Carbon Vote #2 : AMA on Reddit and Discord, Addressing Concerns
Below are the relevant links to check out regarding Carbon Vote #2:
- Reddit open AMA — The team will do a check every 12 hours and respond accordingly.
- Carbon Voting 2 site
- Carbon Voting 2 Proposal (IPFS) Updated as of 20th August 2018, 1pm SGT
- Live discussion on Digix’s Discord channel #dgdao-governance
We announced our Carbon Voting 2 exercise last Friday 17 Aug for DGD token holders to decide on the disbursement of USD 20MM from our DigixDAO Crowdsale funds to accelerate the growth of the Digix ecosystem.
Over the weekend, we have been monitoring the comments and feedback from the community. We were intentional in not making an official statement over the weekend so as to give everyone some time to gather their thoughts and also to engage with discussions amongst each other in the community. We thank you for your patience over the past 48 hours, as we know that if we engaged too early, we might shape the discourse in a narrow direction.
We address some concerns that were highlighted.
- Why the short duration of voting of 15 days?
We set the voting period to 15 days based on past precedence in Carbon Vote 1. We have seen >25% of DGD participation within the first 10 days of Carbon Vote 1, hence we believe that an extra 2 weeks may just be an unnecessary delay.
In fact, most voting rounds in DigixDAO Governance (when it goes live) will tentatively have a similar timeframe.
Everyone is free to change their vote anytime before the deadline.
Please also note that we will be conducting an AMA throughout the duration of these 2 weeks through the links shared above, so please reach out to us via the links above if you have any questions about the proposal.
- Can we have more details on how the budget is allocated and how long it will last for?
We did not intend for the first proposal to be a document that is imposed on the community with finality. Instead, we envisioned the proposal process to be one that is consultative and iterative in nature, just as how it would be when DigixDAO governance is live with us (or the proposer) taking into account any feedback and comments from the community
As we have heard from your suggestions, we have included more details about our budget estimations and timeline in the latest version of the proposal. Please feel free to drop us a note on Discord, Reddit or other channels should you have any questions. Where we are unable to provide further specifics or details on business plans, we seek your understanding that this is due to a consideration of business risks involved in revealing our competitive advantage in the public sphere, and sabotaging the effectiveness of these plans when they are later executed in the future (for example, clearly stating what we believe is required to list on major exchanges may change the price during negotiations).
- Should we put some of the ETH into a CDP?
We are not intending to speculate with this amount of monies. We could consider doing that with a small % of ETH for experimentation and as a show of support for the MakerDAO team, but the bottom line is, we need to be certain of the cash flow for the next 3 years. If Ether was to take a huge hit / a new blockchain that comes that becomes the de facto standard instead, the CDP could be liquidated and we would be in trouble.
- Why carbon vote now and not previously when the community was demanding it?
We were not comfortable in asking for funding when DGX was not live. We made a promise to deliver what makes DigixDAO work first, which is to release our gold backed tokens DGX before asking for funding, hence it was not possible to call for this in December. We also needed at least one quarter (4 months) to test the full life cycle of our Proof of Provenance protocol (with the audits in place) before this call for funding was made.
- What has changed in terms of plan that makes the team think that they need 4x USD value of what was raised (USD 5.5mil).
The entire crypto landscape has changed drastically since 2015. The listing fee on Bittrex was USD 5k 3 years ago. Fast forward to the present, top tier exchanges are charging exorbitant listing fees. Fees for services provided in the blockchain space now (such as legal, marketing, PR) have been excessively inflated, such that if we want to globally scale and expand to cover even other jurisdictions, calling for only 5.5mio would not sustain our business.
We were fortunate to have raised when Ether was at USD 15 but times have changed and the tide and scale of competition have risen.
- Why do you need to take out 20mio dollars at one go — why not take out 6mio first to fund the first period, and ask for more funding when it is needed?
The reality is that there are several areas that we need to work on, including hiring headcount and marketing expenditures. Among them, headcount makes up the most. Developers and employees need to see long term sustainability in the project, and if they realise that company funding is going to dry up with an uncertain future on the approval on more funding to keep it going an extra year, they would be looking for other jobs within 9 months of joining Digix, or not even decide to take a leap of faith. We have to understand that not everyone we hire believes in the vision of what the blockchain brings, have a family to feed, and a sustainable career is more important to them. This gives them added confidence to stay with us and build for the long run and see it through.
Also, if in the second year of the appeal, Ether for some reason drops by as much as 90%, we will be in trouble when what we have raised deflates overnight, and hence we need to take a longer term horizon in our funding request.
- How would Digix do the treasury management for this funding, if it is passed?
We will work with active Treasury Management solutions companies to ensure that we manage the risks involved to the best we can. We will discuss with them the best way to liquidate ETH to Fiat if we pass the appeal. It could be over the course of weeks / months, but definitely not all at one go. This is still in the process of being worked out. We cannot expose our full liquidation strategy or would risk getting exposed to parties who try to game us.
Parts of the funding could be diversified into DAI potentially.
We look forward to your participation in Carbon Vote #2. Thank you.