Earlier today, Lion’s Mane released its Quarterly Report to Tracer DAO, following the completion of its first quarter being one of Tracer DAO’s Service Providers. In that report, Lion’s Mane reported its financial position and laid out a roadmap for the quarter ahead.
One aspect of road-mapping that was omitted from the Lion’s Mane’s Report was token distribution. How Tracer DAO’s TCR governance tokens are distributed is a matter for all Tracer DAO members. In recent weeks, conversations around the effective distribution of TCR governance tokens have been observed in Tracer’s Discord and Discourse - for example, on the topics of airdropping and Service Provider consideration.
We have prepared an interactive spreadsheet to facilitate structured discussion between DAO members, and the Tracer community, about the distribution of TCR governance tokens. Have a look here:
Lion’s Mane recommended distribution:
In the initial tab of the sheet we have detailed the current distribution of TCR. In the second tab, we have detailed a draft allocation of how tokens might be distributed in the future. We are keen to see the thinking around future token distribution evolve via community discussion.
Share your thoughts
By commenting at the bottom of this thread.
Or, by following this process:
- Right click the “ [Template] - Future Token Distribution ” tab, then click “ Duplicate ”;
- Right click the new tab, then click “ Rename ”, then rename the tab to your name in the Tracer Discord;
- Click on the editable fields (shaded grey), and replace the stated percentage with your desired percentage; and
- Once you have finished, add your thoughts at the bottom of this thread.
The successful distribution of TCR governance tokens cannot be overstated. Successful distribution will attract valued new Governors into the Tracer community who can introduce desirable perspectives, expertise and experience to the development of Tracer DAO. On the other hand, poor distribution will result in stagnant governance, poor community engagement and loss of direction.
We remind all community members that the TCR token is a governance token only, which means it allows holders to participate in Tracer DAO via its governance mechanism and provides no ownership, financial or economic rights of any kind.
We’ll now touch on the kinds of distribution mentioned in the “Future Token Distribution” tab:
1. Ecosystem Developments
We have seen Governors (the initial 100, plus 52 successful applicants), Service Providers (Lion’s Mane, RMIT BIH and, most recently, DeFi Pulse) already be engaged, via proposal, to work with Tracer DAO. Applications have now reopened for Governors to join Tracer DAO, you can apply here. The DAO has recently passed a Proposal to allow 100 Alpha Testers to join the DAO to test the Perpetual Swap contracts. Those Alpha Testers will be welcomed in the coming days, once the result of the off-chain Snapshot vote has been pushed on-chain.
We believe that, in the future, additional TCR governance tokens will be distributed to incoming Service Providers to Tracer DAO or other individuals or entities whose incentives should be aligned with Tracer DAO to govern its financial ecosystem. If you are interested to become a Service Provider, or know someone else who might be, read this article.
2. Market Incentivisation
The users of Tracer’s financial contracts deserve governance rights over the contracts with which they interact. Liquidity mining is a great way to achieve this. Tracer DAO could run a variety of liquidity mining schemes, based on its priorities at those points in time. For example, as Tracer’s initial focus is to win market-share in the Perpetual Swap market, Tracer DAO could distribute tokens to prominent users of the Tracer Perpetual Swap contracts.
Over time, there will also inevitably be certain market behaviours that Tracer DAO should wish to incentivise, which Tracer DAO can be reactive to. Our question is, what market behaviours should be incentivised?
3. Public Distributions
Targeted airdrops, based on the needs of the DAO, can have great outcomes in terms of governor quality and engagement, if executed correctly. We like Badger DAO’s work here. For all readers, it is worth considering, how would you like to see a Tracer DAO airdrop, if any, rolled out? And what criteria would be relevant for the airdrop?
DAOs are looking to solutions like Balancer’s Liquidity Bootstrapping Pools (“LBPs”) or Gnosis Auction to facilitate public token distributions. The LBP path is now fairly well trodden, with recent examples including Perpetual DAO’s PERP LBP and Illuvium DAO’s ILV LBP. The newer mechanism of the two, Gnosis Auction, uses batch auctions to enable fair price discovery, where the market sets the price for the portion of tokens being sold.
When it comes to the best way to distribute TCR governance tokens, we should all be sharing our thinking and attempting to gain consensus as a community. We welcome the expression of any views regarding token distribution.