[Discussion] Proposal to Increase the Shimmer supply for a Community Treasury

Total Shimmer Ecosystem Growth Fund - Insead of changing supply after the supply has already been set, what about an option where we can choose to reinvest or stake 20%, 25% or some maximum amount of our initial Shimmer tokens back into the ecosystem. Those reinvestors could be paid via the TangleSwap proposal of earning individual airdrop tokens from the projects that grow out of it, or maybe that whole reinvestment could be treated like a stock Total Market Index Fund where investors are paid back in Shimmer tokens based on the profitability of a large segment of businesses that grow out of that fund. Many of those new projects will never make it, maybe even most of them but for the few that do make it and hit it big, they should pay well. The expectation is the payoff will be passive and consistently growing overtime. The growth could continue to compound if the projects repay the fund and investors and the replenishment of the fund is available to reinvest in more new projects over time. The fund could be a significant source of liquidity for new projects and it may double dip on the profits of those projects by being an initial investor with the expectation that the Shimmer provided would be paid back with interest over time as well as the expectation that tokens or other assets/income created by the new projects could be distributed to the fund investors


I don’t believe in centralising a treasury or increasing the supply of the shimmer token. I believe establishing lending hubs driven by the community for new projects. You want more shimmer for your projects? You will need to convince the IOTA community that you are worth it.

All projects that grow quickly will fall as fast, and I believe we should’t let greed drive our community.
Let us grow slowly so we acquire stability and make the iota community great.

Though as proposal I would love to have system where we could hinder our networks getting flooded with trash projects and rugs as seen on Soonverse and other networks, it is like looking for diamonds in
a dumpster. We should protect our users from this and create a great user experience with IOTA.


Three points from me:

  1. Web3 is all also about assuming responsibility by taking back some kind of power from centralised platforms and cloudproviders and managing it oneself.

  2. Although strong communities are important, they also tend to become kind of centralised since they need strong leaders in order to be able to get the majority on board and to act quickly (espescially in web3 market environments).

  3. The true advancements in human history have taken place due to splitting up of communities, allowing the groups to develop differently but also to compete against each other.

I therefor conclude that A) we do not need consensus in this matter and that B) angel investors or groups should compete to fund the best projects.


Instead of increasing the Shimmer supply, I would recommend running the community similar to a traditional capital market. If someone wants investment to build on Shimmer, give them a platform to pitch the idea and sell shares to the community. This way projects will have to compete for funding and there is less risk of wasting funds on a project that will never be completed. It shouldn’t be up to the IF to verify the credibility of Shimmer projects.


Shimmer does need to remain a viable testbed for IOTA. That’s it’s number one job for awhile.

IF is part of the community, no?

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But selling “shares” = Selling securities. You can’t just go doing that wherever you like.

But a DAO can fund an ongoing project(s) , pay for hours or for a result, have bounties, share profits and ownership, etc. Probably is easier to register a couple big DAOs as LLCs (or equiv) than to have every project trying to sell its own securities?

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First of all I want to thank all of you for these in depth contributions.

While this proposal is very smart, I’ve the feeling that people forget that Shimmer is going to be an extensive testnet for IOTA. Yes I know, we are all impatient and want to use the new features as soon as possible. Also I’m aware that Shimmer is a “staging network”. But please, let’s recognize the fact that new features are going to be tested on Shimmer for a couple of months before arriving on IOTA mainnet. This is true for Stardust, Coordicide and Shading in the future.

So know imagine we hand out a lot of incentives and lots of people start building on / porting to Shimmer, totally unaware that the network might still have some issues. Eventually a bug might appear and the network together with it’s TVL serious crashes. This would be a horrible incident for IOTAs reputation and it would rather scare developers away then attracting them.

The corresponding IOTA mainnet upgrades will follow shortly after they have been properly tested on Shimmer. I’m sure we can wait just another 3 months for the mainnet upgrade. Furthermore this time isn’t lost at all as everyone interested can profoundly test their product on Shimmer for a couple of months before launching on IOTA. Basically what would happen if TVL in Shimmer is too high we would need a staging net / testnet for Shimmer itself.

