[SCP-TBD] Draft Proposal - Enable Partial Salaries in FOX

Title:

Enable Partial Salaries in FOX

Summary:

Allow workstream contributors to elect to receive part of their salaries in FOX through Hedgey time-lock bonds.

Abstract:

If passed, this proposal would allow each workstream contributor to choose from the options listed in the Specification section for a portion of their monthly contribution compensation to be paid in FOX tokens. Contributors would select a percentage of pay in FOX, along with a time-lock period. This would result in extra FOX being paid to contributors, relative to what they’d receive if they did not choose one of these options. (Alternatively, contributors could choose to receive their pay as usual.)

Motivation:

In order to conserve the DAO’s stablecoin treasury, and to align contributors to the long-term success of FOX, it would benefit all parties for contributors to have the option to opt-in to receive part of their monthly salary in FOX. To incentivize this behavior, the DAO would offer a “bonus” in the form of additional FOX. The longer the time-lock selected, the larger the bonus.

Survey conducted in the month of May show wide support for this option:

Specification:

Contributors will have the following options:

  • 100% pay in USDC
  • 25% FOX, 75% USDC
  • 50% FOX, 50% USDC
  • 100% FOX

For the latter three options, a time-lock period must also be selected. The longer the time-lock, the bigger the bonus:

  • 3-month lock, 10% extra FOX
  • 6-month lock, 20% extra FOX
  • 18-month lock, 30% extra FOX

The USDC portion of pay will be available immediately, but the amount of FOX–both the base amount and the extra from the time-lock selection–will be locked and unavailable until the time-lock expires.

At this time, it looks like the best option to offer this incentive is through Hedgey bonds. With Hedgey bonds, every month employees will receive an NFT that can be traded for the corresponding amount of FOX upon time-lock expiry. It would also be possible to sell the NFTs before the time-lock period is over to interested parties for USDC or any other crypto.

Benefits:

The DAO benefits by spending its stablecoins more slowly, allowing for a longer period to sustain a bear market and/or recession.

Contributors benefit by having the option to increase their salaries by agreeing to lock-up the FOX portion of their pay (plus a bonus) for a specified time period.

Drawbacks:

It would be inappropriate if any contributor felt undue pressure to participate in this program. With that in mind, it’s important to note that this program would be completely voluntary. All contributors have the right to choose to receive their pay in 100% stablecoins–or, if they currently receive FOX instead of USDC, to maintain the status quo of receiving all their FOX immediately.

Vote:

A “yes” vote would enable contributors to select a percentage of pay in FOX, and a time-lock period with a corresponding FOX bonus as specified above. It would also trigger the ability for workstream leaders and multi-sig signers to create new Hedgey bonds for each pay period to meet this need.

A “no” vote means nothing changes.

12 Likes

In full support of this proposal and love seeing the data/feedback from the community on this.

Right now based on the current % bonuses and time lock it seems the 6 month is in a bit of a “sweet” spot as the best bang for the buck that makes it more attractive than the other options relative to how it should be , I think it might make sense to slightly even these out such that 3 months = 10% bonus, 9 months = 20% bonus, and then 18 months = 30% bonus and the discrepancy wouldn’t be so much.

Just an idea here, don’t feel overly strongly but otherwise this seems to make the 18 month lock less attractive as a result IMO.

4 Likes

Thanks for posting this Josh. It’s nice to have direct feedback from the community in terms of what would be the right fit. Agreed that Hedgey is a great fit here, as it allows for relatively easy setup while also allowing contributors to sell their NFT if they so choose (something that’s not possible with streaming solutions).

@willy also had an interesting idea about using our Success Tokens for longer-term timelocks…something that would be very feasible given that those tokens are already in existence. Something also worth considering, either for this initial implementation or a follow-on phase.

Another suggestion that came up during the Foxenomics call last week is that we could offer FOXy lockups rather than FOX. There are some challenges there in terms of rebasing and the mechanics, but also worth considering in a Phase 2 IMO.

4 Likes

Hey everyone - Lindsey here from Hedgey. Just wanted to stop by and drop a comment on the proposal. From the Hedgey side of things this is all totally doable. We’ll be demoing the distribution process on tonights tokenomics call - looking forward to it feel free to bring any questions you have!

Like @jonisjon said, it’s been cool to see Shapeshift explore the details on this - stoked to be considered as part of this :raised_hands:

6 Likes

Thanks for dropping in Lindsey. I was out sick yesterday but will check out the archive of the call.

2 Likes

Overall I’m supportive of this and am thankful for the creativity and agility of the ShapeShift DAO.

What if a contributor wants to participate for 3 months at the split USDC/FOX + bonus rate? And then wants to switch back to USDC 100% due to their own personal circumstances?

1 Like

This would be up to the workstream leader, how often they will allow contributors to change the option. I wouldn’t have a problem with them changing every month.

3 Likes

gm @Josh, can you please confirm that these are the updated options that will be proposed to governance?

A. 3-month lock, 5% extra FOX
B. 6-month lock, 10% extra FOX
C. 12-month lock, 20% extra FOX
D. 18-month lock, 30% extra FOX

3 Likes

That is correct. Thanks @willy

4 Likes