by 0x43b2cc9004630b2912abbce0fdf09ff5a3cc144b (Aardvark)
These are several of the reasons for the need for this proposal:
Over 30,000 names have been claimed for 100 MANA each. Each of these names currently has 100 voting power. If we reduce the cost of the names, does the voting power also drop? Does it drop just for those that claim a name for a lower price? If so, who will track which names were claimed at full price and which were claimed at reduced price to determine voting power? If the voting power is reduced for all names including those that were claimed for 100 MANA, then it will create an inequity in voting power distribution.
Owning an NFT name is not a requirement for participating in any activities in Decentraland. It is purely optional. In fact, anyone can enter Decentraland and use any name of their choice at any time for free. It will just have several additional characters added at the end as an extension. Therefore, I question the need to reduce the price of names at all.
It seems that virtually every day there are several names claimed for 100 MANA each. If people are willing to continue to pay 100 MANA to claim a name then there should be no reason to reduce the price.
Many of those that claimed one or more of the 30,000 existing names for 100 MANA did so as an investment. These are NFT’s that have value. If the cost of claiming a named is dropped, it will completely change the value structure of these NFT’s. All those that were claimed for 100 MANA will drop in value.
People paid 100 mana knowingly, gaining first movers advantage to name squat. You now want to doubly reward those folks by issuing a refund.
Overall, this idea of reducing prices over time AND simultaneously refunding the delta in all previous purchases is a terrible plan. The precedent set here will reverberate through Decentraland economics system for a long time as it will make it normal the the DAO is a temporary holding fund for future refunds. Maybe we should go back to burning Mana to prevent this nonsense. This approach is barely a bandaid to the mistmatched tokenomics of Mana as a consumeristic currency.
Imagine if any time someone spent bitcoin and the exchange rate went up, you took your products back to the store and asked for the difference in the exchange rate. It’s an absurd request.
As you mentioned, people are still spending 100 MANA which means the price is fine. Reduce the price if you want to increase the volume of names, but refunding is asinine.
“People paid 100 mana knowingly, gaining first movers advantage to name squat.”
Were early investors of Bitcoin, Bitcoin squatting? Weren’t they taking a chance on a high risk investment? Don’t they deserve the reward if they happen to get it right? Don’t forget that it’s a risk/reward balance. When names could first be claimed, they weren’t even NFT’s at the time and there was no guarantee that they ever would be or that they could be sold or transferred. The only value in them was that we would be able to use it as our name in Decentraland. For investment purposes we were taking a risk at our own expense. Those that took a risk early should be rewarded for the risk they took. I knowingly and gladly paid 100 MANA per name. I think it’s a fair price. I’m not advocating that it change. In fact, I would prefer that it stay at 100 MANA. I don’t hear anyone asking to drop the price of Bitcoin because the early investors had “first mover advantage” like you are complaining about.
“Overall, this idea of reducing prices over time AND simultaneously refunding the delta in all previous purchases is a terrible plan.”
I don’t want the price to be reduced. Someone else has submitted a DAO proposal to reduce the cost of claiming a name without considering the consequences in terms of voting power and NFT value. I’m simply trying to respond to a bad idea with a potential solution. I would be glad to hear an alternative solution if anyone has one.
“The precedent set here will reverberate through Decentraland economics system for a long time as it will make it normal the the DAO is a temporary holding fund for future refunds.”
The precedent is being set by reducing the price of NFT’s while not addressing how it affects voting power and the value of the 30,000+ NFT’s that have already been claimed at a higher price. If you bought Bitcoin back when it was $10k and the price today is $50k and then someone proposes reducing it to $12.5k because it’s too expensive, wouldn’t you be upset for losing $37.5k in value per Bitcoin just because someone cried that it was too expensive? Wouldn’t you want someone to pay you back for that lost value? Or would you just be a Bitcoin squatter that didn’t deserve the reward for your risk for buying early? Basically you would have taken the risk with no reward just because someone complained about not getting in early enough.
“As you mentioned, people are still spending 100 MANA which means the price is fine.”
I agree, so why is someone trying to reduce the price? Have you criticized that proposal?
“Imagine if any time someone spent bitcoin and the exchange rate went up, you took your products back to the store and asked for the difference…”
Asking for the price on name NFT’s to be dropped is like asking for the price of Bitcoin or Ethereum to be dropped because you didn’t have the foresight to invest early.
