TIP-098: The Future of Threshold

Proposals
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Introducing tLabs

tLabs is a proposed labs company with the single purpose of developing and maintaining tBTC and Threshold Network. This proposal outlines the role of tLabs in the Threshold community, its relationship to the DAO, and the strategy to ensure the long-term growth and success of Threshold DAO.

This proposal is motivated by a clear need to address the core challenges facing Threshold and tBTC:

  1. Stalled tBTC product and technical development
  2. Growth coordination challenges and unclear market position
  3. Undercapitalization and runway
  4. Limited tokenomic model.

It is proposed that tLabs lead protocol, product, business development and marketing functions for tBTC.

High-level goals of tLabs include:

  • Increased tBTC TVL and bridge velocity
  • Upgraded tBTC core technology
  • Developed tBTC product and usability.

To fund this endeavour, tLabs will conduct a fundraise on behalf of Threshold DAO, with the outcomes of an extended runway for Threshold DAO, funding for tLabs, and the further decentralization of Threshold Network by engaging aligned investors.

The Future of Threshold

Threshold Network operates the most secure, most decentralized Bitcoin bridge in the market, and tBTC has the potential to become the canonical BTC token. A recent surge of interest in Bitcoin makes now the time to secure Threshold’s position.

How do we do it?

Let’s start by understanding where we are now.

tBTC development has stalled because of competing priorities in the previous development company. Threshold has enjoyed some success, but its first-mover advantage will decline.

tBTC v2 is just the MVP for the true potential of tBTC.

tBTC needs a forward-looking product and protocol vision, one that takes the core infrastructure of tBTC and builds with it something more functional, more scalable, and more economically sound.

Here is what tLabs plans to scope, design, and implement.

tBTC Protocol Upgrades

Tokenomics

Recent discussions of $T inflation and possible tokenomic models need alignment within a larger vision for Threshold. tLabs will design a new tokenomic model for the $T token that addresses the concerns of inflation and token value accrual, to be proposed and voted upon by the DAO.

BitVM2

New developments in Bitcoin core technology have demonstrated that Bitcoin bridges can dramatically improve their trust assumption models. Currently, Threshold’s tBTC operates on an honest majority trust assumption: the bridge is secure if there is an honest majority of wallet signers.

BitVM2 enables a 1-of-N trust model, which means that, for the bridge to operate, only one of the operators on any given wallet is required to be a good actor.

Implementing tBTC as a BitVM2-style bridge will require significant research, planning, and development but will ensure that tBTC remains the leader in Bitcoin bridging technology. This tech can be implemented on Threshold’s own application-specific chain.

Threshold App-chain

Part of the future vision of Threshold involves moving Threshold Network consensus to Threshold’s own chain, built from the current pool of Threshold nodes.

Threshold currently relies on Ethereum to coordinate wallet signing and maintain consensus between Threshold nodes. This also means that all tBTC minting and redemption must occur on Ethereum. All “native minting” implementations require routing via Ethereum, which limits functionality, increases (gas) costs, degrades UX, and maintains a reliance on Ethereum and other bridging protocols.

By transforming Threshold Network into an app chain, it will be possible to directly integrate with each blockchain where tBTC exists to deliver truly native minting, forming the Bitcoin liquidity and settlement layer between all chains.

Prioritization

Numerous exciting initiatives exist to be explored and implemented, but they require funding and alignment.

Upon approval of this proposal from DAO governance, the initial goals of tLabs will be to:

  • Secure funding for Threshold DAO
  • Formalize the relationship between Threshold Foundation and tLabs
  • Propose a 1-year budget for tLabs from the DAO
  • Share a product and technical roadmap for Threshold and tBTC.

Scope of Work

tLabs proposes to take on responsibility for the following aspects on behalf of Threshold Network:

  • Protocol development

    • Ensure that Threshold completes Schnorr signing schema upgrades
    • Upgrade tBTC’s custody model to a 1-of-N honesty assumption via BitVM2 vaults (or similar)
    • Update tBTC’s roadmap based on developments or changes in Bitcoin core tech (e.g. OP_CAT, OP_CTV)
    • Manage the development of a Threshold app-chain
    • Research, propose, and develop T tokenomic improvements.

  • Product development

    • Develop and maintain the Threshold DApp
    • Develop tBTC SDK
    • Continue tBTC interchain deployments.

  • Marketing

    • Create and define a clear product marketing strategy for tBTC
    • Liaise with a leading marketing agency to handle marketing operations for tBTC.

