TIP-098: The Future of Threshold

Proposals
41

I applaud the initiative to take ownership of tBTC development.

I advocate for crisp definitions with business purpose and how tLabs will address.

For example:

Protocol development
Purpose should be to accelerate decentralization and increase performance at scale. This is where development slowed down due to competing priorities from all Threshold participants with infrastructure engineering resources (including Thesis and NuCypher). Schnorr has been the next step on this, BitVM also sounds promising.

Mechanism improvement
Purpose should be better alignment between network value and asset utilization. The lack of a strong correlation between T and TVL/volume is a clear eyebrow raiser for prospective network stakeholders. The work here should address fixing this very incentive friction (e.g. w/ tokenomics improvements), and measure outcomes aggressively per validator and builder participation as well as T-TVL/volume correlations.

Liquidity growth
Purpose should be increasing surface area of tBTC across chains and apps, reducing bridge frictions, improve tooling, and promoting alternate paths to minting (e.g. swap pools w/ BTC). The target uptake should be both from chains/protocols and major LPs. Historically, we observed that consistent liquidity growth follows major upticks.

Marketing
Purpose here should be to increase tBTC awareness and recognition of its prowess for CTOs, app founders, and business developers. We always find ourselves explaining how tBTC works and why it’s superior. This should be self-explanatory with more marketable docs/diagrams, a straight forward website that’s not behind Threshold, higher conference/event presence with a strong tBTC brand, more consistent messaging etc etc.

Finally, about “product”…

I observe the use of protocol/technology/software development interchangeably with product. I find this problematic. Any development without a robust outlook for product-market fit is simply busy work. Projects like Mezo and Acre emerged in this context. How might tLabs support the existing work in this area and work in concert?

2 Likes
42

Hi @sap thanks for taking the care to work on this proposal. It has indeed many aspects very welcomed to improve Threshold in several ways.

Probably the main one, as highlighted by others, is the potential to give the needed speed, flexibility and efficiency required to keep up tBTC and the whole ecosystem in line with market demand and I only see that possible with a different type of structure more close to corporate that most people are used to.

I agree with comments that growth and marketing should be prioritized over technology and agree that the later won’t be, at the moment, a crucial factor that will contribute to TVL increase in short term. While I see benefits from Schnorr signing, BitVM2 and alternatives to have tBTC across more blockchains and the potential to reduce costs in long term, in terms of weight of priorities, growth is a lot more significant and should be the focus of the available resources first.
It was rightly pointed that other projects that don’t have by far the same level of technology and security being able to get TVL much faster and that can certainly be attributed largely to growth and marketing efforts. The costs for growth and marketing is probably less than the amount of work involved in the technology part so it wouldn’t need that large figure initially.

I see however very concerning that this proposal is flowing so fast and lacking so many details asked by several while there are significant comments and contributions still being received throughout this discussion. From the proposal presentation to snapshot it was only 7 days. How can it go into vote with so much pending details and discussion to happen among significant actors ?

There are several details that are still unclear like the new structure that DAO will operate, how IG and MG will remain, its new/adjusted functions, how the will DAO deal with tLabs, align and decide priorities, details, projections, numbers, simulations, stress tests on different possible scenarios, etc. Who from the DAO will follow up tLabs work more closely and be able to feedback that back to the Concil and TG ?

We are not talking about a newer feature being implemented, but about a USD 30 million figure that can fundamentally change many aspects of how the DAO works and impact T inflation quiet heavy. That requires more detailing, scrutinizing, perhaps public Q&A sessions to exhaust the key points on the new scenario. Such a significant thing requires some minimal time to mature.
Yes they take some time, even if there are opportunities ahead, but skipping proper discussion for such big thing is normally not healthy.

Therefore I see that perhaps the scope should be shrunk and have more focus initially on growth, then marketing and then other things, in segregated steps, evaluated and aligned with the DAO as things progress and evolve.

I also agree with maclane’s point that this relationship should be viewed as a contractor and many operational things don’t need to be detailed. What needs more detailing is the relationship between Threshold DAO and tLabs, what are the key and most important points to be prioritized and worked.

