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0049_Vested_Allocation_Release_DAO_Founding_Partner.md

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PGP49: Vested Allocation Release for DAO Founding Partner

  • Author(s): @arkitoure
  • Start Date: 2025-01-25
  • Category: Economic
  • Governance Role: Council
  • Original PGP Pull Request:
  • Tracking Issue:
  • Vote Requirements: Council

Summary

This proposal seeks approval to release 6.5M PHY from the DAO’s Reserve Treasury to a Founding Partner in exchange for 403 SOL. As in previous rounds, this funding marks another stage of capital-backed expansion, enabling the DAO to continue scaling development and governance activities.

Impact

  • Why Now:

    • An additional 403 SOL injection will strengthen the Physis DAO’s capacity to fund R&D and ecosystem initiatives without delay.
    • Delaying this infusion could slow ongoing feature rollouts and reduce the DAO’s competitive advantage.

  • Opportunities:

    • Immediate capital to sustain and scale the DAO’s core mission through grants, development, and community growth.
    • Reinforces the Founding Partner’s ongoing commitment to the DAO’s long-term success.

  • Challenges:

    • Allocating 6.5M PHY can raise concerns about dilution and potential market impact.
    • The DAO must ensure proper vesting measures (18-month lock followed by 18-month vest) to prevent sudden sell-offs or governance imbalance.

  • Future Vision:

    • This additional capital will bolster development pipelines and accelerate cross-ecosystem collaborations.
    • A successful deployment helps pave the way for further expansions and solidifies stakeholder confidence.

Stakeholders

  • Affected Parties:

    • PHY & ASTRALIS Holders: Potential impact on circulating supply and market dynamics.
    • Community Developers & Physis Labs: Gains extra resources to advance the ecosystem roadmap.
    • Founding Partner: Receives a premium PHY allocation aligned with ongoing early-stage development.

  • Engagement for Feedback:

    • Proposal posted in the Council forum for open discussion.
    • Council Q&A session to gather direct input on this new round.
    • Written feedback collected from key contributors and community members.

Explanation

  • Concept Introduction:

    • This proposal allocates 6.5M PHY from the DAO Reserve Treasury at a “premium” rate in return for 403 SOL.
    • The same Founding Partner continues to support the DAO’s mission, reinforcing collaboration and governance participation.

  • Implementation Overview:

    • Upon approval, the DAO Reserve Treasury will vest 6.5M PHY.
    • The Founding Partner deposits 403 SOL in the DAO’s Reserve Treasury.
    • A lock-up schedule prevents immediate liquidation—18-month hold, then 18-month linear vest (36 months total), consistent with prior agreements.

  • Practical Examples:

    • If PHY’s baseline is $0.02, the “premium” effectively values PHY at around $0.015 (subject to final calculations).
    • Over the vesting period, the Founding Partner gradually unlocks PHY while maintaining a stake in the DAO.
    • Any newly released PHY can remain in the Rewards program until fully unlocked.

  • Addressing Corner Cases:

    • If the Founding Partner does not deliver 403 SOL, the allocation is reversed.
    • If PHY’s market price changes drastically, the reference value is the time the DAO Treasury receives the SOL.

Pitfalls

  • Reasons for Hesitation:

    • Concerns about increasing the Founding Partner’s share in governance or market influence.
    • Another premium round could set expectations for future deals.

  • Potential Problems:

    • An inadequate vesting period might lead to undue market pressure upon token unlock.
    • Misalignment if the Founding Partner’s approach shifts away from the DAO’s long-term strategy.

Rationale

  • Optimal Design Justification:

    • Offering a second premium allocation follows the same early-stage incentive strategy as previous rounds.
    • 6.5M PHY is smaller than the initial allocation but still meaningful enough to drive expansions.
    • Continuity in terms from the last vesting cycle ensures consistency and predictability for the DAO and partner.

  • Considered Alternatives:

    • Seeking new external contributors, which requires extra vetting and could delay the DAO’s development timeline.
    • Restricting future rounds to new backers only, forfeiting deeper engagement from an existing, trusted supporter.

  • Consequences of Inaction:

    • Slower or halted ecosystem growth if the DAO remains capital-constrained.
    • Missed opportunities for synergy and scaling in 2025 and beyond.

Queries

  • Pre-Merge Resolutions:

    • Confirm vesting details match the standard 18-month lock + 18-month linear vest.
    • Validate governance rights if any changes occur due to increased PHY holdings.

  • Post-Approval Developments:

    • Deploy or update vesting contracts on-chain for transparency.
    • Provide periodic updates on how this extra SOL accelerates the DAO’s roadmap.

  • Future Considerations:

    • Option for additional capital infusions if all parties remain satisfied with progress.
    • Continue monitoring overall PHY distribution to prevent excessive concentration.

  • Dependencies and Timelines:

    • Receipt of 403 SOL in the Reserve Treasury prior to releasing 6.5M PHY.
    • Smart contract vesting schedule implemented within 24 hours of SOL arrival.

Deployment

  • User Impact:

    • Possible slight dilution, but intended to boost core strategic initiatives.
    • Accelerated development benefits for the broader community.

  • Documentation Updates:

    • Record the newly vested 6.5M PHY in on-chain logs and governance documentation.
    • Update tokenomics references to reflect the second round’s parameters.

  • Compatibility Considerations:

    • This proposal mirrors previous allocations, preserving existing governance and workflow structures.
    • No migration strategy needed unless vesting differs significantly from the initial round.

  • Reversibility:

    • Once PHY is locked and the vesting schedule begins, reversal would require renegotiation.
    • The lock-up mitigates immediate release concerns.

  • Migration Strategy:

    • Not applicable. This is an additional discrete allocation, not a protocol change.

Metrics

  • Performance Indicators:

    • Increased capital for R&D and roadmap execution.
    • Continued or improved velocity of ecosystem deliverables (commits, new features).

  • Stability Metrics:

    • DAO Treasury retains adequate reserves for other initiatives.
    • Market liquidity for PHY remains stable with no major disruptions.

  • Complexity Reduction:

    • Maintaining an ongoing relationship with an established supporter avoids overhead in sourcing new partners.

  • User Acceptance:

    • Assessed via forum discussion, vote outcomes, and feedback during or after implementation.
    • Positive reception backed by tangible project updates.

  • ETL Reporting Needs:

    • Track usage of the additional 403 SOL.
    • Monitor vesting progress and impact on the DAO’s broader metrics.