One Owl scribbling: the index token

feeling the whisper voice tonight, raspy, it’s been goin round as much midnight-oil has been burned of late, thought espresso after dessert was a good idea, i’m gonna go with it

all of this is written as one Owl scribbling; i’ll stand to account for my responsibilities otherwise, this isn’t written in any titled capacity

i’d love to know everyone’s thoughts about the value proposition of the index token - not price; value . . . not price; value . . . f’ing chant it out loud . . . not price, value . . . price tells us that a thing is valued, not why a thing is valued. i’m just going to lay it out as i see it, can’t wait to learn in the places i’ve got it twisted

this dao. what do we do, like at a base level. we currently provide access to macro investing themes. have an inclination to express your view that the metaverse is going to expand in valuation by multiples? we have something you might be interested in. baskets of tokens that represent themes, curated and rebalanced periodically to maintain adherence to the methodologies that are essentially the specifications of the token. then there’s the ferrari-level stuff like fli that gives one-token access to leveraged price action; and this space is about the get mf bananas - and when the baskets and the bananas get together it’s only going to invite more apes and well, everyone’s welcome in our tam-level-everyone community here at The Coop

how does the index token get distributed to the dao? sparingly to those that consistently produce the greatest impact. this is the mechanism of rewarding contribution to the dao, accepted in modest amounts by those doing the work that needs to get done, and representing that a track record of contribution is a fine measure of one’s ability to guide the high-level decisions of the dao. i vibe with the idea, and i think if sized right it’s a good way to accomplish a few things that i’m not looking to dive into here; it’s what we have

i value the index token mainly because it allows me to express my voice in governance decisions; i like that doing things perceived as valuable gets me more of that voice, i think it’s a pretty good way to reward contribution in that sense

how has it been distributed otherwise? rewarding early and ongoing service to the dao; formation, support, and so much love from our partners. rewards for providing liquidity. loaned on option to a market maker, and otherwise distributed in a capital raise with our early institutional partners; both essential in their advisory capacity to the dao

the utility. currently effectively two-fold. governance of the indexcoop dao, and meta-governance using the tokens in our composite indices. in the interest of brevity i’ll leave it there. i’d also maybe add composability; and that is relative to integrations so maybe more of a feature the dao relentlessly executes on improving

but like why, really? speculation is a factor; a protocol-based dao that generates significant and growing revenue is likely interesting, especially given that the use of that revenue is currently not established. the dao’s diversified treasury holdings might be of interest; indexcoop have become somewhat expert in the area of treasury diversification from an operational perspective as well; once the service-side of the dao is opened-up more fully i imagine that could compound revenue

maybe people value the initiative it takes on the part of every Owl to drive relentlessly toward collective success, bringing reliable easy to use products to blockchain users, growing to over 100 minted Owls in under a year, and running one of the most operationally diverse dao’s in existence toward robust sustainability; i ceratinly do

so at the end of the day, i can describe the thing a bunch, but like, why do folks find it valuable? infinite answers, but i work hard to reframe this constantly to build context. of late, ens coming into existence and expressing the market-value of a community and governance, seemingly from thin air, interesting. it’s everywhere and value seems to accrue quite differently based on the distribution mechanism of the initial distributors, and the management of the tokens otherwise after initial distribution

i can’t help but wonder: distributing the ownership of ens broadly - every user - seems to be a net positive from the market’s perspective, is that worth exploring at indexcoop? i suppose it makes sense - in network-effect terms: the larger the network, the more useful and thus valuable it becomes. maybe network size is just correlated to network valuation. the ens approach being that users of the product and service would make good stewards of the overall governance in the protocol. does flash-ownership of the maker of a product inspire loyalty, further product exploration, and maybe even evangelizing and contribution, creating a virtuous cycle? i tend to think so

i think about these things, as i toil daily to earn solely in the token i value

i’d love to know how y’all see the index token and its value

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Personally I don’t think valuation metrics are super relevant on DAO structures yet as the concept, execution model and tokenomics aren’t fully established. I think the community (network value) could trump everything else as tokens will become very sticky in core believers wallets. These are my views on some of the community tokens I received and all have relevance for INDEX :

  1. ENS - The fair launch (wide, small and active user distribution) was very successful. However I think the immediate attempt to get users to delegate stakes to leading community members was clever. A wide distribution of tokens has trade offs for governance when you have so much competition for eyeballs. Valuation - you already had GoDaddy at $11bn as a loose comparable however I don’t think ENS is going to become a profit maximising organisation with community ownership.

  2. Uniswap - Pretty fair as circa 500k wallets got 400 tokens. However I don’t think the community governance is getting much traction. I eventually sold the tokens NOT because the product wasn’t good but more because its a VC project/ distribution of the token. Valuation - pretty obvious if you look at exchanges and your number 1 DEX.

  3. Sushiswap - Controversial project that bootstrapped user growth. However has developed a passionate community over time which brought more LT holders of the token. Fascinating former debate (Community NO to VC raise) and current debate (how do you bring more formal structure into Sushi to allow it to compete against the VC projects). Valuation - has always had a discount

INDEX Valuation - focus on the product metrics Dune Analytics, keep solving problems such as liquidity, develop a multichain/layer2 strategy and don’t panic about S/T price moves.

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