Discussion: What should the gitcoin community multisig do with the donated AKITA

TL;DR: Sell it slowly.

Why?

First, you don’t want to assume ill-intent on the AKITA community. By rugging the token (market selling it) you suggest that community is worth dumping on, which is not the ethos of Gitcoin. That said, Gitcoin has a mission, which is to make the open source community better, and it’s their job to execute on that mission, so ultimately they should sell it. To do right by the AKITA community and assume the best, while also staying true to their mission, Gitcoin should sell at periodic intervals no matter the price (e.g., price insensitive selling) and publicize the selling plan and specific timings. That way member of the AKITA community can responding accordingly, while giving everyone a chance to stay true to their values.

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The rug component has really already taken place, if you try and adjust your actions to correct the past, all you end up with is a situation where AKITA dies anyway and Gitcoin gets no benefit from it.

I understand the sentiment, and could see some argument for a TWAP approach (although I’m skeptical) but any publicized detailed sell plan just gets front run to a lose-lose.

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I’ll focus on after selling part (I think it should be sold, but can’t say what’s the best way to do it)

My proposal is to swap it for DAI

Why DAI

Main idea would be to NOT be exposed to volatility. This is funding that should be there for ongoing support for builders in the ecosystem.

With DAI community can go in two directions:

Yearn Vaults

Directly Via Yearn where on a monthly basis part is used in gitcoin round

Alchemix

Supply DAI, get half in alUSD, use alUSD (or sell it for DAI), and supply for round funding.

What I like about Alchemix idea is that on a round basis we can constantly max out 50% dept in alUSD and use it in each round.

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Good concepts on selling it to a diverse basket of assets. Something productive that can add on going sustenance to the Gitcoin treasury through other defi protocols is interesting.

Edit:

There may also be a way to take a snapshot of those effected in the pool.

Sell the dog token, and put it into productive assets like ETH validators or defi. Use the gains from that to airdrop DAI to the users up until a certain return (perhaps even whole value depending on how productive the assets end up being) and then after that future proceeds go to Gitcoin.

It would mean at least some comp for those impacted but still a longer term future benefit for Gitcoin.

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suggestion from pioneerpat on twitter:

Make a proposal to create a lending market for AKITA on CREAM. Deposit and take a DAI loan instead of selling it. Market doesn’t crash and you have working capital.

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Why not sell it via a Gnosis auction? This is transparent and gives people warning (nobody is getting rugged) and allows the market to set a clearing price.

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Here are a few options on what we can do:

  1. Sell via OTC desk: We’ll get far less than the donated USD amount but we can get experienced market makers to execute this. OTC will be the quickest solution, however, it isn’t on-chain and trustless.

  2. Gnosis auctions: Gnosis batch auctions let you execute trades on-chain and trustlessly without getting sandwiched/front run. (See article.) I think the largest trade executed so far is by Boson Protocol, which had >$50m of bids and ended up settling ~$26m. For the size of the AKITA position, we would need to do several auctions (10+ probably).

  3. Selling on DEX: High slippage, low liquidity, chance of getting front run/sandwiched. Advantage: on-chain execution.

  4. Hold on for longer: Solutions might emerge from the broader crypto community and/or the AKITA community. For example, @Crisgarner suggested token buybacks from AKITA as a potential solution. If we have confidence in the AKITA community, we can even decide to earmark these funds over a longer time horizon for Gitcoin grants. If we are selling large amounts of the tokens, we also need to time to understand if there are any legal implications from doing this.

Conclusion: We should understand any legal implications of executing a large sale, especially when it seriously impacts price. We should discuss a partial token sale with OTC desks and the Gnosis team. And we should hold the rest of the tokens till we get more clarity on the points above.

I’m happy to help facilitate the discussion with Gnosis and/or OTC desks. I’m also helping the Crypto Relief team that received a $1B donation in $SHIB. We can coordinate efforts if needed.

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Not sure about this since then we are exposed to AKITA volatility and asset management due to volaitility

Make a proposal to create a lending market for AKITA on CREAM. Deposit and take a DAI loan instead of selling it. Market doesn’t crash and you have working capital.

I like that idea @nickjohnson and @HelloShreyas mentioned about either OTC or Gnosis auction

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Talk with the AKITA community to see if they are interested in buybacks.

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This would be cool! Finding a solution with the AKITA community can be ideal

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Hello guys, Im Relic , project lead for AKITA network. I’m going to leave a little bit about us so you might understand the magnitude of what has taken place for our community.
@relic22 on TG

Twitter: AKITA_network
Medium: https://akitanetwork.medium.com/

We never thought V would ever touch these tokens, and now it seems the fate of our project has been put into your hands. I’m sure our steward chose well.

We initially tweeted to VB to see if he wouldn’t mind burning our tokens, but seeing them go to help humanitarian efforts is something we would never disagree with. I hope we can all figure out a way to help each other, all we ever wanted was to be involved.

I think we can all agree that Vitalik did not want the burden of having these tokens in his possession.

With that being said, I cant really argue that our fate does not deserve to be in anyone else’s hands, since the entire genesis of the project was centered around that fact.

Ideally I’d love to collaborate both of our communities, and leverage all of our assets and connections into building. I don’t think our goals are dissimilar.

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Can you explain the justification for sending tokens to VB in the first place rather than a burn address?

Because you note that the goals of the communities are similar and seek collaboration, but, I can’t help but have a healthy bit of skepticism towards that based on the decision to send tokens to VB in the first place.

Racking it over in my mind, I can’t imagine in which that decision was not done simply as a marketing ploy, which doesn’t bode well for any trust or good faith in collaborating.

