Shimmer Growth Committee as part of Tangle Ecosystem Association - Version 2

Shimmer Growth Committee as part of Tangle Ecosystem Association - Version 2

This is an updated version of the initial proposal, contains clarifications, and implements community feedback.

Do you support this proposal?
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Simple Summary

We have opened a new world of opportunity with the successful Shimmer launch. Not only was Shimmer received very well by the market - exceeding our initial expectations - but we’ve also received significant interest from investors, builders, and essential groups outside of our ecosystem that offers to support Shimmer and be a part of this growing ecosystem.

Shimmer’s full potential will be available with the upcoming launch of the ShimmerEVM. In preparation for that, we want to expedite community efforts around growth, marketing, and adoption efforts by expediting the capital allocation from the Community Treasury. We see a real need to allocate part of the Community ecosystem fund alongside the existing Tangle Ecosystem Association (TEA) treasury to accelerate our ecosystem growth and adoption. Now is the time to be ambitious with Shimmer and ensure we do not miss this unique opportunity.

We ask the community to make a decision on our proposal:

  • To elect three community members to join the Tangle Ecosystem Association’s “Shimmer Growth Committee” as Community Delegates and to be empowered to allocate the ecosystem fund quickly, effectively, and transparently in a joint effort together with the Tangle Ecosystem Association. Their mandate will be for one year, to be renewed yearly.
  • To use the established legal structures of the Tangle Ecosystem Association as the responsible entity for allocating 50% (90,681,025.5 SMR) of the Community Treasury Shimmer tokens. Through the legal structures of TEA, the Shimmer Growth Committee will fund the ecosystem alongside the Tangle Ecosystem Associations’ efforts and the Community Treasury Committee, which is currently being set up by the community.

For Clarification:

Tangle Ecosystem Association (TEA) - The Swiss entity founded to be the primary entity responsible for ecosystem support for Shimmer and IOTA. This entity has received 10% of the Shimmer supply (181.362.051 SMR) and has the sole purpose of increasing the adoption and growth of the IOTA & Shimmer Ecosystem. The TEA will use its received funding for this purpose.

Community Treasury Grant Committee - An Independent, Community driven, and community-governed Committee currently designed by the Community Governance group that proposes to select five members through Governance decisions currently discussed and proposed in the IOTA Governance Forum. This committee would receive 15% (27.204.307 SMR) of the Shimmer community treasury tokens (10% of the whole Shimmer supply 181.362.051 SMR) and give out grants based on grant applications submitted to this committee.

Shimmer Growth Committee - A Committee that takes care of the Growth and Adoption of Shimmer by allocating Shimmer tokens from the community treasury. We ask the community to let this committee of community delegates and TEA members decide over the use of 50% (90,681,025.5 SMR) of the Tokens. Additionally, the Tangle Ecosystem Association will add to the Growth Committee’s initiatives.


Abstract

Although Shimmer was a successful launch, we are still far from reaching its full potential. We want to be more ambitious with Shimmer and attract more builders and dApps to join our ecosystem to unlock its full potential.

As shown by some of our recently launched competitors, investing significant capital in the community and ecosystem will reflect positively on the traction and growth of the project. We need to use our shared resources now to maximize our chances of success with Shimmer. We can no longer be held back by doing things slowly. Setting up our community DAO structure will take months, by which time this unique opportunity with Shimmer and our DeFi ecosystem will have faded away.

To avoid this, we should use the existing legal structure of the Tangle Ecosystem Association (TEA) to efficiently and quickly allocate the ecosystem fund and help us achieve our objectives with Shimmer. To ensure the community is actively represented in allocation decisions, we want to involve trusted community delegates through the Shimmer Growth Committee.

Since Shimmer launched successfully, several promising opportunities have been brought to our attention. We believe that we must use these opportunities now to grow the adoption of Shimmer and its technology and advance its positioning in the market. With this proposal, we want to empower the community to take matters into their own hands and fund new initiatives with a part of their treasury tokens.

Now is the time to be bold and push Shimmer to adoption.


Motivation

As a new layer one smart contract network with a fair token distribution and a nascent dApp ecosystem, Shimmer has opened up a new world of opportunity for us. For the first time since IOTA’s inception in 2015, we are now empowered with the necessary tools (smart contracts) and incentives ($SMR, dApp tokens) to create our own success. This unique opportunity offered by Shimmer is still in the early phase, as the network launch was only one month ago. In preparation for the smart contract ShimmerEVM release, we must scale up our efforts to onboard builders and dApps to Shimmer.

