The approval of the decentralization budget does not mean all $RLY liquidation will occur immediately. For budgeted $RLY, there will be volume restrictions as determined and set by the $RLY Network Association to help phase into the circulating supply. From September to December 2021, the impact of the budgeted $RLY will be no greater than 32m $RLY per month.
Thanks for addressing this, Johnny. Appreciate it. I’m going to read between the lines and note that the price of $RLY isn’t one of your three primary measures of success. That’s fine but somewhat telling. I’m personally not sure if the price of $RLY even matters for Rally’s long-term success, but I think it’s worth thinking about from the perspective of an existing creator or supporter who might have to watch the value of their coin decrease in terms of dollars – potentially by a lot. As the Head of Finance, do you have any projections for the effect of this rather large spend on the price on $RLY? I know this sort of thing is difficult/impossible to predict, but I’d love to hear your thoughts.
So the circulating supply will roughly double by the end of the year? Am I reading this right? Apologies if not. Just trying to wrap my head around it.
1 - Yes is the short answer to TBCs being deployed on trustless, decentralized blockchains! The longer answer, which I’ll only touch on as @DaddyFatSax is the expert here, is that various applications over time will be able to use different chains and put more and more business logic on-chain, especially the TBCs themselves.
2 - Yes
3 - DAO is community-run with a specific budget to invest in the ecosystem as $RLY token holders see fit. The DAO can make grants, loans, partner with other DAOs and crypto projects, or put the funds into liquidity mining or whatever the community decides. I hope the community takes an exploratory and experimental mindset, versus a conservative one. It will operate as a direct democracy governance model. It’s funded periodically by the Network Association.
The Network Association will develop and maintain the core blockchain technology, control network-level rewards, and oversee and invest the bulk of the $RLY treasury. From a governance standpoint, the proposal in this phase of decentralization (which is not the end state) is to have trusted delegates from the outset, and then have $RLY token holders add and turnover the executive board over time starting in 18 months (Q1’23). It operates as a representative democracy. The next 18 months gives us time to focus on decentralizing the technology further and for us all in the community to figure out the process and vetting for the representatives to govern the Association.
The Association will have power to change the network rewards in the protocol.
And definitely agreed on getting much, much closer to Ethereum than we are now. One of the goals of decentralization is to enable our Network engineers to much more quickly advance our core Layer1 work, while enabling the Rally.io team to focus on application-level functional improvements for creators and fans.
I anticipate that the dilutive effects will be minimal. As the finance team has posted, the community treasury has over $105M in USDC today.
The budgets totaling $86M USDC in the proposal goes all the way out through the end of 2022, so there’s no need for any entity to liquidate $RLY for USD. The $RLY is primarily for recruiting either team talent, in which case we’ll be working with the Association to set standards for team (generally vesting over 4 years) or creator talent in which case we’ve locked up far more $RLY than we’ve issued to talent and expect to continue to do so.
We’re also increasingly able, and vendors want, $RLY as payment for services. In many cases, these vendors do not liquidate much of the $RLY as they want long-term participation – anyone who takes $RLY as a payment these days generally wants long-term alignment, not USD immediately or they’d simply ask for USD!
Our number one rule as management in the Rally corporation as it stands right now is that no employee can talk about price. Why? Because the USA’s SEC has strict rules about this, and we’re a USA-based team. But obviously we’re a creator and community monetization platform!
And yes, monetization can happen with a ‘stablecoin’ token design, but that is clearly not what we’ve built at Rally.io or $RLY. We created a digital asset that has utility for tokenizing creators, communities and brands, whereby the price is determined by supply/demand in a global marketplace.
So you’ll never see us talk about price, but we know that creators, fans, and the crypto community care about price because it affects the monetization rate vis-a-vis other monetization methods (be it ads, subscriptions or other fiat paymnets). Our core belief is that if we create tokens that are useful, used by exponentially growing creators and users, and the network is designed such that $RLY is utilized and captures the value created, we’re all going to do fine as a $RLY community.
Hope that helps your read of the situation!
As of today, 8/18/2021 the Community Treasury has the following balances:
USDC = 105,879,570; RLY = 10,157,338,365
How much of the ~10B $RLY balance is unallocated?
I’m assuming that number is including the 7.5B $RLY allocated for general Rally Network Usage Rewards?
Could you provide more detail about the “Rally corporation”? I assume its a legal entity.
- Who are the shareholders?
- Is it the legal entity that holds the +$86M USDC?
- Does the entity have revenue and how does it make a profit?
This info might be buried somewhere, but I couldn’t easily find it.
Ah, makes sense. Thanks for allaying my concerns both here and on the call. Exciting times ahead!
Thanks everyone for the great discussion around this proposal so far. It seems like we’re getting to a point where folks are asking questions to clarify or gain a better understanding.
We are aiming to put up the proposal on Snapshot on Monday at roughly 10am PT. Let’s keep the discussion going from now until then!
First off want to commend @KevinChou and all those who contributed to drafting this proposal. It’s clear this is the output of a very long sprint.
My gut reaction is there is a lot to take in here. Five teams, all with different responsibilities, budgets and leaders. I’m supportive of this direction, but would call out there should be an extreme amount of educational resources put in to tokenholders being able to make sense of what’s happening.
In another world, I would have seen value in breaking out these teams independently, rather than lumping them all together into one mega-proposal. With that said, the intent is positive and the framework being laid here is one I’m in favor of.
