[Discussion] Proposal to Financially Empower Existing Builders for a Flourishing IOTA Ecosystem.

✍ General Governance General
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It’s been an incredible journey of over two years since TanglePay’s initial launch in the IOTA ecosystem. Holding substantial amounts of IOTA, our belief in its technological prowess remains unwavering. We are deeply committed to fostering growth in this ecosystem, contributing as a dedicated, professional, and proactive team.

The recent announcement of IOTA 2.0 is huge. This audacious roadmap, if executed meticulously, possesses the potential to elevate both IOTA and Shimmer to unparalleled heights. Two aspects particularly pique our interest:

  1. IOTA’s Layer 1 Evolution: The introduction of smart contracts stands to revolutionize the landscape, paving the way for novel web3 offerings like GroupFi to flourish.
  2. Reimagined Token Strategy: A paradigm that will undoubtedly offer enhanced support to builders like us.

Yet, every significant shift invites debate. We’ve been privy to discussions regarding the lack of a voting mechanism behind this momentous decision. Dom’s rationale, emphasizing the urgency of swift plan execution, holds water. As IOTA grows and takes center stage in the cryptocurrency arena, there will be an inevitable shift towards enhanced transparency and community-driven decision-making.

As steadfast builders, we are oriented towards the horizon. It’s imperative to ensure that this significant decision translates into tangible success for IOTA. Drawing from my extensive experience as builder in the crypto space since 2014 and my dedication to IOTA’s progress, I propose the following:

  1. Community Involvement: It’s crucial to engage the community in the decision-making process. The true strength of IOTA is rooted in its community, one of the most robust and dedicated in the entire crypto sphere. We cannot risk alienating this foundational asset. By ensuring transparency and inclusivity in decisions, particularly those with significant ramifications, we will reinforce IOTA’s resilience and maintain its pivotal position in the industry.
  2. Empowering Continuous Contributors: Our dedicated builders, who consistently contribute, are our pillars. We’ve historically faced resource constraints, which everyone understands. But now, as resources become available, we must judiciously allocate them to fortify our builders. Their success in designing widely adopted products is intrinsically linked to IOTA’s success, eventually benefiting all token holders.
  3. Balancing New and Old: While fostering new teams is vital, our long-standing builders—those who’ve been with IOTA through thick and thin—warrant special recognition. Their proven track record of delivery, quality, and loyalty is invaluable. For newcomers, we must discern genuine contributors from those with fleeting interests. A nuanced funding mechanism, with periodic evaluations for newer contributors and a more streamlined approach for our consistent builders, would be optimal.

And here is the more detailed proposal:

Proposal of Financial Support for the existing builders

In this proposal, please vote for Yes or No just to show if you support it or not. The final say on its adoption, and determining the beneficiaries, should lie squarely with the community.

1. Special Financial Support for Existing Builders:

A designated financial package will be put to vote. If approved, this will be disbursed to support the ongoing efforts of our established builders over the next two years.

Eligibility:

  • Teams: A maximum of 15 teams (subject to confirmation) will qualify for these incentives.
  • Application Process: Teams from the community can forward their candidature, either for individual projects or as consortiums of projects. If selected, they can internally manage the distribution of the grant as deemed appropriate.

2. Proposed Allocation:

  • Amount: Out of the 12% token reserve set aside from TEA (Tangle Ecosystem Association), it’s proposed to channel 6.25% (equivalent to 0.75% of the total supply or 34,500,000 IOTA) to back the stalwart builder teams. These teams have consistently fortified the IOTA community over the past years, establishing themselves as an integral part of our ecosystem.
  • Distribution Across Teams: The 15 qualifying projects will be stratified based on the community’s voting into three tiers:
    • Tier 1: Comprising five teams, each will be allocated 3,450,000 IOTA (cumulatively 17,250,000 IOTA for the tier).
    • Tier 2: Consisting of five teams, each will be allocated 2,300,000 IOTA (amassing 11,500,000 IOTA for the tier).
    • Tier 3: Incorporating five teams, each will be allocated 1,150,000 IOTA (totaling 5,750,000 IOTA for this tier).

3. Token Distribution Schedule:

  • Initial Release: Upon approval, 10% of the allocated tokens will be disbursed upfront.
  • Vesting Period: The residual 90% will be vested and distributed evenly over the subsequent 24 months.

This proposal aims to both recognize and bolster the efforts of our core contributors. Your insights, recommendations, and votes are pivotal to its evolution. As we await the establishment of the IOTA governance framework, this proposal will be relocated appropriately within the governance forum. The primary objective of this voting procedure is to gauge community support for providing financial assistance to existing builders in the forthcoming IOTA governance.

  • YES, I support it!
  • NO, I don’t!
0 voters

As we stand at the crossroads of transformation, let us remember that our collective strength, determination, and vision will shape IOTA’s destiny. The challenges ahead are many, but together, with unwavering resolve and unity, we can craft a future that reflects our loftiest ambitions. Here’s to forging ahead with purpose, innovation, and shared dreams for IOTA’s luminous future.

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Thanks for taking the initiative Garrett!

Funding is all well and good and so is supporting the teams that drive the ecosystem forward. Since these funds will be obtained by inflating existing holders’ bags, however, some form of compensation, e.g. in form of project tokens, should be returned to TEA.

Effectively, TEA would value projects at X and grant support in form of iotas, and projects would, in return, provide tokens that, if things develop according to plan, will eventually appreciate in value enough to make this worthwhile for everyone involved.

Some form of accountability as to how these funds will be used would surely be reasonable, too.

Fair?

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Interesting idea that would ideally keep the TEA funded and able to act for a longer period of time. There are some project, which do not have any tokens (open-source builders, content creators, etc). These could be supported without giving anything back (they are also no profit-printing machines like established DeFi platforms).

