GIP-3: Goblin Sax Strategy Document

Title: GIP-3: Goblin Sax Strategy Document

Authors: Ethan Weber, Dakra Mystic

Created: 05/30/2023

Abstract In this proposal, we attempt to outline the product vision, goals, and metrics of Goblin Sax. This will enable us to minimize future contention around resource allocation and governance of Goblin Sax.

How can you contribute towards Goblin Sax’s product vision, goals, and metrics?

Sharing either feedback, suggestions, and criticisms on proposals via reasoning and ideally alongside data to support arguments. Writing up your own set of product vision, goals, and metrics for Goblin Sax. Sharing data points that either help support or criticize a product vision. Publishing a proposal for resources that will move metrics (listed below) Proposal Details Purpose and Background This proposal is designed to present a comprehensive outline of the product vision, objectives, and key performance indicators for Goblin Sax. Its primary purpose is to provide a clear, unified strategy that will serve as a beacon in future decision-making processes. This document is an essential instrument in minimizing potential disputes and ensuring the smooth and efficient operation of our DAO. The ultimate goal is to establish well-defined, high-level Objectives and Key Results (OKRs) and Key Performance Indicators (KPIs), which will guide the DAO through its journey of product development and growth. By developing a shared understanding of our product vision, we will be better equipped to navigate the challenges ahead and steer Goblin Sax towards success.

Product Vision Future State: Our mission is to empower individuals and institutions to participate in NFT Finance effortlessly. We do this through a suite of tools and resources to help users gain access to the best opportunities across all composable primitives in the ecosystem. The GoblinSax ecosystem includes smart contracts for safe custody and execution, data systems for market monitoring and research and analytics for optimal decision making.

AutoPilot: Autopilot is a tool to help lenders turn their opinions on NFTs into a loan portfolio. With Autopilot, users can automate the discovery, bidding and execution process in NFT Lending; allowing users to participate across the ecosystem with minimal time investment. After setting lending conditions, Autopilot tracks loans across numerous marketplaces, and refers them to the user’s Smart Contract. If the loan meets the user’s specifications, it is approved. Rather than spending hours a day tracking numerous collections on numerous platforms, market participation can be done passively.

Workflow: User goes to GoblinSax Autopilot Website User signs in with wallet User creates Autopilot Wallet instance User creates rules (lending parameters) supported by data and analytics User deposits eth into wallet Wallet creates loans on all available marketplaces with best possible terms within risk thresholds User track progress, changes rules, withdraws eth This allows easy capital deployment and optimal price discovery to take its course by automating the minutiae of finding, structuring and executing transactions.

Components: Smart Wallets to connect borrowers and lenders to all available protocols. Data and Automation tools to help individuals deploy capital strategically and efficiently under conditions of complexity. Interfaces through which new protocols can integrate. Composable Platform on which new protocols can be integrated and built. With GoblinSax Autopilot, users can get the benefits of NFT Finance without committing extreme amounts of time or resources.

Monetization: Tiered Subscription Fees: Running bots effectively requires data and analytics, smart contracts and off chain services. We will monetize our products through subscription fees. Paid use of our API and SDKs for Businesses: Providing data APIs and transactional SDKs to businesses. Why is Autopilot/GoblinSax necessary? Fundamental Failure of NFT Finance Many people try NFT Finance, few if any stick with it. Our analysis of consecutive monthly usage on the three well-established peer-to-peer lending systems revealed that over 50% of NFT Finance users discontinue their participation within just one month, and a staggering 90% drop off within six months. This dropout rate highlights the challenge that ordinary individuals face in keeping up with the complexities of NFT Finance. Successful long-term engagement in NFT Finance currently demands access to data, analytics, bots, and dedicated time, which are resources unavailable to more than 90% of participants. Presently, decentralized pools suffer from performance issues, while centralized pools present regulatory and governance challenges. By providing access to data, analytics and bots, we hope to improve the NFT lending ecosystem for lenders and borrowers alike.

Bots and Analytics are Necessary to Deploy Large Amounts of Capital Giving a loan is easy, maintaining a loan portfolio is hard. To effectively deploy large amounts of capital, users must constantly be active and engaged. Maintaining deployment becomes a challenge even with amounts as low as a few hundred ETH. It requires the lender to bid both on blue-chip assets like Bored Ape Yacht Club and CryptoPunks, along with lower-tier collections across various lending platforms. This necessitates constant price checks on numerous collections, and scanning multiple websites for potential deals. Without the assistance of bots and analytics, managing these tasks becomes overwhelming and impractical. This often leads to low utilization rates, overly aggressive tactics to secure utilization, or quitting entirely.

