Title: OATH Tokenomics Upgrade
Proposal Chain: All current and future chains hosting OATH liquidity
Proposal Type: OATH Improvement Proposal (OIP)
Proposal Author: Charles
Date: November 20, 2023
This proposal aims to refine OATH tokenomics to maximize benefits for stakeholders, address fragmentation challenges, incorporate innovative features (oOATH), and update features of Bonded OATH (bOATH) LPs. Emphasizing real yields and implementing new measures like Option Tokens will drive deeper community buy-in and enhance the OATH ecosystem’s sustainability and growth potential.
Reason for Submission: Given OATH’s shift to address liquidity fragmentation, a tokenomics update is paramount for the project’s success. The goal of this proposal is three-fold:
- Facilitating the alignment of incentives between protocols and users by redirecting value from opportunistic liquidity to dedicated liquidity.
- To increase on-chain liquidity for $OATH.
- To enhance sustainability and profitability for the protocols and users.
Potential Conflicts of Interest:
None identified at this point. Continuous disclosure will be discussed with the community should any arise in the future.
The current tokenomics is faced with challenges such as inability to penetrate markets across multiple networks and lack of effective incentives for long-term community engagement.
- Introducing oOATH (Option Tokens) to provide users with perpetual call options for OATH at discounted rates. https://x.com/OATHFoundation/status/1715079540677193928 6
- Redesigning $bOATH to incorporate features like real yield, fee-sharing, airdrops from Chapters, and more, emphasizing longer-term staging benefits. https://x.com/OATHFoundation/status/1714354441061859345 6
Part I: Option Token (oOATH) Implementation
oOATH will represent the right to buy or obtain liquid OATH at a discount, and will replace all OATH rewards. When a user receives oOATH, they will have three (3) options:
- Requires upfront capital.
- Immediate redemption of oOATH for liquid OATH at a 50% discount.
- Example: User has $100 oOATH, pays $50 in ETH to instantly receive $100 OATH.
The revenue generated from users redeeming oOATH rewards will be distributed as such:
- 80% to bOATH stakers
- 20% to OATH treasury
- Requires less upfront capital + time.
- Convert oOATH into Bonded OATH (bOATH). This involves a gradual vesting process over 3-6 months, during which claimable amount increases linearly.
- Requires no upfront capital, only time.
- Deposit oOATH and receive OATH distributed linearly over 6-9 months.
Part II: bOATH Revenue Sources
Following the implementation of Ethos Reserve v2, bOATH will receive revenue in the following ways:
- All Ethos Reserve platform fees will be directly given to bOATH stakers in the form of ETH, BTC and OP.
- oOATH tokenomics revenue in the form of $ETH.
- Allocation of OATH Chapter tokens.
All specifics to be implemented are subject to change following further discussion and feedback from the community.
The OATH team has shown adaptability by evolving strategies based on the needs of the hour, such as the introduction of oOATH and focus on bOATH. Their successful collaborations and implementations in the past provide confidence in their ability to carry out the proposed tokenomics update.
Key Objectives & Success Metrics:
- Increase OATH’s competitive position.
- Enhance the OATH ecosystem’s sustainability.
- Increase OATH trading volume.
- Create positive feedback and alignment between the protocol and committed users.
- Increased liquidity conditions for OATH.
- Increased revenue for bOATH holders.
- Enhanced active user and community engagement metrics.
Length of Engagement & Budget Breakdown:
No budget requested. Seeking community feedback.
Early feedback from community forums like Twitter (X), discord and google forms has been positive, especially regarding features like real yield and bOATH. Seeking governor feedback on the proposal specifics.
- Potential confusion among existing users due to the tokenomics transition.
- Technical challenges during implementation.
- Market risks due to volatility in the cryptocurrency space.
Implementation details will be made at the discretion of OATH Foundation contributors. Any desired changes or additions to the model post-implementation are subject to change via future governance votes.