[Proposal] Active Earnest Rewards (AER) similar to JUP ASR

Sanctum Community (SanctumDAO)
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Hi CLOUDMEN!

Sanctum are currently in the process of sunsetting their previous in house onboarding process and moving towards “a more public and collaborative approach”. This is extremely exciting & I for one can not wait to finally use my new governance power to shape the future of the protocol.

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AER Rewards

To kick off this new paradigm shift within the community, I propose introducing Active Staking Rewards, an initiative that has been a huge success within the JUP community.

There are significant benefits to this initiative:

  • Active Community Engagement

It will encourage Cloudmen to be actively involved in governance decisions, fostering a more engaged and invested community. This, in turn, should lead to better, more informed decision-making and a stronger sense of ownership within the community.

  • Incentivised Governance

Unlike traditional staking, where rewards are earned passively, AER rewards users for directly contributing to the platform’s direction. This should lead to thoughtful voting, which is expected to improve the quality of LSTs launched with Sanctum.

  • Fair Distribution of Rewards

Rewards should follow a linear distribution, ensuring that value is shared equitably among participants, with active community members receiving greater benefits than idle ones. This will, hopefully, attract and retain users who are genuinely interested in the platform’s growth.

  • Community Building

Fostering active participation through AER will help build a more robust and dedicated community, which is crucial for the long-term success of decentralised platforms. Furthermore, we aim to get $CLOUD into the hands of genuine community members who are helping shape the future of the platform!

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Suggestions

  • Minimum Stake

I suggest introducing a minimum staking balance of 100 CLOUD to avoid having wallets with fractional amounts of CLOUD upon AER claim. JUP had to implement this measure due to many smaller wallets not claiming their AER.

  • Opportunity Cost

Users need to lock their tokens to participate in governance and earn AER. I recommend adopting a 30-day lock period, so community members are not forced to lock their tokens for extended periods, as is common in most other crypto staking programs.

  • Community allocation

I suggest we use part of the 30% (300,000,000 CLOUD) community allocation for AER, I recommend 3m CLOUD be used for the first 3 month period of AER that would be 1% of the 300m. After the first AER we revaluate the amount and put it to the community.

Thanks for reading my post! Have a great weekend!

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EDIT: 5/10/2024

Upon discussions with some community members, I would like to acknowledge an improved upon reward distribution mechanism. As the impetuous for AER is to exhibit true earnestness, upon reflection I have decided to adopt a slightly different approach.
A breakdown of the reward, which can be amended, would look something like this:

  • 60% rewards to voters on proposals

  • 28% rewards to proposalers (those writing proposals, predicated on them being well thought out & being aligned to the protocol)

  • 12 % rewards to authors of winning proposals these are adopted & shape future protocol change, i think the last bit of this is important. If a proposal is not adopted like for like but is moulded into something that does shape the protocol in the future, that user should get some sort of earnestness allocation.

We still want to drive users to Sanctum and increase the understanding of our protocol. Active Earnestness Rewards are an elegant way of doing this, JUP has a fantastic distribution mechanism but it has grown a sense of stake to earn philosophy.
Proposalers are thinking and learning about the protocol and suggesting ways for it to be improved and wanting to foster more adoption. Their efforts should be better reflected in the distribution of rewards.

Thanks,
Asimsy

34 Likes
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I love this proposal. I had something very similar in mind too. I was also thinking the voting DAO Sanctum site should be built in and access it through the profiles, that will help to keep this a more genuine members. In addition to the min 100 stake Clouds you proposed. Additionally, I had mentioned before to have a bi-weekly CLOUD-MEN Call as well.

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Yeah love these ideas, would love a biweekly/monthly call to touch base with devs & ask questions

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I can’t recall exactly if Jup does this (I don’t think they do) but I would take it one step further and have a multiplier for time staked.

I would make it more interesting and not have any long drawn out unstake. Unstake as you please but once you do, your multiplier stops vs someone who stays in the entire Quarter. each time you unstake during the current ASR period, your daily mulitplier is lowered based on the last unstake and how many days passed between restaking.

ASR reward is automatically dropped into staking like JUP does.

Those who don’t sell their ASR and unstake it get a bonus next ASR drop. It essentially creates a compounding loop for the more convicted community members.

