Introduction: Amplified’s Telos Improvement Proposals (TIPs 13–19)
Amplified Telos asks the Telos community to consider changes to the TLOS token economy.
Overview
To succeed as a robust blockchain network that supports a vibrant application ecosystem, Telos must have a healthy token economy. To that end, the Amplified Telos team has identified numerous opportunities to improve the token mechanics of Telos. In this series, we propose seven modifications to the token economy. We recognize that the TBNOA has already been voted upon. Nonetheless, we believe that the token economy will benefit from closer examination. Pre-launch, we believe there’s still plenty of time to modify the token economy and doing so is crucial to Telos’ long term success.
That said — these Telos Improvement Proposals (TIPs) are not meant to be declarative; we are not saying with 100% conviction that Telos must do the following seven things. Rather, we share these proposals to spark conversation within the Telos community. Furthermore, we do not see these proposals as interdependent. We think the community could succeed by adopting one of these proposals, all of these proposals, or some combination thereof. Ultimately, our hope is that Telos will launch with a token economy that all stakeholders believe in and are excited about.
Below, please find dedicated links to each TIP:
- Introduction: Amplified’s Telos Improvement Proposals (TIPs 13–19)
- TIP 13 — Lower the maximum airdrop in the Telos Initial Distribution from 40,000 TLOS to 20,000 TLOS per EOS wallet
- TIP 14 — Increase the Telos Founders’ Reward Pool from 6 million TLOS to 25 million TLOS
- TIP 15 — Increase funding for the Telos Foundation from 6 million TLOS to 20 million TLOS
- TIP 16 — Fund a “give away” contest of 10 million TLOS
- TIP 17 — Capitalize the Worker Proposal Fund with 10 million TLOS upon launch
- TIP 18 — Frontload the TLOS inflation schedule
- TIP 19 — Set a 1-year expiration date for unclaimed TLOS in the Exchange Token Reserve Fund
- Conclusion: Putting it all together
Objectives
Before jumping in, allow us to outline the primary objectives driving these proposals.
First, we believe that if tokens are initially distributed to the right stakeholders, then Telos will be able to effectively grow its early community. We adopt the lens of an economic rationalist; we ask “why does this particular stakeholder need tokens?” and also “what is the optimal amount of tokens for this stakeholder?” each step of the way. As a result, we propose lowering the token allocation for certain stakeholders while increasing the token allocation for others.
Second, it is important that ongoing contributors are sufficiently compensated. If so, the Telos community will become financially self-sustaining. Otherwise, it may be too expensive for serious contributors to sustain operations, and Telos will struggle to attract and retain a robust network.
Third, we find it quite possible that the current crypto-bear market may continue for several years. If so, the price performance of TLOS will be uninspiring post-launch. Telos’ token economy must be structured in such a way that the network remains resilient through a protracted bear cycle. When estimating the price of TLOS, we expect that becoming a top 30 coin (with a marketcap comparable to that of Decred’s and Qtum’s) is not unrealistic. Such an outcome would earn TLOS a price of approximately $1.
Fourth, we believe that Telos will benefit from a relatively egalitarian token economy, such that no single individual controls a massive share of the tokens. An egalitarian token economy is desirable because unequal token allocations discourage new participants from contributing to the community. Moreover, for blockchains like EOS that have built onchain governance mechanisms, economic inequality translates into political inequality, which undermines the democratic ethos and participatory incentives of the network. Telos can stand apart from virtually all other blockchains (including EOS, where 1.6% of addresses control 90% of the tokens) by launching with a relatively flat token distribution. Accordingly, even though these proposals rebalance tokens across different constituencies, Telos will remain considerably more egalitarian than virtually all other existing cryptocurrencies. Whales that own several percentage points worth of a cryptocurrency’s circulating supply will not exist upon Telos’ launch and may never emerge.
About Amplified Telos
Amplified Telos is a team of engineers, designers, and product people. We amplify Telos ecosystem by contributing as a block producer candidate and also by engineering core blockchain infrastructure and higher level dapps. Learn more about Amplified by visiting amplified.software. If you have any questions about the content of this article, or want to connect and chat more broadly about Telos, please reach out to us on Twitter (@AmplifiedTelos), on our Facebook page (fb.me/AmplifiedTelosBP/) or via email (telos@amplified.software).