As a RLY tokenholder - there are a couple areas I’d like to comment on.
In its current form, this reads as a Grants DAO.
This is an awesome first step, but it fails to identify how a central Rally DAO captures value over a longer time horizon as creators are successful on the platform. I’m fully in support of the Ecosystem DAO, and would push us as a community to think of ways to bring in new assets with a high potential for success. As a RLY holder, I would want to find one central DAO address to easily measure the aggregate value of assets held by the DAO. See Slides 5 & 6 of this treasury breakdown for how this looks for Friends with Benefits.
In its proposed form, RLY holders have no governance over Rally.io - solely the ability to participate in Creator Coins using RLY as a form of payment. This is fine, however I would encourage the Rally.io team to consider things like the Mirror Write Race as a means for tokenholders to signal their interest with onboarding from time to time. To clarify, RLY holders should not govern all onboarding, simply the ability to add wildcards and independent creators in the mix every now and then.
Perhaps the biggest blocker to more widespread crypto recognition is the fact that Rally Creators are unable to take advantage of amazing mainnet tools like Gnosis Safe and Snapshot. I know @kevindelphi and the Delphi team shared some thoughts on ways to better bridge after a certain maturity point, and I’d take this time to call out when I think of “decentralization” I think a lot about Creators being able to have autonomy over the ecosystems they create on Rally.
Stated another way, I would encourage more thought towards making Rally Creator Coins tradable on Ethereum mainnet.
In closing, I’d summarize my feedback as follows:
- Unpack each layer of this proposal for better education after passing the vote.
- Provide more ways for RLY holders to take direction action.
- Start building a treasury of assets that is not predominantly based in RLY, or USDC earned from selling RLY to create a central point of focus.
I will be voting in favor of this proposal and look forward to watching the team continue to unpack these complex issues.
Great points as always
Thanks for sharing FWB DAO report. I also love the way llama presents this report; we should hit them up. Yes, the $RLY Ecosystem DAO is meant to be a grants and partnerships DAO, and I’m hugely supportive of bringing in new assets and partnerships across the social spaces; cool to see FWB have a big WHALE holding. And definitely agreed on a central DAO address. @GaryCoover is running the process on DAO set up, and we just met with the whole team at Syndicate on Friday. We should also make sure we look at https://daohaus.club/ as well Gary and figure out a way for the community to make the decision on DAO platform. Interested in your thoughts @coopahtroopa on how to enable a community-led process for forming and setting up the DAO correctly
Agreed, this is an area for improvement for us. @BremnerMorris I know has been thinking about this, and would love his thoughts
This is done from a tech standpoint. It’s actually easy technically, it’s the compliance issues that have been a huge thorn, but we’re now in the final stages of compliance work now. We’re hopeful for Q4. I know we’ve been dinged by the crypto community ever since launch because of not having the ability to exit creator coins into a non-custodial wallet. It has literally taken 12 months of work, but we can see the light at the end of the tunnel now.
Path to Mainnet importance cannot be stated enough.
This is exactly to the point → I can’t wait to see this solved, I believe it will have great effects on the network and the level of participation in Rally’s ecosystem.
A thoughtful analysis! The only caveat is that $RLY holders do have powerful, additional governance over Rally.io as established through the Creator Review Council. $RLY holders voted in 3 community members to the Creator Review Council that replaced the snapshot process (primarily in order to accelerate onboarding, while maintaining $RLY holders governance powers). The CRC community members continue their work, having approved nearly 200 creators since April, but having also exercised our power to turn away creators. The CRC has also taken on additional responsibilities such as sourcing and granting innovative use case rewards from the creator community, and we occasionally (though not often enough!) receive qualified organic creator referrals.
I think your point is valid here still, and would like to hear more on Bremner’s vision for the mix of creators on the platform and further participation of $RLY holders in governance.
+1 and for the NFTs that we are starting to see on rally.io as well. Encouraging timeline from Kevin!
Second Kevin here! I’ve been thinking a lot about this and how we might apply some of the best practices developed by Maker Dao and Synthetix to empower RLY holders.
@GaryCoover I hope we can all connect on this and feel free to host a discussion anytime outside of the Rally community calls to bring in the community to learn more. Eager to pitch in.
The $RLY Network Decentralization proposal is now up as of 9:45am this morning! Time to vote.
Thanks for the suggestion, @coopahtroopa. As Kevin mentioned, we’re working on a few mechanisms to open up the Rally onboarding funnel for more creators. This includes developing the tools for organic onboarding via self-service tools (right now, it requires a hand-held process via someone on the Rally team) as well as creating new channels for creators and / or community members to nominate new creators to join. The voting mechanism you shared from Mirror is a great idea and I’ll take this back to the team on a potential avenue for engaging the community in nomination process for new creators.
Per @Grand’s point, the community does have oversight on new creators added to the network via the Creator Review Council. Eventually the CRC will evolve and expand to include more people, and with a mandate that extends beyond approving new Creators to launch on Rally. This group will still be composed of an elected mix of Rally advisors, Creators and team members, and will be empowered with a budget along the lines of this year’s successful Innovative Use Rewards budget.
Beyond the CRC, we hope to expand the opportunities for creators and developers to weigh in on Rally decision making by opening up the ability to participate in governance via elected councils who will have direct access to executive leadership, as well as budgets for rewarding and incentivizing activities aligned with the Rally mission. More to come on these various councils in the coming weeks.