  • Threshold growth

    • Liaise with DeFi protocols for tBTC integrations
    • Collaborate with new L1 & L2 protocols to deploy tBTC
    • Maintain tBTC and T token infrastructure listings (e.g. DefiLlama).

tLabs will not perform or be responsible for any operational aspects of Threshold Network, such as running nodes, hosting DApps, managing DAO treasury, or paying DAO expenses. Note: the scope above is broad and subject to resource constraints and prioritization.

Why do this as tLabs and not the DAO?

Although some of the scope is covered by the DAO today, tLabs proposes to move these functions into a more efficient and streamlined structure that aligns with a long-term product roadmap.

Threshold Network was founded on the principles of decentralization, and that will never change. However, the DAO has faced several coordination and execution challenges that can be ameliorated by delegating certain tasks and functions to a contracted entity, with the following advantages:

  • Operational efficiency for the raise
  • Deep technical expertise
  • Ownership of long-term product roadmap
  • Speed of execution
  • Fiat payments to bank accounts.

Funding

We propose to mint ~1.12B $T tokens (a 10% dilution of the current supply)

  • 7% - ~780M T will be sold to investors and key ecosystem participants to capitalize the DAO, and fund tLabs.
    • Funds raised will be held by Threshold DAO.
  • 3% - ~335M T will be granted to tLabs team members to be vested linearly over four years with a one-year cliff.
    • Distribution will be subject to tLabs meeting key milestones or demonstrating meaningful progress towards these.
    • Distribution approval will be determined by the Threshold Council.
    • Milestones will be determined on approval of the proposal once key roadmap items have been identified.
    • T will be distributed to tLabs team members as long-term alignment incentives to ensure retention of top industry talent and protocol-aligned outcomes.

The raise will commence on approval of this proposal. Unused earmarked funds will be managed at the discretion of the DAO. In the event of cessation of the arrangement between tLabs and the DAO, vested tokens will be distributed pro rata upon handover of work completed up to the cessation date.

Alignment and Continuity

tLabs and Threshold DAO will be synergistic organizations that both work to grow and maintain Threshold Network. tLabs exists for the sole purpose of developing tBTC and Threshold Network and any intellectual property developed will be assigned to Threshold Foundation and/or released under the appropriate open source license…

tLabs will fulfil the technical, strategic, growth, and marketing requirements of tBTC.

Threshold DAO will continue to operate independently and to manage the DAO treasury, grant applications and distributions, and community-led events and initiatives.

Threshold DAO will act as the custodian of all raised funds, and it will approve yearly budgets to tLabs based on their requirements. If tLabs fails to perform to the DAO’s expectations, the DAO can elect to end the engagement via an onchain vote.

tLabs will present a quarterly activities summary to the DAO to identify key progress that occurred in the previous quarter.

tLabs will aim to maintain momentum within the existing growth and product development projects while aligning them with the broader strategy tLabs proposes for Threshold DAO. The DAO will be able to decide on an operational and organizational structure that suits its needs in the light of the functions that tLabs will take responsibility for.

tLabs and Team

tLabs will be led by MacLane and Sap. MacLane is the founder of NuCypher (the predecessor network of Threshold) and Sap brings a wealth of experience in tBTC growth, communication, and product design. Importantly, both are deeply familiar with tBTC and have extensive experience coordinating with the DAO to achieve Threshold-aligned outcomes.

Team members will be sourced from leading industry talent and from existing DAO roles where suitable. The hiring process will commence on the completion of the raise and be at the discretion of tLabs.

MacLane will not accept any compensation from tLabs or Threshold DAO (except in the unlikely event it is required to comply with applicable minimum wage/employment laws).

Close

This proposal introduces a number of new ideas and concepts, so please share your thoughts. The opportunity that presents itself to the Threshold community is incredibly exciting, but timing is of the essence. Threshold is in a crucial market moment that, if captured, will secure tBTC’s position as the Bitcoin-standard of DeFi assets.

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As a long time community member, I’m excited to see this initiative coming from inside the community. TBTC is in a strong position to take over the market and with a concerted effort by a well incentivized group of stakeholders, I believe it can become a DeFi bluechip.

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Happy to see this proposal, but there is one concern that I feel has not been addressed properly:

Of the mint, 30% is set aside to tLabs team. At current prices, those 335M T would be worth $10M. And it is all distributed over 4 years to what is obscurely dubbed “tLabs team members”, of which there are currently only two known: sap and Maclane.

