XIP #18: Liquid Fund OTC Strategy

Overview

This XBorg Improvement Proposal suggests a strategic OTC (over-the-counter) sale of 10 million vested XBG tokens to institutional investors, liquid funds, and business angels. All funds raised will be used to buy back XBG tokens on the open market. This initiative aims not only to broaden our investor base and enhance our visibility but also to position XBG as the best-performing token of the next bull market phase.

Current Market Conditions and Scarce Capital

In the current market, the available capital from retail investors is limited, as shown by the recent performance of gaming tokens. To outperform competitor products and tokens, we believe it is crucial to engage a new investor base — institutions. Furthermore, since our first private round in 2022, we are now much better positioned to attract new strategic investors with great industry influence to assist us with our goals.

Buying Back XBG on the Open Market

We believe that the next phase of the bull market is approaching. In the past, the best-performing tokens emerged early in these phases, so timing is key. A recent example is $BEAM, which performed well in October 2023 and maintained its growth and status as an industry leader due to its initial momentum. We will use all the funds raised to strategically buy back XBG tokens on the open market. The timing of these buybacks will be at the team's discretion to maximise the initial momentum of XBG and position it as an industry leader to benefit its long-term growth.

Terms

• Discount: 30% off the spot price (based on a 7-day trailing average)
• Vesting: 4 months, no lock
• Eligible Investors: Liquid funds, business angels. Ex: Defiance Capital
• Ticket Size: $10,000 — $100,000
• XBG Offered for Sale: 10 million
• Execution Timeline: Q4 2024

Rationale for discount to spot: Given current market conditions, most liquid funds are interested only in discounted exposure with low vesting terms.

Pros and Cons

Benefits:

• Increased buy pressure
• Strategic partnerships with liquid funds and business angels
• Enhanced price reflexivity
• Greater visibility for XBG as a token
• Increased trading volume
• Increase legitimacy towards CEXs

Drawbacks:

• Potential misalignment with the “100% community investment” narrative
• Discount to spot price
• Potential sell pressure
• Alters tokenomics: The 10 million XBG would be sourced from the “Reserve and Treasury” allocation, stored at address 0xF9f9478F38A639636E2d523d97A44d1744161a9e. This would result in an immediate unlock of 10 million out of the total 200 million.

Conclusion

Although we already have a comprehensive token growth strategy, we want to do everything possible to ensure XBG is the best-performing token of the next phase. We believe this strategy will position XBG as a leading GameFi token and be net positive for XBG holders, as it aims to enhance price reflexivity.

If approved, outreach will begin immediately; if rejected, the team will not pursue strategic sales of XBG to institutional investors. If the team wants to participate in additional XBG sales, new proposals will be issued.