Hi all, let us share some of these comparable cases 
(cc: @T_Ley)
We have seen other cases in the space where tokens went from non-transferable to transferable. As you can imagine, each DAO has its very individual dynamics, but we found the exercise still helpful for insights on the process and challenges connected to it. Btw, if anyone has more examples or thoughts, feel free to share - would love to keep this as a discussion for us to smarten ourselves up.
| Project Name | Token Name | Market Cap ($) | FDV ($) | Timeline | More info |
|---|---|---|---|---|---|
| Gearbox | GEAR | 23,589,107 | 87,032,950 | Launch of product V1: December ‘21 Launch of non-transferable token: December ‘21 Token transferability: December ‘22 |
Link |
| SudoSwap | SUDO | 6,753,778 | 15,581,840 | Launch of product V1: July ‘22 Launch of non-transferable token: January ‘23 Token transferability: February ‘23 |
Link |
| CoW Protocol | COW | 57,622,782 | 314,125,318 | Launch of product V1: February ‘21 Launch of non-transferable token: March ’22 Token transferability: April '22 |
Link |
| Element Finance | ELFI | n/a | n/a | Launch of product V1: June ‘21 Launch of non-transferable: January ’22 Token transferability: February ’23 |
Link |
| Sturdy Finance | STURDY | n/a | n/a | Launch of product V1: March ‘22 Launch of non-transferable: January ’23 Token transferability: May ‘23 - first discussion, then stopped |
Link |
Key insights for SafeDAO
This section highlights the insights from comparable cases in an objective manner. Please feel free to delve deeper and contribute your thoughts or additional case examples.
- Token Utility: Gearbox and CoW Protocol, demonstrate the effectiveness of prioritizing the development of token utility prior to enabling transferability. This strategy has been observed to lay a strong foundation for token value and practical application.
- Active Community Participation: Insights from SudoSwap and Gearbox’s token transferability highlight the significance of active community involvement in governance. In these cases, the DAO went through a longer period of active discussion, and even several rounds of voting. The sentiment following the enablement of transferability suggests that active community participation played a crucial role in shaping a successful outcome.
- Comprehensive Governance Process: The experiences of Gearbox and CoW Protocol indicate the benefits of a milestones-based approach in governance. Ratifying key steps individually has seemingly contributed to more precise and effective decision-making processes.
Detailed cases below
Gearbox
Governance Process: Gearbox took a year after its launch to initiate token transferability, focusing on key topics, the biggest one of them being token utility. The governance process involved multiple iterations, leading to this proposal. They’ve since moved to Discord for governance discussions, but old threads are still in the WebArchive.
The final token transferability model was unique in its structure since it includes a price discovery mechanism, where participants do not know the exact final price but are aware of the price range. This model was a result of the collective effort of 0xCider and the DAO and is well-documented for reference. Hard to see this being a way for SafeDAO considering the size/stage difference, but an interesting concept in general.
Key Takeaway: The critical lesson from Gearbox’s approach is the significance of a thorough discussion before making a token transferable. They went from general models like a simple token sale, to building a roadmap of long-term project value, and determining how this value would be transferred through GEAR to token holders and Gearbox users. For Safe, there has already been an active discussion around SAFE utility available here.
CoW Protocol
Governance Process: There were three interconnected proposals – CIP:3 (Token Utility Program), CIP:4 (Liquidity Incentive Program), and a final one - CIP:5 (Swapability of vCOW to COW) – which allowed vCOW holders to convert their tokens into transferable COW tokens, catalysing the COW token’s price discovery process. The Token Utility Program incentivized long-term holding of COW tokens with trading fee discounts on Ethereum Mainnet. These discount tiers varied from 5% to 40%, depending on the quantity of COW held by users.
Key Takeaway: A multi-step approach taken by CoW allowed the community to divide its focus among crucial parts, instead of bundling all discussions into one thread and voting on everything simultaneously. This made the process easier to follow and, once again, enabled token holders to participate effectively in making the right decisions. There are clear similarities with the current approach of SafeDAO by creating clear process milestones vs. pushing out token transferability for the sake of it.
SudoSwap
Governance Process: By the initial distribution, SUDO was non-transferable to make sure that there would be sufficient participation from SUDO holders in governance. The airdrop and token launch was done in January. Interestingly, there were multiple attempts to vote for the Token Transferability, but out of three proposals, only the last one was voted through, the rest were canceled or defeated due to quorum failure.
Key Takeaway: A****ctive participation of the community in all stages is crucial, especially at the token transferability itself. This has proven to work effectively in the past with the DAO taking a firm decision on token transferability. Besides the active engagement on the forum already, initial initiatives could be considered to facilitate discussions. ****Strategy 5 of the recently ratified proposal highlighted the importance of SafeDAO governance to be efficient and user-friendly for all participants.
Disclaimer: This exercise is strictly objective and does not reflect any subjective personal or firm view or judgments concerning SafeDAO’s decisions or strategies. Its purpose is solely to provide additional context for an informed and objective discussion. Please note that this exercise was conducted swiftly and, as such, does not guarantee the correctness of any of the information presented. Readers are encouraged to verify the details independently for accuracy.