Shimmer Growth Committee as part of Tangle Ecosystem Association

Governance Proposals Shimmer & IOTA [Phase 1] Discussions
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  • Yes, I support the idea
  • No, I don’t support the idea (reason why)

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Simple Summary

With the successful Shimmer launch we have opened a new world of opportunity. 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 important groups outside of our bubble that want to support Shimmer and to be a part of the growing ecosystem.

Shimmer’s full potential will be made available with the upcoming smart contract launch with the ShimmerEVM. In preparation for that, we want to significantly invest into growth, marketing and adoption efforts by expediting the capital allocation from the Community Treasury. We see a real need to allocate part of the 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 make sure that we do not miss this unique opportunity that was offered to us.

We ask the community to vote on two separate, but related proposals:

  • To elect 3 community members to join the Tangle Ecosystem Association’s “Shimmer Growth Committee” and to be empowered to quickly, effectively and transparently allocate the ecosystem fund. Their mandate will be for 1 year, to be renewed on a yearly basis.
  • 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 Community Treasury Committee (DAO) which is currently being setup by the community.

For Clarification reasons:
Tangle Ecosystem Association (TEA) - The Swiss entity that was founded this year 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).

Community Treasury Grant Committee - Independent Community driven and community governed entity that plans to establish a committee of 5 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 tokens (which are 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 is part of the Tangle Ecosystem Association and takes care of Growth and Adoption of Shimmer by allocating Shimmer tokens. We propose to let this committee decide over the use of 50% (90,681,025.5 SMR) of the Tokens that have been created for the Shimmer community

Abstract

Although Shimmer was a successful launch, we are still far from having reached the full potential of Shimmer. We are aiming for even more traction in the markets, and as was shown by some of our recently launched competitors, investing significant capital in airdrops, marketing and incentivizing the right players goes a long way in increasing significant market traction. We need to make use of our shared resources now to maximize our chances of success with Shimmer. Doing so will require incentivizing the right partners and builders and we need to invest into marketing and growth.

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. Instead, we should make use of the existing legal structure with 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.

Now is the time to be bold and really push Shimmer to new heights.

Motivation

As a new layer 1 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 IOTAs 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 an early phase, as the network launch was only 1 month ago, but especially now, in preparation for the smart contract ShimmerEVM release, we have to scale up our efforts and more aggressively push for the growth and adoption of Shimmer in the market.

Shimmer is perfectly positioned to capitalize on the current market conditions. Especially during uncertain times like the ones we experience right now, fundamentals and the right narratives matter. Shimmer hits all of the right 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 and many builders have taken the opportunity to be early and become one of the first DeFi, NFT or GameFi projects on Shimmer. Without a doubt, one of our biggest advantages is our strong community, who already to date have built close to 75 and counting dApps, NFT and GameFi projects on Shimmer. We are already supporting many of these projects and will increase our ecosystem support through the grant programs which will relaunch in the coming weeks under TEA as well as the community DAO.

Grants alone are however not sufficient to burst outside of our bubble to make Shimmer and its ecosystem be recognized beyond our existing community. We need to increase our allocation from the ecosystem fund now so that we can create the right incentives to on-board new investors, liquidity providers, important services and infrastructure providers and users to support Shimmer and the amazing dApps building on top of it. Incentivizing the right partners is an investment into the broader ecosystem, and we should therefore use the funding made available through the ecosystem fund for this.

We have an enormous opportunity in front of us, but it is up to us to realize it. Our competition has raised hundreds of millions of dollars from VCs and they’ve aggressively entered the market by incentivizing adoption. It is impossible for us to outspend them (which quite frankly, is the wrong strategy to begin with), but in a market like this, it’s difficult for us to compete without actually investing into the ecosystem.

In anticipation of the ShimmerEVM launch, we have to review our strategy and discuss openly how we can expedite ecosystem growth and maximize our chances of success with Shimmer. Our great ambitions for Shimmer need to be matched with the correct and timely capital allocation to spur growth, adoption and on-boarding 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.

