Final amount of the annual donation pending approval from The Sandbox Board (investors and directors of The Sandbox Company).

TL;DR

What

The 2025 SIP Budget introduces revised budget categories based on lessons from 2024, ensuring greater flexibility and alignment with The Sandbox ecosystem's needs. It proposes the new percentage allocations for each category and the total SAND budget amount for the year.

Why

The SIP program processed 45 proposals, with 10 approvals, spanning community-driven, TSB-backed, and constitutional initiatives. While some categories saw strong execution, such as Staking and Sandbox For Good, others faced challenges, due to rigid budget structures that limited flexibility: difficulties in managing the Platform categories due to restricted access to the Roadmap, challenges with the SAND initiatives category due to regulatory scrutiny. Fluctuating SAND values underscored the need for prudent financial management.

How

The DAO admin team will liaise with The Sandbox Finance team and coordinate a test transaction and, upon good receipt, the full transfer for total SAND donation for the year. Additionally, the website and treasury dashboard will be updated to reflect the new categories. New wallets with updated management rules will be created to maintain checks and balances within the admin team.

When

SIP becomes effective upon total budget acceptance and funds will be transferred to The Sandbox DAO wallet. Regular budget updates will be provided throughout the year and made available for transparency.

Who

The proposal is submitted by Arasakio, leveraging insights from 2024 to refine processes and optimize resource allocation for this year.

SIP Details

Overview of 2024 Performance

The SIP program processed 45 proposals, with 10 approvals, spanning community-driven, TSB-backed, and constitutional initiatives. While some categories saw strong execution, such as “Staking” and "Sandbox For Good", others faced challenges, particularly due to rigid budget structures that limited flexibility: difficulties in managing the “Platform” categories due to restricted access to the Product Roadmap, challenges with the SAND initiatives category due to regulatory scrutiny. Additionally, fluctuating SAND values underscored the need for prudent financial management.

Operationally, we allocated 1.5M SAND to SIPs (another 600k SAND are pending projects reaching final milestones) and 950K SAND to the operational budget, which was primarily managed in stablecoins to reduce exposure to SAND’s volatility. Despite fluctuations in the token’s value, the DAO Admin team successfully closed the year within budget, highlighting the importance of effective asset management. Furthermore, while the renewal of the donation has been postponed, it has not hindered our ability to operate.

General Impressions of 2024 Budget Categories

Reflecting on 2024, certain budget categories - such as LiveOps, and NFTs - experienced limited utilization. These constraints highlighted a gap in alignment between TSB teams and the community. The rigidity of the existing categories also posed challenges in accommodating proposals that did not fit neatly into the established structure.

While we have approached areas like the SAND initiative cautiously, mindful of potential regulatory considerations, other categories such as content and platform faced some challenges due to differing views on broader strategic priorities. Overall, while some categories were effective, the limited flexibility and occasional misalignment across stakeholders made it challenging to move forward with unified community support.

The Sandbox DAO: Vision and Objectives for 2025

Vision for 2025: Growing the DAO

In 2025, the DAO's mission is to grow into a robust community of meaning and value by fostering greater engagement and increasing the utility of the SAND token. This will drive more players, more content, and ultimately more revenue. The focus will be on empowering the community, exploring funding avenues, and ensuring alignment with long-term goals that solidify The Sandbox’s position in the Web3 ecosystem.

Strategic Objectives for 2025:

1. Empower the Community: Grant members a stronger influence on the DAO's budget and priorities, fostering a sense of ownership.
2. Diversify Funding: Introduce flexible budget categories that encourage innovation and a wider scope for proposals and, in turn, increasing SIP authors engagement.
3. Align with Long-Term Goals: Ensure that all initiatives funded align with the overarching vision of growing the ecosystem and strengthening The Sandbox’s position in the Web3 space.
4. Leverage Assets: Maximize the utility of the DAO’s key resources: SAND treasury, NFT collectibles, LANDs and TSB assets

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Budget Categories for 2025

To streamline funding and foster SIPs submission, the DAO will adopt the following new budget categories, each tailored to its strategic goals:

|Type|% |Purpose|Why it’s important|Why this allocation| | --- | --- | --- | --- | --- | |Web3 Ecosystem Integration|37,5%|Dedicated funding to drive partnerships and integrate The Sandbox’s community and assets into the broader Web3 ecosystem.|Interoperability is key to expanding the platform’s reach and attracting new users. This category will fund initiatives aimed at increasing token utility and forging strategic partnerships that elevate The Sandbox’s presence within the Web3 space.|Partnerships and interoperability are critical for future growth. Investing significantly ensures the DAO can expand The Sandbox’s ecosystem and global reach while increasing the utility of its assets, including the SAND token. Forging strong external relationships and integrations will yield long-term benefits for the platform and community.| |Season Rewards & Game Creation|23%|Provide creators with funding for high-quality games and engagement-driven projects. Leverage SAND as an incentive and a functional token for creator participation and rewards.|Game creators are the heart of The Sandbox, and we must continue to nurture their growth. This category will ensure that the most promising projects receive the support they need to succeed, which in turn will attract more players and developers to the platform.|Reflects the importance of creators and seasonal engagement while balancing funding for other strategic priorities.| |Community Engagement & Charity|16%|Fund events, communications, community-driven initiatives and charitable donations.|Backbone of any DAO. By pooling resources into one category, we can streamline event funding, support grassroots initiatives, and foster stronger community bonds. This will empower members to lead projects, host meetups, and engage in meaningful contributions.|Proportion reflects a commitment to empowering members while maintaining focus on other high-impact areas.| |Education, Onboarding & Technology|4% |Create resources and tools to onboard users and educate creators, including programs, workshops, content, and software or platforms that simplify onboarding and enhance SAND’s utility.|Lowering entry barriers and nurturing talent are key to ecosystem growth. User-friendly technologies and educational tools will drive engagement, expand SAND’s use, and attract more users and creators to The Sandbox.|Reflects its targeted focus on lowering barriers to entry and expanding SAND’s utility, acknowledging that significant funding in other categories indirectly supports education and onboarding outcomes.| |Operations (minimum threshold required)|4m SAND|Essential operational costs, including admin and council fees, legal and professional services, Cayman Islands tax obligations, software and SaaS tools, banking and treasury management, necessary equipment, and various marketing expenses.|Ensures smooth day-to-day functioning of the DAO by supporting its foundational infrastructure and core administration team.|The operations team has discretion to hedge positions against SAND exposure, safeguarding the budget from token price volatility. The treasury strategy will ensure financial sustainability while enabling flexibility for managing funds effectively.| |Foundation Reserve|3,5%|Financial buffer to replenish other categories when depleted or to mitigate potential volatility in SAND’s value|Provides financial stability and flexibility, enabling the DAO to adapt to unforeseen challenges or opportunities.|Operations team has discretion to hedge positions against SAND exposure, helping to protect the DAO’s resources from token price fluctuations. The hedging strategy will follow a conservative and risk-averse approach, ensuring that funds are managed responsibly and with the DAO’s long-term stability in mind. Regular updates will be included in the DAO’s financial reporting to provide transparency on the overall health of the reserve. The reserve allocation, though modest, reflects a commitment to maximizing the use of active funds while maintaining sufficient flexibility to address unforeseen challenges or opportunities.|

Implementation Plan

|Milestones|Expected Date| | --- | --- | |Test Transaction|From donation approval| |Receives the donation|Within 2 days post test transaction | |New wallets + management rules|Within 15 days after receiving the donation| |Updating Website Dashboard |30 days after SIP Acceptance| |Regular Updates to share with the community|Every quarter|