TempleDAO: RFV

In the aftermath of the bearish turn in the crypto market and the collapse of yielding token economics, there has been spirited debate on defining $TEMPLE value and how to deliver that value to holders best.

Some of these perspectives align under the banner of “RFV”. Pulling together the community feedback to date, the TempleDAO team has composed this document to add clarity to the topic for all Templars.

We want to answer:

  1. What is RFV?
  2. How has RFV been used at Temple?
  3. How will TempleDAO return RFV value?
  4. Liquidation event
  5. What’s coming next?

1/ What is RFV?

RFV was first popularized by @ohmzeus from OlympusDAO to help understand the value of $OHM. Their native token OHM, which launched the rebase token season, had traded at over 1000x its IV (Intrinsic Value) of 1 DAI or $1. Since OHM was trading at a high premium to IV, the Olympus community felt there must be a better way to assess value.

Over time various measures of asset value per token were defined, with a similar function to how book value per share is used in TradFi (BVPS). RFV was one of these metrics, capturing the value of ‘risk free assets’ owned by the protocol per token owned by users. Risk free assets included stablecoins and protocol owned liquidity priced at the lowest possible OHM price ($1). These risk free assets were also what OHM could be minted against.

These metrics, while imperfect, were helpful to compare the relative value between similar projects.

2/ How has RFV been used at TempleDAO?

RFV has been one of several metrics discussed within the Temple.

While TempleDAO always prioritized Intrinsic Value, to avoid confusion between the definitions of IV, RFV, and assets per token, the definition for RFV was published in two places: the Dune dashboard and in this Tweet.

RFV is one possible measure of value available to Templars if a liquidation were to occur immediately. However, TempleDAO’s mission has always been to return more than the RFV value to each investor without the need for a liquidation event.

3/ How will TempleDAO return RFV value and more?

We have strived to achieve this by providing a reduced volatility, lower risk yielding token with an Intrinsic Value floor. While the first iteration of this product delivered exactly the mechanics promised, including strong yield and an Intrinsic Value floor, it did not sustain a price above IV the way we all hoped after the yielding token crash.

Since then, this is the plan put in place by Temple Team to deliver value:

  1. Modify the mechanics to achieve our original mission above (product title: Temple Core Vaults)
  2. Achieve product-market fit with these mechanics as measured by growth in value staked by new wallets staking $TEMPLE into vaults
  3. Sustain price appreciation driven by strong demand for $TEMPLE and incentivized locking into vaults
  4. Deliver yield per token at a level above what a user can achieve by themselves through natural and direct leverage within TempleDAO

All Templars will be monitoring these metrics closely to observe if we are achieving product-market fit with users. If we can sustain new demand for the product, we have a far greater chance of sustaining a higher $TEMPLE price. We all hope that these deliver far more value than RFV to $TEMPLE holders within a reasonable amount of time.

But what if none of this occurs? What is the backup plan?

4/ Liquidation event

On the eve of launching a major iteration of the product, it seems the wrong time to weaken the future growth prospects of the Temple. With positive and sustainable cash flow and multiple products about to launch, we do not anticipate a liquidation event to be fast approaching.

But post-launch, all Templars should be watching measures of success such as the total value of $TEMPLE staked into vaults from new wallets and intangible but important measures such as community sentiment, team confidence, strategic partnerships, etc.

If all measures suggest it is unlikely that Temple will be able to deliver sustained value to $TEMPLE holders, buybacks, a distribution, or a liquidation event will be the next steps. In the case of a liquidation event, TempleDAO will organize a timely and fair process that returns the liquidated asset value to $TEMPLE holders who wish to exit.

This will not be a decision taken by anyone unilaterally. TempleDAO is accelerating its Representative Governance roadmap so that it is fully implemented as quickly as possible and the community can own the measure of success and path forward. Full article on governance roadmap progress coming soon.

5/ What’s coming next?

All of the following is currently in progress:

  • STAX pre-launch (Temple LP)
  • Temple Core Vaults
  • DAO Game (governance Phase 2)
  • Temple Nexus (puzzles re-launched)
  • Representative Governance (Phase 3)
  • Full STAX launch (automation & more)
  • Temple Metaverse

The first four are imminent and in the final phases of development & testing. Products will be released in roughly this order in the coming months. Temple Team is happy to answer questions on any of these products or any other topics, as always.

All of that is on our minds is how to deliver the most value to long-term holders of $TEMPLE. This has been the guiding principle since day 0. We believe a bright future is ahead for the community and your bags.

If you would like to discuss this further, join the team in #general in Discord for an AMA at 6pm PST April 26th, 2022.

— TempleDAO Team

Appendix

The two methods by which RFV can be calculated:

[1] RFV based on token price, yield and runway — the method used for rebasing tokens can be calculated as:

[2] RFV calculation under liquidation/distribution scenario — the definition we have communicated from TempleDAO

*Circulating Supply here is defined as all $TEMPLE tokens with claims on RFV: from the staking contract, in the ExitQueue Contract, in the TempleCashback contract, in the Team Payments Pool & in user-owned wallets.

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In a world of volatility, the Temple of long term wealth creation is where disciples come to stake, sleep easy, and chill. Join Discord: discord.gg/frCbCrGv2U

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TempleDAO

TempleDAO

In a world of volatility, the Temple of long term wealth creation is where disciples come to stake, sleep easy, and chill. Join Discord: discord.gg/frCbCrGv2U

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