It has been a challenging time for many small crypto projects and Bao has had no exception here.
Over the past 8 months, we did a lot. We launched on mainnet, xDAI and BSC with our farms and swap franchises.
From this we learned a lot, as I was working on a new proposal I wanted to take time to document some of these learnings for everyone to learn from.
1. Infrastructure is important.
Having reliable RPC/node infrastructure like Infura and TheGraph is pretty critical to being able to run analytics tools and frontends needed for a project.
On BSC and xDAI we ran into lots of different issues in getting analytics sites running because of RPC and node syncing issues. While the nodes are good enough for users to connect and transact without issue, they haven’t been reliable enough to always get analytics tools running.
While we think we finally have a solution for that on xDAI, we still don’t on BSC.
So we learned that having access to professional tools like Infura really matters.
2. Listings and promotion matter for TVL/volume.
We made the mistaken in thinking that listings weren’t important. Most people look for things like listings on CMC and Coingecko as important for price, which we don’t want to push for, but it turns out they also matter in helping TVL and volume.
Because we didn’t have an analytics site and because PNDA and RHINO didn’t have volume on an exchange that was already listed on Coingecko, and because we didn’t have a high trade volume on Pancakeswap, we couldn’t get PNDA listed.
This lack of listing hurt the TVL locked in these farms and the volume, as it seems listings like this are an important part of how people discover and use new farm products.
3. Qualified Solidity Talent is Unavailable
We also thought we’d be able to scale up experienced Solidity developer talent.
Even though the DAO was willing to offer high salaries, we received no applications from candidates who were anywhere near qualified.
This meant all our development was going to take longer.
4. Coupons are a bad idea.
The concept of redeemable coupons is something that seemed simple but is actual complex.
It leads to a lot of sunk time, cost and complexity with very little benefit.
It requires are lot of infrastructure to maintain.
I think trying to use the redeemable coupon model was the biggest mistake we made with Bao so far.
The franchise approach is much stronger, but other options would be incorporating bridged tokens (although that comes with security risk)
5. Education is needed on franchises.
I think people that don’t like the franchise idea don’t understand it and as a DAO we need to do a lot more to invest in education around that topic.
Being able to have sub products with their own governance tokens and own incentive models is important and the DAO can always have a controlling cut of that governance token with conditional thresholds of how to disperse it long term.
Using an existing token means no new incentive models.
Airdropping a new token means an unfair start and unneeded selling pressure in the early life of a project which can hurt the incentives we design.
The franchise lock model makes long term incentives but I think a lot of people struggle with that concept.
6. We were too aggressive in our early rewards
I think we likely had too aggressive of an early distribution curve. If I could go back in time, I’d likely propose a slightly different one.
We wanted to promote early liquidity and gather analytics on diverse pools, but I think since things took longer to develop it meant giving away a lot of the incentive reserve very early. That wasn’t harmful but it did mean leaving less options on the table and tighter timeline pressure.
7. The infrastructure for crosschain anything is still young
I think we underestimated the state of crosschain infrastructure. The ability to swap between chains, vote between chains, and have reliable keeper systems.
These things exist but they are new and not yet reliable. That’s one more reason I am strong on the franchise model it lowers the risk of any one failing part, chain or crosschain infrastructure failing and causing issues with the entire project.
8. Liquidity moves fast and we should trust others with that
I’ve been wanting to get back to a place where we can focus on parts of our tools that don’t compete with liquidity and we can trust in early partnerships like with Sushiswap and focus on building out things that leverage their liquidity.
When we made the decision to build on other chains, it was because we needed that diverse liquidity for synths at somepoint.
We had no idea that 8 months later there would be an explosion of sidechains becoming popular and that every major project would be building there and incentivizing liquidity in AMMs.
Sushi’s teams are experts at that stuff, and I think we can do a better job of relying on them for that instead of trying to take on the entire challenge ourselves.
9. AMM risk is serious
I think we’re all very pleased that because of our commitment to being careful, BAO is a project that launched on 3 different chains and never had to deal with exploits.
But what we have noticed is that most of the exploits that happened to other teams over the past 6 months have almost all been attacks on AMM pools.
We should probably have focuses on parts of our project that don’t introduce this risk in order for us to keep moving quickly.
Which I think also supports the idea of relying on partners for these things.
10. We need more community structure
As a decentralized DAO I’ve been impressed at how much has developed from self organized groups.
I think we can do more to encourage this and focus a lot more on guidelines and processes of how users can put forward new proposals, contribute to the core protocol and start ‘working-groups’ that have specific focus areas.
For example, some protocols have working groups of volunteers who focus solely on finding new partnerships for the ecosystem.
I don’t think any project should ever make processes top down, but we have seen a lot of natural efforts develop in our community that lead to things like the creation of a ‘front-end galaxy’ and ‘QA galaxy’ and I think we can put more effort into documenting and formalizing these best practices so we can better coordinate these efforts.
11. BAO isn’t one thing
I think we’ve all learned over the past few months that the power of BAO doesn’t come from being one specific product.
We aren’t the most engineering heavy community. Or the best designers. Those are things we’re all working on.
But what we are is an amazing community and an innovative and fast moving one.
Bao has hit lots of road blocks that would stop most projects.
Bao has also launched more deployments in 8 months than many teams have in three years.
We’ve been willing to come up with interesting ideas in the community, create them and launch them.
I think long term it is this community spirit and willingness to experiment that will be important for BAO as we all continue to learn what fits within the ecosystem and what doesn’t.
12. Synths are still critical
We’ve seen more and more the importance of soft synths (indexes) and full synthetic assets as traditional finance is broken, disconnected and inaccessible.
While there are a lot of teams working on synthetic dollars, we’ve still not seen a lot of ambition in teams trying to make unique assets. I think this space is still wide open.
13. People will steal your name
If you announce a product name before you launch it. People will take it.
14. People will ignore your warnings
If you warn them about fees in the docs and 10 times on the website and in a confirmation button, they still will complain about fees.
If you tell them to take part in the product and not treat a governance token with farms as an investment token, they still won’t listen.
You can try as hard as you can to tell people things, but they won’t listen. This is something we need to keep in mind as we design new products. If people don’t listen you have to design the economics of the system in a stronger manner to make it a disincentive for the negative behavior.
15. I am more excited than ever
While this community has spent more time and effort for more challenge than I would have ever expected, I think we are still on the right track and I am still as excited as ever for the community we’ve built together to continue to move forward on our vision of self sovereign, accessible, synthetic products.