The launch of Aptos has shown to us what can happen if the right players have significant incentives to push a project. The hundreds of millions they’ve raised at a billion dollar valuation was used f.ex. to pay for marketing, exchange listings and promotions. We are not advocating to go a similar path, quite the contrary, with Shimmer (and IOTA) we are positioning ourselves as the antithesis of Aptos / Sui - as a competitor that is fully community-owned. But we want the community to realize what we can achieve if we invest into our ecosystem and give the right incentives to builders, liquidity providers and important stakeholders.

Now is the time to be ambitious. Instead of hiding, we have to aggressively go into the market by allocating part of our ecosystem funding now. This proposal is meant to offer the community an option to allocate more quickly the ecosystem fund without having to wait 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 make use of the existing legal structure of TEA and begin making use of the ecosystem fund now already.

Community Treasury Action & Inaction

The current community treasury was meant to be set up through a DAO structure. While a handful of community members have done absolutely amazing work in defining the DAO governance structure, it is important to highlight that we are still in the very early stages with 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 simply not enough. We don’t propose to replace these amazing community-driven efforts, but instead we propose to set up a parallel stream which uses the existing infrastructure of TEA to expedite the process of allocating the budget to grow the ecosystem.

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 that we will cover all possible funding opportunities and really push Shimmer forward.

Tangle Ecosystem Association Budget

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 on-going ecosystem support, partner on-boarding 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 Liquidity Partnerships (50%)
  • Grant Program (10%)
  • Incentive Program (20%)
  • Marketing & Growth (20%)

TEA and its budget allocation differs from the Shimmer Growth Committee in that it will use its token allocation to directly on-board 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 (e.g. Airdrops could be jointly funded by TEA and the Shimmer Growth Committee), but with a lower priority compared to the former mentioned allocations.

The Shimmer Growth Committee

The Committee will consist of 5 members wherein 3 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). The Community members will be selected by a community vote. For the selection, we propose to follow the processes that are currently being developed for the Community Grant committee.

The Shimmer Growth Committee will actively identify high impact growth potential and engage in those opportunities with key players in the DLT space. The IOTA Foundation has a dedicated Team of professionals that have many years of experience and know the industry best. We have connections to resources that the community alone would have a hard time activating and so we will be able to start certain activities that have proven to be extremely successful for the growth of a network. The IOTA Foundation will prepare certain proposals to use the funds committed to the Shimmer Funding Committee and the committee will decide if these measures should be taken.

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. Other activities can and will be shared publicly with the community. At the end of each quarter there will be a transparency report that will highlight where and how the budget was allocated.

The 3 community members elected into the committee will be involved in all those decisions but are of course not allowed to give out information that falls under an NDA. The Shimmer Growth Committee will work alongside the community-governed DAO and TEA to allocate the capital from the ecosystem fund.

The Shimmer Growth Committee will use the tokens in the best interest of the Shimmer Ecosystem to initiate marketing and growth strategies which benefit the entire ecosystem. We could envision these activities to cover the following areas:

  • NFT campaigns and airdrops
  • Incentives for builders and liquidity providers
  • Targeted Marketing in Crypto media
  • Twitter campaigns
  • Targeted outreach in competing Ecosystems
  • Promotions with our partners

Specification

Firstly, we want the community to select 3 members from the community 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. The decision which specific measures will be embarked on will be made by the above committee and shared with the community at large in a quarterly report on its activities.

We want this campaign to last over a timeframe of 12 months from the point of receiving the funds. Any unused / leftover tokens will be redistributed to the Shimmer community Treasury at the end of this timeframe

23 Likes
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I support this, but as I mentioned a few times now… Imho, listing on all of the big exchanges for SMR and IOTA should be one of the main topics, even if there have to be paid listing fees. No success without every crypto investor having the opportunity to invest. :wink: Let’s gooooo!!!

