[Status: Draft] XIP-3: XYO Cryptoeconomics 2.0 ("The Lime Paper")

#1
xip: 3
title: XYO Cryptoeconomics 2.0 ("The Lime Paper")
author: Aaron Malone, Arie Trouw, Bryce Paul, Erik Saberski, Nate Brune, Scott Scheper
status: Draft
category: Cryptoeconomics
created: 2019-04-24

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ONE-SENTENCE DESCRIPTION

We believe the implementation of the cryptoeconomics outlined in the “Lime Paper” will result in a clearer, healthier XYO Token ecosystem.

MOTIVATION

Currently, there is no clarity or plan around the distribution of the GAMMA Token Pool or the token economy of XYO. This paper contains a plan that will solve this.

SPECIFICATION

Here is a link to the Lime Paper:

https://github.com/XYOracleNetwork/papers-xyonetwork/blob/master/lime-paper/XYO-Lime-Paper.pdf

The brief summary is this:

  1. There is a total of 2,871,068,696.85 XYO in the Cryptoeconomic Reserve ( 2.8 Billion).
  2. The GAMMA Sale ended on November 30, 2018. The left-over amount of XYO is 4,340,144,773.44 in the GAMMA Token Pool.
  3. The FHR is comprised of those who purchased directly from the XYO Network core team from January 6, 2018 to November 30, 2018. See XIP-1.
  4. 340,144,773.44 XYO will be distributed to those on the FHR. The XYO will be staked in the XYO Network with an un-staking period of 5 years. At the end of the period, the XYO can be withdrawn by the FHR Wallet Address. The XYO will be distributed on a pro-rata basis, meaning the amount of XYO you receive is based on the amount of XYO you originally purchased.
  5. We recommend you hold all of your XYO in your FHR Wallet.
  6. The remaining 4,000,000,000 in XYO from the GAMMA Token Pool will be allocated to the Cryptoeconomic Reserve. We will begin deploying this via the XYO Cryptoeconomic Packages.
  7. Every XYO Sold in Cryptoeconomic Packages use Network Staking. This means every XYO sold through the Cryptoeconomic Reserve has a staking period of 12 months minimum.
  8. This is going forward – this 12 month staking period does not apply to any XYO from prior to today’s date.
  9. We will be selling XYO at a price 10% higher than the all-time-high price point of XYO sold during the GAMMA Platform Sale, which was $0.00942. Thus, for the XYO Cryptoeconomic Packages, the starting price of XYO will be $0.01 per XYO.
  10. We believe this to be a better value than what the market deems the price of XYO to be.
  11. We will be adjusting and plan to increase the price regularly based on the growth of the Data Flow Index (outlined in the Lime Paper).
  12. When we determine the Data Flow Index is mature, we plan to create an Ethereum smart contract, which tracks the Data Flow Index and tethers the price of XYO distributed through the Cryptoeconomic Reserve to the Data Flow Index.

REQUESTS FOR COMMENTS

Please post any comments or questions in this thread!

Thank you!

3 Likes
#2

@scott just read the summary so far, but i like the lockup period length of 5 years… glad you guys aren’t encouraging dumping… i’m not an FHR, but glad you are giving out some to those who were super early adopters… they deserve a little bonus for being in the vanguard.

6 Likes
#3

@scott @_ryan

Thanks Scott, I agree, I like the Holding period, and this plan is definitely going to drive token value and demand way up. I love the future outlook and this confirms my beliefs in XYO and the people who have worked so hard on it! To The Moon!

ReconCatLord

2 Likes
#4

I’d love to see 0.01; that’s a hell of a lot of return for my investment at 0.0019!!!

2 Likes
#6

I have been a Share Holder Since September 2018 and recently invested into the XYO Token / Cold Storage Crypto Hardware Wallet. So as an early investment, do I qualify for the FHR? I did not see my address listed on the spreadsheet???

