MoonCat Community Accessories Vote
On January 12, 2023, the MoonCat Community members launched a proposal vote on Snapshot regarding how the MoonCat assets appear on Marketplaces. This is a retrospective taking a look at two key aspects of that vote, from the perspective of the maintaining team. Firstly, there’s the topic of voting in general, including how did the process itself go, and what can we learn from that. And secondly, the outcome of the vote and the effect it’s had on the project.
A History of Voting
The MoonCatRescue project has a precedent of gathering feedback from the community of holders, and has had several community votes. These votes have taken a few different forms and used a few different technologies to host the votes themselves. As the concept of decentralized organization is still quite young, it’s good to keep evaluating the tools being used, and see if they’re good fits for what the project needs.
Taking the Path of Heroes…
The first vote that was organized for all MoonCat holders took place shortly after the Insanely Cute Operation completed (the collection was minted out). The MoonCatRescue project launched in 2017, and took until 2021 for the rescue ship to fill up with rescued MoonCats. The project design created 25,600 spaces for MoonCats to join the blockchain as digital denizens, but only 25,344 were reserved for “rescued” MoonCats (ones that anyone could find by “searching the moon” in a unique proof-of-work mechanic). The other 256 spots were reserved for unique Genesis MoonCats (easily distinguished from the rescued MoonCats because all Genesis MoonCats are black- or white-colored, while all rescued MoonCats are all other colors of the rainbow). However, by the time the project was full on rescued MoonCats, only 96 of the 256 had been released for adoption.
Many of the new MoonCat owners felt it important to set the tone right away by declaring decisively what would happen with those other 160 Genesis MoonCats; would they be released now and bring the total up to 256 as the original design called for? Or because they had not been released for adoption before the rescue operation completed, would they remain on the moon and off the blockchain? The project organizers decided to put it to a vote.
The method that was used for that vote was a custom smart contract, with a merkle tree coded into it that included 6,110 eligible addresses as voters. With a 48-hour window given to vote, 1,311 addresses cast a vote. The outcome of that vote was that the Genesis MoonCats took the path of heroes and remained on the moon, not joining the rest of the MoonCats on the blockchain. 1,311 out of 6,110 is 21.45% of eligible voters voting. Is that a good percentage? In theory nearly all those eligible voters were active, since they had taken part in the end of the rescue mission just a few days prior, and ponderware as the vote organizers heavily incentivized voting by raffling off several MoonCats to those who had cast a vote.
As a benchmark, voting in US elections typically sees 40–60% voter turnout. And the expected typical response from cold-calling/mass-mailings is around 2%. This MoonCat community vote gathering a response rate between those two is an okay starting point, but definitely room to improve.
Also, this vote used the logic of “one person, one vote” for how voting power was distributed: each Ethereum Address that had interacted with the MoonCatRescue smart contract was granted one vote. This is not exactly each person getting one vote, as a single person may have interacted from multiple addresses, but is pretty close.
Accessory Sentiment Vote
The second key vote of the MoonCat community was a sentiment vote to gather feedback on the perception of MoonCat Accessories. Instead of a custom contract, Snapshot.org was used as a tool to manage the vote. And rather than having each Ethereum Address have one vote, a weighted voting method was used, which gave additional weight to users who owned MoonCats, and lesser weights to addresses who interacted with other parts of the MoonCat ecosystem (lootprints, MoonCatPop, and MoonCatPop Vending Machines). A total of 6,367 Ethereum Addresses were elegible to vote. The vote ran from April 25 to May 2 of 2022. At the end of the vote, 158 addresses (2.48% of all eligible) had cast a vote. That was dramatically less than the 21.45% of eligible voters that voted in the previous vote. Looking at it from the perspective of the held assets, 1,944 MoonCats (7.6% of total) were accounted for in the vote. That’s a slightly higher percentage of eligible than counting by address, but still significantly less than the previous vote.
In terms of process, after this vote, there were lots of concerns discussed. The small number of responses meant it was hard to tell if this was a representative sample or not. Feedback received included the fact that some people didn’t vote because they were inactive, but rather they didn’t have a strong opinion on the topic, or had a blended opinion (the vote only allowed picking a single option), or were confused what additional ramifications the different choices would have (what would “vetting” entail, or how would other parts of the MoonCat ecosystem be affected by the change), so didn’t cast a vote at all. It was also voiced that some didn’t trust the Snapshot ecosystem, so were hesitant to connect their wallet to it. Also, the window of time available to vote was short, and so some were unable to vote in the time given.
Getting a result that 60.87% of voters wished to hide Accessories is interesting, but hard to gauge how much to act upon it with the structural issues this voting structure revealed and how small the sample size was.
Accessories in Marketplaces
The MoonCat Community organized a second vote regarding how Accessories are viewed in Marketplaces, and created a criteria document for that vote that details the intentions. The way that vote was conducted was through Snapshot.org, and ran from January 12 through February 12 of 2023.
