ShapeShift

Summary:

This revised proposal ratifies accountability metrics for the rFOX staking program, providing clear KPIs tracking its success and offering the community tangible goals. These metrics will ensure the program’s performance is transparently evaluated, enthusiastically marketed, and built on a solid foundation. It allows for robust monitoring, frequent evaluation and adjustment to stimulate the KPIs, and/or sunsetting if it fails to meet performance.

Abstract:

The ShapeShift DAO has already approved “SCP-166 an upgrade to FOX tokenomics” involving RUNE distribution and FOX token burns. This proposal builds on that foundation by implementing a robust set of Key Performance Indicators (KPIs) measuring the success of the rFOX staking program. By setting clear goals, we aim to drive community engagement, ensure effective use of resources, and foster a culture of accountability within the DAO. If the program is a smashing success, this proposal outlines the numbers qualifying that success. If the program underperforms over a defined period, it will be sunset, preventing resource drain on unsuccessful performance. We already made a dashboard for these for reporting at product office hours: Dune Dashboard.

Motivation:

• Accountability: Establish clear metrics ensuring the rFOX staking program is held accountable for its performance. This proposal adds measurable goals and significantly increases the marketability of rFOX participation.
• Community Engagement: Provide the community with specific goals to support and rally around, enhancing user engagement and participation. By setting these goals, we aim to elevate our current/future community’s involvement, encouraging everyone to rise together towards common objectives.
• Governance Responsibility: By having a broad consensus and agreement about what constitutes success, the workstreams and the DAO are better equipped and informed in future possible trajectories of this (and related programs).
• Resource Efficiency: Ensure that the DAO’s resources are used effectively by evaluating success, adjustment, and/or under-performance. If the program doesn’t meet the established bar every month, we can redirect resources aiming toward growth.

Specification:

• KPIs Implementation: Introduce a comprehensive set of KPIs to track the success of the rFOX staking program.
• Regular Reporting: Provide a live dashboard and regular updates on KPI performance to the community. Reporting will be done at every product office hour and potentially added to the monthly IPFS posting thread. In addition, the DFC will report on the FOX-tokenomic performance of the program, evaluating it for incentive adjustments and iterations.
• Success, Perseverance, & Sunset Criteria: Define clear criteria for the success of the program. The KPIs give the community the necessary input for the program’s growth. It should be obvious if the program is gaining traction, slowly succeeding, enabling participation, or underperforming. A strict number of KPI’s succeeding is too prescriptive, but bi-weekly reporting by product, weekly monitoring by the DFC, and the level of effort from engineering is sufficient to steer the program towards better outcomes.

Main KPIs and Goals:

1. Staking Participation Rate:
   • Definition: The percentage of total FOX tokens staked by users, calculated as rFOX deposits divided by the total FOX supply (liquid and in circulation).
   • Goal: Based on the first month; 5% MoM growth is a good benchmark. Failure is not achieving a 5% month-over-month growth for three consecutive months, indicating low user engagement and interest.
   • Measurement: This will be measured both as an average over three months and month-on-month (and daily just for funsies/because we can). We will use reliable sources like Arbiscan & CoinGecko to ensure consistency and transparency for circulating supply.
2. Increase Trading Volume and FOX Burn:
   • Definition: The trading volume on ShapeShift increases, leading to increased FOX burns.
   • Goal: Within 3 months of August 2024, $24,000 per month is a success case and $75,000 of FOX burned per month is a smashing success. Failure is 3 consecutive months of sub $15,000 burnt (staying at our status quo).
   • Measurement: For holistic reporting, this will be measured both as month-on-month growth and by applying an average figure over the programs lifetime to date (e.g, 3 then 4 months etc.)
3. Number of Unique Stakers:
   • Definition: The total number of unique users participating in the staking program month-on-month.
   • Goal: Per month we want growth, so < 50 unique stakers is a failure, ≥ 100 is a success, and 400+ is a smashing success. Several months of underperformance should be cause for concern.
4. Staker Gini Coefficient:
   • Definition: The Gini coefficient of stakers in the pool above a certain threshold (100,000 FOX). A lower Gini coefficient indicates a more equitable distribution, we want more users holding and staking FOX.
   • Goal: For 38,843 FOX holders that currently exist, aim for a target at about 0.6 – 0.3 for smashing success. A failure here is 0.7 and above for consecutive months, combined with no new stakers (KPI 3).
5. Staker Retention Rate:
   • Definition: The percentage of users who continue staking their FOX tokens over multiple months.
   • Goal: 15%-25% retained stakers indicate success, and 30%-55% indicate smashing success. A staker retention rate of less than 15% for two quarters is a failure.
6. Average Staking Duration:
   • Definition: The average length of time users keep ≥ 30,000 FOX tokens staked, 60,000 FOX tokens staked, 90,000 FOX tokens staked.
   • Goal: For 65% of the staking addresses: 2 months staked indicates success, 4 months indicates growth, and 8 months indicates smashing success. One month or less is failure.

Ancillary KPIs (Nice to Haves):

1. Percentage of Active Traders Depositing into rFOX:
   • Goal: We want to be able to say something like “50% of stakers have done 1 trade in the last month.”
2. Trading Volume & Number of Dolphin Holders of FOX and RUNE:
   • Goal: 10%, 25%, and 45% increases in the number of holders for success —> growth.
   • Measurement: Volume looks like 1 million per day FOX volume indicates success.
3. Total RUNE Distributed:
   • Goal: Track to seek insights; simply tracking indicates success.
4. User Feedback and Satisfaction:
   • Goal: Get actual feedback; 0 indicates failure/status quo, 5 in-depth interviews (recorded and paid in FOX) indicate success, and 50 indicate growth.
5. Unique Visitors to Platform and rFOX Page:
   • Goal: Increase unique Monthly active visitors; Above 35K is success, Below 10k is a failure.

Benefits:

• Enhanced Accountability: Clear KPIs ensure the program is held accountable for its performance.
• Increased Engagement: Tangible goals provide the community with a clear focus, driving engagement and participation.
• Resource Optimization: Prevents resource drain on underperforming programs by setting criteria for success and/or sunsetting.
• Governance Responsibility: Encourages responsible decision-making and ownership within the DAO.

Drawbacks:

• Resource Allocation: Requires ongoing effort to monitor and report on KPIs.
• Operational Burden: Increases workload for tracking and managing the program’s performance.
• Potential Disruption: Sunsetting the program could disrupt current users if KPIs are not met.

Vote:

• For: Formalizes the community’s support for implementing accountability metrics for the rFOX staking program.
• Against: Opposes the implementation of accountability metrics for the rFOX staking program.