Shimmer is perfectly positioned to capitalize on the current market conditions, especially during uncertain times like the ones we currently experience. Shimmer hits all of the correct narratives which excite the market: fixed supply, sustainable tokenomics, parallelized execution through our DAG ledger, multi-chain smart contracts, modular architecture, proven and successful team, large dedicated ecosystem, etc. Most importantly, we finally have the technology to prove it.

Over the last 12 months, we’ve already laid the groundwork with Touchpoint to support our ecosystem. Many builders have taken the opportunity to be early and become one of the first DeFi, NFT, or GameFi projects on Shimmer. Undoubtedly, one of our most significant advantages is our strong community, which has already built close to 75 and counting dApps, NFT, and GameFi projects on Shimmer. We, as TEA, are already supporting many of these projects. We will increase our ecosystem support through grant programs, which will relaunch under TEA and the community DAO in the coming weeks.

Grants alone are insufficient to burst outside our bubble to make Shimmer and its ecosystem recognized beyond our existing community. We need to increase our allocation from the ecosystem fund to create the right incentives to onboard new investors, liquidity providers, essential services, infrastructure providers, and users to support Shimmer and the amazing dApps building on it. Incentivizing the right partners is an investment into the broader ecosystem, and we should use the funding made available through the ecosystem fund for this.

We must match our grand ambitions for Shimmer with the correct and timely capital allocation to spur growth, adoption, and onboarding of the right partners. In the end, we cannot build Shimmer alone - we need to have an entire ecosystem of applications, exchanges, and liquidity providers supporting us to be successful.

Now is the time to be ambitious. Instead of hiding, we have to aggressively go into the market by allocating a large part of our ecosystem funding now. This proposal is meant to offer the community an option to distribute the ecosystem fund more quickly without waiting for the DAO structure and legal entities to be set up in the first place. Instead of waiting months until we can allocate ecosystem funding, we can use the existing legal structure of TEA and now start to use the ecosystem fund.

We also want to highlight that certain aspects of a growth strategy cannot be executed by a transparent and fully community-driven organization like the Community Treasury committee. Without the additional creation of the Shimmer Growth Committee, we would not be able to do a lot of the very effective growth measures in our reach now.

Community Treasury Action & Inaction

The current community treasury was meant to be set up through a DAO Committee structure. While a handful of community members have done fantastic work in defining the Community Treasury Committee structure, it is essential to highlight that we are still in the very early stages of community & DAO governance. Most importantly, we are still missing a legal structure for the DAO, which takes time to finalize and set up.

The current proposal to the community of spending 15% of the ecosystem fund budget over the next year via a Community Treasury Committee is not enough to enable Shimmer’s full potential. But it is, of course, a reasonable approach for the community to begin their journey as a DAO and an entirely community-driven organization slowly, step by step.

We don’t propose to replace these great community-driven efforts. Instead, we suggest setting up a parallel stream that uses the existing TEA infrastructure and expertise of the IOTA Foundation’s professionals, our connections, and partners to expedite allocating the budget to grow the ecosystem more efficiently.

For that reason, in addition to allocating 15% of the budget via the Community Grant Committee, we want to allocate 50% of the budget alongside these fully community-driven efforts through the Shimmer Growth Committee. This ensures we will cover all possible growth opportunities and push Shimmer’s adoption forward.


Specification

The Shimmer Growth Committee

The committee will consist of 5 members, wherein three are voted in by the community and 2 are members of the IOTA Foundation (Christian Saur from the Touchpoint Team and Holger Webel from the Ecosystem team). A community vote will select the Community members. For the selection, we propose following the processes currently being developed for the Community Grant committee.

The community will initiate a Governance vote selecting 5 Committee members for their Shimmer Community Treasury Committee. One of the members will be chosen as the Lead and work in a full-time position for the Community Treasury to facilitate all activities of the Community Grant program. Four reviewers will be selected as part-time / freelanced committee members that will mainly review grant applications and decide on spending.

We propose that the selected Lead and the 2 Grant reviewer candidates with the highest vote count of this selection process will automatically become the three community delegates sent to sit in the Shimmer Groth Committee. They will therefore sign service provider contracts with the Tangle Ecosystem Association that include Non-Disclosure-Agreements. This ensures that the highest trusted community delegates will have access to the information and proposals in the growth committee and act in the community’s best interest. By working with the TEA professionals and getting insights into how this industry functions, they will earn valuable experience that will allow them to be more effective in the decisions taken by the Community Treasury Committee later on.