This is why I’m against the proposal. Better use the (short) time before the mainnet upgrade to beta your project and then fully focus on IOTA.


yes - i think there is no reason to panic. the late guests coming to a party are the best ones…

Personally, I’m in favor of the proposal. The way I see it, if you are going to vote ‘build’ in the upcoming treasury vote, you would naturally vote to increase the shimmer supply to build as well. Both votes come down to vision: either you are primarily concerned with the potential of short term gains or you take the longer term view with a much higher potential reward. That being said, I know it can be frustrating when plans change and expectations must be revised.

Perhaps if we use the extra 20% to give preferential funding to projects that pledge to repay the community when successful it will be more palatable.


Shimmer´s value is yet to be gained …please keep in mind that Shimmernet´s main goal is to battle-test innovations before deploying them in IOTA 2.0, therefore some disasters are to be expected. That´s why Shimmer token was distributed as “free money”. I think nobody should expect to collect financial gains directly with Shimmer token, mainly developers that would dedicate long hours of work. If anything wants to test its success on Shimmer network it shall be mounted and tested the same as any other application on Shimmer. The Community Treasury shall be a DAO with its own token. Pushing “start” in the money-making machine button is an element always present in crypto project death spirals, lets not do that with Shimmer.

What I don’t get with this funding proposal, is why do we need it in the first place. You compare Shimmer, which is supposed to be a staging network to upgrade iota, to definitive L1 networks. Is there on top of the money raised for the projects you quote a comparable amount raised to build on solana’s, fantom’s or Avalanche’s testnets ? I believe not.

As I understood it, there’s already a 100M$ fund that has been raised for assembly : shouldn’t that contribute to fund dapps that want to launch on the broad iota ecosystem ? And what about the unclaimed Iota’s that could be voted for Buidl in a treasury fund ?

As a iota holder, I’m not aiming at shimmer’s growth for its own sake, I want shimmer’s success to fuel iota’s. So to recap, how do I view funding for projects on shimmer :

  • the end goal should be a release of said project on iota. Releasing an early version on shimmer should be seen as a natural step before launching on iota mainnet and not an end on itself. So if the project enventually aims at releasing something on iota, it can naturally tap its funding from iota’s buidl treasury (that I will vote in favour) or assembly’s funding fund. If the projects uses smart contracts, it will most probably run on assembly, so that makes perfect sense.
  • if it needs additional funding, it can procede as many other great projects did : look at soonlabs, lendexe, tangleswap, tanglelabs, tangle pay, etc…

I like all the reasons for disagreements and agreement for the proposal, most seem valid. Some not so valid about not exploring the option about not having a dedicated shimmer supply for the projects.

We are building on Iota-Evm, here’s my two cents

  • VCs and angels don’t care about holding tokens and supporting projects, they look for exits and extremely rarely fund without traction…
  • if a supply is not dedicated for the project why should a project explore the option with risks against testing and promoting , what’s the security?
  • shares and securites is a main, too much paper work each time and very little gain( one should not be on cap without skin in the game )

I am sharing all of this because i am in favor of the proposal. Even with all the hick up my project is growing because of productive contribution from assembly team and some members in the community.

If we want to compete with the big funds, we have to manage more funds, some even for equity investments.

Hopefully members will bring in new regulation rather than outrightly objecting the idea

Thank you


I like this discussion, yet I think we have a bit of tunnel vision. So what do I mean by that?

1. Let’s Play - I fully agree that we need some type of Treasury and funds to ignite and grow our ecosystem. It is, in my opinion, one of the only ways to compete, gain market share, and be an established technology in the crypto space, is to play the game. So As stated, let’s play the game and not be handicapped.

2. Are We Playing? - To me, I don’t see it as we are handicapped. Yes, if we look at the Shimmer network “only” we don’t have much to support the expansion of the ecosystem; however, the Shimmer Network is not the whole ecosystem. Actually, it is only a small part of it. It is only the test-network part. The IOTA mainnet, and soon to come Assembly, will be much bigger areas of our entire ecosystem. So the question then arises, do either of those areas have methods to support an ecosystem expansion? Does the IOTA network and Assembly ecosystem have funds to support expansion? YES!

