FOX KPI Options - Community Temp Check & Ideation

Howdy Foxes! Talk of implementing FOX KPI Options via an UMA Trustless Contract has been bouncing around ShapeShift Discord for a bit now.

In the spirit of the gov process and with that initial encouragement, it’s time to gather community sentiment around the subject.

Before asking for a temp check and/or further ideation, I’ll offer a short explanation (as well as a few use cases) to demonstrate the utility of UMA KPI Options.

What Are KPI Options?

UMA KPI Options are fully collateralized synthetic tokens whose value is tied to achieving a predetermined metric. The term KPI stands for Key Performance Indicator.

Think of a KPI as any key metric that would be included in a measure of the overall health of the DAO.

KPI Options have a predetermined expiration period upon which they can be redeemed. They have a floor that can be set to zero, or a minimum value, as well as a ceiling (or maximum redeemable value).

How Can KPI Options Help A DAO?

In some of the most powerful use cases, KPI Options show their ability to incentivize, motivate, and mobilize a community.

The secret sauce is that they encourage teamwork and the buidling of relationships within, as well as outside of the DAO.

An additional benefit to the DAO is a max payout that can only be achieved by reaching the ceiling goal. Should the KPI fall short of the ceiling, that portion is collateral returned to the DAO.

Hodlers of KPI Options have a motivation to band together. Teamwork to improve the chosen KPI is the obvious answer to achieving the highest value possible upon expiration.

By making the ceiling goal a challenge, the DAO can encourage both individual and team growth along the way.

Current Use Cases

One of the most successful use cases for KPI Options was launched by their creator, UMA. This is evident in the nine month development from scratch of the SuperUMAn DAO.

After a wide and external community building distribution, the first round of uTVL Options was a great learning experience.

The newly formed SuperUMAn community made large strides towards growing the KPI, which was TVL. Unfortunately, the May correction wiped out most of that effort just before the Options expired in June.

A uTVL Retrospective

In light of these experiences and with much input from the SuperUMAn community, UMA changed the KPI to ‘amount of integrations’ secured before expiration. SuperUMAns continue their efforts towards this same KPI now in a third round of Options.

Additional use cases for your reading below:

BadgerDAO Digg KPI Options

Aragon KPI Options

BanklessDAO KPI Options

Three Liquidity Mining 2.0 Use Cases

ShapeShift / KPI Option Temp Check & Ideation

In order to move forward with a more formal proposal (or not), please indicate your general support for ShapeShift KPI Options with a like of this post.

If you disapprove, avoid that like tab but please still feel free to offer feedback.

Should you approve of moving ahead with a KPI Option design, please offer feedback around the following areas.

What KPI (metric) should the Options target?

How long of a period until expiry?

Who could be eligible to receive the KPI Options if ShapeShift did an internal / external distribution?

How could ShapeShift DAO members organize to improve the chosen metric?

Thanks for the time and support so far. Don’t hesitate to ask questions.

Geoff, aka, Inalittlewhile / FOX / SuperUMAn

Hunt has been talking about these for a long time and is in support. I believe from this post and what Hunt has told me, I am in full support as well. I would love to hear ’s security analysis/opinion on this as well before this goes to official voting though.

I think KPI options are really under-rated for the value they add to the community. The best thing is that these can always be shaped around the metrics which are in line with the DAO.

I mentioned my impressions about this proposal in #incubation channel, but I think it’s worth registering them here. Im adept of this motivational concept and its really interesting imo, so it’s possible to set KPI’s for workstreams, teams, individual members… def a temperature gauge, but performance oriented.

btw, UMA has a nice and engaged community, im looking forward to it.

Hi Guys,

If we were to analyze the negative impact of KPI on the DAO what would it be in your personal opinion?

I’m in favor - I think its a fantastic way to keep people motivated and retained. I’d even love to see these layered with sablier streams, allowing for realtime vesting.

Thanks for your persistent effort to bring attention to KPI Options. Wouldn’t have come to this point without your help. And for all the gm’s.

Lucky for us, KPI Options use the same LSP (Long Short Pair) contract as the Range or Success Tokens. Still, I would DeFinitely encourage another look from MrNerdHair.


Yeah KPI Options can be designed in all sorts of imaginative ways. My only caution might be to warn against too much complexity for the first round.

KPI Options provide valuable data, which can then be leveraged to adjust the terms and make subsequent rounds more successful. Complexity can often lead to indecision.

Good points you make that Foxes should be aware of. :+1:

I think the biggest possible downside would be tying up FOX collateral in KPI Options that fail to incentive the holders.

In several ways, UMA experienced this with their/our own first round of Options. The retrospective linked in the temp check proposal offers a great window into those lessons UMA learned.

Our distribution was much too wide. This resulted in only a small percentage of addresses coming over to UMA Discord to help grow the value of the KPI Options. Most addresses likely just dumped the Options after expiry / redemption. We found that TVL wasn’t the best choice of metrics.

The retrospective also offers that our first round was both a success as well as having plenty of failures. We formed a community of SuperUMAns that didn’t exist before. We organized, learned from the failures, and adjusted the KPI Options as we moved ahead. Now we’re launching our own DAO!

Great question because it gives ShapeShift the opportunity to learn from UMA’s lessons. Hopefully others chime in with their thoughts/perspectives here.