[Discussion] Non-Redeemed Token Airdrop

Title: [Discussion] Non-Redeemed Token Airdrop
Authors: 0xKiel.eth [open to co-authors to join]
Created: 2024-03-24

Abstract
Kicking off a discussion on the approaches on what to do with the approximately 22,852,641 in unredeemed SAFE tokens from the user airdrop.
Write a short summary (tl;dr) of the proposal. Keep it as simple and concise as possible.

Proposal types
State which proposal type this proposal belongs to.
SEP: Constitutional Proposals
SEP: Governance Proposals
Other SEPs

Proposal details
Share all information and context about this proposal, including:

Purpose and Background

At the founding of the SAFE foundation, 50,000,000 SAFE tokens were allocated to Users of SAFEs. Generally, the SAFE Airdrop in 2022 allowed users who created safes on Ethereum’s mainnet before February 9, 2022 to be eligible to redeem the airdrop. The claim ended on December 27, 2022, and 64.4% of the tokens were not claimed.

In response to the lower than anticipated redeem rate, SAFE DAO then took up SEP#5 which voted to take 50% of the non-redeemed tokens and create an additional airdrop for SAFEs that had already redeemed during the initial claim period on a proportional basis. The other 50% was to be withheld for a later discussion by the DAO for use [SEP #TBD]. The SEP#5 redemption period closed on October 27, 2023. [9,345,514] SAFE tokens were redeemed leaving [6,753,563] tokens as unredeemed

The current total of tokens unredeemed related to the User Airdrop allocation is [22,852,641].

Now that there is line of sight to SAFE token transferability, this proposal is to set up a forum thread for all to discuss the potential paths to using the [22,852,641] non-redeemed SAFE tokens. It is anticipated that with token transferability, more attention may now be paid to a SAFE airdrop event.

The guiding purpose of the original airdrop event can be found here: Proposal for SAFE distribution for Users

Original SAFE Airdrop Goals
The distribution criteria should be set in order to achieve the following:

  • Decentralization: SAFE governance would benefit most if the token is widely distributed.
  • Reward usage: More active users should receive more tokens than less active ones
  • Reward past usage but prefer potential future active governance participants, i.e. accounts that care about the Safe.
  • Raise awareness for the Safe as a project and DAO
  • Recipients should get a “meaningful” amount, i.e. users should care about it and tx fees for claiming shouldn’t make it economically unwise to claim SAFE tokens allocated to them.
  • Ownership: Long term, we envision the Safe as a community-driven project. It is empowering to own a part of the product they use.

In alignment with the original intent of the airdrop – I believe we should constrain this discussion for these User tokens to Ethereum mainnet only. Additionally, during the last two years there have been long stretches of time where it would cost less than $10 to deploy a safe on ETH.

Why only consider Ethereum mainnet?
“Looking back, mainnet was by far the most important chain for the Safe. Individuals and teams moving significant funds into Safes on mainnet was key for its popularity and trust. Additionally, Safe governance will happen on mainnet initially.
With the Safe now becoming popular on sidechains and L2s, we would rather encourage users on those networks to consider creating a SafeDAO proposal for airdrops. There is the SafeDAO treasury (40% of the total SAFE supply, vested over 8 years) that could be considered for this.”

Options for consideration:
Option 1: Leverage the original airdrop requirements but extend the period of time to March 28, 2024. Remove the addresses identified by the prior bounty program (no bounty paid this time). Consider running an updated bounty program; however, airdrop hunting likelihood was highly decreased.

  • [22.8M] SAFE are distributed
  • Only consider Safes created before (=March 28, 2024)
  • Only consider Safes that have at least 2 actions OR 10 ETH stored over time, prior to March 28, 2024
  • Each Safe gets a minimum of [XXX] SAFE
  • Consider all official master copies (singletons) on Ethereum mainnet
  • â…” of SAFE are distributed relative to their share of ETH spent on txs fees.
    • Smoothing function: x^(½) (Square root)
  • â…“ of SAFE are distributed relative to ETH stored over time on Safe.
    • Include wrapped ETH
    • Smoothing function: x^(â…“)

Option 2: Target active users of Safes since the close of Airdrop 1 (December 27, 2022 to March 28, 2024)

  • Definition of active: TBD

[Option 3] – to be added from discussion
[Option 4] – to be added from discussion

What problem does it solve? What is the reasoning behind the proposal? What is the goal? Why should SafeDAO care about the proposal?

