Is Gitcoin over its skis? should we hold spending flat while addressing unavoidable risks?

[griff]

@myceliumcoordinator

It looks like there is millions of dollars per day of volume for GTC. I’m not sure this is true.

GTC circulating supply is 14,211,563 GTC according to Coingecko and the DAO has supposedly ~45 Million GTC the volume is not relevant here, as that is just GTC being passed back and forth. The 45M GTC needs to hit the market slowly.

@myceliumcoordinator

This feels like something that could be a good learning for Gitcoin. Giveth has shipped a handful of protocols in the last 9 months. How is it that Giveth is shipping so much faster than Gitcoin on much less resources?

We don’t hire Americans, as American tech wages are outrageous, we hire people in Latin America, the Middle East and South East Asia that are intrinsically motivated by our mission.

Also, we spun out a group called GeneralMagic.io that contracts out to other Impact DAOs for their primary income so that we can modulate our resources without having to hire more people full time when we only need them for a month or two, and we don’t have to hire expensive contractors to do work either (we have GM as high quality low cost contractors that don’t need much training since they spun out of Giveth).

For smart contracts, we grew our talent internally and avoid using custom contracts when possible, but when we do, they are audited by my friends at a large discount… I am very lucky to be good friends with some very high profile solidity auditors, that believe in the Giveth vision.

@myceliumcoordinator

Also @griff do you know how much money has been moved on Giveth?

We have seen 1.1M donated on Giveth in the last 11 months. This is all organic, from individual donors, we haven’t ever had donations from large protocols or foundations. We are only recently starting up a fundraising team. This seems to be the secret sauce of Gitcoin that Giveth lacks… a very strong and professional fundraising team. Maybe it is a place where we need to hire Americans and better networked Ethereum OGs… We will see.

@shawn16400

I also agree that the way crypto valuates magic internet money is kind of cringy - but the math is pretty basic. Assuming price is consistent, and assuming we don’t do something dumb like dumping 45M GTC on the market all at once, we have the treasury to carry us into the next 5 years as you describe. if the price drops, see the point above.

The math is basic, but not simple and it doesn’t give us any where near 5 years runway (which would require $60 Mil at our current burn). For every GTC we payout that hits the market, there needs to be new demand for GTC that didn’t exist before, or it lowers the GTC price, lowering the value of the GTC we hold. Since most of the liquidity is on centralized exchanges, its hard to know measure the impact of our spending, but it will be huge. Maybe the next few million GTC can dump on the market without a huge impact, but there is a huge elephant in the room:

What is creating demand for GTC right now? What is supposed to create demand for GTC in the future? This is a critical issue!

Also, we are not in a vacuum, there are a lot of other vested and locked GTC that will also get unlocked that can hurt the GTC price. That 8 mil in stables was raised by selling GTC right? When does that GTC that was sold unlock? What about the original investors, when does their GTC unlock? Who is providing the liquidity on the exchanges? Have we made deals with market makers? What do those deals look like?

So many things can hurt the GTC price, especially in this market. We need to cut back our spending.

What if we said we can never spend more then the # of GTC that we spend this quarter (around 2 Mil) + any revenue generated… If we tie the GTC price to our budget, that would actually give us 5+ years of runway.