3. Does IOTA & Assembly Help Shimmer? - This answer is pretty clear. As we see every project that is newly built, or is building (ie: Soonaverse, Tangle Swap, LendeX, etc.) all of them are going to be building on the Shimmer Network. As would any new product, because they want a viable test environment as close to the mainnet as possible. So then we should look at, does IOTA and Assembly have funding in place to support the growth of developers and an ecosystem? The answer is clearly “YES”. The IOTA community has the Treasury Funds (vote is currently 85% “build”), The IOTA Foundation has the Economic Development Fund (being rebuilt in Switzerland), and the Assembly network has the majority of their tokens set aside for supporting community Dapp projects. As well as, the Assembly network has Venture Capitalist that have contracted to fund and expand the ecosystem.

If we do not increase the Shimmer supply by 20%, does this mean that we are handicapped and can not fund the ecosystem growth? Nope, actually as we know, with IOTA and the Assembly network, there are tens of millions, if not hundreds of millions of dollars ready to be dispersed and ignite an aggressive expansion of the ecosystem as a whole.

4. Should We NOT Create Any Treasury At All? - Though there are already hundreds of millions of dollars in tokens ready to support the growth of the Assembly, IOTA, & Shimmer (AIS) ecosystem as a whole, I always believe more is better! The question becomes, is it worth changing the overall token supply, simply to get a bit more value to expand the ecosystem?

Personally, I don’t think it is, simply because we can fund a Treasury through other means. Easily, we can fund it through transaction fees, a percentage of inflation, or other methods. To me, the benefits of increasing the supply to fund an ecosystem, in which we already have funding does not outweigh the potential negative image that will emerge. The image that on day one people came together to MINT tokens out of thin air to fund projects, as well, a decision that splits the community right off the bat. If there was no other funding such as with IOTA and Assembly, I would then think the positives outweigh the cons. Yet we do have funding. Another risk we would be taking also is that we don’t even know if the Shimmer token will have value. So we could go through all of this, hurt the image of the IOTA, Assembly, and Shimmer ecosystem, and in the end get no value return. Is it really worth taking the risk?

5. Do We Have the Governance Structure in Place? - Increasing the token supply is not a small decision, and should be one made with the full consensus of the community. The real question is, at the present time, do we even have a sufficient governance structure in place? Do we feel that such a discussion, and vote, will reach a true consensus of the community at present time? One that people won’t think wasn’t manipulated in any way? Personally, I think we are still young when it comes to governance as a community and ecosystem. We should take on easier and smaller decisions first. We should “build” the actual governance structure, test it and see that it is trusted. When it has history of fairly reaching the consensus of the community, then propose such significant changes at that time.

Saying all that, again, the point of the increase is to increase funding an ecosystem and “play the game” as Kappy described. Let’s just not forget that we already have a ton of funding, that we are already “playing the game”. More would chips in our stake to play would be even better, absolutely; but at what consequence? What risk do we want to take to get just a bit more leverage on top of the current leverage we already hold in this game?


exciting proposal!
Would the 20% participate in the Staking?

In my personal opinion, we have already earned enough smr as stakers, since we already have enough smr, then it makes more sense to vote yes for smr to rise. I say yes for shimmer

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you are right but it was not pre-sold to raise funds instead it was distributed free to stakers and now we need to support Shimmer for funding

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Hello Iota Foundation, I would like to know what is the position of the early investor that bought Shimmer for millions of Euros and now with this increase their invest will be devaluated. what is the estimation amount of the devaluation Vs the price increase in the with this incentive?

I support increasing the supply for construction. But I want the share that will be given to the developers to remain locked for a certain period of time, the locks will be opened gradually. Thus, it does not affect the price too much. The entire crypto ecosystem is doing this.

@dom @kappy

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The first thing that came to mind is how the newly created tokens will impact the view of the SEC in regards to it being a security or a commodity. So, far shimmer should be in the clear because of the fair coin offering instead of an ICO. Great care needs to be taken so that the issuance of the new coinage does not jeopardize this.

were any of these bought? i thought it was all given out via staking