But I agree that for already funded, established for-profit projects its okay to ask for something in return (like tokens).

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I fully agree with you here, Linus.

On the current proposal I voted no, due to the missing points regarding accountability and fiscal responsibility, however, if amended, this sounds like a viable idea to help projects generate momentum.

Based on internal discord discussions, plenty of no votes (and users who aren’t voting) share that sentiment.

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Thanks for your suggestion! I personally think it is totally fair.

The only problem is that some projects might be really good infra structure projects without a token for now. And it might be a problem if offering token in return is a barrier. But the suggestion is really constructive and will see how other community members suggest.

OK, I just saw the comments of Linus below, I think your idea combine together can make a really good one for us to adjust the proposal!

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I support the idea of providing builder support, but I’m casting a negative vote on the proposal. I have two main concerns:

  1. The significant number of tokens allocated raises serious questions about the long-term sustainability of TEA funding at this spending rate over the course of a decade or more.

  2. The statement, “If selected, they can internally manage the distribution of the grant as deemed appropriate,” is completely unacceptable. It implies that winning the allocation is the endgame, without any requirement for projects to establish clear objectives or achieve predetermined milestones. This could potentially lead to the misuse of funds or a lack of accountability.
    While “their proven track record of delivery, quality, and loyalty” may serve as a necessary criterion to make the rules less tight, it cannot be a sufficient criterion for blind trust.

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Appreciate your input!

Given that the financial aid targets teams who’ve consistently contributed to the ecosystem for 2-3 years, allocating 0.75% from the 12% might appear proportionate.

The idea of tracking progress or milestones is constructive. We’ll explore how best to implement this.

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Eco funds should be awarded for tangible results only. Give awards for ongoing TVL brought into the ecosystem. Without some hard metric like TVL, tbh this just looks like you handing out free moneys to your pals.

Voted NO. Devs and projects that bring measurable ecomonic activity deserve to be rewarded. All others should try harder.

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I agree with the proposal. Someone above made great suggestions. I have a little idea: the overall amount of funding applied for is too much, and the TEA is well-funded, but it needs to be kept running for a long time. I think it is possible to reduce the overall funding by 30 percent, and at the same time, the funding can be in the form of 12 tranches a year. Because the one-year period brings more competition and vitality to the community and market, it will also bring other projects to join, and there will be a more active ecology if there is competition。

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Hi Garrett,

Thanks for writing this proposal.

Firstly I want to say I want to vote yes to this proposal as I understand how difficult it is to be funded in this eco. Can you consider the below points, if you are rewriting the proposal.

In addition to S4lt32’s repay the eco point and accountability.

  1. The definition of existing builders - does it mean all teams that are building because I think there is a fair few. Either this definition has to be more succinct or it should take into consideration all the builders that are already building.
  2. If the project had a successful community raise (from selling NFT’s) or already received funding would they be considered?
  3. What are the cut offs what if the project is already generating income after the first year? Does the Eco fund continue to provide funding?
  4. Maybe make it an equivalent $USD value rather than a set number of token (If Iota rockets to $10 this could be potentially be an issue)

If there is a payback - is it a $USD value or number of Token value?

Thank you again for writing the proposal, fully want to support this. Please take into consideration the points.

Thank you,
Roy

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Thanks for your constructive reply, Garrett.

It looks like you are getting quite some feedback - with all of this accounted for (as much as feasible without changing the core of your proposal), you probably have a really good initiative at your hands.

Just one correction: Based on your proposal it’s 6.25% of TEA funding = 0.75% of total supply.

On that: It might be good to define the total in terms of dollar value and token amounts, e.g. to set a maximum upper value in USD and a maximum token amount in case of price dip (bull v bear scenario).

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make community projects great again!

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Thank you for pointing that out!

To clarify, the proposal recommends allocating 6.5% from the 12% fund. This equates to 0.75% of the total 12%.

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Absolutely! We’re grateful for all the constructive feedback received, which will be invaluable in refining our approach. It’s worth noting that the current proposal is still in its preliminary stage, serving as a platform for open discussion and idea contribution. In the formal proposal, we’ll ensure to provide more specific details such as the USD value and the exact IOTA amount for clarity.

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Thank you, Roy! You’ve raised some pertinent questions. It’s vital for us to maintain transparency with the community, especially regarding the project’s background, whether it’s infrastructure-driven without profits or if it has revenue streams. This includes any NFT/token sales conducted within the community. Additionally, we are considering involving expert entities, like the Tangle Treasury, to offer professional insights. This will ensure that the community can make informed voting decisions with a comprehensive understanding of the matters at hand.

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But TEA is now used to give funds to eg Bitboy (well to be fair I don’t know which entity gave him the money, but will all the NDAs and lack of transparancy, could very well be TEA).

I do wonder if it makes no sense to give more to the DAO, and just loosen their rules, but since that is not going to happen, this seems like a reasonable proposal. The amounts are quite frankly negligible on the total amount being printed. I would consider maybe reducing the values, and make it a yearly thing for the coming X years. But not reducing it too much, it is like 2 FTE - 6 FTE he is proposing right now. Of course a downside of having DAO, TEA, these funds, etc. That you get some receiving funds from 7 directions, others zero.

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Perhaps the benefiting teams could also offer a joint quid pro quo. In this way, the teams would control each other and have a common interest in success that is not delegated to the community treasury.

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Unless they are in competition and this would in effect stifle development / reduce incentives to strive hard :wink:

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It is a good proposal although I would like to see more proposals from the community of people who have not been linked to the iota foundation.

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As I take this proposal as a first draft and I guess it will be amended with the differents good suggestions given in comments. I vote YES

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