VIP-1: Update Vab tokenomics to support decentralization and community security

Dear Vabble Community Members,

I hope this message finds you well. I am writing to present a proposal for significant changes to Vabble's tokenomics. As a pioneer in decentralized infrastructure for film financing, distribution, and investments, Vabble has always strives to provide opportunities for filmmakers and individual investors while advancing our platform to meet the needs of the film industry and the Web3 community.

We firmly believe in upholding high moral standards for our products and tokens, and as such, we have decided to revamp our underlying tokenomics. These changes are designed to foster stability, decentralization, and trust among our investors, while supporting the integration of our VAB token into new product features. The proposed tokenomic changes include a reduction in circulating supply, a new vesting schedule, and a lower emission rate.

Let's delve deeper into why these changes are necessary and how they will work:

Why the Changes?

The modifications are a direct response to the increasing demand for decentralization in the Web3 space. By decentralizing our ecosystem, we aim to establish a more sustainable and secure platform for users and investors. Transparent decentralization of the tokenomics plays a pivotal role in fostering trust between the broader Web3 community and the Vabble development and management team. These changes ensure that no actions that could be detrimental to the success of the ecosystem can occur.

How Do the Changes Work?

The proposed tokenomic changes involve the following adjustments:

a. Decreased Circulating Supply: The circulating supply of VAB tokens will be reduced from 1.1 billion to 800 million. This reduction will be achieved by re-vesting 25% of the previously unlocked tokens and integrating them into a new vesting schedule, which will regulate a slower release of new tokens.

b. Lower Emission Rate: The emission rate of VAB tokens will be reduced from ~2.6% per month to a range of 0.62%-2%. This adjustment will help curb inflation and promote stability within the ecosystem.

c. Empowering the Community: The objective is for the team treasury to hold less than 30% of the token supply, with a significant portion of tokens being locked up. This decision empowers the community by returning control to them. Additionally, 25% of the previously unlocked tokens will be re-locked and deposited into the VAB DAO treasury, further enhancing the stability of the DAO.

Beyond individual wallets, a portion of the VAB supply is held in the VAB DAO Treasury and the Vabble Treasury. The VAB DAO Treasury breakdown is dedicated to EVM Chain Pools for DAO Rewards and content funding. The Vabble Treasury breakdown includes funds for development, marketing, and team expenses.

The old and ongoing vesting schedule can be viewed at: https://www.team.finance/view-coin/0xe7aE6D0C56CACaf007b7e4d312f9af686a9E9a04?name=Vabble&symbol=VAB.

As the old vesting schedule unlocks, 70% of each release will be redirected back to the VAB DAO treasury and re-vested. The remaining 30% will be allocated to the Vabble Treasury until all balances are satisfied.

Here is a Full breakdown:

VAB DAO Treasury:

1. Initial Vested Balance @ 183M. (Currently unlocked. Held by Vabble Treasury. To be transfered to DAO)

2. Unlocked for Polygon Beta Pool @ 50M.

3. To be re-vested as old schedule unlocks @ 167M. (As old schedule unlocks, tokens will be re-vested. Address will be made publicly available).

50M tokens will be released from the VAB DAO Treasury every 6 months. If they are not required for new EVM Pools, reward pool replenishment, and content funding, 50 million tokens will be re-vested every six months in the VAB DAO Treasury. This cycle may continue for years, with the possibility of 50M tokens being re-locked after each six-month period. The release and re-vesting of these tokens heavily depends on the user demand for the platform and associated pools.

Vabble Treasury Breakdown:

1. Developer Fund @ 40.1M — 15M Unlocked — 25.1M Vested.
2. Marketing Fund @ 40.1M — 15M Unlocked — 25.1M Vested.
3. Liquidity Fund @ 180M — 140M Unlocked — 40M Vested.
4. Hosting Fund @ 21.1M — 5M Unlocked — 16.1M Vested.
5. Team Fund @ 165M — 41M Unlocked — 124M Vested.

Benefits of the Changes

The proposed tokenomic changes offer numerous benefits for Vabble users, including:

a. Increased Decentralization: The reduced circulating supply and new vesting schedule make it harder for a single entity to control the VAB ecosystem. This structure ensures that no team member can significantly impact the market price, fostering a fair and balanced environment.

b. Lower Emissions: The reduced emission rate helps deter inflation, preserving the value of VAB tokens over time.

c. More Utility: In the upcoming months, VAB tokens will gain additional utilities, such as staking, governance, and payment features. These new utilities will boost the demand for VAB tokens, creating new avenues for users to earn rewards and actively participate in the ecosystem.

We invite you to review the proposed changes in detail and as a community, vote on these changes. The voting period is open for 7 days. Once voting has concluded, the changes, if any, will be made to the tokenomics over the following 2 weeks.

We also encourage you to join us in discord to discuss these changes and ask questions you may have which have not been answered above. Simply use the link provided and you will be directed to the appropriate channel.

This is our first step towards full decentralization and even more importantly to some, correcting our errors from the project's early days.

Finally, here is our one pager detailing on the information in this proposal:

Team Vabble