12 Likes
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I agree with you, but don’t think it must be listed on every exchange… if we List it on 3 of the major ones would be enough imho.

5 Likes
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Finally, the problem is being addressed! Amen.

You really need to change something about the development time, things take too long!

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Support…we need to speed up things dramatically!

7 Likes
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Id like to nominate RyanG for the committee :trollface:

1 Like
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Thanks Dom,

I agree and think it would be great to have three funding structures in place (ie: the Community Treasury (100% Community), the Growth Committee (IF & Community), and the Tangle Ecosystem Association (TEA) (100% IF). Each has their own strengths, weaknesses, and ultimately can support the growth of the IOTA/Shimmer Ecosystem by all working together to capitalize on each others strengths.

The community Treasury is built to be for open-source projects and also maintain transparency as it should. The Community Treasury DAOs’ main strength is that it is decentralized with delegate management, yet built in a transparent manner as other community DAOs have been built within the Web3 crypto space. The weakness however is we would not be able to give out grants that may be subject to NDA’s or closed-source production. The Shimmer Growth Committee seems to be a nice hybrid creation to have community members in conjunction with IF members working directly together, all under NDA / KYC contracts, and have funding to give grants to be used to onboard the needed ecosystem growth accelerants such as: liquidity providers, investors, services and infrastructure creators, etc.

I do think at least the program lead, or co-lead, from the Community Treasury should have one of the three community positions in the Shimmer Growth Committee. This would allow the IF members within the Shimmer Growth Committee to act as a mentor, as well as, ensure that each Treasury is focused on different ecosystem areas of growth. It would be good to avoid multiple treasuries funding similar focused areas within the ecosystem. Allowing for interaction and communication between the three Treasuries Groups, by having a member of the Shimmer Community Treasury working within the Shimmer Growth Committee, as well as, IF members in the Growth Committee that have direct access and interaction with the the Tangle Ecosystem Association (TEA) team; this setup can ensure efficiency and best support for ecosystem growth.

Can’t wait to see this all go live #SOooONn!

5 Likes
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So the Community Treasury Fund will lose 50% of their funds or would the 50% come from the Tangle Ecosystem Association Funds. That would live the Community Treasury with only 35% of the Fund after the initial allocation of 15%. I’m not sure thats how I imagined our Community Treasury should be used.

Would prefer if the TEA and the Community Treasury each give 25% of their fund as the Shimmer Growth Committee will consist of Community and IF members.

7 Likes
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I feel like TEA is well diversified on its allocation and ready to take action anytime. If I understand correctly the motivation behind this proposal is urgency and Community Treasury can’t do the proper legal framework in time to take action. So from “capital efficiency” angle and in my opinion, taking 50% from Community Treasury makes much more sense.

8 Likes
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Just a few months ago the proposal was made and accepted to increase the Shimmer supply by 12.5% for the DAO, and 12.5% for IF’s ecosystem fund. This proposal as everyone here knows was accepted. So the obvious questions:

  1. Why is the existing 12.5% of the original supply, 10% of the current supply, which IF’s ecosystem fund has not sufficient? We are talking about $15M. Do you assume this will be spent in less than a year? If not, why not just request the money when it is required?
  2. What changed? Why was the idea just a few months back that this would be sufficient, and now it would need to be a 15%-5% division, where before the DAO even started the proposed setup is ignored. And of course, that is just a proposal and nothing voted on yet, but still.

I understand the points of not having to wait a few months before the DAO can be ready, but why can’t those months be bridged with the 10% of the supply you already have? And would the DAO be gutted by having over 3x its yearly budget removed before it even starts.

TEA and its budget allocation differs from the Shimmer Growth Committee in that it will use its token allocation to directly on-board individual partners (e.g. service providers, crypto funds or important individuals)

How should I understand this? The service providers I get (eg paying for listings). But how do you mean allocating funds to “important individuals”? Considering most of those are not really poor, it sounds to me like paying money to rich people? Hoping they then shill Shimmer to their followers?