1 Like
#7

@scott How does this FHR token drop exactly work? Will I receive my share of the 340M XYO on my FHR registered ethereum address? Will it be automatically staked in the Network? And does this show up in my XYO app, or do I need to take any action?

Hope someone can answer these questions…

Thank you. Rock on Crazy Ones!
:stuck_out_tongue_winking_eye::love_you_gesture:

1 Like
#9

Where is the spreadsheet?

2 Likes
#10

@CreationArts @butterfingers @ReconCatLord @_ryan @DerbyCity
Here’s an updated / corrected link to the Lime Paper on Github:

https://github.com/XYOracleNetwork/papers-xyonetwork/blob/master/lime-paper/Lime_Green_Paper.pdf

AND @butterfingers on the link below, scroll down until you see the FHR Google Sheet link. There are other details there as well. Thinking this may help clarify for @DerbyCity

https://geohacker.xyo.network/t/status-accepted-xip-1-founding-hodler-registry-fhr/927

Hope this is helpful

4 Likes
#11

Almost made me Cry…

Thanks for the link and the information.

Now I am going to add some Lemon with that Lime.

Enjoy

3 Likes
#12

:smile::smile::smile::smile::weight_lifting_man::muscle::tada:
I found my address!!! So exciting!! Previously I kept getting an error which is what led me to asking where it was. I just barely was able to make the window! There was just a slight moment I was able to buy tokens in the end! Thank you thank you thank you !! :smiley:

3 Likes
#13

Can the team consider making any revisions? as I’m not sure if any feedbacks were taken on this XIP but the decisions were made within the team.

1). Some clarification on how the team came up with splitting 4B GAMMA tokens to XYO and 340M to FHR? what was the reason for this % split?

2). Can the team match the tokens sold via crypto packages and “burn” those tokens?

1:1 ratio token burn from tokens sold via crypto packages.

  • This would help reduce the token supply since this is what existing investors have been asking.
  • Potential new investors can see that the token supply ~14B will be reduced. Also, create constant news when the token is burned and attracting more eyeballs to look at this project.

3). 340,144,773.44 FHR tokens locked up for 5 years. Can we get this reduced to yearly unlock?

5 years is a long time and people would forget about this project. Some will sell their tokens and never return. So, releasing tokens annually would potentially bring those FHR investors interested again. I really think 5 years is a long time in crypto space and most will forget about the FHR lock up tokens / some would even move on to other things.

If released annually, that would help gain more interests in the project from the die-hard supporters.

  1. Can the team announce a buyback of XYO tokens from exchanges?

Not taking cash from the company but currently, XYO holds 4,214, Etherum and 9 Bitcoin = ~$850,000 Can this be used as “investment” in the books and announce a buyback? It doesn’t have to be a one-shot purchase. Could be $250,000 per quarter for the next 3 quarters to buy back on exchanges. It is not a huge amount considering there are 14B total supply but any kind of buyback would definitely boost confidence to current and potential investors.

3 Likes
#14

Great feedback. And yes! We will consider these items. The Lime Paper Status is still in Draft mode for this reason. The updated version will be released very soon. Great ideas. Will review it closer and talk with team today on this. Will follow up here with additional questions for all.

2 Likes
#15

I agree with the sentiment that an un-staking period of 5 years makes sense. It will encourage the early founders to stay involved in XYO and also discourage people dumping their share.

Another idea could be reduced costs for bridges or other hardware for those that were early on. This would encourage more involvement from the core community and offer those that were early investors the opportunity to get closer to the project at a reduced cost.

1 Like
#16

Proposed Update to Lime Paper: "The Dracarys Plan"

Dear XYO Community!

With the Lime Paper still in Draft Mode, it enables us to solicit feedback and test different models before tethering the price of XYO to the Data Flow Index.

Our goal is to have a healthy XYO Token Economy; one in which grows, and one in which we can then tether to the Data Flow Index.

It’s tough to see the price of XYO going down when the rest of the market is going up.

