We have been quietly building for a few weeks, and our first token is almost ready for launch.
Our current focus:
- Testing the completed contract codebase
- Beginning informal and formal audits
- Finishing the front end app build
Which means that we are within striking distance of launch and it is time to release more details.
Note: This article is providing context and reasoning behind protocol design. We won’t give full details on each mechanism itself, that will come over the next few medium articles.
Tl;dr from our medium posts so far:
A. Growth coins & stablecoins are on opposite ends of the risk spectrum
The defi status quo is to meme risk away. Partly for good reason. It’s not obvious that differentiating between “very risky” and “very very risky” is useful.
Instead we strap in:
However we believe the volatile experience of retail defi is a reflection of the shortage and shortcomings of available products and offerings rather than the intrinsic nature of defi.
Most defi users have few tools at their disposal.
One of the main ways is to shift capital into stablecoins pegged to USD. These (mostly..) don’t swing in price, but they depreciate in value every day. Each year your stablecoin buys you 5–20%+ less stuff than the year before, depending on what you’re buying. So yes, it’s “stable” .. at losing you money every year.
Other spot price risk-mitigation strategies involve leveraging sophisticated financial derivatives such as futures contracts and options contracts. Most of these tools are beyond most retail investors for reasons such as the high gas cost of transactions and low liquidity in these specialized markets.
B. TempleDAO is your safe haven in a sea of volatility
The purpose of TempleDAO is to create an ecosystem that provides perfectly balanced exposure to growth coins in a way that goes far beyond simple indexed currency baskets. Our ecosystem will allow you to invest in assets along the entire risk spectrum with minimized volatility and downside exposure, while enjoying high returns.
This is a first-in-class reduced risk asset that is not pegged to the US dollar. We have a pipeline of assets and protocol features that will create new, safer defi investing opportunities.
The big picture: TempleDAO ecosystem
We have more to say about this in a future article on the roadmap.
But a little context for now..
TempleDAO provides a curated range of sophisticated, automated investment pools that allows users to boost their return, manage their risk, or both.
Think of this as parking your bags in a transparent, automated, trading strategy. You can maintain exposure to high growth tokens, step back on your risk exposure, and more. This means you don’t have to sit and watch the market, you can choose your risk level and chill while the Temple manages your bags for you.
We see this as an exciting development in defi — bringing more sophisticated risk management and trading strategies to the community.
Our first staking option is a little special, because $TEMPLE reflects the whole ecosystem.
Our first product, $TEMPLE, is for people that believe sophisticated risk management strategies should be available for everyone…and would like to grow their bags..with exposure to a completely redesigned governance token.
Completely redesigned? Glad you asked.
Here are the two standard ways to design a community token:
Standard Design #1: Fixed supply. As capital flows into the protocol, price rises, and early buyers benefit.
Problem: This is unstable. If the price rises too quickly, people want to sell. Once the price starts falling, everyone tries to get out before they’re left holding the bag. Classic pump and dump.
Examples: Every shitcoin. Some governance tokens with truly fixed supply. $BDP, $ZAI, etc
Standard Design #2: Massive minting of a second token. To incentivize participation, protocols often give away a second token under the veneer of a governance token. This second token has little to zero intrinsic value, so massive supply needs to be minted and rewarded to yield farmers and stakers to sustain APY in the face of strong downward price pressure from inflation.
Problem: This is unstable. It can last for a while, but once price rises people start selling because they know not everyone will be able to cash out. Supply is so large that dumping has a dramatic price impact and everyone rushes to the exit before collapse.
Examples: $TITAN, $GAIA.
We want to avoid these problems for $TEMPLE holders.
So we designed a new, and we believe, far improved community token.
These are the three principles that guide our new design:
Principle #1: Ecosystem growth benefits $TEMPLE holders.
This one is simple. If you are excited by our roadmap and future TempleDAO offerings, you want to be holding $TEMPLE.
Principle #2: Protocol features reduce volatility and reward long term holders.
There are a few simple mechanisms that work together here, and will be unpacked over the next few medium articles.
In short, value is delivered over time to stakers rather than immediately pumped prices. You get the same value, without the pump and dump incentive.
This is one of a few features that reduce price volatility and reward long term holding.
Principle #3: $TEMPLE’s intrinsic value always increases and is not diluted away.
Unlike most protocols that deliver yield, our token minting is limited by value created. The token supply growth will be constrained by a collateralization ratio of protocol controlled assets in the Treasury.
In short, the protocol will not dilute stakers by minting coins from thin air and enable predatory sellers to dump on hodlers. Most protocols steal from the believers to give to the day traders. We will not.
Protocol reserves grow from a number of sources: eg capital inflows and investment returns. Collectively, the value collected through these sources are the reserves of the Temple.
The intrinsic value of each token = total reserves / total supply.
$TEMPLE is designed to minimise the chance of intrinsic value decreasing. In particular, new $TEMPLE can only be minted to the degree that intrinsic value is still increasing.
This means $TEMPLE intrinsic value will not be diluted. We hope the concept of sustainable growth rather than inflation growth is fully embraced by more protocol launches this year. Farming massive token mints and getting out before the dump is very 2020.
TempleDAO medium article roadmap
Articles coming up next, as we move towards launch:
- Mechanics: Safe return & intrinsic value
- Mechanics: Safe premium
- Mechanics: Bonus offers
- Mechanics: Unstake queue & price defend
- Roadmap of the ecosystem
- Tokenomics: whitelist details & launch date
Once we release the first few articles, we will line up a community call to discuss.
Talk more soon.
The information provided in this Medium Post pertaining to Temple DAO (“Temple DAO”), its crypto-assets, business assets, strategy, and operations, is for general informational purposes only and is not a formal offer to sell or a solicitation of an offer to buy any securities, options, futures, or other derivatives related to securities in any jurisdiction and its content is not prescribed by securities laws. Information contained in this Medium Post should not be relied upon as advice to buy or sell or hold such securities or as an offer to sell such securities. This Medium Post does not take into account nor does it provide any tax, legal or investment advice or opinion regarding the specific investment objectives or financial situation of any person. Temple DAO and its agents, advisors, directors, officers, employees and shareholders make no representation or warranties, expressed or implied, as to the accuracy of such information and Temple DAO expressly disclaims any and all liability that may be based on such information or errors or omissions thereof. Temple DAO reserves the right to amend or replace the information contained herein, in part or entirely, at any time, and undertakes no obligation to provide the recipient with access to the amended information or to notify the recipient thereof. The information contained in this Medium Post supersedes any prior Medium Post or conversation concerning the same, similar or related information. Any information, representations or statements not contained herein shall not be relied upon for any purpose. Neither Temple DAO nor any of its representatives shall have any liability whatsoever, under contract, tort, trust or otherwise, to you or any person resulting from the use of the information in this Medium Post by you or any of your representatives or for omissions from the information in this Medium Post. Additionally, the Company undertakes no obligation to comment on the expectations of, or statements made by, third parties in respect of the matters discussed in this Medium Post.