KtonDAO
A Flexible Deflationary Model for KTON – Empowering Holders, Boosting Staking Rewards, and Strengthening the DAO #193 #25
Replies: 6 comments 5 replies
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Can you please repost the entire suggestion here as this is more appropriate than DCDAO Discussions. Thank you. |
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@SasoLithops , @hackfisher , Do you mind jumping in on this topic here? |
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I’m not particularly enthusiastic about this idea. Taxing transfers might push token holders away, as they might not like the idea of being taxed and choose to exit entirely. Increasing transaction costs doesn’t necessarily create value—remember, they always have other options. Additionally, this approach could introduce technical complexities for DEX integration and other DeFi collaborations. Currently, KtonDAO lacks the technical resources to handle these complexities. I’ve only seen similar mechanisms in a few experimental tokens. I’m not sure if I’ve captured the proposal accurately, so I used AI to help summarize the key points below. Please confirm. Summarize from AI: Summary of Key Points: Objective: Key Proposal Elements: Positive Impacts on KTON Token Value: Community-Driven Adjustments: Alternative to Buybacks: Conclusion: Community Discussion: |
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Yes, this is accurate. The proposal would exclude smart contract-to-smart contract interactions, so it won't interfere with DeFi operations. I specifically wanted to avoid disrupting buying and selling, as well as to protect liquidity providers from being impacted by the tax. The tax would only apply when KTON exits and lands in a wallet, or vice versa. My thinking is that if the tax is kept small and people understand its purpose, they won’t mind as much. They’ll likely feel the effects not just from the tax itself, but also from the positive impacts of the burn, redistribution, and token appreciation. I believe the positive effects on the ecosystem would far outweigh the slight burden the tax might impose. When combined with the ongoing reduction of new token issuance, this could have a huge positive impact. It would not only help with price appreciation but also provide the DAO with funds to maintain liquidity provision. Additionally, if a portion of the tax is distributed to KTON stakers, they would benefit from the appreciating asset. You raised concerns about this tax potentially deterring investors, but I see this from the opposite angle. If we are transparent about it,and inform them of the rational behind this tax proposal, They would get on board with the idea. The deflationary aspect and automatic accumulation could attract more people, as they would be drawn to the long-term value proposition. The 1% tax is at the extreme end of what I think should be applied, and I made sure to emphasize that it's the maximum possible. It's not my ideal rate; I’d prefer a smaller, incremental approach. Ideally, I think a tax rate of 0.25% to 0.33% would be more appropriate. I'd rather see a gradual reduction in supply than something that causes a massive shock. The reduction of new token minting is a good idea, this is also a good idea. I hope you will consider it. I truly want to see KTON and CKTON survive, and I think we can make progress toward becoming more self-sufficient with small adjustments. im not wanting it to be a parasitic relationship perpetually, where kton constantly feeds off ring rewards. everyone was happy with the status quo since inception,and nobody thought beyond the present. Unfortunately, it seems like there wasn’t much foresight early on. Governance isn't always exciting, but I hope people will start to get more involved rather than leaving everything to others to decide. We need new ideas and feedback. I’m trying to step up and take a more active role in this project than I have in the past. I hope we all can work together so that it benefits everyone involved. |
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also, would like to point out that all these numbers included, such as burn and redistribution ratios are just for illustration, and are not necessarily how they would go, that would be totally up to the community to give their input on if we don't want to burn as much of kton, we can reduce that , or if we want more to go towards treasury,we could increase that ratio. or if we want to add other buckets, its a;; open for discussion. I am sure we all can find the right balance for this to have the most positive impact while minimizing any downsides. if we can gauge community sentiment for it,and if we can figure out the technical aspects, would that change your level of enthusiasm? Im not wanting to push against a wall on this. perhaps we could test it out on crab, less people and dollar figures are involved to be impacted. just a thought. |
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Technical complexities for DEX and DeFi integrations that Denny wrote now worry me that this might not work well. I was thinking we could swap using DCA on Hydration part of Ring rewards to USDT and BTC. Where does one get stables for staking(I know in DyDx they do now too, but their liquidity can take it easily) but don't know where does one get BTC. We need to swap Ring carefully though to not put too much price impact although the ammounts we change will still probably be way less then what is put on market daily, check previous debate and proposal on this: What do you all think how should we move forward? |
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I’m all for taxing every KTON transaction—in theory. But when I really think about it, I start to see the potential issues. We have to think about the liquidity providers and what they earn from each transaction. They play a key role, and if a tax gets added, it could really hurt them. Honestly, liquidity providing is already risky enough, and every time I’ve tried it, I’ve ended up losing. That’s why I leave it to the pros. I really don’t think liquidity providers should be taxed. If they were, they might just stop providing liquidity altogether, because the tax would eat into their already small profits. The same goes for decentralized exchanges (DEXs). If they’re taxed for accepting and routing KTON, they might stop accepting it entirely. So, any tax would really need to apply only to the individual user level to avoid scaring off liquidity providers and exchanges. We need to be realistic about this—some things need protection, or we risk killing the token. I also really like the idea of dollar-cost averaging (DCA) into stablecoins or BTC. A diverse treasury would go a long way in stabilizing things. We definitely don’t want to be in a position where we have to dump the token just to fund something. I’m all in on this idea, and I think it’s something we should seriously revisit. I know some people might not be on board with the tax, and some might decide not to engage with it. But if we could redistribute a portion of the tax back to stakers, I think they’d see the benefit. Instead of just getting a static reward, they’d be holding onto something that’s appreciating over time. That would naturally encourage them to hold onto their tokens. |
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… On Mon, Nov 11, 2024, 2:36 AM SasoLithops ***@***.***> wrote:
Technical complexities for DEX and DeFi integrations that Denny wrote now
worry me that this might not work well.