Each Address that was eligible to vote was given a voting weight based on how many MoonCats they held. This was simply a count, and didn’t factor any differences for type of MoonCat (e.g. Genesis MoonCats were counted the same as Rescued). It also did not count if an address held any ERC20 tokens that represented fractional shares of a MoonCat (e.g. MOONCAT tokens from the NFTX MoonCat Pool). But it did count all original, Acclimated, and JumpPort-deposited MoonCats. The actual voting power (MCVote) was not just the count of MoonCats held, but the square-root of the count of held MoonCats. This algorithm diminishes the voting power of “whale”-sized holders, such that they do still have an effect, but less effect the larger the holding.
A snapshot was taken at block 16191000, resulting in 6,804 Ethereum addresses being eligible, with a combined total of 10,052 voting power. At the end of the vote, 229 addresses (3.36% of all possible), representing 637.9 voting power (6.34% of all possible) cast a vote. Calculated a different way, 16.7% of all eligible MoonCats voted (3,927 of 23,454). That total number eligible is not the full 25,440 MoonCats in the collection since it removes those that were known to be in Pool contracts, and therefore wouldn’t be able to vote.
Structure-wise, this vote used the same tool and the previous vote, but did a lot of great things to fix the concerns that existed for the previous vote:
- Lots of time given to drafting the vote proposal, making it clear what each option would mean in terms of impact.
- The time to vote was expanded to one month, which should give everyone who wanted to a chance to cast a vote.
- Rules of quorum were discussed with the community organizers (940 MoonCats worth of voting power)
Did those structure changes have a good effect on the outcome, compared to the last time the Snapshot tool was used? Increasing from 2.48% of eligible addresses to 3.36% and increasing from 7.6% of eligible MoonCats to 16.7% are both increases, and both are above the 2% typical “cold calling” response rate expected from generally polling a large crowd. Those are okay values, but have a lot of room for possible improvement, and are still short of the response seen in the first vote held for the community.
Seeing the percentage of eligible addresses only go up a little, while the number of MoonCats represented in the vote go up a lot means the type of people who were voting were those who generally held more MoonCats than the previous vote. Hearing from those who have committed more to the project is good feedback as a project maintainer, however assuming the vote results generally represent only “the top 3% of asset-holders” means catering to just their wishes ignores a significant portion of the rest of the holders.
One aspect that’s worth evaluating a little further is the use of the “square rooted weight” algorithm. Especially since the analysis shows that generally those with more MoonCats in their Address were the ones voting, did they get overshadowed by those with less MoonCats?
Here’s some charts put together by community MEAO member zibzub that visualizes this well:
In this breakdown, we can see that the one voter with the largest vote weight had 33.1 MCVote power. Their voting power for the “OFF” option was enough to offset the four largest votes for the “ON” option, and nearly all sixteen of the votes that were “ABSTAIN” calls. That’s generally good that one high-weight voter was able to make a notable difference for their vote, but not an overwhelming one. Had the top ten highest-weight voters all voted for one option and everyone else for another, the highest-weight voters would be out-voted.
For comparison, let’s look at how the chart would look if the vote had been done purely by the count of MoonCats held (and not the square root of that number).
The highest-weight vote is for 1098 MoonCats, and with this hypothetical algorithm, that one voter had more pull to their chosen option than all 72 voters who voted for both other options combined. If this voting method had been used, the top eleven highest-weight voters could have outranked all other people who voted, which would be bad. So I’m glad that aspect of the structure of this vote didn’t lock out smaller-weight votes from having an impact.
But is the amount of reduction larger holders get the appropriate amount? This algorithm could potentially be revised for future votes, but it does seem to be a very good balance between an acceptable outcome and not being too complicated a formula.
The Resulting Impact
The second topic to cover is the outcome of the most-recent vote itself. The final result was that the winning option was that voters felt having visible accessories was detrimental to the project. At the end of February 2023, the MoonCat collection’s metadata was updated to not show accessories by default, and for marketplaces that follow the OpenSea attributes structure, not enumerate owned accessories as searchable traits. Looking at March 2023 as the starting point for when the change was live, we can compare what effect it’s had on the project.
The key points that were laid out as to why those who voted for the accessories to be hidden included:
- Low-quality Accessories led new buyers to a perception that the collection overall was less-cohesive, less-attractive, a “visual mess”, or even “vandalized”. Thus wouldn’t command a high value by collectors who value original production and unblemished proofs.
- Unknowing new buyers paying an above-market rate to adopt a MoonCat, because they were mislead it was “more rare” than it actually was.
Being considered “high value” by collectors is a good goal for the project. However, taking a look at the overall NFT market data for March 2023 and later, compared to the previous time range just before it, there’s not a whole lot of difference:
The overall NFT economics during the March 2023-to-present time frame has been in a decline, but not as sharply as these figures. That unfortunately means there is not a clear trend that collectors began to more highly-value MoonCats after this change was made. Looking at the “Average Sale” data from that chart, the blips upward in July and August 2023 were more due to Genesis MoonCats changing hands during those months, rather than the overall value of all MoonCats trending that way.
