Temple Ascend Launches September 6
As mentioned in our last Medium article, TempleDAO’s new Ascend mechanic will be deployed on mainnet this month to acquire $TEMPLE tokens for Core Vault yield distribution and to provide price support. Call to Prayer 24 unpacked the framework of Temple Ascend. This article provides further details for the official launch and inaugural Ascension Festival.
Timeline to launch
On September 4, the last mini-Ascend test-run will end.
On September 5, ~$16mm of FRAX/TEMPLE and ~$6mm DAI/TEMPLE protocol-owned liquidity will be liquidated from their respective Frax and Balancer gauges to establish the price of the LBP as the driving $TEMPLE price. This will still leave approximately $26mm of TEMPLE liquidity across STAX and Templar-owned liquidity to facilitate non-LBP $TEMPLE transactions.
On September 6 in the morning PST, the Ascension Festival will begin. New dApp functionality will go live alongside the first major LBP. (To learn more about LBPs, read our last article.)
The first Ascension LBP will be seeded with 3mm $DAI with a duration of 60 hours.
Who will be able to participate?
Anyone holding liquid $TEMPLE will be able to participate. For the first auction, this includes subvault A stakers who will be within their 1-week unlocked window, unlocked TEMPLE LP farmers, and anyone with $TEMPLE in their wallet.
If you are a staker in one of the other three subvaults, you may get an opportunity to participate as the Festival proceeds in the next few weeks. Also in development is a zap functionality that will allow stakers from any vault to sell staked $TEMPLE directly into an active LBP. If you do not want to wait for the zap feature and you feel that you may wish to sell, we recommend staying unstaked when you have the opportunity to do so.
What are the sizes and timing of the Ascension auctions?
One Ascend auction will be active at a time. The first pool will be seeded with 3mm $DAI. Successive auctions will be seeded with an amount of $DAI depending on the price of $TEMPLE and the price action from the preceding auction.
All auction parameters such as the initial $DAI balance and the rate of weight change will be subject to change as we test and understand the market reaction to our new mechanic. We may also pause trading at any time and drain the liquidity in the pool before the scheduled end of the auction. These decisions will be discretionary, and the Team will iterate based on what is monitored and observed.
What is the goal for these auctions?
Originally, TempleDAO was long-term Intrinsic Value and yield-focused, with all non-circulating $TEMPLE intended to eventually enter circulation via development, partnerships, and user incentives. Earlier this year, traders bought $TEMPLE seeking shorter-term gains through price growth and restricting growth of circulating supply. The goal of the auctions is to strike a fair balance between these two perspectives.
By the end of the Ascension Festival, we hope that any holders who do not want to remain in the Temple have had the opportunity to exit. Those who choose to stay can continue to enjoy staking and the ongoing roadmap development of Core Vaults, STAX, Nexus, and Representative Governance. (If you have any questions on the roadmap, review recent C2Ps or bring questions to Discord.)
With the above goal in mind, we will monitor price action during the Ascension Festival and end any LBP where price grows, or stays above sufficiently high levels. If $TEMPLE price is not continuing to be sold down, it will be presumed that all those who seek to exit have had the opportunity to do so, and the Ascension Festival event will be complete.
For $TEMPLE holders who seek liquidity, or who entered at or near Intrinsic Value cost basis to execute a RFV trade, this will be your last and best chance to exit your initial positions at scale. Future Ascension events will be much smaller and more sustainable.
What is the outlook for people who decide to stay?
During this Ascension event, there will be a number of effects on TempleDAO tokenomics:
- Templars who stay staked will enjoy the yields that sellers forfeit by exiting vaults
- Treasury will shrink as $DAI is sold for $TEMPLE
- Some $TEMPLE bought will be used for yield in vaults, other $TEMPLE will be burned to shrink supply and grow current farming power per token in current circulating supply
- Price will rise, reducing nominal yield in vaults for new stakers
After the Ascension Festival, some important actions will occur:
- $TEMPLE held by Treasury will be burned, no longer planned to enter circulating supply
- Some $TEMPLE held by DAO for product development, marketing and partnerships will be burned, no longer planned to enter circulating supply
- The above two actions will grow the Intrinsic Value per token in total/future user supply (this includes the remaining DAO tokens)
- The hard floor we used to defend $TEMPLE at ($0.65 today) will turn into a soft floor at some higher level — the final price depends on action during Ascend
- Price will be volatile around this soft floor, and TempleDAO will implement a non-continuous mechanic as-needed to ensure price does not stay too far below this floor.
Therefore, if you believe in the Temple product and wish to remain staked and exposed to future product development, then we believe you will have a fair opportunity to exit in the future. Consequently, there will be no future opportunity for price-driven trading positions.
In the medium-term, TempleDAO will announce a number of exciting new product developments, which are likely to include:
- Multiple products in the STAX pipeline that will generate revenues above and beyond what is possible on Convex
- Growing and executing on opportunities in the bribe market to sustainably enhance yields on protocol owned liquidity (and expand into new LPs/stable pairs)
- DAO-exclusive revenue sharing agreements with Yearn and other blue-chip protocols
- Potential framework for Core Vaults 2.0 which will give stakers more vault options, potentially including user-created vaults under certain conditions
- TempleDAO Nexus rituals and experiences
- Final phase of novel representative governance model (extending current chamber led decision making into bottom up elections, moving further towards our goal of full decentralization)
We are grateful to our Templars. May your chosen path during this Ascension Festival bring you prosperity.