Now I am not sure now how it would be technically feisable to implement
tax only on certain swaps, transfers. But I am more in favor of all KTON
holders paying tax then just KTON stakers. However it will be very
distracting to some to even touch KTON if it has tax implemented. Remember
tax and love for project(understanding why tax was implemented) will only
work on us degens;-)
I was thinking we could swap using DCA on Hydration part of Ring rewards
to USDT and BTC. Where does one get stables for staking(I know in DyDx they
do now too, but their liquidity can take it easily) but don't know where
does one get BTC. We need to swap Ring carefully though to not put too much
price impact although the ammounts we change will still probably be way
less then what is put on market daily, check previous debate and proposal
on this:
https://github.com/orgs/darwinia-network/discussions/1566#discussioncomment-10444727
What do you all think how should we move forward?
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I don't know coding, but chatgpt does, can you take a look at this. It's
all Greek to me but I'm hoping it makes sense to you
On Mon, Nov 11, 2024, 12:29 PM joe thomas hall ***@***.***>
wrote:
… https://chatgpt.com/share/67324c2b-c15c-800e-acc0-de522b8cd676
On Mon, Nov 11, 2024, 2:36 AM SasoLithops ***@***.***>
wrote:
> Technical complexities for DEX and DeFi integrations that Denny wrote now
> worry me that this might not work well.
> Now I am not sure now how it would be technically feisable to implement
> tax only on certain swaps, transfers. But I am more in favor of all KTON
> holders paying tax then just KTON stakers. However it will be very
> distracting to some to even touch KTON if it has tax implemented. Remember
> tax and love for project(understanding why tax was implemented) will only
> work on us degens;-)
>
> I was thinking we could swap using DCA on Hydration part of Ring rewards
> to USDT and BTC. Where does one get stables for staking(I know in DyDx they
> do now too, but their liquidity can take it easily) but don't know where
> does one get BTC. We need to swap Ring carefully though to not put too much
> price impact although the ammounts we change will still probably be way
> less then what is put on market daily, check previous debate and proposal
> on this:
>
> https://github.com/orgs/darwinia-network/discussions/1566#discussioncomment-10444727
>
> What do you all think how should we move forward?
>
> —
> Reply to this email directly, view it on GitHub
> <#25 (comment)>,
> or unsubscribe
> <https://github.com/notifications/unsubscribe-auth/AJDNSYRKPOJP42GGGTJPABL2ABUA5AVCNFSM6AAAAABRDB3FYWVHI2DSMVQWIX3LMV43URDJONRXK43TNFXW4Q3PNVWWK3TUHMYTCMRRGE4TSOI>
> .
> You are receiving this because you authored the thread.Message ID:
> ***@***.***
> com>
>
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@hackfisher @boundless-forest @sonoferin2000 It's all Greek to me too🫣😉 |
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it will even do auditing. FTW |
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Objective:
Let’s introduce a gradual deflationary model for KTON that benefits everyone—from holders to the DAO itself. The goal is simple: create a steady revenue stream, reward those who stake, and build a treasury reserve that can be tapped for future liquidity. This proposal is all about flexibility and community choice, bringing a sustainable, deflationary approach that can evolve over time.
Key Proposal Elements:
Deflationary Transaction Fee (Up to 1%—Community Decides the Final Rate)
A small transaction fee would apply whenever KTON changes hands, excluding transfers between liquidity providers or smart contracts. Recommended Rate: I'm suggesting a 1% max as a starting point, but the exact rate is completely open to community feedback to keep trading healthy.But feel it should be kept minimal so that it isn't seen so much as a burden,while still accomplishing what it is put in place to accomplish.
Distribution of the Fee:
Here’s how I'm thinking the fee could be split:
Burn Mechanism: Half of each fee would go toward a burn, gradually reducing the total KTON supply.
DAO Contribution: The remaining half could be:
Sent to the KTON DAO treasury, or
Split, with part going to the treasury and part to a rewards pool for stakers, or
Another distribution the community feels works best.
Note: All numbers here are just examples—I'm looking to fine-tune everything with your input. we can play with the numbers and ratios, and design something that strikes the right ballance.
Positive Impact on KTON Token Value:
Supply Reduction and Value Growth: As KTON gets burned with each transaction, the overall supply shrinks. Over time, this scarcity can drive up
the token’s value as demand grows or holds steady.
Incentives for Long-Term Holding: With a portion of fees going back to stakers, there’s a built-in reward for those who choose to hold and support the ecosystem.
Boosting Demand for Staking: Redistributing part of the fee to stakers creates ongoing rewards, drawing more holders to stake and contributing to a more stable token price.
Enhanced Liquidity and Stability: A gradually growing DAO treasury supports liquidity, making the whole ecosystem more resilient.
Community-Driven Adjustments:
All suggested numbers—fee rates, distributions—are flexible and open to community input. We want this fee to feel beneficial, not like a burden.
An Alternative to Buybacks:
This deflationary model is a resource-light approach compared to traditional buybacks. By building up the DAO treasury over time, the DAO can influence market stability and liquidity without needing to rely on big buybacks.
Conclusion:
In short, this proposal aims to set up a deflationary model that rewards KTON holders and grows the DAO’s self-sustaining revenue. By encouraging long-term staking and reducing the circulating supply, it lays the foundation for gradual value growth, liquidity, and community governance.
Community Discussion:
KTON holders are invited to share thoughts, suggest tweaks, and help shape this proposal. All the figures here are just examples, meant to kickstart the conversation. Let’s work together to align this model with our shared vision for the DAO’s future.
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