Regarding new buyers “paying too much” for individual MoonCats, there’s still situations that come across the adoptions feed where buyers payed more than the lowest asking price for individual MoonCats. There doesn’t seem to be a consensus on why that might still happen, but turning off accessories didn’t have the desired effect of stopping those “mistakes” from happening entirely. That is then evidence that perhaps it wasn’t the accessories being visible (or search-able) that was the significant reason for those buyers making those choices. Because the Acclimated MoonCat collection is a wrapper-style contract, all the calculations on trait scarcity on marketplaces are wrong, because they don’t account for unwrapped/original MoonCats in the mix. This has been the case from the beginning, and unlikely to change unless NFT marketplaces move to treat wrapping-style contracts differently than other tokens.
The Ripple Effect
Hiding MoonCat’s accessories from Marketplaces has had ripple effects into other areas of the collection and the maintaining team’s finances. The concept of Accessories is a feature of the MoonCat ecosystem that makes it unique, and it not being visible in some of the more popular places where people browse makes it less-desirable to MoonCat owners as a way to show off their MoonCat in ways that match their personal style. Diminishing the visibility of Accessories as a feature has had a significant impact on the number of Accessories purchased.
There was a sharp falloff after March 2023 in the number of Accessories purchased. Looking at purchases of non-free Accessories, April and May 2023 each had only one purchase each, and there were zero paid Accessory purchases in June 2023. There was a blip of traffic in mid-August as the organizing team put out a celebratory project anniversary accessory, but then the month of September 2023 again had zero paid Accessory purchases.
Also in this time range, submissions of designers creating new accessories has completely dried up too. No new Accessories have been created after February 18th, except for the one project anniversary accessory the team created.
The MoonCatRescue team doesn’t intend to go after VC/Angel funds and acquire a large nest-egg of funds to operate off of. Therefore the team needs a steady stream of income to keep the infrastructure servers going, maintain relationships with other projects, and compensate themselves for time spent on the project. The change made in March 2023 has effectively dried up this income stream. That’s a pretty major disadvantage, and seems a very hefty price to pay in exchange for not a lot of improvement being seen in the areas that were expected to benefit from this change (higher valuation, less price confusion).
Next Steps
The structure of how future votes take place will continue to use Snapshot as a tool. The benefits of having off-chain vote attestations (cheap for voters) and good management/organization tools for the vote creators have been useful. The team will continue to work toward community education on how Snapshot works, to increase the trust in that tool and hopefully increase participation numbers in future votes. The “square root of count” algorithm for vote weight seems to be a good balance for letting larger holders have a larger say, without those voters being overpowering.
The latest trends in NFT Marketplaces are to make royalty payments to collection owners optional, and the United States government actions are hinting at more restrictions on projects that gather income from secondary marketplace activity. Therefore it’s pretty likely that the income stream the maintaining team receives from NFT marketplaces will continue to diminish or be cut off entirely. It’s therefore imperative that the team have some other source(s) of income that can keep the project operational.
The MoonCatRescue maintaining team doesn’t want to have secondary sales be their primary income source, as that means needing to emphasize selling/flipping your MoonCat to others. The direction we intend to lead the project toward is cuddling your MoonCat long-term.
The Accessories infrastructure is already a robust tool that operates like a marketplace on its own, where anyone can come and design an accessory and market it to MoonCat owners. The MoonCatRescue team gets a small fee from each Accessory that sells, as well as owns several Accessories where the full purchase price goes to the team. As such, it seems like a good candidate as an income stream, if interest for end-users could be captured.
Throughout 2023 the technical goals of the MoonCatRescue team have been to harmonize the many tools and features available to MoonCat owners, and the ChainStation site has been growing as the central repository for that. Q4 2023 was planned to be focused on replicating all the functionality from the Purrse site (to be able to retire that site as a separate tool), and that will continue. But the goal for Q1 2024 will be replicating Accessory Boutique functionality into ChainStation, with the intent of getting that up to being a viable income stream for the team.
If we can shift new users from using Marketplaces as the primary way to browse the collection/project to ChainStation, that gives us much more flexibility to present the whole ecosystem exactly as we want it. We would be able more clearly show new visitors the difference between each MoonCat themselves, and the extra assets like Accessories they have, plus ensuring trait information accounts for all MoonCats in the collection.
The income for the maintaining team will need to shift to a blend of multiple income streams in order to be viable in the future. If you’d like to help maintain the stability of this project into the future, the most direct thing you can do is sponsor us with a direct Superfluid Stream. Similar to a Patreon-style support model, this sort of sponsorship trickles money to who you’re sponsoring over time, without you needing to remember a monthly payment. You just maintain a pool of funds you top-up whenever you’d like, and the Superfluid protocol handles the rest. There’s a tool on the Contribute page on ChainStation that can help you get started with that.
In addition to the warm fuzzy feeling of helping the project keep up-to-date, becoming a sponsor can have some perks for you too! Keep an eye out in Q4 for some incentives we’ll be raffling off to those who sponsor us…!
