Dear community,
Yesterday we announced the application of a process in Upland that led to some differences of opinion, that were made apparent in the community. We always try our best to explain our perspective and rationale as quickly as possible, and yesterday was no exception. However, we also had to listen and make sure we understood the perspective of every player.
This is why we want to follow up and clarify a couple of foundational concepts to everyone. Yesterday’s feedback from the community, regarding the originally planned reveal of the first non-sold-out collection, was an indicator that some deeper context was needed.
TLDR:
- Recalculating unminted properties as part of a collection is not new. It’s been around since San Francisco.
- After careful consideration, we are confident maintaining this mechanic is the right thing to do from a market and economy perspective.
- Due to the confusion that was caused to travelers, we will work to reimburse the NYC travel fees spent in the last 3 days.
- We will continue to strive to be as transparent in our communication with you as possible.
First, some background
San Francisco was the first city in Upland, its first property minted in June of 2019. Back at that time, there were no collections, and property prices were calculated based on price per UP2 that was assigned to each neighborhood, roughly mirroring the differences between neighborhoods in real life.
With the introduction of UPX in august 2019, the concept of earnings followed suit. Earnings have always been calculated at a global rate (currently set at roughly 17.3%/y, which is subject to reduction in the future as per the Upland white paper) multiplied by the original minting price of the property. This is a crucial economic concept in Upland, with a purpose to help keep inflation under control.
Fast forward to Oct 2019, and the SF collections were introduced. With the introduction of collections, all unminted property prices have been recalculated to reflect a premium for properties that match collections. The premium calculation takes into account the base minting price of the properties, and the levels of the matching collections (multiple collection matching does have a multiple effect, which diminishes with each additional collection)
In December 2019, with the introduction of Block Explorers, SF was opened up for discovery allowing players to make decisions of which properties they wish to mint. Properties that did not match collections were naturally priced lower than similar properties that did. The idea was simple — properties should be priced according to the available market information. Failing to do so, would have not just created a distorted reality, but would also make it hard for owners to get market value for their owned properties
In Aug 2020, we started opening up Manhattan in what we call Vanilla Mode. This means that all Manhattan collections have been determined and minted on the chain, but ciphered and hidden from Uplanders. As a result, collection premiums could not have been applied to unminted properties, as it would have given away all of the collection information. The reason why Manhattan was opened in Vanilla Mode was to create a thoughtful and careful expansion mechanism in Upland, which would maintain activity and focus on San Francisco. At the same time, Manhattan would offer the raw experience of how SF was at its early stages, allowing for some play room for Uplanders who thought they could guess what the collections would be.
In preparation of the reveal of the first non-sold-out collection in NY, we communicated how this process would be different than the previous sold-out ones, allowing time to recalculate the prices of unminted collections per the newly revealed market information. This was in no way a change of plans on our side. It was always the plan and unfortunately we failed at communicating that important piece of information, that for us seemed obvious, at its proper time.
Nevertheless, we did communicate this information in advance, and have received feedback that seemed important enough to take a step back to see how we can potentially address it.
Other than the poor communication, the main feedback received was around the fact that early purchasers’ properties would be in a disadvantage compared to later-minted properties which will carry higher returns, based on the mint price (in our view, this is offset by the significant discount at which the property was minted). It’s important to note that this situation is also present in SF, where properties minted prior to collections (e.g. on Twisty Lombard) have lower earnings based on their lower mint price. It’s also important to note that not adjusting the unminted properties for collection premiums could be viewed as a disadvantage to players who guessed collections right, but didn’t get to enjoy the discount effect that would come with it.
Our conclusions
After reviewing all the concerns that were raised yesterday, we are still confident that our original plan of recalculating unminted property value based on published collection information is the right thing to do from a market and economy perspective. In the future, we will work to ensure that all relevant information is shared as clearly as possible, and in a way that more players can access.
In addition, due to the confusion that was caused to travelers, we will work to reimburse the NYC travel fees spent in the last 3 days.
Again, we want to thank the community for all the feedback we received yesterday, helping us better understand different perspectives on a complex economic modeling issue. As always, we will continue to strive to be as transparent in our communication with you as possible.