And Maclane is working pro bono.

By approving this proposal, as far as I can tell, it may result in $10M being funneled to one single individual over the course of 4 years.

That is an astronomically large amount and should be justified better. In addition to clearer milestones, why this number, how will it be distributed (to whom - exactly?) and why is the vesting only 4 years?

This is hardly a long-term alignment incentives, this is getting paid on avg $2.5M yearly to (in the worst case - with no guarantees) string along for 4 years.

Presumably, this amount is on top of (in addition) to wages paid from the 7% of supply mint, wages that are up to the discretion of tLabs to set? So in reality the numbers are far higher.

This opaqueness bothers me a lot and needs to be addressed in a way more transparent manner for the proposal to gain my vote. I also have trouble making sense of the very large numbers that Threshold community will be minting and handing over to tLabs, and how this is all just supposed to happen in 4 years.

With that said, I commend your willingness to put together and lead this effort. Also, massive respect to Maclane.

If these concerns are addressed properly, I’m likely to vote yes.

If unable to provide this info now, I suggest to remove or adjust the 30% allocation to team members and make this part a separate proposal for the DAO to approve after having clear milestones, list of team members etc.

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I’m excited to see such a clear vision for our collective future. As someone who’s been in the trenches—helping to integrate tBTC into the DeFi ecosystem —I believe the core pillars of the proposal resonate with what we need to further solidify our position as the go-to BTC bridge for DeFi. Overall bullish, I do share some of the concerns @Agoristen pointed out, as a $T holder myself, but sure clarification will come soon.
Main-points and a Threshold Network appChain Yey!

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Excited about this one, and also a little apprehensive! Two sides of the same coin, I suppose.

It is proposed that tLabs lead protocol, product, business development and marketing functions for tBTC.

This sounds great! But the rest of the proposal appears to just be about tech and product, and I’d like to understand why we’re confident tLabs is going to nail what I think we need most… growth.

Up until this point, a lot of our growth has been an awkward tag team between me and contributors at Thesis, MacLane at NuCypher, and the marketing and integrations guild at the DAO. It’s been under-coordinated and at times frustrating for everyone involved.

I really like the idea of a focused, war-time growth lead coordinating all of our efforts, including marketing campaigns, product growth loops, etc. What I don’t see here is who that person is, or in lieu of that person, what our growth strategy will be.

Put differently, I have similar concerns to @Agoristen… but rather than a hiring or spending plan, I’d like to see who will have the growth DNA and experience on the tLabs founding team.

I really appreciate you guys putting this together, and I believe tLabs and a diversified treasury managed by the DAO is the way forward. For me to feel good, I want to know who our growth expert is — and I’m on hand with exec recruiters and talent-search at Thesis to help find them!

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Thank you for the thoughtful response and general support. I appreciate you for raising the concerns and hope to provide as much clarity as possible.

I can see how there needs to be more clarity around team incentive structure. However, let me be clear that there is no scenario in which these token incentives would be directed to a single individual. The purpose of these incentives is to attract the best industry talent, and to create the strongest possible team. I expect we’ll need a team of 10-15 people to achieve what we have outlined here. And they need to be the best. We work in a competitive industry, and in an increasingly crowded sector. In the light of this, I think the incentive amount is reasonable over the time period considered, and creates strong outcome alignment of the two organisations.

Without funding or approval we can’t begin hiring. Each compensation package will be determined on an individual basis, and will be at the discretion of tLabs. For these reasons, it is difficult to provide clarity on the actual structure at this time, and is something that likely will not be shared publicly (although it is possible it could be deduced onchain).

Yes, team incentives are in addition to wages. Both token distribution and tLabs budget need be approved by the DAO on a rolling basis, which mitigates the risk the DAO takes on for underperformance.

In terms of vesting, 4 year vesting with a 1 year cliff is standard in the industry. Structuring distribution based on milestones and requiring DAO approval puts the power in the hands of the DAO. The burden of proof of outcome is on tLabs, as it should be, and I am confident that the milestone structure we propose will be amenable to the DAO. If this is a major sticking point I feel open to extending the vesting period, but it needs to be balanced with our capacity to secure talent.

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Thanks for the positive feedback Matt!

I completely agree with your point here, and the proposal was a little light on the growth detail. That said, I think the technical and UI improvements we’ll make are huge growth drivers, though on a delayed function. At the same time, we want to swiftly eliminate the confusing multi-input approach we’ve had to growth, and focus it all through the tLabs lens, which requires buy in and handover from existing growth stakeholders.

