[DCP-11] Evolving DappRadar PRO 2.0 and Staking: A Proposal for a Healthier Token Economy

Summary

As DappRadar progresses, it's time to implement a trailblazing membership system through staking and update the requirements for obtaining PRO, to better reflect the value provided by the service. This proposal seeks to get an approval for the essential allocation of 180M RADAR tokens for a Staking program that enables the PRO 2.0 Membership. This initiative represents one of the initial steps in steering RADAR tokenomics towards the desired direction, built upon months of careful planning and research.

Motivation

The goal is to establish DappRadar PRO as a membership that offers users more benefits and features across the ecosystem while keeping RADAR at the forefront. By reducing the token distribution (compared to the existing RADAR staking program) and refining our target audience, we aim to create a healthier tokenomics model for the RADAR token and align incentives with the participants of the ecosystem.

Abstract

PRO's Evolution PRO was initially launched in 2021 alongside the RADAR token, serving as a supplementary product designed to incentivize RADAR holders to engage with DappRadar and its ecosystem. Over the past 17 months, PRO has continually evolved, enhancing the value provided to its users. This growth is not expected to slow down; in fact, we aim to make PRO a central component of DappRadar. However, despite considerable resources being allocated to develop new features for PRO users, exclusive content, and the overall evolution of PRO, the current pricing model has not been beneficial for the ecosystem. Users were only required to hold a minimum of 5,000 RADAR tokens in their wallets to access all PRO features, but this pricing structure did not contribute to the development and expansion of PRO. With the high APR, it was also difficult to gauge whether users were staking their RADAR to access PRO features or simply for the economic gain by farming staking rewards. As a result, an updated pricing framework (through staking) will be introduced with the forthcoming launch of PRO 2.0 and Staking, better aligning the value provided by the service with the price paid by users.

Introducing PRO 2.0 PRO 2.0 is being introduced as the product evolves and matures, offering an upgraded experience akin to Spotify Premium or Amazon Prime. While users can still access the basic services for free, staking in PRO 2.0 will provide enhanced benefits, features, and RADAR rewards. This development is particularly exciting as DappRadar has been consistently attracting millions of users, providing valuable data and content for the past five years. Our goal is to continue delivering exceptional products and services while offering advanced users the opportunity to access more personalized experiences tailored to their needs. As PRO continues to offer increasing value, we anticipate a growing demand for RADAR tokens and more staking activity. The token model we've developed aims to strike a balance between increased demand and limited supply, ultimately reducing the circulating supply through more tokens being locked in staking.

The required number of tokens to access PRO will be set at 30,000 RADAR tokens. This value is derived from our token model, taking into account data from the existing PRO product, RADAR staking, the overall RADAR ecosystem, as well as upcoming token unlocks and future plans. It is important to note that several assumptions have been made in this process, and we will closely monitor the effectiveness of this pricing model. If necessary, adjustments will be made in consultation with DAO members, ensuring a suitable and accessible experience for all users.

Membership Approach and 30-Day Cooldown for Staking The new staking system introduces a 30-day cooldown period, emulating a membership model similar to traditional monthly subscriptions. This approach aims to provide a familiar experience for users. Additionally, the cooldown period helps prevent potential abuse of PRO services by malicious actors who may stake RADAR tokens temporarily, extract content or utilize advanced features, and then immediately sell the tokens on the market. With the 30-day cooldown, when users decide to unstake their tokens, they will initiate a cooldown period, and at the end of this period, the tokens will return to their wallet. This concept can be compared to subscribing to Spotify Premium for a month and receiving a refund at the end of the subscription. Quite an appealing proposition, isn't it?

Shifting the Audience Currently, a significant number of RADAR cross-chain staking participants are primarily focused on earning rewards and farming tokens, with little interest in DappRadar's product or vision. This update aims to address that issue by aligning incentives and risks to attract users genuinely interested in utilizing our products and contributing to DappRadar's future beyond merely farming and selling tokens. While there may be a short-term decline in PRO users following this change, we believe that, in the long run, it will cultivate a more valuable community with a shared vision and values.

Tokenomics Impact & DAO This decision is grounded in a tokenomics model that we have developed over the past six months, which considers the impact of all key stakeholders in the ecosystem (Users, Dapp Developers, Contributors, Team, and Partners) on the token economy. The objective is to establish a stable balance between demand and supply, fostering a healthy market for the RADAR token centered around the product. According to our tokenomics model, the ideal long-term APR for RADAR staking is approximately 3%. We propose initiating this new program with a 20% APR to facilitate a smooth transition for current stakers, then gradually reducing the APR over time to reach a stable 3%. This adjustment will help maintain equilibrium within the economy and sustain market dynamics.

To support the upcoming changes for PRO 2.0 and the new Staking program, the DAO must allocate 180 million tokens for distribution over the next two years. As mentioned, the APR will be set at 20% at the beginning and gradually decrease to 3%, in accordance with the chart provided in this proposal.

The new staking contracts have been built with a DAO-first approach, allowing variables like APR, minimum staked amount or cooldown to be decided by the DAO in the future.

The parameters will be reviewed in collaboration with the DAO on a quarterly basis. Based on the results, adjustments will be made as needed to ensure that we consistently respond to market demands and product development, maintaining an adaptable and effective approach.

Token allocation: 180M RADAR for 2 years (Estimation)

Default parameters (can be updated by the DAO at a later stage)

• Minimum staked tokens to get DappRadar PRO: 30,000 RADAR
• 30 days unstaking cooldown
• APR: Start at 20% and gradually decrease to 3% to achieve a sustainable demand/supply ratio

Benefits

• PRO's continuous evolution, becoming a key component of both DappRadar and the RADAR token ecosystem
• Audience shift from speculators and farmers to users genuinely interested in the value provided by PRO membership
• Decreasing the number of tokens released into circulation, aiming for a balanced demand-supply ratio and a healthy market
• Progress toward a robust tokenomics model centered on stakeholders who use the product, contribute to its development, and actively participate in shaping the DAO's future

Drawbacks

• Significant allocation of tokens for this program, potentially diverting resources from other initiatives
• Increased requirements for obtaining PRO membership, possibly leading to a short-term decline in PRO members as the audience shifts toward users more focused on the product than high APR

Vote

FOR: Agree on the changes made to DappRadar PRO, the default parameters and and the allocation of RADAR

AGAINST: Disagree on the changes made to the DappRadar PRO, the default parameters and the allocation of RADAR