6 Likes
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You do realize, that the 50% is coming from the Community Treasury ? How can anybody accept this proposal

3 Likes
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Hmmm… I didn’t see that at first read; for some reason I was reading it as a combination of the Shimmer Community and the TEA together as one funding the Shimmer Growth Committee. It would be nice to see a split between the two DAOs, maybe not specifically 50/50 to form a third DAO, but some sort of split between the two to form the third. Each one certainly has strengths that we actively need right now in the ecosystem.

I do believe it will still take time to build the Smart Contract and Legal Entity for the Shimmer Community Treasury, and we need to get funding out sooner than later. Which is clearly a strength that the Growth Committee would have over the Community Treasury. As well, the Growth Committee, having IF members involved, would allow for NDA funding which I believe is a strength that the Community Treasury does not have currently have.

It will be interesting to get others opinions on the 50% amount in this situation.

4 Likes
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IF is very proud presenting the Community Treasury Grant Committee and the DAO they are creating as examples how this community can be a big part of the picture.
This proposal is kind of contradicting: take major part of the budget and possible plans again into IF-lead constructions, leaving the crumbles for the CTGC.

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But why is the 180M Shimmer they already have solo control of not sufficient for this? Why was the idea a few months back that this would be sufficient? What changed?

Regarding funding closed source software, this would of course be a choice of the DAO to make, they can perfectly well fund closed source software. Hell they can also do NDA stuff, if it is implemented as proposed and they stay under the tier 4 limit. Yeah then you do need to change some of the proposed rules, but that quite frankly makes more sense than ignoring those proposed rules (and a bunch of others) by directly giving >3x your yearly budget away.

6 Likes
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I don‘t get it too.

Why isn‘t the energy going into speeding things up instead of taking away 50% from the Community Treasury. We are not stupid. The Community Treasury should be used responsibly.

Short term this might work out, but long term it will not help.

So I guess we are aiming for Aptos/Sui, lol

5 Likes
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For me this proposal leaves a bad feeling.

On the one side I agree that it makes sense allocating a larger part of the fund by using the TEA´s already existing functional structures, professional insights and industrial influence to promote projects above start-up level (which is what the Community DAO grant program would likely deal with most of the time) thus increasing the chance to strengthen the ties with the big industry…

…On the other side it is questionable to basically negate the first community proposal about the allocation of shimmer tokens by effectively halving the Community DAO´s stake from 10% to 5% of the total token supply and handing it over to a sub-organization of IOTA Foundation´s TEA. Increasing the TEA´s resources at the expense of the Community DAO and creating a proposal with a sense of urgency to get it through the vote shortly after the initial token allocation is a bit dubious.

In conclusion; Yes, the community would again have the final word and could decide about the proposal´s legitimacy in an open vote. And yes, reallocating funds in retrospect to better suit the economical circumstances is acceptable if it is communicated transparently and approved by the stakeholders. But it is strange to do this change of course so shortly after the initial decision of token allocation.

I suggest;
-the proposal that comes to vote has to clearly and transparently state the facts that the Community DAO´s fund is reduced by 50% in favor of the newly founded Growth Committee which is legally tied to the IF´s TEA, there should be no euphemisms or distracting texts
-the goals of the Community DAO still have to be sufficiently financeable with the reduced stake, hence the Community DAO working group should release a statement about this proposal aswell
-in my opinion it would be fairer if both funds (Community DAO and TEA) would reallocate 33% of their stake to the Shimmer Growth Commitee (thats around 60 000 000 SMR each), so there would be 3 organizations with a 120 000 000 SMR fund each

8 Likes
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I think the Community Treasury Grant Committee is a great thing, but if time is now of the essence and there is a concrete use for the money, I would give as much capital as possible to the Shimmer Growth Committee and with it the second 50% of the Community Treasury. Perhaps this could be set up as a loan of sorts to the TEA, which would have a term of 6-12 months. If everything goes according to plan, then the Shimmer price should rise in the coming months as a result of these actions implemented by the Shimmer Growth Committee, and with it the assets of the TEA, which will then return this amount after the DAO is established and the Community Treasury Grant Committee is ready for use.

