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Transaction Split Proposal Approved by Blockchain Community Vote

Vault12
Vault12
Jun 12, 2019 · 4 min read

As announced in May 2019, the Vault12 team put proposed changes to the functionality of the Vault token economy to the vote. All Vault Guardian Token (VGT) holders with unlocked tokens were eligible to vote via a blockchain vote conducted on the ETH mainnet.

The “Transaction Split” proposal has been approved overwhelmingly as the new policy of Vault platform.

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Transaction Split proposal adopted by the community.

With a total of 66,241,593 votes cast, more than 96% went to the transaction split proposal.

Voting breakdown:

No Change 1.84% (1,221,576 Votes)
Dual Token 1.27% (841,974 Votes)
Transaction Split 96.89% (64,178,043 Votes)
Total Votes Cast: 66,241,593

As a hallmark of blockchain voting, the voting can be inspected on the blockchain: https://etherscan.io/address/0x908d81a4961c4a40b38c91f16d216c6307a89954#events.

What is the Transaction Split Proposal?

Key Goal: Optimize for ease of use and reach for app customers

Providing app customers with VGT tokens will be heavily restrictive as long as tokens remain categorized as a security. The task of categorizing VGT as a utility might take years and may depend on regulations that are not yet issued.

Instead, we can make the platform accept the widely available Ethereum (and other cryptocurrencies at a later date) and keep the original VGT token as a registration of commercial rights on the platform. This way millions of Ethereum users can immediately use the Vault platform with no extra steps such as buying tokens on exchanges. At the same time, VGT tokens become valuable since ownership entitles holders to automatically receive a piece of each transaction that takes place on the platform.

As you might recall from our white paper, the Vault platform will be powered by the three following transaction groups:

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We propose a flat, 20% transaction split to be implemented by all elements of our platform stack.

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Anatomy of Transaction Split

Here are the main consequences of this policy:

  • Any Ethereum owner will be able to use the Vault12 application immediately.
  • Ownership of VGT tokens will become an instrument to receive a steady flow of Ethereum proportional to transaction volume taking place on the platform. At a later date, any ETH-convertible cryptocurrency will be acceptable as platform payment and will accrue to VGT owners with the same 20% split.
  • Currently, external investors and advisors control ~82% of all unlocked VGT tokens and therefore will receive ~82% of ETH received in transaction splits. (See token distribution report).
  • VGT tokens will remain a security, but owning VGT token will no longer be a requirement to use the Vault Platform and end-user products.
  • VGT tokens will be tradable only on security exchanges. US residents who wish to buy VGT tokens will have to remain compliant with KYC/accreditation regulations.

As token scarcity becomes a desirable property of the platform. Vault12 will provision a buy & burn smart contract that will spend 10% of the previous month’s fees to purchase and permanently burn VGT tokens until the total number of provisioned VGT tokens falls to 100,000,000 (one hundred million) tokens. All monthly burns will be inspectable on the mainnet.

More details on each proposal can be found here.

Voting Mechanism Used

  • Each unlocked owner of VGT can participate in the vote on the Ethereum mainnet. One token grants one vote.
  • There will be at most ~267.2M tokens eligible to vote. The exact number will change during the year as investors and advisors tokens come out of smart contract lockup.
  • The vote will be binding if 100M or more tokens participate in the vote.
  • If less than 100M tokens will participate in the vote, Vault12 will adopt the “Transaction Split” proposal as the default outcome based on team & advisory board recommendation.
  • If 100M or more tokens participate in the vote, Vault12 will adopt the vote resolution that gains the majority of votes cast as long as such majority is more than 10% higher than the 2nd place proposal.
  • If the first and second place proposals are within 10% of each other, Vault12 will organize a second round of voting and winners will be determined by a simple majority of votes cast.

Example #1: Proposals A/B/C gain 10%/20%/70% of the vote. Proposal C will be adopted.

Example #2: Proposals if A/B/C gain 20%/35%/45% of the vote. B and C are within 10% of each other, Vault12 will organize second runoff round between B and C, and the simple majority winner will be the adopted policy.

Vault12

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