“Reduce the price if you want to…”
You obviously didn’t read what I wrote. I don’t want to reduce the price. I’m simply responding to someone’s proposal to reduce the price while not considering the implications in terms of voting power and NFT value.
Instead of bashing my bandaid, maybe try bashing the proposal to reduce the cost of names. Or at least address the issue of voting power and the implications of the value of these NFT’s if the price is reduced.
I am all for reducing price for a NFT name (maybe 25 MANA is a bit too low), but I am against refunding 75 MANA to the people that bought names before this price reduction. It has been their choice to invest their money in DCL names instead of holding MANA.
Currently there are 31.1K names according to OpenSea, 31.1K * 75 MANA = 2 332 500 MANA = 8 023 800 USD (at the time of writing this comment).
It is a fact that moving minting to 25 MANA is debasing the intrinsic value of all current names by 75%.
I personally believe that reducing the minting fee has merits, but if you knowingly destroy 75% of the intrinsic value of names held by active community members and loyal DCL participants without renumeration, it will be disastrous.
What capital would want to stay in an ecosystem where user value and early adopters are massively debased every time MANA rises. It is an incredibly foolish idea, is terrible for long-term community trust and capital attraction and is a very dangerous precedent to set of destroying user value.
Many DCL community members took the risk of investing in illiquid names in a very early metaverse because of their trust and belief in the long-term vision and viability of DCL. If the intrinsic value of their long-term investments is destroyed by 75%, compensation is the only fair and ethical solution.
Finally, I have been an active and loyal community member of DCL since March 2021, and have invested in many names and L1 wearables. It is fair to say that these investments have not performed well over the past year, even as MANA has risen substantially. I would seriously caution anyone who thinks further destroying value for loyal DCL participants is a good idea, especially at a time when other popular metaverses like the Sandbox are strongly competing with DCL. Early adopters of DCL should be respected and treated fairly, and not treated as disposable commodities. All we ask is that any value destruction be fairly acknowledged and compensated for.
Yes, and 31.1k * 100 MANA = 3,100,000 MANA of that was put up by loyal DCL community members, who had an understanding that they wouldn’t have 75% of their intrinsic value debased overnight.
You mention that “it has been their choice to invest”. I personally find this attitude very troubling, as if huge and sudden debasement of a loyal and trusting community is somehow morally acceptable. If you woke up tomorrow and found out that the value of your portfolio had declined by 75% in real-terms because of debasement, I doubt you would have the same callous attitude.
Prices in MANA for L2 wearables has also gone down, should everyone who bought these wearables get refunded the delta? Lets just give out all the DAO funds to users as a refund!
You’re conflating 2 points here and making a straw-man out of my argument. Let me explain:
Although the DCL wearables market has met an unfortunate fate, it is based on the reasonable supply and demand of those assets. We can debate the merits of allowing user-generated wearables and the impact that had on the short-term value of the market, but it was not entirely unexpected, especially given other metaverses such as Cryptovoxels had made a similar decisions.
Although L2 wearables clearly indirectly had a negative impact on L1 prices, there was a fair market dynamic that I believe will change over the long-term. I lost a lot of money on wearables, but that’s fair, and is fair market pricing. I am not suggesting and never have suggested that market-based price fluctuations should be justification for refunds, of course not.
However this is a completely separate and distinct issue from DCL reducing the only intrinsic value in the names, the minting price, by 75% overnight, without compensation. The difference in these two scenarios would be say the difference between the government unsurprisingly growing the monetary base during a deep recession vs the government going into your savings account and giving you a 75% haircut (as they did in some capacity in Greece, for example).
Hold up - you guys are asking for refunds. In crypto. Do you hear yourselves? All sales final by design.
Also for what it’s worth, should probably choose a programmatic way to set prices for things going forward else this argument could just get rehashed ad infinitum.
I’ll continue to press that No button as hard as I can until the idea of refunds is removed from such a proposal.
The only people that have used the word “refund” in this context are those opposing the motion. It’s not a “refund”. That’s an entirely misleading and dishonest statement, as well as a complete non-sequitur.
All the community is asking for is some compensation for the MANA we put in, if in fact it goes ahead that our purchases are explicitly and directly devalued by 75% overnight.
Some people here seem to conflate the idea of the market devaluing an asset (which is entirely fair), to a directive passed to explicitly and directly devalue an asset by 75% overnight, completely independent of any market forces.