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What a productive and informative post. Thoroughly enjoyed this. I think the minimum cloud stake to qualify for ASR rewards is a strong concept. Looking forward to some of this becoming reality soon!

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Thanks for the feedback!

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Which bit can’t you recall?
Thanks for the feedback, think having a multiplier for time staked can be quite detrimental to new users which ASR is trying to attract. Unfortunately it only serves to benefit the earliest stakers and gives new users a disadvantage. As each vote during the ASR period counts towards your overall reward if you don’t vote on all the proposals your rewards are automatically less than someone who has voted on all proposals. Adding multipliers over complicates a programme that should be simplistic as to attract new & inexperienced users.
I really like the idea of automatically dropping the CLOUD into wallets, I might steal that idea, thanks!

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I don’t know if JUP rewards longevity in staking.

I’m not suggesting it should be a huge multiplier but you should always consider your early & longest users. Especially your most convicted ones.

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Jup style ASR no issues with that style of approach , although i do sometimes wonder on what we would vote on a semi regular to keep the community engaged without it seemingly becoming either mudane or to the point of micromanaging (not particular to sanctum, lots of projects would have the same issue)

Fair Distribution of Rewards - would need to look at the holders that could be eligible to vote, we did have some large whales (no idea if they still hold or not) that potentially could render a linear approach to led a top heavy distrubution

Community Building, minimum stake, short lock ups are a no brainer really within ASR, would need thought around community building and how to control/reward, the effort from the team to do earnestness was immense

AMAs and casual catch ups would be great, just as over brief of whats coming, and any need/skills needed etc

really hope we can find a way to do this fairly and without over complicating

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I hope we can find an outcome that is not overcomplicated and fair, regarding voting - every new LST that gets launched will have to go through a vote by CLOUD holders so we should voting on a fairly regular basis depending on how they plan to these votes? Individual LSTs or batches?

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just thinking out loud, do we need to vote on which get launched?, is it actually fair?, there’s a whole process to go through with the team to get there, any issues would most likely come to light during that. Of course there are benefits to being a sanctum launched LST, but there is nothing stopping anyone with the knowledge to do it themselves if they really wanted too, we don’t want to limit the possibities for people to be able to launch

Maybe there is something perhaps with the non apy/goodwill LSTs like @Bengshark healthSOL where they could apply for a grant/allocation of cloud to be distributed over a period of time (or a Season of Wonderland) to give holders some ROI for supporting in even if small obviously some rules and oversight would be needed but you get the idea

the other option would be voted to be included in a wonderland season, which again i’m not sure on, as one of the initial ulitity ideas was to use $CLOUD as entry

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I’m not entirely certain i want the gatekeep new LSTs.

Maybe we have a say in how CLOUD related to a new one but I think it’s not in the best interests of Sanctum for the community to yay or nay new products

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All LST…even individual ones? Or only those that are sanctum verified?

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Good question, I think that’s for the devs to answer. I would assume Sanctum verified, it could be a hindrance if considered for all LSTs

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I don’t want to see any LST’s determined by our votes. Only the utility of CLOUD as we move forward w/ them.

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Great suggestion and of course I support

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I love this proposal. Please start ASR

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Honestly future drops should incentivize active participation in governance and in socials.

The lone purpose of the token is governance right now. LSTs like this are useful and wanted. We don’t need to give tokens to people to just try and get season 2 points. They will just dump unless you have some nice long vesting attached to it so they can’t jeet it right away.

I would be more apt to give surprise drops to INF holders. for the next season maybe juice the rewards in SOL a bit. Keep cloud out of the line of sight of the farmers and jeeters. they are not your target customer.

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We will see many of the same unsavory folks from first airdrop come back for s2. Maybe those are the folks who @MikeAF is referring to. I also appreciate your sentiment about keeping cloud utility focused, and not as the main reason to farm s2. We want Sanctum Aligned users :pray:

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well at this point it should be very clear that airdrop/point hunters are not the sticky user you are looking for. The earnestness was a good attempt at recognizing this and trying to reward the ones who will, but it was met with something that was probably more negative than positive. Mainly because the loudest ones were the FUD. For the record I didn’t get that allocation nor even in appeal do I expect to.

But S2 shoudl focus on Sanctum aligned and it should be very clear that will be the mission of S2.

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