The market dynamics need to change now and we need a kickstart to get them moving in an upward direction. This concept is to promote the plan of putting a steady stream of revenue into token burns to reduce the overall supply over time thereby increasing value per token and future percentage of earnings per token.
The proposal is to put 90% of all revenue into token buybacks and burns. When the BaoV2 token value returns to $0.01 this can be reduced to 80%, after the token price hits $0.1 this can be reduced to 50%.
It doesn’t matter at this point how small the revenue is. We need a plan in place to put revenue into buybacks and buy pressure. This in turn creates confidence and structure in place to support those considering buying Bao tokens knowing that their value will increase over time. This is a winning strategy to any investor that has no knowledge of the details or complex nature of using the protocol. All they need to know is that their token supply will be reduced over time. Buy pressure will be constantly added over time and the tide will change.
This concept deserves to be voted on and tested by the community. If a significant improvement is gained then the percentages or levels could be made more aggressive. As it is we have a dwindling and frustrated community on the verge of abandonment while some of the guardians seem to think everything is just fine. We need to vote on, test and market this idea and then decide if it should continue.
I appreciate the intent behind redirecting revenue to burns and I agree we need to address the balance of demand and supply for the BAO token. However, without organic growth of the core business, any change to how revenue is used is likely to have a negligible effect.
Let’s concentrate our efforts on getting the flywheel spinning and building fundamental traction first - We need to focus first and foremost on driving usage and adoption to increase protocol revenues.
There is also already a concept open for discussion that will buy back a significant portion of BAO tokens on the market for a partner program which is designed to kickstart positive momentum and create a long term demand for the token. You can see it here if you haven’t already: Dim Sum Partner Program
After we achieve meaningful revenue growth at scale, reassessing measures like burns or other incentives realignment would make more sense. My belief is that taking revenue from veBAO holders and using it to burn BAO tokens takes away one of the fundamental reasons for locking tokens in the first place. Lets not forget that those with voting power are the ones that have locked their tokens too, so it seems counter intuitive that they would vote to reduce their rewards to favour those that have not committed to the protocol long term.
This proposed concept doesn’t detract from organic growth. Its intention is to further the flywheel effect from gaining attention through price increases and token reduction. We have yet to see usage and adoption increase through fundamental traction.
What would happen if Bao started showing up on cryptobubbles.net? Would it help gain attraction as more people start to notice it on their radar? This concept has a deeper and multi layered purpose that is beyond the simple token reduction. Its intent is to market and advertise that price increases are coming and as I have noted other projects that incorporate this into their protocols have fared better overall than Bao has.
The Dim Sum Partner Program only proposes to buy 15,000,000 tokens out of an existing 1,251,000,000 current token supply that is on track to double over the next few years. It’s not nearly enough.
Getting to $0.01 price is roughly a million dollar market cap based on circulating token supply. This is a small but meaningful goal post to set to gain some momentum and enthusiasm into the project here.
We have a difference in opinion in the necessary order of steps needed. At this point I am alright with all my locked token rewards going to burns because there will be more benefit from the attention of the price increases than the small amount of revenue being generated from the locked tokens. It’s a cart in front of the horse event to keep expecting everyone to lock their tokens as the price continues to plummet. Reducing token supply in the future means larger revenue to locked token holders so it benefits the locked token holders long term. It makes more sense to remove tokens while they are undervalued now than later if the price drastically increases.