Proposal: A new Kong Land medium of exchange, $LAND

Governance
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This proposal is for the creation of a medium of exchange token to be used by the Kong Land ecosystem on Ethereum mainnet with a ticker of $LAND.

This proposal has been informed by consultation with the core contributors Cameron, Paul and David, as well as feedback and debate at a workshop during EthDenver at the Kong Land embassy. If you weren’t at Denver or were unable to join remotely, hopefully the video should be available shortly, but this proposal summarises the general consensus at that discussion.

Why $LAND?

Citizenship in Kong Land is recognised by the Citizen NFT, available to those who have converted their (alpha) $CITIZEN token and $CTZN tokens. Citizens are the sovereign governors of the Kong Land DAO. They hold the ultimate control of the Kong Land DAO. They are in control of the Kong Land treasury.

However, the Citizen NFT is not suitable for building economic relationships with users of Kong technology. We need a token that is available for:

  • charging fees for registering and potentially using secure chips produced by Kong Land
  • conducting token swaps with other DAOs that are using secure chips in order to align incentives
  • seeding a treasury that can fund public goods, research and development, and seed promising subDAOs
  • any potential future public sales that the Kong Land DAO might see fit

There are a number of other tokens already in the Kong Land ecosystem, including $KONG for the Kong Cash notes. We expect there to be many more as subDAOs establish their own tokens. $KONG, like these future tokens, are best seen as products of Kong Land.

The token

The $LAND token is a medium of exchange token whose value is determined by its utility. As we expect that use of secure chips will require paying fees (‘taxes’) in the $LAND token, the value of $LAND will be a function of the demand for the chips.

There are additional uses for $LAND that were discussed in the EthDenver workshop, including using $LAND as a path to citizenship (an immigration policy, effectively) but these additional uses can be subject to governance in the future.

The proposed $LAND token is a fixed supply token of 1,407,230,468 $LAND tokens. A fixed supply token provides for more predictability for holders than an expanding supply token.

Allocation and distribution

It is important for both decentralisation and liquidity that $LAND is widely distributed. The distribution of $LAND is also an opportunity to reward those who have been early supporters of Kong Land, as well as seed a substantial treasury of $LAND that can be deployed for future uses.

In Denver, I proposed that the core contributors develop a token allocation along these lines, which would also ensure that all DAO members were incentivised to help build Kong Land. They have created an allocation proposal here.

Keen for feedback - ideally if there is general agreement along these lines I will post up a formal proposal on the Snapshot in a week or so.

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Thanks so much for taking this on Chris, I am excited about the proposal! I learned a lot from you during our discussion at the Denver embassy. I do not have any criticism or problem with the proposal at this time. I look forward to the formal proposal! Thanks for your time and energy.
-Matt

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Great work @chrisberg! Thanks for getting this ball rolling.

2 pieces of feedback:

  • The allocation document calls for 1.4 billion and some change, though there is a conflicting comment that says one row is meant to be 100m instead of 500m. Not sure if it’s a typo or we actually want to issue ~1.4b. The numbers should match before submitting to snapshot.

  • $LAND is already a namespace for the very popular Decentraland NFT. Do we want to compete for this namespace? $KLAND, $STATE, $REAL, $SILO, $HALO, $CHIP, or $ELEM will have lower SEO competition and less likelihood for confusion.

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I have amended the comment regarding the 100 million token; the intention is that it is a portion of the 500 million that is earmarked for core contributors (e.g. not other purposes such as grants or treasury diversification).

While one might contend that we shouldn’t slice up the the treasury prior to considering all the areas that KONG Land might want to allocate resources, I think that initial signals like this are important to show intent.

$LAND is proposed for several reasons, but the primary one is to reinforce KONG Land as a crypto state. $LAND is something that may be somewhat inert as a medium of exchange in KONG Land, but instead reflects a distinct participation in the crypto state other direct vote as a $CITIZEN. In that spirit, the total number of $LAND tokens reflects the hectares of arable real land in the world (obviously this changes due to desertification, etc., but as of a decade ago this was 1.407 billion). We want $CITIZENs and DAOs alike to see $LAND as fertile ground to build cryptographic futures upon.

I would contend that while there is potential for overlap with Decentraland, the fact that they use $LAND for NFTs and not a fungible token is a significant distinction.

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I have a few questions. In the Allocation google sheet, about 35% of the tokens are reserved for CITIZENS. Does this mean just the 500 alphas? Or does this mean that this allocation will go to alphas + other citizen classes?

Will the 35% be distributed equally amongst the citizens?

