connections sections, correct v1.metadao.fi URLs, and
  on-chain metadata
- Records rewritten:
  1. Ben Hawkins $50K OTC (Proposal 6, failed) — canonical manipulation resistance evidence
  2. Pantera Capital $50K OTC (Proposal 7, failed) — first institutional rejection
  3. Colosseum $250K OTC (Proposal 13, passed) — first successful OTC, hackathon pipeline
  4. Theia $500K OTC (Proposal 10, passed) — 14% premium, active governance commitment
  5. Proph3t/Nallok Compensation (Proposal 2, passed) — convex payout with utility theory
  6. Burn 99.3% META (Proposal 11, passed) — radical treasury restructuring, FDV fix
  7. Develop AMM (Proposal 4, passed) — origin of Futarchy AMM core infrastructure
  8. Develop FaaS (Proposal, passed) — platform expansion to multi-DAO, $96K budget
  9. Benevolent Dictators (Proposal 14, passed) — emergency executive authority via futarchy
  10. Fundraise #2 (Proposal 3, passed) — $1.5M raise, no discount, no lockup
- Pattern: Full OTC sequence shows market rejects discount deals, accepts
  premium deals — consistent mechanism for distinguishing extractive vs aligned capital

Pentagon-Agent: Rio <5551F5AF-0C5C-429F-8915-1FE74A00E019>
2026-03-24 13:23:15 +00:00

8.3 KiB
Raw Blame History

type entity_type name domain status parent_entity platform proposer proposal_url proposal_date resolution_date category summary key_metrics tags tracked_by created last_updated
decision decision_market MetaDAO: Approve Performance-Based Compensation for Proph3t and Nallok internet-finance passed metadao metadao Proph3t, Nallok https://v1.metadao.fi/metadao/trade/BgHv9GutbnsXZLZQHqPL8BbGWwtcaRDWx82aeRMNmJbG 2024-05-27 2024-05-31 hiring Proposal 2 (Autocrat v0.3) — Convex payout: 2% of token supply per $1B market cap up to 10% at $5B. $90K/year salary each. 4-year cliff to April 2028. 22.6K volume, 65 trades, +29.6% TWAP spread.
proposal_number proposal_account autocrat_version volume trades twap_spread
2 BgHv9GutbnsXZLZQHqPL8BbGWwtcaRDWx82aeRMNmJbG 0.3 $22,600 65 +29.6%
metadao
compensation
founder-incentives
convex-payout
passed
rio 2026-03-11 2026-03-24

MetaDAO: Approve Performance-Based Compensation for Proph3t and Nallok

Summary & Connections

Proposal 2 (Autocrat v0.3) — founder compensation via convex payout system. 2% of token supply per $1B market cap increase, up to 10% at $5B. $90K/year salary each. No tokens unlock before April 2028. DAO clawback until December 2024. $22.6K volume, 65 trades, passed at +29.6% TWAP spread.

Outcome: Passed (2024-05-31).

Connections:

Full Proposal Text

Type

Operations Direct Action

Author(s)

Proph3t, Nallok

Objective

Align the incentives of key insiders, Proph3t and Nallok, with the long-term success and growth of MetaDAO.

Overview

We propose that MetaDAO adopt a convex payout system. 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.

Details

  • Fixed Token Allocation: 10% of supply equals 1,975 META per person. This number remains fixed regardless of further META dilution.
  • 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.
  • Unlock Criteria: Decided at a later date, potentially using a simple moving average (SMA) over a month or an option-based system.
  • Start Date: April 2024 for the purposes of vesting & retroactive salary.
  • Vesting Period: No tokens unlock before April 2028, no matter what milestones are hit. This signals long-term commitment to building the business.
  • 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.
  • 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.

Q&A

Why do we need founder incentives at all? I thought MetaDAO was supposed to be decentralized? 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.

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.

What would be our roles?

Nallok: Firefighter, Problem-Solver, Operations Manager

Proph3t: Architect, Mechanism Designer, Smart Contract Engineer

What would be our focus areas? Frankly, we don't know. 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. MetaDAO LLC, the Marshall Islands DAO LLC controlled by MetaDAO, states our business purpose as "Solana-based products and services." We expect this to hold true for several years.

Appendix — 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.

Methodology: We estimated our reservation wages (potential earnings elsewhere) and verified that the utility of those wages is less than our expected payout from MetaDAO.

Utility Calculation: We used the square root of the payout in millions to define our utility function.

  • $100,000 payout gives utility of 0.3162 (sqrt of 0.1)
  • $1,000,000 payout gives utility of 1 (sqrt of 1)
  • $10,000,000 payout gives utility of 3.162 (sqrt of 10)

Assumptions:

  • Earnings Elsewhere: Estimated at $250,000 per year
  • Timeline: 6 years to achieve MetaDAO success
  • Failure Payout Utility: 0.5 (including $90k/year salary and lessons learned)
  • Very low probability of success w/o maximum effort: both believe MetaDAO will not succeed unless both pour their soul into it. This gives $1.5M in foregone income, with utility of 1.2 (sqrt of 1.5).

Nallok's Estimate:

  • Probability of Success: 20%
  • Effort Cost Utility: 3 (equivalent to $10M)
  • Calculation: Nallok needs a success payout of at least $361M for it to be rational to stay and exert maximum effort.

Proph3t's Estimate:

  • Probability of Success: 10%
  • Effort Cost Utility: 1.7 (equivalent to $3M)
  • Calculation: Proph3t needs a success payout of at least $562M for it to be rational to stay and exert maximum effort.

Conclusion: 10% token allocation each at $5B market cap = ~$500M payout. This exceeds both minimum thresholds, making maximum effort the rational choice for both founders.

Raw Data

  • Proposal account: BgHv9GutbnsXZLZQHqPL8BbGWwtcaRDWx82aeRMNmJbG
  • Proposal number: 2
  • DAO account: CNMZgxYsQpygk8CLN9Su1igwXX2kHtcawaNAGuBPv3G9
  • Proposer: HfFi634cyurmVVDr9frwu4MjGLJzz9XbAJz981HdVaNz
  • Autocrat version: 0.3
  • Completed: 2024-05-31
  • Volume: $22,600 across 65 trades
  • Approved/Rejected TWAP spread: +29.6%

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