Hibernation - Next steps

Last week I had a Q&A with some bears regarding what we should do in regards of Hibernation, or bear locking.

Here are the best next steps we found:

  1. Implement bear locking
  2. Have no plans to distribute revenue until we seek legal counseling.

Why #1:
After bear locking gets implementing only locked bears will be able to vote in the DAO. This has two benefits:

  • Even without revenue sharing bear locking aligns the incentives of the voters by making sure they are affected by their choices.
  • People that don’t want to have anything to do with the DAO or be liable by it’s actions can simply just hold a ERC721 token (JPEG) and be sure it is only a piece of generative art.

Why #2
We have people working daily on the DAO that live in wildly different legislations but a majority is concentrated in the US. As community members take up more responsibility they also take on any extra possible liability. So in order to make sure we keep our bears protected and the future of our community protected we must show our willingness to abide by the applicable laws and consult with industry leading firms like Fenwick

This is not how I planned to do things when I first started. Now seeing the scale of the organization we are building I must recognize that I was wrong and overly optimistic.

10 Likes

I think your vision was really good, just some questions came up which happens. Lots changes in this space. I personally would like to see legal advice first before I can say too much more. I don’t really know if this is a real or perceived risk? It kind of feels the same as the tax question that got asked. Again, a good question. There are so many countries involved that I saw when people tagged their flag emoji, and it is not possible to cover every eventuality. Usually law is governed by the jurisdiction where something is created, or where the issue happens, so that would probably be Portugal? I am finding it hard to grapple with this one, as you probably gathered on the call and now. I like the idea of locking bears, as it can be challenging with proposals not getting much engagement, but I am not sure whether I want to lock my bear without having legal advice first. Also, if it is a non-issue we can just go with the original direction and then its just a question around timing etc. Also, if we lock our bears, what does that mean for revenue return? Is that retrospective? Or what are the benefits of locking aside from DAO voting? I am a little concerned about the impact it may have to the JPEG investment option for those bears that don’t lock their bears away, as currently part of that is based on what people understand ‘value’ to be, so I guess I just need to understand what this change would mean in terms of that ‘value’. I dunno I am still unclear on this one, so looking forward to hearing what other bears think. I think ultimately for me, I defer to the legal advice as it provides for clear guidance so we can act with certainty. Thanks so much for getting this conversation going.

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Something small to consider: If/when hibernation is introduced and those will be the only bears that can vote, we may want to update our quorum criteria

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The bear/jpegs act as a membership ticket to the DAO, once inside, only if you lock your bear/jpeg you can turn that bear into a vote.
Max supply of locked bears will be the 100% of votes, so by example, if we have 5k locked bears, 500 votes (10%) would be needed for a proposal to be approved.
Less locked bears will increase DAO gov’s efficiency (if we don’t update our quorum criteria) but there will be more supply, so a lower floor (aka cheap buy for holders) but as the amount of locked bears goes up, there will be less supply so floor will be higher and it’ll be funding the honeypot.

Next thing I think we need to do is to establish time periods and perks.

Each 3 months we open open and close the hibernation window by having hibernation sessions, whatever we want to call it

  • time window/vote weight
    3 months______ 1
    6 months______ 1.3
    1 year________ 1.7
    4 years_______ 2
    (*values are opened for discussion)

here’s an example of how this set-up can look like (thank you @gabimazza)

Every 3 months, with ending cycle and new locking of bears, this table would adjust the total of bears+voteweight and all the functions that rely on it would also be affected for the next 3 months.

Your share of the DAO would change every time we have a hibernation session.

can you sell your locked bear?
no, you’ll be given a replacement nft after you lock your original bear and only the wallet that activated that bear’s hibernation can withdraw it when time window expires.

we can also “gamify” our DAOs accension, something like for the DAO to reach level 100, 10k bears need to be locked for 4y

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This sounds interesting and overall I like the idea of hibernation. I have one main question:

Why would someone want to have a vote in the DAO? If a small group of people lock thier bears and have votes, then they share the responsiblity and power to make the Buzzed Bears awesome and valuable. Why would I participate if I can just sit back, stay liquid with my bear, and just watch other people do all the work while I reap the rewards? I think there needs to be some other kind of reward system baked in for the people that are locking/hibernating. Maybe its access to free airdrops (bees?) or getting whitelisted for partner projects? Maybe these benefits can also be tiered similar to @Mesk85 's model of voting power based on length of hibernation. I’m not sure and would love to hear suggestions, but I think there needs to be more of a tangible incentive. Just saying that the floor price will rise the more that are locked will not incentivize people to lock their bear.

5 Likes

why dont u make the incentive to hibernate that there is no lock up needed but if one does pull out their bear they will lose all the rewards they staked for and it gets sent to the honey pot to reward those who held on? this way ppl dont feel trapped and understand that they can pull but for less value but if they do pull out then it will only help all of us by adding whatever reward he got to the honey pot.
while im here id like to add that it would b really cool if that reward was in the form of coins that people could buy bear upgrades to make the nft mre valuable/ swap if needed/stake on its own
OR if it could b an nft of ur bear sleeping and evrey airdrop after 1 full cycle of hibernation (a year i guess?) will b another few items to add to ur hibernating version of bear like a blanket and stuff and a bed but make them start off in a bland cave and they get like a small item evrey 3 months or so and then can claim the full nft with all items at the end of the cycle or if they pull b4 the year is up then it gets sold for the honey pot and u will hav to restart the hibernation with a diffrent bear till ur original stake is over
PS. A lava lamp / bong would b funny or somthing like that to pimp out the cave and after while if that nft gets too full someone who filled up ther past “sleeping bear nft” that they earned to the max can stake that bear for an even more sleepy lookin brand new nft (call it as many cycles as u see fit till that can happen)

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very cool ideas. I like where this is going.

2 Likes

First of all. Great ideas that have been shared here so far.

I find the proposed distribution of the vote power a bit unfavorable. In my opinion, under this aspect, no one will lock their bears up for 4 years. The difference between 1 and 4 years is far too small.

Here would be my suggestion:

3 months______ 1
6 months______ 1.25
1 year________ 1.5
2 years_______ 2

What happens after the blocking time has expired? Can the bears be locked up again? What is if you lock your bears up for 6 months, but then after 3 months you realize that you want to lock them up for 2 years? Do you have to wait for the 6 months?

Of course, locking up the bears gives you a lot of power in the dao. this alone is a big reason to do this. i don’t think we need any further incentives to get people to lock up their bears. we should rather create incentives that people who take part in the dao are rewarded in some form. You can only take part in the voting if you lock your bears in.

1 Like

Yeah I have to agree with the comments above. I think the % change makes sense. I also think there needs to be incentive to lock bears, more than voting, coz bears currently have the right to vote now, so we need to do something to incentivize people to lock their liquidity, otherwise, I am concerned that it won’t happen. I think providing a token per day, like some of the other groups provide is a good idea, that maybe that token can be ‘cashed’ in somehow for some benefit. Not sure what that is yet, but it would allow for something more than just a voting right that currently exists. Also, I was wondering what happens after the period you lock your bear, like if you do the 2 years, and then after that, should you automatically get the 2 year rate, regardless of how long you lock for? Coz it wouldn’t make sense to have a greater benefit and then if you pop it back in for 3 months have a lesser benefit when your total accrued period has been greater than the highest period. So we probably need to think about this. Looking forward to more thoughts. Has anyone got experience with the other DAOs that are providing tokens and other benefits for locking?