While I have no interest in seeing individuals, who didn’t know any better, getting hurt, there is a principle matter here in that the blockchain has no governing principles beyond the chain at the end of the day, and so if you sent them to VB you cannot then ask by social contract those tokens to not ever be used.

I think most in this community will want a more olive branch and less fire and brimstone approach than I’d advocate for, but I’m sure they would still be interested in understanding the background on that decision as they weigh up how to collaborate.

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Not sure why a “fire and brimstone” approach would be even considered.

We cloned ourselves after SHIBA who originally sent tokens to VB.

I personally had no involvement with the launching of the contract.

I was just there to pick up the pieces after the original contract owner pulled liquidity.

Intentions aside, a community was formed and a direction was taken.

So, in regards to justification, I cant really provide a good answer to that, I am just leading a community interested in being something more than a meme.

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Since @relic from AKITA has shown up, I think some/most of the tokens should go back to the AKITA Network, depending on your discussion with AKITA team.

If some tokens are left for GitCoin, a good way to put all tokens on auction is to use a bonding curve. The start price of the bonding curve could be set to a slightly lower than the market price, and the end price could be set to a higher price (e.g. 3x or 5x). The duration of the auction can be a long period of time (e.g. a few months). By using a bonding curve, you can obtain sustainable funding transparently without hurting the AKITA community.

A suggestion – Curve Auction (a Dora Factory product) can help with the process, a curve of self-defined parameters can be created: Bonding Curve Factory. The bonding curve factory team will refund all costs generated from the auction to the GitCoin community.

The Dora team is sharing the vision of funding public goods with GitCoin, and we hope that the result of selling AKITA tokens can contribute to the global open source community development, but in the same time make sure it’s not at the cost of AKITA holder community.

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And what is that ‘something more’ you are interested in being?

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I willingly ask for you guys to keep 10% of the supply and work together with us to build a better decentralized future.

Vitalik has given you this, and you should benefit from that decision.

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Our plan is to first enable governance for the project, since our token on eth is unable to be interacted with, we have decided on moving to Avalanche for governance.

The first goal was to establish funding, by creating a dex.
Team is heading to BTC 2021 in miami to try and convince BTC maxis to bridge to our dex on avax.
Longer term, the realization of AKITA network, a truly decentralized social media platform. We want to implement a social media structure that is completely self governed while implementing defi mechanisms to pay users for activity, data and analytics. Instead of users data being hoarded, we intend to sell it via data marketplaces like ocean protocol and redistribute that back into our token liqudity.

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I’m from DoraHacks and Dora Factory team so I won’t decide where the fund should go and how much it should be kept. However if GitCoin and AKITA community need us to set up a bonding curve, we are happy to help!

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Hello, it is I, cupojoseph. I have worked for gitcoin (back in 2018), contributed to the platform, spent tens of thousands of dollars donating to grants and funding work on the platform, and got my very first eth ever on Gitcoin shortly after it launched. I consider myself very involved, and the long term success of gitcoin is deeply important to me.

I hold these truths to be self evident:

  1. Gitcoin community and the world of funding public goods + open source does not owe anything to the akita community. 0 of this was donated by the akita community, and 0 of it would have made it here if it were just up to them.
  2. These funds were removed from liquidity before being sent to gitcoin, where the akita community thought they would stay to increase their ability to dump.
  3. Gitcoin community will not benefit long term by becoming an akita connected product, which will likely happen if these funds are held for long.
  4. The goal of the gitcoin community is to fund open source sustainably in a way that has never been possible before.
  5. The goal of the akita community is a pyramid scheme to make token price increase as more people buy in… and memes
  6. these goals have competing interests whether or not we are willing to admit it.

with these in mind, the goals of the gitcoin multisig wallet members should be to turn as much AKITA into ETH and DAI, in order to fund open source and public goods, as fast as possible while extracting as much value as possible. A 98% dump right now does not extract as much value as we can so that should be mostly ruled out. However, we the members of gitcoin ( who have been honestly building a more transparent financial system and other non-meme-pyramid-scheme based crypto projects on gitcoin for years now) do not owe the akita community anything, and should not hold these coins for very long with the reasoning that dumping will hurt them somehow.

One plan to extract as much value from this for open source and public good funding:

  • dump some small percentage now, maybe not more than would crash the price by 10-20%
  • create a lending pool on CREAM and lend as much as possible out for DAI and ETH
  • use these funds to buy equity in Gitcoin the company (not the community) back from consensys and VCs
  • sell in non-dex places where there may be less slippage: OTC, gnosis auctions, and back to akita community
  • create akita yield farm to increase liquidly again and dump more over time
  • Set hard goals of not holding any significant amount for more than 6 months

Edit: re Akita team members asking us to hold a percentage of the coins.

This is just dishonest. Your project’s website clearly describes itself as “inspired by elon musk, little brother of dogecoin, meme-based”
I’m not against holding a small percentage in good faith. But holding it so the price doesnt collapse to the advantage of akita holders, is directly disadvantaging open source projects for good we could be funding instead, which is my primary goal.

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Right, so puffery, buzzword nonsense and meme filled hopium that is just going to hurt people entering the crypto space.

That sounds like all the more reason for the Gitcoin team to dump the coin.

Maybe you’ll work something out with them, but I personally have no patience for a project that peddles an unrealistic narrative on users who don’t know any better.

You can be a memecoin, but if you are a meme coin without any tech (or even the tech knowledge to make a realistic pitch) then be honest about it as people deserve to know what they are buying. When there is a disconnect between what they are being sold and what they get, that doesn’t do you any favors.

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