Hey there
UCG Alumni, Astar dApp, dApp Staking participant and long time web3 founder and builder here. I’m writing to explore some practical ways to build on the already awesome dynamics of dAppStaking and to see if there are like-minded thinkers or if others in the community may share a similar sentiment.
There are a couple of aspects which could be discussed to make the Astar eco for builders more attractive, for both early stage and already running.
- Mitigate Selling Pressure: Explore ways to reduce sell pressure on ASTR, such as introducing stablecoin-based rewards or managed treasury funds to enhance price stability and reputation.
- Boost Community Engagement: Foster ideas that encourage deeper community involvement, emphasizing content creation and market adoption over purely monetary incentives.
- Expand Market Access: Leverage partnerships, like Soneium, with recommendations on paths towards fruitful partnerships to provide builders with affordable and strategic access to critical markets like SEA.
- Adjust Reward Dynamics: Reassess the gap between tiers to ensure equitable opportunities and optimize the system for both builders and the ecosystem.
- Simplify Tier Structures: Streamline the DS tier system by implementing a curve-based reward mechanism or merging tiers, making the system more intuitive and accessible for all builders.
If seriously interested in delivering something of value, a builder needs to find their way through various networks, programmes, accelerators, grants, prejudice, rug pulls, and beyond.
There is a high risk involved. Is the team right? Is the ecosystem right? Can I take the money? What can I even build with it? Where do I get more? How can I scale? Etc etc.
dApp Staking (DS) seems of course tempting, as people perceive it as “community conviction” in the best case, but also as “free funding”. DS currently provides a tier structure with a more or less dynamic reward pool. While this alone seems valuable, the initial assumptions for founders also are eventually:
A. Money plus community helps to build and grow
B. JP/KR/CN/SEA market is super attractive
C. Soneium provides a cool value add for Astar, becoming an eco with “growth pressure”
But
The general problem of a system like DS is that it creates sell pressure, which is unfortunate. People want to use their support for their project, so they sell ASTR off. This leads to what I call the “Monday dump” problem and continuous devaluation of a precious asset.
Price dynamics creates uncertainty for builders, one day the price is <0.5, the next day >0.7, this is too unstable for an already risky startup, so, again, people sell ASTR off to DCA.
Oh, the rewards are low, “ok, better than nothing”, let’s sell ASTR.
This psychology is unfortunate, other ecos have/had it as well, and tried to mitigate by establishing a tandem of a managed fund and issuing support in stables instead of their native asset. Like this the teams have a reliable source of income they can work with, the market dynamics are being managed by professionals, and ASTR is not dumped, ergo: more price stability, more reputation.
If not being managed, the price dynamics for tiers and rewards would need to compensate for the market dynamics, which even increases the depletion of the treasury.
Merging tiers like mentioned above improves the monetary attractiveness of the community fund but does not solve the selling pressure, meh.
And
Community engagement would even increase attractiveness, as community > funds, also in terms of building it. People can throw money but rarely throw people at stuff they are not attached to in a way, well, apart from conviction votes and rewards, which is also a dilemma, as the necessary factors for growth are less monetary, but mostly content and community backing related.
Why
Market and ecosystem access are super critical as a factor in the current state of web3. If you look at adoption, regulation and market growth, you could compare e.g. North America, Europe and SEA.
For most innovative projects from NA and EU/DACH it is super hard to access SEA, even though combining these markets may be quite effective, so apart from funding and the eventual community boost, a real opportunity: Astar + Soneium + advanced market + some funding…
Market access is hard and expensive. Even with funding: Community acceleration means more than spending, but the spending is also important enough to make it one of the reasons to come and stay and build.
Astar Stakeboard Prototype
My personal conclusion is, that at the current state I am not even sure if there is a need for tiers, this could also be covered by a curve rewarding the top 20 or 50 projects based on their total stake contribution. I would also suggest giving upper and lower bounds and definitely would raise the total amount.
This could drastically streamline and reduce the complexity, people will understand it potentially without a PhD, which is good.
The gap from Tier 1 even to Tier 2 is quite big, maybe I do not understand the top 2 projects sufficiently enough, but they appear to be contributing to the Astar dev team itself. If this is the case, I was wondering how the sell pressure on Astar would be managed to not cannibalise the store of value.
I think dAppStaking should and will continue to evolve, possibly some of these things may have been discussed internally already, thanks to OP for kicking off the conversation.
Cheers,
Marco
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