“It’s not a refund”… ::immediately proceeds to define it as a refund::
You enter into an [explicit] contract at the time of purchase. You do not get a refund on your electronics after the price comes down the following year. The purchaser of a home does not owe the appreciated value to the previous owner. NASDAQ does not compensate you for the value of your stocks going down - the price was fair at the time of purchase.
If you want to change the terms of owning a name to be more like a swap, then you need to consider both sides of that exchange. If mana goes down, we should also require more mana to be coughed up by the purchaser - it’s only fair.
In fact, this could all be done programmatically. We can deploy a smart contract that you approve it to touch your mana and name at the time of purchase. If mana goes up in value, mana gets pushed to you; alternatively, if mana decreases in price, we can automatically pull the mana right out of your wallet. If you don’t have enough mana, we can automatically revoke the name until the debt is paid.
If you think the above is ridiculous, it’s because you’re only interested in one side of that trade which means this is personally benefitting and not in the best interest of the DAO.
Once again you somehow manage to conflate the idea of a change in market value (e.g. your NASDAQ and electronics example) with a completely independent 75% overnight devaluation by outside decree. This really is a very simple and clear distinction; perhaps you should read over my prior post again to see if you can understand more clearly.
In your final sentence you decide to personally attack me for some reason that is quite unclear. I have been a loyal and active member of the DCL community for nearly a year now, and have put a lot of my own capital and attention into DCL to help make the community and experience better for everyone.
Some of the most engaging and productive members of the DCL community have voted in favor of this proposal, so I resent your judgemental and entirely unfounded accusation that “you’re only interested in one side of that trade” and “not in the best interest of the DAO”. What’s not in the best interest of the DAO is actions that destroy long-term value for its community members.
While I think WordSalad is clearly at an advantage being very articulate and well spoken, I agree with the others. When I started people bought hundreds and some thousands of names at USD 8 a piece. Can be seen in the DCL Bloggers Discord, I think. From what I understand some of the people want to send these guys, (and yes I am going to call it) a “refund”, hundreds of thousands of USD for making the same mistake the rest of us did with wearables. Does not sound right to me. “Debasing the intrinsic value” sounds like a lot of smart nonsense to me. Names that sell for 10k MANA are not going to lose in value because of this. These are not commodities and it really depends on the name and the demand for that specific name, not on its initial registration cost. All in all, it was an interesting read but to me it sounds like a debate club session showing of some linguistic superiority. The whole point of this is to allow for new guys to register names at a reasonable cost, even if the fees are still going to be hard to take on L1.
Was certainly not meant to be a personal attack, was meant to be rhetorical and self-reflective. So if the shoe fits…
Everyone can ask themselves - do you have an issue with the other side of that event? If “with a completely independent 75% overnight increase in valuation”, should we require 75% more mana from previous purchasers (a “debit” instead of a “credit”)?
I own 56 Names. And I’ve had nearly 24 hours to digest both sides arguments.
While I am thrilled at the potential 4200 Mana I could receive, and could finally purchase my first land parcel, the precedent set by this is concerning. I knowingly minted those names for a well established price. And it wasn’t until just a few months ago that I actually obtained VP for those names.
I minted names for an investment. When you collect items as an investment, the cost to collect changes over time. This doesn’t diminish the value of what I purchased. It doesn’t warrant a refund.
Here’s my solution: All names minted for 25 Mana be Gen 2 Names
Gen 1 Names minted before cost change - Bolded and in bright color to denote Gen 1. Same names maintain 100 VP.
Gen 2 Names minted after cost change. Normal font and white color. 25 VP.
Love this KJ. This is one of the best solutions in terms of keeping value for those who spent their mana earlier, without going as far as refunding insane amounts of mana.
I bought names when mana was both under 1$ and nearly 2$… was not asking for fiat valuation or refunds then. We barely made it to $10 and everyone freaks out.
Aside from your clever suggestion KJJK, I would suggest name vouchers. Even if they likely wont give us 3 vouchers per name, even 1 per name would be reasonable in my opinion.
And while were at it, do the same for wearable creators who submitted wearables before the reduction proposals timeline
I like the idea, it also would be nice if Gen 2 names would be on Polygon, otherwise I would be paying more for gas than for a name.
~100$ to swap ETH to MANA
~100$ to buy the name
additionally ~25$ to approve spending ETH and/or MANA
You didn’t pay 100 MANA to the DAO for your name. Your burnt 100 MANA to generate your name, the DAO didn’t have anything to do with it, it’s not like it has the funds to refund you. Generating a name requires burning MANA, so it’s gone now. Voting NO.
