🌴⛓ Chainletter - Issue #1
🌴⛓ Chainletter
Welcome to the Chainletter.
Our new weekly newsletter covers Chainforest - a recap of our latest happenings, our members’ accomplishments, and our projects to come. We’ll also offer a collection of the best (twitter) threads and articles sparking conversation within our Discord. You’ll even find featured pieces written by the community!
This Week: OHM Fork Mania - KLIMA, TIME, & other OHM Forks. Plus Layer 1 Tokens and some member happenings!
Community Happening: KLIMA’s (stalled) launch.
Discussions and Perspectives: The Beginning of $TIME, More OHM Forks, & Layer 1s.
The DAO’s Dashboard: What are members working on outside of Chainforest?
Community Perspectives
Community Happening: KLIMA’s (stalled) Launch
There was so much hype around the launch of Klima DAO, an environmentally focused fork of the beloved yet controversial $OHM, that 10 Chainforest members decided to ape in via the voice channel to share the launch experience together.
Spoiler Alert: The launch wasn’t exactly successful - with a delayed official launch / trading opening due to a rogue $BCT pool — some address had already created a Sushiswap BCT-ETH liquidity pool pre-launch which drove the price of BCT much higher than the Klima team wanted — a discord crash, staking bugs, and invisible tokens. You can read more about that here and here, as well as the project overall here and here. Though the launch was anticlimactic, for better or worse, it’s something many in Chainforest will never forget.
Pre-launch we focused on education:
Research on KLIMADAO: Learning about BCT, etc.
Research on purchase process: Need to purchase MATIC, bridge, etc.
Launch community:
Exchanging info on how to buy, how it went down, commiseration, fun asides from the KLIMADAO Discord etc.
Post-launch perspective:
Amit asking about takeaways and leaving us with…
Community: Peep the #Klima-Dao channel under “learning resources” in the discord. It won’t take you long to realize the extreme value being provided through the dialogue of fellow members, while socializing on the journey to participate in interesting web3 and crypto projects.
Education: the channel provides a repository of member aggregated resources to aid in deciding whether to take a position, how to go about the actual purchase process (how to prep in advance, troubleshooting, support after launch, etc.) and understanding the larger context around ambitious projects like Klima.
Perspective: Amit shared really thoughtful commentary on what we can learn from the launch instead of writing this off as a complete disaster.
Keep an eye out for future launches, or let us know anything you’re excited about that could benefit from a Chainforest Learning Resource Group!
Community Perspective: The Beginning of Time
1/ It’s $TIME we talk about the launch of Wonderland and take a deep dive into what went on.
This involves some of the most prominent names in DeFi so I expect it to come off as surprising to many.
However it needs to be addressed.
👇 https://t.co/t4dvkvHjpw
One thing which has gotten us talking this last week has been the controversy surfacing about the launch of Wonderland ($TIME), another fork of Olympus DAO ($OHM) on Avalanche.
The Issue: An initial seed round was opened exclusively to friends of the creator Danielle Sesta, without public knowledge, and prior to the release of Wonderland.
Why it matters: Crypto Twitter was upset over a lack of transparency about a private seed liquidity pool for the protocol that was opened up to VCs and influencers, but not the broader public. This is from a developer who’s platformed himself on the back of sovereign money, financial freedom and breaking from the legacy institutions like VC.
Chainforest’s Take: Some in the Chainforest community felt the lack of transparency was something to be corrected, though the comments between Zeus (founder of Olympus DAO) and Danielle drew attention to the tribalism at play between these two protocols. On social media, people pledge allegiance to the protocol of their choice with specific emojis. Wonderland being a fork of OHM, this level of community devotion and zeal makes sense and may be a necessity as, for forks, community is their only real MOAT.
Community Discussion: More OHM Forks
Word to the wise: forks will dilute you heavily.
You can tell if this is an issue if bond discounts are persistently high.
Dilution is growth of supply versus the index.
For $OHM: 80% in 7 months
For $TIME: 78% in 7 weeks
For __: probably 78% in 7 days
The Issue: The emergence of at least 15 new OHM in the past week across a handful of ecosystems begs the question, are multiple instances of on average 50,000%+ APY sustainable?
Some initial concerns:
Dilution: the increase of supply for a protocol like OHM results in a user’s share of the market cap declining.
In OHM-esque systems, this stops stakers from receiving profits equivalent to 100% of the growth in the reserve’s supply. Bonders receive some too.
For example, if an OHM fork’s market cap jumps 10x, the stakers will not see the full 10x reflected in the value of their stake, as some of the new supply goes instead to Bonders.
Chainforest’s Take: While they may be profitable in the short term, there are concerns about the long-term viability of OHM-esque protocols being sound investments.
Layer 1 Tokens as Nations?
Layer 1 tokens are a new breed of assets. They’re sorta stocks, sorta bonds, sorta currencies. But the bigger a blockchain platform gets, the more it acts like a sovereign economy & its native token a bonafide currency.
https://t.co/MzdCbH2kTd
The Issue: As Tascha (@realNatascheChe) says, trying to value and understand cryptocurrencies as similar to stocks, pricing them like companies, reduces the complexity and multifaceted nature of all the functions they serve. It may be better to understand them as a native currency, and the Layer 1 blockchain as a sovereign economy.
Chainforest’s Take: Chainforest discussed different models used in the past in attempts to understand Layer 1 tokens (John Pfeffer (@jlppfeffer), investor, entrepreneur, and long-time crypto bull introducing the idea of MV = PQ in 2017) though this brought him to the opposite conclusion as Natasche. Understanding blockchains and their currencies more like the Internet Protocol Suite, rather than countries, was another model proposed by Chainforest members. Cryptocurrencies should not be thought of like companies, but rather like networks.
The DAO Dashboard
What are members working on outside Chainforest?
Founding Member, Parker Jay-Pachirat (@parkerjayp) is spearheading the launch of her startup Fintech Today’s new arm: Crypto Tonight - a weekly newsletter producing opinion & analysis, educational explainers, and interviews with founders and operators working on interesting projects in the space.
Musician and Professor at Juilliard School of Music, Elliot Cole (@elliotcole) is working with music organization Found Sound Nation to build a sustainable record label / community funding model as a DAO. The DAO will produce and release their records, sell NFTs, and fund music and social change projects around the world, put together by their global network of young musician-leaders.
Founding Member, David Feld (@dchristrf)’s first mint on Solana is releasing soon. KIKI | BOUBA (@kikiboubas) is an NFT series of pieces showing neural networks’ ability to replicate the Bouba/Kiki Effect, which is “a phenomenon of non-arbitrary mental mapping between speech sounds & visual forms.” David also works as Product & Community for Twali and freelances for Decrypt.
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