Monastery DAO Governance: A New Way To Govern
Greetings Monks! It’s been very productive here in the background as we move the project forward. Here are some quick updates…
- We are releasing the date for ICO launch SOON (just finalizing a few things)
- We’ve been watching the entire landscape & seeing what has happened with other DAO’s & have adjusted accordingly (this plan with governance has been one of the strategies we’ve developed)
We are working diligently to ensure that we have a massively successful launch and a sustainable DAO over the long term.
We have a variety of plans we are going to be sharing here such as investment plans, DAO advancements, etc. However — any plan is contingent on community voting thus why we are releasing this article first.
We’ve seen that traditional governance via purchase protocol governance tokens on the open market can lead to massive manipulation for the voting system.
We were thinking long and hard on how to eliminate these problems to ensure whales don’t take over from the start.
We’ve come up with a very solid solution after watching other DAO’s and their participants feedback and we are calling this Governance 2.0
A step up from previous governance strategies but with a twist.
Liquid Staking But Not Liquid…
If you are familiar with liquid staking protocols such as Lido then you can skip to the next section.
If you grasp the concept of Liquid Staking that is great but here is something we need to make clear before you skip to the next section. You need to understand that these governance ‘liquid’ tokens are simply just acting as ‘receipt tokens’ that are NOT LIQUID. They are going to act as a ‘receipt’ as proof that you are participating in the staking pool.
What IS Liquid Staking?
To understand what we are doing you need to understand liquid staking first.
Typical staking protocols you would need to stake your TOKEN and then there would be a ‘lock period’ where you can’t access those tokens.
The lock period of different projects can be whatever they decide. This lock period is rather self explanatory as it ‘locks’ your tokens as a holder, causing them to become illiquid.
Here is an example…
Let’s say you lock your ETH in the ETH 2.0 PoS when the pools first launched. The minimum amount was $25k ETH with a 12 month lock period and the return was 8%. However once you lock your ETH for 12 months you CANNOT sell that ETH that you locked up.
So if you deposited ETH at $2,000 and then it goes to $5,000 but you have 5 months left, you cannot liquidate your ETH until you surpass your lock period.
Platforms like LIDO, Yearn (and many others) have appeared where you can participate in these staking pools and earn your APR from participating.
However they provide you a minted token that is paired 1:1 with your investment and that token becomes LIQUID!
So let’s say you participate in their ETH pool where you get 5% APR — if you participated in the ETH regular staking pools then you’re locked up for X time period.
With LIDO you are receiving a token they mint for you that is exactly how much you staked.
If you stake 1.5 ETH in Lido you get 1.5 stETH. stETH (LIDO’s token they mint for you) is pegged to ETH main price.
If you want to liquidate your stETH, by all means you can. You can easily transfer it to an exchange like GATE.io and sell it for USDT.
Summary Of Liquid Staking…
Liquid staking is where you stake your initial token and receive back a token that is LIQUID (means you can sell it).
However it also acts as a ‘receipt’ or proof that you are participating in that pool. It’s simply another token.
What Does That Mean For Us?…
Well, the Monastery governance ‘receipt’ token is NOT going to be liquid… HOWEVER the token that it is pegged to (main governance token) is going to be liquid.
Receipt token: Not liquid
Native Governance Token: Liquid
Introducing Our WEIGHTED Governance 2.0 Objective?…
Governance token holders will be able to vote ONLY if they have this ‘receipt’ token.
Let’s use 100 governance tokens as an example. Let’s also say that the max supply is 1,000 (for example purposes). That means having 100 governance tokens will (theoretically) give you 10% vote. That is how it traditionally works.
Rather than granting a 1:1 voting power, participants are going to have to LOCK their Governance tokens for X period of time and in return they receive a token that CAN BE used for voting purposes but it will be weighted.
How does it work exactly?
Let’s go back to the 100 tokens example. We are going to create a staking portal for governance tokens that have multiple different options for ‘locking’ your governance tokens for X period of time in return we mint you the ‘receipt token’ that will allow you to vote on proposals.
For example if you have 100 tokens you can pick from multiple options (the locking period is yet to be determined).
Option 1: 1 Week Lock
Option 2: 2 Weeks Lock
Option 3: 1 Year Lock
Option 4: 2 Year Lock
However, each lock has a % reflection on your BASE staking tokens.
xgTOKEN = gTOKEN * option
Weighted Voting Is HERE…
The lower time frame you pick to lock your tokens the less of a vote you have when your voting token is minted. Let’s say the 1 week lock up is 10% voting rights that means out of your 100 tokens your vote will ONLY count as 10 tokens.
Let’s say 2 years is 75% voting rights. Your 100 tokens will have the same voting rights as owning 75 tokens.
NOT the full 100!
This is going to deter voting manipulation extremely well
Whale Manipulation Stops Here…
Not only does this make the protocol much ‘safer’ and trust worthy this also shows how the Monastery community ‘health’ is doing.
If we have more participants staking their tokens for long periods of time it shows the community is in it for the long haul.
This also means that tokens become in SUCH high demand since they will be locked up driving the price of governance tokens very fast to the upside.
Less governance tokens on the open market with high demand = higher price.
The most important part is that it stops whale manipulation.
If you paid attention to DAOs that recently failed, whales were quickly acquiring governance tokens at a rapid race to make the needed changes FAST.
If whales did this with Monastery governance tokens, in order to have a meaningful effect on their tokens they would need to buy in significant amounts AND they would need to lock their tokens for a long time period.
So essentially the ‘small investor’ has the same say in voting as a whale if the small investor is playing the long term game.
This is a 3 way win.
Can it be manipulated still? Down the road it is possible. But remember the tokenomics — at the very start it is NOT easy cause there isn’t a heavy circulating supply on the open market.
With this feature we are implementing from the start the supply shock for governance tokens is going to be immense.
As we believe this is extremely smart to implement and we are the first to really push forward with this system — we hope the community receives it positively as we are always striving for innovation, stability and long term growth.
The fact we’ve been watching the entire landscape has been a true blessing. We aren’t rushing because we want to implement ‘fail safes’ like this one where we believe the backbone of the community should be priority.
We want your opinions as well! Feel free to leave feedback where you see fit…
Becoming A Monk Is Simple…
If you want to become a Monk and participate in the Monastery DAO this is your chance! You can grab a Monk off the floor.
Don’t forget the more Monks you possess the more governance tokens you are allowed to claim.
Immortal Monks Team
Official Website: https://immortalmonks.com
Official Discord: https://discord.gg/immortalmonks
Official OpenSea: https://opensea.io/collection/immortalmonks