Let me share a few ideas I have around immediate growth impacts:

  • Upon approval, we’ll initiate an immediate PR push of tBTC v3 and strategic reposition.
  • We will hire a dedicated CMO/Head of Growth to lead large campaigns and coordinate with an agency (currently in discussions)
  • We will continue current growth initiatives to ensure continuity and expand to new beachheads, with support of TIP-096.
  • We will execute on tBTC interchain expansions (without waiting for app chain)
  • We will unblock existing deployment issues that currently facing DAO dev by completing a handover process from Thesis, which has already been outlined.

On a personal note, and in terms of growth DNA, please consider that I lead the tBTC v2 liquidity roll out, worked as growth lead at Threshold and have spoken at conferences in behalf of the DAO. I look forward to representing tLabs and Threshold as a speaker and a leader.

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I think a few clarifications to address the concerns here would be to share how the comp decisions will be made. Standard corporate governance has this covered, we just don’t have enough here to know that it will apply.

So…

  • Is the T going to be split up into an employee pool and a treasury? How large will each be? What roles do we expect the pool to cover, and how much? I realize this might seem intrusive, but this is exactly the level of planning my board would ask if I want to issue employee equity from the pool.
  • How does the USD funding for tLabs come in? At what speed? Will tLabs periodically submit budget requests to the DAO, or will that be managed another way? The expectation is that the new org also pays USD salaries, right? tLabs will want to know well in advance if it’s not getting funded so it can make personnel changes, etc.
  • Is comp at the discretion of the CEO or another manager or director? How are conflicts handled?
  • Does tLabs have a board? Who are the shareholders?

EDIT: Also calling out generally that the proposal is prescriptive for the 3%, but less so for the 7%. That might be on purpose, but we should make sure there’s enough detail that tLabs can be spun up and paying salaries promptly, at a minimum.

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My preferred structure for the team token incentives is for these to be distributed directly to team members via the DAO, rather than to tLabs. While the corporate structure and jurisdiction of tLabs are not yet finalized, if we assume the tLabs entity is based in a taxable jurisdiction, routing team token incentives through tLabs may incur significant tax leakage (i.e. double taxation at both the corporate rate and again at the recipient’s personal rate).

The main concern I have with this approach is the DAO micromanaging compensation decisions. tLabs needs full discretion over hiring and compensation decisions and should be able to provide an address, token amount, and vesting terms to the DAO which deploys a llamapay (or similar) vesting contract. The DAO should just be exercising a continual binary choice on whether to engage tLabs or not, rather than being involved in daily operational decisions.

The other implication of this approach is that the team allocation will not fully vest over 4 years since each individual recipient’s vesting period will start when they are hired.

The core requirement is that there needs to be a sufficient bucket of tokens allocated for team incentives.

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Is the T going to be split up into an employee pool and a treasury? How large will each be?

The tLabs allocation is meant to incentivize team members and secure talent. There will not be a tLabs treasury and annual budget requests will be at-cost without a profit margin baked in. A major goal of the proposed structure is to align tLabs as closely as possible with T token holders so tLabs’ equity should, ideally, be worthless.

How does the USD funding for tLabs come in? At what speed? Will tLabs periodically submit budget requests to the DAO, or will that be managed another way?

@sap suggested annual budget requests above. Whatever cadence that isn’t a significant distraction or work burden is fine.

tLabs will want to know well in advance if it’s not getting funded so it can make personnel changes, etc.

tLabs sole purpose is to engage with Threshold DAO. If Threshold decides to end that relationship, tLabs no longer has any reason to exist.

Is comp at the discretion of the CEO or another manager or director? How are conflicts handled?

Comp would be at my discretion, yes. If a DAO multisig is managing the token incentives they would be aware of that component but I want to avoid the DAO micromanaging operational details. The DAO should view tLabs as a vendor.

Does tLabs have a board?

I don’t anticipate the need for a board. The DAO will have ultimate authority to end its engagement with tLabs if it’s not delivering a sufficient value.

Who are the shareholders?

The corporate structure isn’t finalized yet but If it’s a pass-through LLC entity or reportable foreign entity, I will likely not be a shareholder due to the personal tax complications that may introduce. Another possibility is that tLabs starts as a wholly-owned subsidiary of NuCo (of which I’m the majority shareholder) so that we can use the existing operational infrastructure (payroll, etc.).