As I’ve said before, we’re focused on building the core underlying foundation for XYO.

A future in which every phone, smart home device, IoT device, etc. has “XYO Inside” is a massive undertaking. Yet creating a people-powered mesh network is critical to the location infrastructure in the world of tomorrow.

Currently, we are seeing over 100,000 new cryptographic bound witnesses per day. In addition, our Geodapp COIN is taking off. We currently have over 41,000 users who have installed the app. It’s growing very quickly. And we have not even been advertising it. We will be starting to advertise COIN on a massive scale next week.

In brief, we believe the Token Economy should be moving upward (not downward) and our goal is to create the mechanisms to facilitate a healthy economy before tethering it to the Data Flow Index.

After researching this and talking with a number of our advisors and professionals with experience in shaping token economies, we believe the best thing to do is to try a different model than simply starting off at $0.01 per XYO sold from the Reserve.

The model we’re considering is this:

Item #1: XYO Token Burn
For every 1 XYO Sold, 1 XYO from the Crypto-economic reserve would be burned until 50% of the Crypto-economic Reserve is burned. Burning will take place daily or weekly (To Be Determined).

In total, we would be burning up to 3,420,106,660.15 XYO (3.4 Billion).

The model is inspired by the Binance BNB token burn model.

Every quarter, we will destroy BNB based on the trading volume on our
crypto-to-crypto platform until we destroy 50% of all the BNB. All transactions will be on the blockchain. We eventually will destroy 100MM BNB, leaving 100MM BNB remaining.

Burning tokens is typically very, very good news for current HODL’ers. Here’s what this would do: this would result in a bigger % stake of XYO for all current XYO HODL’ers.

It reduces supply; which, in theory, should help create growth in the right direction for XYO’s price. This is important because Geodropping XYO in COIN to create a large mesh-network of Sentinels is a key piece of our current near-term strategy. And it’s working. Really, really well.

The total burn would likely take years (to burn 3.4 billion tokens for every 1 sold via Crypto Reserve).

Before XYO Dracyrus (i.e. XYO Token Burn):

After XYO Dracyrus (i.e. XYO Token Burn):

The burn would result in current XYO HODL’ers owning 68% of the Total XYO Pool (opposed to 51.83% currently).

XYO Token Pool Currently: 14,198,847,000.0000
XYO Token Pool After Dracarys: 10,778,740,339.8500

We have a unicorn in COIN. It’s growth is insane. Arie and I have seen this only one other time in our careers. We believe we need to help facilitate the growth with a growing XYO Token Economy to mirror its growth.

Item #2: XYO Price
The price of XYO Sold From Crypto Reserve would no longer start at $0.01. It will be sold at average exchange price at either i) avg exchange price that day, ii) avg exchange price previous day, or iii) real-time (to be determined).

An alternative to being sold at the exchange price, would be to price it 5-10% higher than exchange price (to ensure we do not create an artificial price ceiling for the token).

Item #3: For Those Who Purchased at $0.01
C) Whatever is decided would be applied retroactively to those who purchased XYO from the Reserve at $0.01 (~100 holders). Thus they would get XYO at this new (better) pricing. And for every XYO sold, we would burn that amount of XYO.

Item #4: 70% of XYO Sold Comes with 12-month Minimum Network Staking
70% of the XYO sold from Reserve would come with Network Staking (minimum stake period of 12 months). This ensures the purchasers of XYO are those that believe in the long-term aspect of the product. Staking XYO in the network via our Network Staking (validating data) is what secures the network; enabling validated data.

Item #5: 30% of XYO Sold Comes without Network Staking Requirement
D) 30% of the XYO would be sold without staking so the user can transfer around freely outside of the XYO Network (this is useful for HODL’ing, or, for other uses (other than XYO Network Staking). This includes paying to set up your own Geodrops in COIN BOSS; an app that facilitates anyone to setup their own Geodrops). It was used at Ethereal and Consensus! We used it to Geodrop T-shirts around the event!