If starting with growth and things progress well, then can advance to a newer phases within the other topics suggested.

1 Like
43

Snapshot ends tomorrow. Please make sure to participate https://snapshot.box/#/s:threshold.eth/proposal/0xc80ddd25510430db366f866950f134a01b374794fc53bfd865ba39faa083a1b0

44

I must commend the proposal and the ambition to challenge the status quo. Nevertheless, it is imperative to observe that the DAO was previously allocated 10% of the mint and, regrettably, delivered scant, if any, meaningful outcomes in the realms of product development, marketing, or growth. It is worth noting that the DAO already boasts an existing structure of guilds and full-time contractors.

I should very much like to see the articulation of a more substantive and detailed roadmap, with token mints dispensed incrementally as specific, measurable milestones are achieved. At present, this proposal appears to be little more than a speculative venture, accompanied by assurances that matters will be handled differently this time around.

2 Likes
45

Thanks for the comment.

“very much like to see the articulation of a more substantive and detailed roadmap”

  • Me, too! And this is coming; the Labs leads will prepare and share their proposed tBTC development & growth strategy, roadmap and high-level execution plan, and token holders will then vote to approve or not the requested year-1 funds to execute.

“the DAO was previously allocated 10% of the mint and, regrettably, delivered scant, if any, meaningful outcomes in the realms of product development, marketing, or growth.”

  • I assume you’re referring to the January 2023 formation of Threshold Network, DAO and token (the result of Keep and NuCypher communities discussing a merger plan for months and each voting to ratify it, along with the 10% allocation to the DAO (1 billion T))?

Reasonable people can disagree on the levels of effectiveness of each of those areas of focus (I and others in the Marketing Guild have repeatedly acknowledged the challenges and that we have definitely not come close to cracking the code on how best to not only position Threshold and its 3 products but also (and even more importantly) grow customers, engagement and tBTC TVL, etc.).

But the DAO has only recently taken over (from Thesis team, and with the assistance and guidance they’ve had bandwidth for) attempting the development of tBTC (and primarily L2 implementations).

Thankfully, @maclane and @sap proposed this TIP and are willing to lead the new effort, as we all (DAO contributors) recognize that a DAO’s ability here is both insufficient and too slow.

Further, Thesis (with input from NuCypher and support from DAO and contributors) DID deliver significant growth, and TVL and other metrics proving so have long been available in DAO-supported tools like tBTCscan and TACoScan.

Yet the tools have also shown us that this growth isn’t nearly enough; e.g., we’ve not yet made a huge dent in WBTC market share - and our goal is to far surpass it.

Threshold Labs is the answer, and they (with token holder support) will succeed. I expect token holder sentiment to react quickly as Labs begins to deliver in a manner and speed that we haven’t been able to. Exciting times.

“It is worth noting that the DAO already boasts an existing structure of guilds and full-time contractors.”

  • The DAO currently has 3 full-time contractors (all of whom are paid hourly according to the hours they post, which exclude any vacation or other time off). The rest are part-time, as outlined in the TIPs that authorized each one. We have 3 guilds and a Council; all are part time (Treasury and Integrations committee member expectation is 8 hours/week on average, and Marketing is < 2 hours/week for compensation that is 20% of each of the other two).

As noted in this thread and elsewhere, a group of DAO contributors is working with MacLane and Sap on a recommendation to token holders on the tasks that will move to Labs, those that would continue to be managed by contributors under a revamped structure, and those we propose to eliminate. This will (assuming token holder approval) reduce DAO costs and complexity, and aim to operate more efficiently (again, on a much smaller list of priorities once Labs is approved to take over tBTC development for year 1).

3 Likes
46

Snapshot passed: 1.7B in favor, 4.6M against. https://snapshot.org/#/s:threshold.eth/proposal/0xc80ddd25510430db366f866950f134a01b374794fc53bfd865ba39faa083a1b0

2 Likes
47

Thanks for the temp check support!

Given the significant changes, including the rescission of the mint request, this TIP is continued in TIP-100.

1 Like