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I like this proposal and am cautiously optimistic about the potential long-term benefits. Aside from the valid comments from Agoristen, Matt and others that need to be resolved, I am curious as to the 780M T that “will be sold to investors and key ecosystem participants”; what are the parameters around this sale, and will current T holders be incentivized in some way to participate?

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First let me say thank you to @maclane and @sap for not only putting the thought into articulating Threshold Labs but also being willing to lead it, and on a pay-for-performance basis. I think the positive reaction here is a reflection of how badly and urgently needed this is.

One of Threshold’s earliest and ongoing stakeholders noted in a discussion this fall that it’s amazing how far we’ve gotten in three years, having launched the merger at the start of a long bear market with a less than ideal structure: our treasury is intact (though in need of re-capitalization), we’ve had tremendous growth in tBTC TVL as the oldest and leading decentralized bridge, and tBTC has substantial revenue, even with the mint fee holiday.

But what got us here isn’t going to get us where we need to go (we’re still less than 4% the TVL of WBTC, even with theirs plummeting 14% since August). We need a clearly articulated security, product, growth and marketing strategy for tBTC, a plan of execution and the right team to do so. I’m confident in MacLane and Sap’s ability to present this for tokenholder sign off. And of course a fundraise is a major undertaking, one I don’t see a DAO as configured to execute properly.

I’m also confident we will work out the incentives discussion above.

A few points to underline:

  • a successful fundraise will enhance our decentralization by engaging aligned investors; I see this as a very positive proof point for the market

  • we’ve gone a long way with the honest majority assumption, but a 1-of-n trust model will be a tremendous upgrade; planning and executing that well requires an excellent team like Labs is planning

  • tLabs will focus on what they can do best while the assets, ownership and annual yes/no vote on plan and cost remain with the DAO; there will be no tLabs treasury and they will design and build for us at cost

  • we will have an opportunity for a yes/no vote on the year-1 strategy, plan and cost tLabs will present (presumably at or near the close of the fundraise)

To achieve all this the right team is going be essential; I look forward to seeing the key hires for critical roles, as noted by @mhluongo and others. (That said, my understanding is that fundraise discussions could commence immediately upon approval of this TIP, which is fantastic.)

I think we will all benefit from the following happening at a quicker pace than we’ve seen with other TIPs:

  • additional days of discussion here as needed to satisfy all on the parameters of this shift

  • a snapshot vote to confirm TIP-98 as written or with modifications

  • Governor Bravo votes on this (assuming successful snapshot) and other token supply proposals (particularly the updated TIP-92 on inflation and TIP-96 on TVL growth) so that tokenholders can give the market clarity on both our vision and plan, as well as token supply

And assuming we move forward with tLabs there will be a need to review DAO committees and roles to align on the appropriate ongoing configuration, size and cost for what remains DAO purview in the “Threshold 2.0” era. I look forward to collaboration on that.

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Is the only way to grow Threshold Network to perpetually inflate the T token and use the T minting press as an atm?

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There have been talks to try and reduce inflation, even reducing staked rewards, now there are 2 proposals to mint nearly 15% of T supply as payment to unknown people/trading firms,etc…

How can the tokenomics of T be improved by continuous inflation?

How can the disease(inflation) of T tokenomics be cured by more inflation?

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I’d like to commend @sap for addressing the pressing challenges facing Threshold Network and tBTC. This proposal provides a much-needed roadmap for achieving the full potential of tBTC, and I appreciate the level of thought that went into it.

It’s no secret that tBTC has immense potential, but its journey to becoming the canonical Bitcoin token requires substantial investment in both technical and product development. The current gaps in developer resources and fragmented priorities have hindered progress. This proposal directly addresses those gaps by creating a structure where development efforts are centralized, focused, properly managed and adequately funded.

MacLane, with his proven leadership and his deep technical expertise, is undoubtedly the best person to spearhead tLabs. His track record of navigating complex challenges and his deep understanding of Threshold’s architecture make him uniquely qualified to lead this initiative.

One of the most significant challenges of DAO-based efforts is the lack of cohesive structures for cross-team initiatives. Fragmented workgroups often lead to misaligned goals, a lack of accountability, and inefficiencies in execution. By establishing tLabs, this proposal introduces a much-needed mechanism to unify efforts, set clear goals, and ensure accountability—all while maintaining DAO oversight.

While the focus on tBTC is essential, I have some questions about how this proposal will affect other Threshold services, such as thUSD. thUSD has been gaining traction as a decentralized stablecoin, and it would be helpful to understand whether tLabs will have any involvement in its development or if it will remain under the purview of the DAO.