Item #6: We’re Also Considering Repurchase Options of XYO from Exchanges
We are also considering the proposal of repurchasing XYO from exchanges. However, we are running this (and everything) by our legal and compliance to make sure it can be done; and done properly.

IMPORTANT: Please submit any comments as soon as you can!

Timeline: We intend to test this new model within the next few days, but first I’d love to hear any other feedback from our community.

If you have any feedback on this, please send me your thoughts and ideas!

XYO is a community-driven project, and every one of you has a say in this.

5 Likes
The Dracarys Plan: A Proposed Model Update to XYO Cryptoeconomics 2.0
#17

I like the coin burn idea. It it works for Binance, there’s no reason it can’t work for us. This combined with an increase in marketing will help drive adoption.

3 Likes
#18

I see this as being a form of separating the chaff (the burning) from the wheat. Once done, what’s left is the wheat, which is used to fuel the human body…breads and so on. Thus the remaining XYO will be much stronger, healthier and more potent, to fuel the Network and growth.

Your 1 for 1 model sounds spot on! Even more so as it creates some incentive for increasing bags, and HODLing longer as well. This has a very positive 2 prong effect…reducing supply with matching burn, which reduces over all availability of same. And increasing value of both your original XYO and your newly purchased XYO as well. This may well prove to be a bit of a bonus boon for the XYO universe.

I like the idea of honoring those who did overpay at the $.01 price, by making things right with them, in which ever manner is chosen. That goes a long way in public relations.

The 70-30 stake/no stake split is a good idea. Allowing some freedom of movement, while staking the majority for the health of the token and the Network…perfect.

When companies repurchase their own stocks…it reduces outstanding share count, reducing supply…making their stock more “scarce” to which drives up value. I think this repurchase plan, of XYO from the exchanges would provide same value increase for XYO.

We ready for the big time…I just hope the big times are ready for us! XYO for life, y’all!!!

1 Like
#19

#1, token burn: brilliant. 1 to 1. I think this one’s obvious.

#2, XYO sale price: real-time probably complicates things, maybe look at doing the price 1 hour prior? I’m ignorant in knowing how difficult it would be for you guys to sell it at real time price. Worst case just go prior day’s high or close.
No matter which number you pick, go 10-15% above that to eliminate ceiling effect.

#3, 1 cent buyers: credit them with the equivalent, I agree. But also start the burning 1:1 now with the tokens going out.

#4, 70% of sales has 12 month staking period: I like it. 5 years feels aggressive and might scare people off. I’d consider upping the 70% or the 12 months to maybe 75% or 18 months, but I think this is solid.

#5, 30% free: see above. Makes sense so you can use some of your purchase as the oil in the network itself. I imagine transactions will be cheap so 30% should be plenty, no?
Also, how the hell did you geodrop t-shirts? Please elaborate on that!

#6, exchange repurchase: if it’s legal, do it. It’ll help price which helps errbody

#20

@scott
Love all the thought!

I think rewards for spinning up a diviner or archivist would be on point. Currently staking is awesome as planned and I love the ability for easy staking on others’ nodes. But there doesnt seem to be a ton of incentive to create a node (particular if I can stake someone elses).

Even BTC required you to operate a node to have a wallet back in the day :wink:

You could reward node creators with some XYO and burn some XYO as nodes are created. This would enable some people to build nodes with no economic burden to them while expanding the network. Rewards/BurnRate could be based on memory for Archivists and RAM or CPU for Diviners…

3 Likes
#21

From what I have read this has worked well for other companies. The timing seems great. XYO taking off and positive crypto sentiment growing rapidly. Plus the big coin app push that is coming

2 Likes
#23

@theacemada me too! I would also like to be able to talk to friends about it. Incentivizing node generation would help me spread the word.

Check out the Discord page run by ArchAnglo, tons of help there.

2 Likes