The recent SCRC-2 that aimed to restructure tokenomics failed to meet quorum on Jan 24th 2023. Our team at Sandclock decided to abstain from participation and allow the community to review the pros and cons of the situation and vote accordingly. We had previously voiced our opposition to SCRC-2 in this article. In short, we opposed the proposal because debasing the QUARTZ governance token via massive arbitrary inflation/distribution is a short-sighted and misguided approach–one that would harm both existing token holders and the DAO’s future. We are not opposed to future token distribution. Quite the contrary. We simply believe such distribution should happen via mechanisms promoting the project’s sustainable, decentralized growth. We would like to thank everyone that discussed/debated and participated in SCRC-2, regardless of your stance. Despite the recent friction, we are one community working towards the shared goal of seeing Sandclock become a true DeFi success story.
The New Quorum Standard
As seen in all other DAOs, ideas are discussed and they are given time to ferment and evolve within discord channels and forum pages. Once those ideas have evolved sufficiently and there is a broader support, either via delegates or token holders with substantial exposure post the proposal and then others get to vote.
For future DAO proposals, the quorum thresholds—one million tokens voted for quorum to exist and holding at least 60,000 QUARTZ to be able to make a proposal for DAO vote—have been updated to reflect the larger circulating supply and ensure any resolutions put up for vote come from participants with significant stakes in the governance of the Sandclock protocol. Stakeholding thresholds for prompting action by an entity are standard in the business world. DAOs are no different. If any token holder could post a new proposal every week regardless of their holdings (with a single token, for example), it would hurt the project because it would be distracting and time consuming to deal with a deluge of proposals, many of which would be of questionable quality due to the low friction associated with posting one for vote.
Moreover, requiring minimum stakeholding thresholds to propose binding actions for DAO votes will not prevent good ideas from being voted on and implemented, regardless of who first proposed it. You may be familiar with the saying, “Nothing is more powerful than an idea whose time has come.” In the DAO context, once there is a broader consensus within the community about an idea’s viability, token holders with significant stakes in the DAO’s governance can and will be able to elevate the voice of the community and publish a proposal. The recent updates on the quorum requirements reflect the protocol’s maturity level and aim to limit proposals subject to a vote to those that have traction with a significant portion of the power to govern the DAO, which can be ignited during the discovery/debate period in discord.
Contrast SCRC-2 with SCRC-1. SCRC-1 was a proposal spearheaded by our community and it passed by a wide margin. That proposal aimed to create a staking contract wherein most of the fees generated by the platform would accrue to it, while simultaneously introducing some simple game theoretic mechanisms to align incentives between DAO and stakers. We believe SCRC-1 is merely the first of many future proposals that would find novel ways of distributing QUARTZ to community members via positive work done to help grow our ecosystem.
To support the proposal, the Sandclock team allocated resources during our current development cycle to do an in-depth discovery of SCRC-1 from a technical perspective to ensure we move forward in a deliberate, focused manner. Having finished discovery work ahead of schedule, we mobilized additional resources to start the development of the contracts needed to launch the staking contract. We will be releasing exciting updates and potentially an AMA on the staking contracts in the coming weeks. Although we believe the timing of releasing this contract may be a bit premature as the protocol does not currently generate substantial revenue (limiting the size of any staking rewards), we nevertheless wanted to support the DAO’s vote and build it. Similar to this, we initially did not prioritize the launch of QUARTZ on any CEX’s, but elected to do so earlier than planned based on the community’s strongly expressed will in favor of it. In hindsight, it is now obvious that perhaps it was not the right approach and we should have waited.
Our team is deeply devoted to the development of Sandclock, both as a protocol and as the basis of an entire ecosystem. Community members may have heard of other symbiotic projects being developed in parallel, and that is precisely because we are aiming for vertical integration of diverse moving parts to build a reliable, trustworthy, and successful protocol.
The relentless negativity by certain token holders, hurting their own community and the team’s focus, is an unfortunate situation that hopefully we can start to resolve and turn around in 2023 with a renewed commitment to productive dialogue between the community and the core Sandclock team.
It bears emphasizing that we are a small project continuing to build in the midst of a crypto-wide bear market facing severe global macroeconomic headwinds including inflation and likely recession. Despite that, we remain committed to making Sandclock the best project it can be, positioned to take full advantage of the inevitable cyclical nature of crypto and hopefully serving at the vanguard of whatever the next equivalent of 2021’s DeFi Summer turns out to be. As proof of our dedication, we’d like to share a screenshot of our internal workflow management. From that, you can see that even during the holiday season the team continued to meet and work on Sandclock. If you have any further doubts about our efforts to build, we invite you to monitor our progress at our github and project cycles pages, both of which are public.
Calling the past year in the crypto world “challenging” would be putting it lightly. First, the collapse of Luna/Terra forced us to pivot from our initial intended strategy. However, unlike a myriad of other protocols that were building on Luna and lost funds (in some cases all of them), Sandclock did not. As 2022 wore on, adverse economic conditions coupled with the spread of systemic contagion from the Luna collapse, exacerbated by alleged fraudulent activities by SBF and others at FTX led to substantial economic loss to projects, token holders, and users within Web3. We once again weathered that storm, thanks to conservative spending and risk-mitigation procedures allowing us to preserve organizational and user funds as best as possible.
Briefly turning to our roadmap, we are aggressively working on multiple fronts. We plan to release not only updates on the current projects, but also exciting plans that we have not made public yet. Most importantly, we believe our success and our reputation are inextricably tied to the success of Sandclock. Do not mistake our recent relative silence for inaction: we have been diligently building and developing innovations and solutions sprouting from Sandclock to help make it one of the most used DeFi protocols.
As 2023 progresses we hope to put any animosity behind us and work together as a united front with the community—with one voice and one vision—to see Sandclock excel as a model for Web3 projects in the months and years to come.
