6566cd8306dbc9c55836a73dd83db3e931f04b3b
Hi everyone, welcome to the long awaited vouchers proposal!
Originally, I had planned to release two proposals, one to sunset vouchers by stopping emissions and converting them to DEC-B, and another one to make them soulbound. After careful consideration, I believe the net cost to the team to implement a soulbound solution may be greater than the economic benefit such a strategy can bring to the ecosystem, thus I have decided to NOT post the soulbound proposal and simply try for this one to pass. I have a brief explanation below as to why I believe this is superior to soulbound vouchers.
I know this will be a very controversial proposal with a lot of discussion to be had, but I am confident this is the only way we can see DECs back at peg in the near future and the best way to go for the entire ecosystem.
From the inception of vouchers, its purpose was always meant to be a "proof of time staked". However, due to its transferable nature, vouchers do not live up to this narrative. Someone without any staked SPS can still buy it, allowing them to bypass the staking requirement of having vouchers, which breaks the "proof of time staked" concept entirely.
Another issue is the difficulty of obtaining vouchers, especially for non-crypto users, or even non-hive-native crypto users. This creates a terrible experience for onboarding new players who may want to buy packs directly from the store, or any other feature that uses vouchers, such as buying energy. This discourages new players by making them feel that they pay extra, or learning an entirely new system just to play a game.
Lastly, all the current utility of vouchers compete directly with DEC utility, and with 40,000 vouchers minted daily, that is essentially 2mil DECs minted per day using the rough estimate of 1 voucher = 50 DEC (which is the conversion used for energy + wild pass). Any new utility for vouchers, such as promo cards, exclusive presales and any other cool events in the future can directly be replaced with burning DECs instead of burning vouchers, as both solutions do NOT earn the company any revenue either way.
The purpose of this proposal is to simply remove vouchers by stopping all emissions and converting vouchers to DEC-B at a rate of 1 voucher to 40 DEC-B.
@yabapmatt has confirmed that the team plans to do a series of promo card sales in the coming months which will require burning DEC or DEC-B (the first of which is planned to be the Yabapmatt card). This will give immediate utility to DEC-B that VOUCHER holders will receive if this proposal passes, and will begin to help give significant value back to the DEC token to help move it back to towards the level where SPS starts to be burned.
I believe that vouchers are a sunk cost at this point, the sooner we remove them the better. It was an experiment that ultimately failed so let's just accept it and move on.
I will edit the proposal and post answers to FAQs here once we go live!
Compared to removing vouchers, making them soulbound will still mean we are losing DEC burn. No matter what utility we give to vouchers, it can always be replaced with burning DEC, since both of these methods do not directly fund the team. If vouchers were removed completely, anything that is priced in vouchers such as promo card revenue can go directly to burning DEC instead, thus even if vouchers were soulbound, it will continue to take up one of the largest sources of DEC burn in the near future. A healthier DEC price is paramount to both the survival of the company and the marketability of the game (assuming DEC at peg will trigger SPS burns, causing positive price movements on SPS).
Over the course of writing this proposal up, I have received a lot of suggestions to simply repurpose vouchers instead of removing them. However, the same problem of losing DEC burn still remains. Any utility we give to vouchers such as new skins, or new cards, or even new items can simply be sold as DEC instead, with the DEC used to burn, fund the DAO or fund the team. Everywhere you can spend vouchers simply burns them, which does not give any value to the DAO or the team.
Some people have asked me: how will we know this proposal has worked if it were to pass? Below are some ways we can measure the success of this proposal:
Without vouchers, it will also create a more welcoming ecosystem for new players to join. Although this will be harder to measure, I believe we can also attain a higher retention rate once NPE is improved and marketing starts.
Although the time frame to peg will depend dramatically on market conditions, how well promo cards do and how many new players there are, I believe we can reach a significant way to peg within just a matter of a couple months.
This proposal has been written up over the course of weeks, with the help of many community members, including Yabapmatt.
I would like to add that from both me and Matt's perspective, the best way for the game to move forward is to simply remove vouchers and enact the plan to sunset them. For me, it's mainly regarding tokenomics but for Matt, it is part of the NPE overhaul.
Below, I would like to add a bit of context why I personally believe vouchers are the single biggest roadblock to creating a better SPS/DEC economy. This is no longer directly relevant to the proposal and more of a personal rant.
I believe the only way for the game to succeed is to get new players, and the best way to get new players is through marketing. However, marketing is not as simple as just spending money and new players will magically appear, we need to ensure the foundations are set up correctly for new players to actually want to join, and retain them once they do join.
At the end of the day, this is web3 where optics and momentum matter. Therefore, I believe before we start marketing we need to ensure:
In order to achieve the first goal, I believe vouchers must go. Right now, vouchers are taking up a significant amount of value out of the DEC/SPS dual token system, and in doing so it does not reflect well on the charts. If all the value that vouchers are soaking up is redirected to DEC/SPS, I genuinely believe it could make a tangible positive impact in the game's economy.
Furthermore, with a more efficient economy I believe the community will be in better spirits overall, and thus more welcoming to new players. Let's be honest, if you joined a new project and saw the existing community upset and complaining every day, would you want to keep exploring? Likely not...
The third point may be the hardest to achieve, but I personally believe simply a whitepaper plus some teases of lands 2.0 is enough to gain significant attention. There were many projects out there with just a whitepaper that had a higher valuation than SPS, and I believe if we get enough traction on lands 2.0, it will actually help make lands 2.0 into a reality.
Lastly, vouchers is a huge complication and learning curve for new players to wrap their heads around. We do not want to create barriers for players to buy things, we want to make it as easy as humanly possible for a new player to join the community and buy whatever they want, without jumping through hoops learning Hive Engine, or staking SPS to get the best price. With vouchers gone, I believe it can streamline the new player experience tremendously
Once we can hit all those targets, I believe marketing will actually be effective in getting new players to join, but retaining them is another story. Vouchers has been a huge headache for me as someone who has onboarded many non-crypto friends into the game. Imagine explaining Hive Engine to someone who has never used Binance, it's a pain! With the alternative of using Hive Engine being simply overpaying for packs, it creates a mental barrier for people who may want packs, but don't know how to use Hive Engine and don't want to overpay for them. This is not a good way to welcome new players.
Overall, I just wanted to explain why I think it's so important vouchers are out of the ecosystem. It's a short term hit for SPS stakers and License holders, but I believe it will have tangible positive impacts on the whole ecosystem in the long term.
As someone with a lot of stake in the ecosystem, I sincerely want Splinterlands to succeed. Personally, I see this as the only path.