I for one do not want to risk missing the boat now.

5 Likes
19

next scam proposal.
and people don’t even read. Wall of text wins

2 Likes
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What a HECK!
How can anybody support this proposal.
10 % of the shimmer tokens have been allocated at TEA, 10 % at the community treasury for setting up a DAO.
The active governance members already realized that it lasts too long to set up the DAO, hence there exists a recent and well-made proposal to make available 15 % of the communities’ tokens every year.
The poposition of setting up a shimmer growth committee is nothing else but action without proper planning.
We’d rather discuss this topic in the next governance calls and very pobably come up with a combination of shimmer growth and community grant committee.
Do not support this proposal!

7 Likes
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I am against this proposal for several reasons.

Currently, the treasury is valuated at ~14M. This is a pile of money, but it isn’t much for a treasury. I expect about 300k fixed running costs per year. If we hand out 100k a month, this is sufficient for about 9 years at the current token price. While we certainly hope for it, we cannot guarantee a pump. Once funds are depleted, the treasury is dead, so we need to be sure that we can survive a bear market. If the price goes down 50%, that 9-year countdown runs double speed. Currently, a two-year bear market with an average price of 0.04 wouldn’t be too much trouble, and the treasury would be down to 57% of the tokens. If we only run with half, we are down to 14%! And run dry the year after, even if the price rises to 50% above current levels. That is a significant increase in risk. I do not think we can afford this.

Also, this proposal would dump up to an additional 5% of the supply over the next year. This will significantly affect the token price. Don’t forget that.

If I understood the proposal right, this would make it three organizations, treasury DAO, TEA, and the Growth Committee. Every organization has fixed costs, which will quickly eat up the budget. In the current scenario where we have to housekeep our money, adding additional members to the payroll feels off.

Also, do we need to rush this so hard now? We are currently implementing community feedback into the grant committee setup. I expect this to be voted on-chain in late November/early December. After this, we would have to run the big election in the following months and set the entire thing up from a legal PoV. How much would of a “time save” would we achieve with this? Not too much, if you ask me.

In addition to this, I feel like mass marketing is not going to help us right now. Aside from minting and sending tokens & NFTs, there are no use cases to try out. They come with EVM, once our community has built the first dapps on it. IOTA still is burned in the crypto space for not delivering due to all the 2018/19 drama. If we make up big promises again, those people won’t follow. We need things working. Period. Rushing this is contra productive and a waste of money in my eyes.

And last but not least, why take the community funds for this. The reasons you described (non-public partnerships, industry knowledge) work perfectly for the TEA. I do not see any need for an additional committee. TEA has 10% of the supply for itself. If IF wants to go and do marketing, go for it. Task us to elect some community liaisons for TEA - no big deal. But I do not see any reason to use the community funds for this.

As described in the grant committee draft, everything above 200k dollars (since MCap is above 100M) is a Tier 4 proposal and requires an individual vote from the community. In my eyes, the community undeniably deserves a say if we spend more than 1% of the entire treasury in one go. The growth committee would bypass direct community engagement for quick actions. Having five people control 50% of the treasury clashes with the core principles of a DAO.

If we truly need some quick dollar, we have to vote for this. The budget can be topped up if a majority wants this chance. Or we can decide to spend funds bypassing the grant system. We can look for ways to speed up the governance process in extraordinary cases, like going directly to firefly or making exceptions to phase 2 timings. But using the community funds without engagement is an absolute no-go to me.

14 Likes