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# System prepended metadata

title: Token Entanglement

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# Token Entanglement
RaidGuild reboot which puts RAID token front and center and tightly couples RAID token with DAO operations.

## Current status of a DAO

The treasury is primarily funded by new members' stakes and 10% spoils from any client work. Treasury funds are then distributed to internal and public goods RIPs through on-chain proposals which are voted on by shareholding members. 

The **main treasury is used as both a staking mechanic and a funding source**. As funds are spent from the treasury the members' economic fairshare through ragequit is diluted. This includes new members whose initial stake is instantly diluted on joining, essentially new members are paying some portion of all past proposals through this dilution.

* main treasury (weth, dai): 211,309.07 dai
* total shares: 74,511
* new member join stake:  5dai/share
* member exit rights: 2.8dai/share
* **disparity: 57%**

## Current status of $RAID

The RAID community token was launched earlier this year, with a retroactive drop to current members and past clients, remaining supply put into a 'non ragequitable' side vault that is managed by the dao through proposals. We purposely added very little utility to RAID upfront to foster emergence. Some initial use case have been integrated with internal projects, most notably the hire us staking queue.

rough estimates 
* Side Vaults RAID: 150mil
* Side vault value: $8mil
* total supply: 200 mil
* retro drop to members and clients: 50mil

Currently the **RAID token is not coupled with DAO membership**.

## Entanglement with $RAID and the DAO

**token entanglement:** The amount of which a community token is tightly coupled with the community actions themselves. How integral is the token for the community's continued operation?

### Problem
How do we tightly couple the RAID community token with the actions of the dao? How to allow the token to be more 'entangled' with the DAO? Meaning the DAO will not function without RAID and value can be captured by the community outside the purely financial 'spoils' cut from client work. **How does RAID become integral to the DAO?**

New Resposibility: The permissionless nature of a token means launching one entails greater responsibility to the governing members for the community at large. **How do we build in protections from ourselves?** 

### Potential Solution in The Warcamp Model
The Warcamp model has members staking into a Moloch dao that incorporates a community token into the main treasury to foster more token 'entanglement'.

This is a radical reform to how we currently do things so should not be taken lightly. **I'm throwing out this idea to foster discussion, iterate on ideas on how to get more 'entanglement'**

The main feature of the Warcamp Model is to **separate the main treasury from being both a staking mechanic and funding source**. This way the main treasury is used only for staking and then working capital is stored in a 'non-ragequitable' side vault.

With this, **the main treasury holds only RAID**. New members stake raid at a fixed RAID:share ratio. No funding proposals are against the main treasury, this ensures that the members stake is always 1:1 meaning the economic rights of ragequit are always the same (there is no dilution from funding). The uncirculating supply of RAID and the working capital for funding RIPs is moved to these 'non-ragequitable' side vaults.

- New member stakes are in raid
- Current members must stake RAID to back current shares. 
- RaidParty spoils, instead of being paid direct to the vault is used to buy RAID LP tokens which is added to the vault. Creating buy pressure on the token and adding liquidity.
- Member '20% buy up' of shares after proof of work is in RAID
- Large amount of current treasury is put into a liquidity pool for RAID.
- RIP proposals are paid in LP tokens, (this does a 50/50 split of eth and RAID for funding these proposals, more alighment with community)

**having deep liquidity is very important for this model.** A liquid token allows community members to enter and exit easily. A large percentage of current treasury should be used as LP. This, along with other liquidity bootstraping strategies should give us a strong pool.

This creates a few very important mechanics for RAID token stability and trust. 
- large token holders (members) have skin in the game to manage supply
- ragequiters can exit the community with a fair share.
- success of the guild means success of the token.


### problems
- Rising RAID price creates a rising membership stake. at some point does this become unitainible. 
`Through cohort and bounty programs we will give people pletty of opertunities to earn raid. Cohort could even have shares suplimented for their completed projects. Potentially shares could be suplimented through the champion process. Furthermore we would not need a minimum stake`

- low liquidity means that if someone ragequits and also wants to exit from the token they may not get back the equivalent stake
`large percentage of our current treasury will be used to provide liquidity, also spoils will add liquidity, other liquidity bootstraping programs can also boost liquidity (CCOLP public goods RIPs)`

- current inactive members which received some drop but will not stake because they are inactive or can't be bothered
`It may be time for a purge. Early inactive members are not adding much to the DAO any more. with the successful launch of the token and the retro drop we have essentially done a buy out. Ofcourse they can rejoin if they want with the proper stake`

- This exposes members to RAID volitility
`kinda the point`