Additionally, the DAO’s current guild system has played a critical role in organizing contributors and initiatives to date. How are y’all envisioning changes to the guild structure, or will guilds continue to operate independently of tLabs? How will this proposal impact the roles and responsibilities of individual contributors within the DAO? Will there be existing DAO contributors transitioning into roles within tLabs, or will their efforts be redirected toward other initiatives?

There are a few other questions and considerations I’d like to raise:

• Funding Oversight: The proposal mentions the DAO will oversee and approve tLabs budgets. What specific mechanisms will be in place to ensure transparency and alignment between tLabs and the DAO?

• Decentralization Goals: While tLabs introduces centralized leadership for efficiency, how do we ensure this structure doesn’t compromise the core principles of decentralization?

• Milestone Clarity: The success of tLabs will depend on well-defined milestones. How will these milestones be communicated and measured, and how will the DAO participate in evaluating progress?

• Onboarding Aligned Investors: The proposed fundraise is critical for success. What criteria will be used to ensure that investors are aligned with Threshold’s vision and ethos?

This proposal is ambitious, thoughtful, and addresses many of the challenges the DAO has faced. The creation of tLabs could be the catalyst for tBTC’s growth and Threshold’s success as a whole. However, I believe it’s essential to address how this initiative will integrate with other Threshold services, the existing guild system, and the broader DAO structure.

I’m excited about the future this proposal envisions and fully support the intention to strengthen Threshold and tBTC’s position. I look forward to hearing more details and discussing how we can all contribute to this vision. Let’s seize this opportunity and keep building extraordinary things together!

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I’m in support of TIP96 and TIP97 inflation and expenditures to maintain the current requirements of the network, but this is too far in my opinion. $30 million at current rates is not justified by the outline of this proposal. When less than $1m annually is required to maintain the core requirements for tBTC to function, 30x that is not feasible to fund a team of what, 10 people working likely 40hrs a week? Not to mention the centralization of what’s meant to be a DAO. Why don’t we go ahead and list on the NYSE? The infrastructure isn’t being pressured right now as far as I can tell with the current velocity. Annual staking inflation is ~$15m. So in other words, the combined staking reward since inception is going to be spent on this team. Will their effort be equivalent to 2 years of work by stakers large and small? Small stakers often have contributed significant time and expense setting up and maintaining nodes. They do perform work as they are subject to uptime requirements. The benefit to the protocol is that it can boast the collection of 150 decentralized operators. If not for that, it’s no different to WBTC. Diluting them to this extreme will sour Threshold’s reputation. Here’s what should be priority:

Automatic deposit of staking rewards at 0:00 UTC on the second of the month.
End the gated signer set and open the protocol up to all like all networks should be.
Improve the marketing and traction of TACO.
Improve the marketing and traction of thUSD.

I know the first two can be done for less than $7m a year. We can even make it a bounty to get these done. Some have been in the works for years already with at times little discernible progress. We need to improve our credibility by sticking to the ethos of decentralized, automated protocols.

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In order to achieve this, the tBTC protocol requires upgrades. More information can be found here: The Path to Permissionlessness | Threshold Docs

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This is an interesting (and tough) problem. I won’t lie and say I know much if anything about the inner cryptography of tBTC, so excuse my ignorance. But won’t it at least be somewhat clear who is “misbehaving”? You already know who tends to behave well (the current set). Doesn’t it cost gas to flood transactions? Ethereum doesn’t have this problem for long because you’d bankrupt yourself trying to do it. You’d also know from where it’s originating if a certain operator started sending phony information to other operators through the client itself. Then you could simply block them from communicating or institute a cool down. But, this is out of scope of the current conversation.

My point is that members of the DAO should be investors whose benefit is increasing value of the tokens they hold. We shouldn’t separately compensate limited sets of individuals with inflation. This transfers the risk of investment to others while retaining high returns. Nobody wants to invest in something with a track record of issuing what amounts to potentially unlimited unbacked debt. Accountability is incredibly hard when employing what amount to contractors, especially those distributed worldwide with no legal recourse. It will be members of the DAO deciding whether or not to compensate themselves for a job well done.

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Taken together TIPs 92, 96, and 98 present what I view as the most credible vision for the future of Threshold and tBTC.

They take the first step towards building a stronger value accrual model for T, increase tBTC TVL by up to ~6x, stabilize the DAO’s long-term treasury, and set a roadmap for tBTC’s continued product competitiveness.

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