The Shimmer Growth Committee will actively identify high-impact growth proposals and engage in those opportunities with key players in the DLT space. The IOTA Foundation has a dedicated team of professionals with many years of experience who know the industry best. The IOTA Foundation will prepare specific proposals to use the funds committed to the Shimmer Funding Committee, and the committee will decide if we should take these measures.

Proposals and decisions of the Committee cannot always be made public due to contractual agreements that need to be held under NDA with some of these partners or for strategic reasons. Other activities can and will be shared publicly with the community. At the end of each quarter, there will be a transparency report highlighting where and how the budget was allocated. This report will be produced by the five committee members and will include details of all spending that can be disclosed. Spending decisions that fall under NDA may be summarized under general terminology (i.e., “Marketing activities”, et.)

The three community members elected into the committee will be involved in all those decisions but are not allowed to give out information that falls under an NDA.

Committee Setup Process

Firstly, we want the community to select three members who, together with two members from the Tangle Ecosystem Association, will form the “Shimmer Growth Committee”.

Secondly, we ask the community to allow us to send 90,681,025.5 SMR from the Community Treasury address smr1qrmakyqt5ezm5k9c0sk39gwfavpktxkjmx0jvh9ejxjq6pr6d39egv2mvuc to the Tangle Ecosystem Association and to empower the Shimmer Growth Committee to allocate this funding towards the growth of the ecosystem.

  • Every member of the committee will have one vote in every decision.
  • The majority decision (3 of 5 votes) decides on the approval or rejection of a proposal.
  • The Tangle Ecosystem Association and the Growth Committee itself will bring forward Proposals to the attention of the Growth Committee.
  • The Tangle Ecosystem Association has no voting or veto rights of the committee and its capital allocation.
  • The Growth committee will discuss all proposals in meetings within the committee.
  • Every committee member will sign contracts and NDA agreements with the Tangle Ecosystem Association.
  • Community delegates will be compensated for the work in the committee with an hourly rate of 50 USD paid in stablecoin.
  • The Growth committee will pay the compensation of the community delegates on an invoice basis from its budget.
  • We want this committee to last for at least 12 months from the point of receiving the funds. It can be extended by a governance vote.
  • We will redistribute any unused/leftover tokens to the Shimmer community Treasury at the end of this timeframe or aim for an extension through a governance vote.

Tangle Ecosystem Association Budget and use

The Tangle Ecosystem Association has received 10% of the SMR tokens as part of the Shimmer ecosystem fund. TEA, alongside the Shimmer Growth Committee and the Treasury DAO, will work on allocating its budget to the ecosystem over the coming months. While a large portion of the tokens will be reserved for the ongoing ecosystem support, partner onboarding, and team expenses, TEA will also start its own grant program and spend part of its own budget on marketing & growth-related expenses.

To provide a rough overview of the budget allocation of TEA:

  • Infrastructure and other partnerships (50%)
  • Grant Program (10%)
  • Incentive Program (20%)
  • Marketing & growth (20%)

TEA and its budget allocation differ from the Shimmer Growth Committee in that it will use its token allocation to directly onboard individual partners (e.g., service providers, crypto funds, or important individuals) by running a dedicated grant program or by funding development or research of universities or other research organizations. TEA will also partially fund community initiatives alongside the Growth Committee but with a lower priority than the previously mentioned allocations.

Implementation

The following measures need to be taken:

  • The community decides on the five members of the Shimmer Community Treasury Committee in a Governance vote in Firefly - The application process is defined by the Community Governance Group
  • A vote can happen as soon as Firefly Shimmer is ready to facilitate Governance votes
  • The elected Committee Lead and the two top-voted reviewers sign contracts with TEA
  • Constitutional first Meeting of the Growth committee, where processes will be clarified, can take place
6 Likes

I voted against because I think the 50% part (5% of SMR supply) devoted to the new Shimmer Growth Committee is far too much spending in a short time frame, and leaves too little to the DAO. The TEA has already got 10% of the SMR supply, which is a lot. The TEA could use their funding as fast as they see fit, and the community fund should be used for the long run by the DAO.

4 Likes

Ignoring that most of the general questions regarding this proposal have been ignored in the previous thread (which Dom managed to close but not to answer accordingly), here are some things which comes into my mind:

  1. High level understanding. I don’t think the illustration of “Shimmer Ecosystem Funding” is correct but misleading. The 50% funds of community are operated under TEA not the Community, so this I believe the following illustration is more accurate:

20_smr_overview

  1. Governance. In the illustration and also some part of the text it says, the IF will propose the projects for spending the funds. This is contrary/misleading to

“we want to empower the community to take matters into their own hands and fund new initiatives with a part of their treasury tokens.”