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Does this mean just the 500 alphas? Or does this mean that this allocation will go to alphas + other citizen classes? Will the 35% be distributed equally amongst the citizens?

This is meant to include all $CITIZENs, not just alphas. We don’t want to disclose the exact distributions to alphas within this segment to preclude potential gamification. Alpha’s early contribution and participation in KONG Land is taken into account and as such the distribution is not equal amongst $CITIZENs.

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Regarding the intention of creating more money that appears from SubDAOs within Kongland, and the intention of the new Token, $LAND (which I agree with @cadillion , in which maybe we could think another name), it takes me to the idea that Perhaps this new Token, could serve as General Treasury of Kongland, and main value for the rest of tokens that may arise.

I explain.

  • Like BTC is considered the value reserve of the Cryptoworld.
  • Like the UST depends on the token LUNA to be created, thus burning LUNA and giving more value.
  • Or just like Seascape did with his token CWS. For the rest of the projects to create currency for their own videogames, they had to buy CWS and burn them to create the new token of said video game, within Seascape.

This added use could be given to $LAND and thus giving Kongland’s strength and even attracting investors, or provoke SubDAOs creators must buy said token and finance the Treasury of Kongland.

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I understand the need for an ERC20 token.

  • Allows creating a treasury
  • Incentives for subDaos (something like Gnosis is doing with $GNO, $SAFE, and $COW).

My question would be, why not use an evolved version of $KONG? it allows us to maintain the same brand, dogfooding, and implement some interest models like veTokens.

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I actually see $LAND as one of the sub DAOs, in case we have a physical space, $LAND could be the token used.

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We debated this with $KONG – while possible, there are some challenges:

  • $KONG has a permanent, fixed inflation rate. In the $LAND discussion at EthDenver Chris noted how having a clear cap to $LAND token makes it easier for the broader market to understand.
  • A new, replacement $KONG token would cause confusion for the old one which is already somewhat established (e.g. on Etherscan, and the lockdrop contracts for $KONG will continue into perpetuity).

As noted above, the connection between having a crypto state with property as $LAND is very intentional, hence the 1.407 billion number. For any country, land is a limited commodity (unless it is purchased or seized from other sovereignties). KONG Land intends to generate significant economic activity even without the need for or prior to the existence of a physical land ownership, so a virtual equivalent seems appropriate.

Also, noting that it’s the second half of “KONG Land” and not detached from the branding that folks are already aware of.

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I’d prefer that we don’t overcomplicate the tokenomics of $LAND. Requiring sub-DAOs to buy $LAND to create their own tokens introduces friction and could disincentivize projects from wanting to work with us. I’m also not a huge fan of burning as a mechanism to force value into a token and would rather see $LAND’s value reflects the economic value created by Kong Land (and possibly the value of gaining citizenship through $LAND in the future) without artificial incentives like burning. There’s also the challenge of determining the right price ratio of said sub-DAO token to the $LAND that would need to be purchased/burned. Again, more friction.

Wrt the token’s name, I’m not as concerned with us competing for mindshare against other land tokens. The other tokens are way way down the MC ranking, and I’m confident that our $LAND will have a much higher ranking and, thus, the most mindshare. IIUC Decentraland’s LAND is a branding of their NFT plots and doesn’t show up in coin index searches, so not concerned that there would be any confusion.

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Can someone clarify the future relationship of $KONG to the $LAND token? The KONG + LAND branding is interesting. In future, why would/wouldn’t someone want to buy $KONG? Also who (in aggregate) are the $KONG and SiLo holders? When was their entrance to the ecosystem and under what conditions? I’m aware of the $KONG stake drop but am wondering how else holdings may have been instantiated.

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Any future relationship would need to be proposed and elected by the DAO. The DAO treasury holds a small amount of $KONG token, however, no real market has been created for it, nor did we ever intend to prior to the founding of $KONG Land.

For a limited time, and if the $LAND proposal passes, $KONG holders will be able to claim $LAND (we’ve given the high level allocation in the linked document). This could create short term incentive to acquire $KONG.

$KONG and SiLo holders include anyone with a KONG Cash note or SiLo chipped good. Our guess is that this numbers in the ~1,000 range on number of individuals. These folks were the first to support, share, talk about and use the technology and as such we believe it is incredibly important to allocate $LAND to them.

Additional liquid $KONG was issued to the core contributors (of which, early on, there were additional contributors who I won’t dox here). This liquid $KONG is the primary means of distributing token to these old and existing contributors (see the note after Core Contributors in the linked document).

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Thanks for the clarification. That all makes sense.

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