AutoPilot Vectors of Competition: Ease of Use: We want to be as easy to use as any other option. Capital Efficiency: We pursue the highest utilization without compromising on risk or APR. Brand: GoblinSax needs to build its brand and become a known entity in the ecosystem. Metrics: A proposal will be created to decide how and where these metrics will be available.

Total Value Locked (TVL): The total capital held by users in smart wallets designed by GoblinSax, representing the overall value of assets entrusted to the platform.

Total Value Deployed (TVD): The total capital deployed from smart wallets designed by GoblinSax, indicating the amount of capital actively utilized by borrowers and lenders through the platform.

Peer to Peer Market Share: The TVD divided by the outstanding debt on peer-to-peer settlement layers.

Outstanding Debt Share: The TVD divided by the outstanding debt across the entire NFT Finance ecosystem.

Lending Market Share: TVL divided by the total value locked in all NFT lending protocols.

Active Lender Count on Autopilot: The number of users actively utilizing Autopilot with loans exceeding $100 within the past 14 days.

Average TVL per User: The average total value locked per user.

Adequately Deployed Wallet Count: The number of wallets with >75% utilization.

Week over Week Change in Adequacy: Percentage of inadequately deployed wallets that become adequately deployed.

Uptime: Targeting 99% uptime for both bot-related services and the user interface (UI), ensuring a reliable and uninterrupted experience for users.

Goals: Acquire 10% peer to peer market share in 6 months, restricted to protocols that allow smart contract interaction, with the purpose of building our brand and platform. The bullish scenario aims for 50% market share through organic growth (~20k ETH at time of writing), while the base scenario targets 10% market share through organic and cannibalistic growth (~4k ETH at time of writing). The bearish scenario anticipates a 5% market share (~2k ETH at time of writing).

Acquire 10% Outstanding Debt Share within the first 12 months to establish economic sustainability. The bullish scenario seeks to acquire $80-100m, the base scenario targets $30m, and the bearish scenario aims for $10m.

Achieve > 10% MoM change in active lender count to drive user count growth.

Achieve 10% MoM change in TVL by active users to ensure usage is increasing.

Reduce the "inadequate deployment" rate across users on a monthly basis to minimize attrition and improve deployment efficiency.

Target 99% uptime for both bot-related services and the user interface (UI) to ensure a reliable and uninterrupted user experience. Prioritize system stability and reliability to maintain user satisfaction and trust in the platform.

Failure Modes Obscurity: Goblin Sax fails to gain visibility and capture the attention of its target audience. Despite offering a valuable product, the lack of awareness and user engagement hinders its growth and adoption. It is crucial for Goblin Sax to effectively market its offerings, build a strong brand presence, and employ strategic outreach efforts to ensure that potential users are aware of the platform's capabilities and benefits.

UI/UX Frustration: Users find the Goblin Sax product confusing, unintuitive, or difficult to navigate. This leads to frustration, discouraging users from fully utilizing the platform's features and capabilities. To avoid this failure mode, Goblin Sax must prioritize user experience design, ensuring that the platform's interface is intuitive, user-friendly, and streamlined. Clear communication, guided onboarding processes, and continuous user feedback will be instrumental in creating a seamless and enjoyable user experience.

Non-Composability Wins: The dominant lending protocols in the market do not allow for seamless interaction with smart contracts. This limits Goblin Sax's ability to integrate and access a wider range of lending opportunities, potentially restricting its growth and competitive advantage. To mitigate this risk, Goblin Sax must actively seek integration opportunities, collaborate with existing protocols, and leverage interoperability solutions to ensure access to a diverse pool of lending options. Integration efforts should be prioritized to expand the platform's capabilities and increase its market reach.

Too Much Expected of Users: Users may set suboptimal lending parameters or make uninformed decisions, resulting in low utilization rates or unsatisfactory outcomes. While the product itself may function effectively, users may attribute their poor results to Goblin Sax, leading to dissatisfaction and negative feedback. To address this, Goblin Sax should prioritize user education and support, providing clear guidelines and resources to help users make informed decisions. By empowering users with the knowledge and tools needed for successful lending, Goblin Sax can minimize instances of user dissatisfaction and foster a positive user experience.