Illustration (Box “Shimmer Growth Committee”):

"Approves spending for projects and partnerships proposed by the IF "

Text:

“The IOTA Foundation will prepare specific proposals to use the funds committed to the Shimmer Funding Committee [=Growth Committee?], and the committee will decide if we should take these measures.”

It needs clarification. Are we talking about a set up of: 3x community member + 2x IF member voting on IF proposals only? (Clearly indicating empowering community even less)

  1. Conflict of interest.

While conflict of interest issues are specified for the Community Committee Reviewer, accordingly for Growth Committee, and information can be found in the applications, what are the specifications/where can I find statements for 3.1) TEA member Saur & Webel? Especially for 3.2) the IF as they act supporting to the Growth committee (“The IOTA Foundation will prepare specific proposals”, see also 2.) ). It also matters because of the affiliation of Dom in SmartContract AG or Nakama (Advisor) and e.g. the public dispute of Nakama and Touchpoint supported “DeepR vs. Lendexe”.

  1. Transparency.

“At the end of each quarter, there will be a transparency report highlighting where and how the budget was allocated.”

4.1) How can we trust, TEA will not cease transparency just as they did for EDF? EDF are community raised funds in MIOTA to support the ecosystem in the same way as TEA and Growth Committee is intended to. After some transparency Dom and IF stopped (Q1, 2021) the obligation sharing where the funds are going to, despite multiple inquiries of the community. 4 Tis are undeclared/missing now..

  • Why did you stop the tansparency?
  • Why does the community have to ask for 2 years now?
  • How can you ensure you will do better with TEA, while you trample all over past transparency promises?

I gladly remind you, the community is not a cash cow and it is not just “taking but also giving”.

4.2) 47% of the TEA funds have been moved to new adressesm without any transparency. The SMR increase was an initiative for the ecosystem, funds free to use for TEA, so there should be some information on this. As seen in the illustration, the transparency part is also simply let out on the illustration. Why is that? When we voted to increase the SMR by ~360M SMR the rhetoric was not like this.

4.3) Transparency for the Growth committee

“Spending decisions that fall under NDA may be summarized under general terminology

This is vague and should not “may be” but at least the minimum requirement for transparency where NDA funds have gone. There are many ways to give information without breaking NDAs.

5 Likes

Thanks for the comments. I voted yes because spending needs to occur sooner rather than later, but this is akin to changing the original allocation to 5% to the SMR Community Treasury and 15% to TEA, which is confusing. I would have voted yes then, if that was the choice.

1 Like

I have read the proposal and fully support it. Having been in crypto for many human years and decades in crypto time, I have learned through several market cycles that the most important stages for a project are the period before it launches, as it tries to gather hype and momentum, and then the first year of the project as it tries to make its indelible mark on the crypto space.

I believe we have successfully launched with the best layer1 tech, and as both networks will only exponentially improve with smartcontracts and Coordicide, it’s time now to strike when the iron is hot—with the outreach, marketing and various platform campaigns this proposal recommends. Otherwise, we could limp along the first year, and no matter how much funds we throw at it later, we will never be able to again take full advantage of that fresh feeling a new project exudes, that feeling of endless possibilities and potential.

I believe initiatives like this are a big first step in the right direction, particularly the community and the IF working together at this kind of level as well as the necessity of spinning up our marketing efforts. I support any increase in transparency and collaboration, and the IF and voted representatives of the community embarking on a joint venture with NDAs involved is a fantastic start.

The only change I would suggest in the provisions is to possibly consider having the whole Shimmer Grant Committee signing ndas and not just the lead and two grant reviewers. Even though only the lead and the two grant reviewers will preside over the Growth Committee with the two TEA (IF) members, I believe the whole Shimmer Grant Committee having access to the same information would be beneficial for various reasons. One being they might all need the same information to make the best decisions possible when reviewing grants. And another is that in the spirit of fostering a healthy atmosphere in teamwork it might not be best to launch the Grant Committee with divisions amongst the members, especially in regards to information. That being said, it is a small addendum that might be worth considering to an overall strong proposal.

Let me finish by saying that I understand why people are focusing on how the funds are being divided up, which of course is important, but after all these years, I trust the integrity of the IF and the community when it comes to allocation of funds. What we need to do right now, however, is focus on this narrow window of opportunities—as time is our most valuable resource. We cannot afford to squander the chances presented to us now as this window closes.

2 Likes