Effects and Impact Analysis

This proposal would help distribute the remaining user allocation of the airdrop. The pros of this are ensuring more representation in governance by active users. Given the desire of the foundation to supply these tokens to users to support in governance there are no perceived cons. Additionally there are no perceived risks.

What are the effects of the proposal? What are the pros and cons? What are risks?

Alternative Solutions

Take no action. The current governance community is active and continues to become more active as crypto winter appears to be ending. There may be no need to distribute the remaining tokens.
Burn the tokens. Given the intention in the original tokenomics that unclaimed tokens get returned to the SAFE DAO burning these would go against the intention.
What alternative solutions have been considered? Why have they been discarded?

Implementation
There will need to be assistance from the SAFE Foundation to support a new claim within the governance module. (backend, frontend).

Open Questions
What other ideas are there for the distribution of these tokens? Please take into account that these ideas should be focused on Ethereum mainnet use cases.

Anything that needs to be cleared up before the community can make an informed decision?
Copyright
Copyright and related rights waived via CC0.

4 Likes

It’s nonsense

Airdrop is already finished!

And snapshot date is ridiculous too 2022.12.27-2024.3.28.
You can’t even imagine how many rat trading the person who proposed this proposal created.

2 Likes

Not a bad idea trying to get the unredeemed tokens distributed as initially planned, but I will suggest the distribution focus on larger Ethereum communities (such as Gitcoin donors, stakers with popular LST protocols, etc) and maybe target to get attention from the users of direct competitors (such as Sequence and others).

2 Likes

Incentives for safe staking may be the best way

4 Likes

Thanks for kicking off this discussion! This is a good opportunity to clarify two points regarding User Allocation funds:

  1. User Allocation funds (and their smart contracts) are governed by the Safe Ecosystem Foundation, not SafeDAO
  2. Ratification of [SEP #21] SAFE Token Utility directs the User Allocation funds to be allocated to users through the Safe Activity Program (SAP)

I. Funds governed by SafeDAO vs governed by Safe Ecosystem Foundation

The scope of governance of SafeDAO and what it controls is outlined in the Governance Framework, which states that SafeDAO governs the funds of the SafeDAO treasury.

II. User Allocation is part of the Foundation’s mandate

The User Allocation funds come from the initial airdrop, which was initiated by the Foundation. It was not allocated by the SafeDAO treasury.

This state is also represented onchain that verifies SEF is the sole poolmanager of the funds.

III. SEP #21 directs User Allocation funds to use for Safe Activity Program (SAP)

Historically, the DAO has made recommendations on how to allocate the User Allocation funds, such as SEP #5, however the ratification of [SEP #21] SAFE Token Utility creates a clear framework that directs the unredeemed User Allocation to be allocated to active users through the newly introduced Safe Activity Program (SAP).

The SAP will establish rewards for the most active and engaged users.

As such, the SAP also corresponds with the initial intention of the User Allocation, which is

  • strengthening the voting power of users in comparison to other stakeholders and
  • expanding the number of token holders.

As the first comments in this thread have already shown, there are various perspectives and ways to reward Safe users. These criterias are important and will be taken into account through the SAP. The initial SAP will run for 6 months and is designed in an iterative manner where different criterias can be incorporated over time.

IV. Further Clarification

As over the last months we had quite a few new proposals, the nuances of these details can easily get lost and we are planning a Governance call in the first week of May to go through the full structure and assets of SafeDAO and its relationship to Safe Ecosystem Foundation. We’ll announce the exact date and time here and on our other communication channels: News and Events

4 Likes

@Andre thank you for the clarification! Very helpful.

1 Like

Your discussion is very good. The safe community needs such active discussions, but I think the unredeemed tokens can be allocated to the following eth communities;

  1. To addresses that actively participate in safe governance voting
  2. Users who allocate eigenlayer pledges
  3. Assigned to KZG ceremony contributors
2 Likes

@Andre point to look :eyes:

1 Like

I think it would be wise to reward users who have contributed to the projects governance. It will incentivise future contributions and grow the contributor base which is a win for SafeDAO. I estimate there to be 1000 to 2000 active members of the community, which would equate to a distribution of approximately 3000 to 6000 safe per member.

4 Likes

I think it would be wise to reward users who have contributed to the projects governance.

This aligns well with SEP 21 Safe Token Utility that was passed.

This proposal introduces the Safe Activity Program, which incentivizes Safe users to actively participate and contribute to the Safe ecosystem (both onchain and offchain activity that is deemed valuable could potentially be considered, but also depends on factors such as technical feasibility).

3 Likes