Hello, this is the K STADIUM team
We know that many SO and SOM are experiencing confusion within the community regarding the proposal posted by the K STADIUM team last week.
In response, the K STADIUM team would like to clarify misunderstandings and share the truth about the SOP reduction and inflation allocation adjustments.
Please review the information below, and we ask SO/SOM to consider the upcoming vote as K STADIUM prepares to enter a new phase.
1. Only SOP will be reduced, not the KSTA in the CommunityPool
Currently, the biggest misunderstanding within the community is that the reduction will result in a loss of invested assets.
The essence of K STADIUM DAO VC is CommunityPool.
The K STADIUM team is not planning to reduce the KSTA in the CommunityPool, where our usersโ valuable assets are invested, but only the SOP.
When user invests in the CommunityPool, they receive governance tokens in the form of 1 KSTA=1 SOP, and through these SOP, they can delegate to nodes and receive validator rewards based on the โproportionโ of their delegation.
In addition, through the CommunityPool funds, K STADIUM is recruiting projects to invest in, and upon the investment is made, the governance tokens are cut according to their delegating proportion, and project tokens are distributed according to the cut proportion.
The most important part of the above information is that the reward is based on the โproportionโ.
As a result, if only part of the users are cut, the rewards of the users who cut afterward will be reduced, but in the case of the current SOP reduction planned by the K STADIUM team, all members will be cut by 50%, so the percentage of rewards distributed right after the reduction will not change.
2. Recruit new users and create a mutual benefit
The K STADIUM team understands that one of the main reasons for many membersโ opposition to the SOP cut is the structure that benefits newcomers more than existing users who have been trusted and invested.
In the rewards described in paragraph 1, it is true that the rewards received right after the cut have not changed, but also true that those who invest in the CommunityPool following the reduction have an advantage since they have not experienced the reduction.
However, the K STADIUM team has been monitoring the amount of new CommunityPool inflows and confirmed that there has been no further inflow to the CommunityPool due to the current large volume of SOP in the CommunityPool.
This meant that KSTA, which was distributed as a validator reward, was constantly being exported to exchanges, which we felt was a serious detriment to the entire K STADIUM community.
To solve this problem, we thought about various solutions for a very long time internally, and in the end, we concluded that securing new users and increasing the value of validator KSTA rewards would be the best way to expand the K STADIUM ecosystem and make it more sustainable.
As such, the community has a lot of concerns, but there are two important perspectives we want to ensure you understand in order to achieve the above goals.
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Firstly, the structure is such that existing members will not lose out.
The K STADIUM team believes that our members have realized a recent increase in the price of KSTA on exchanges.
There are many reasons for the price increase, but one thing is clear: KSTA is seeing a strong buying interest on exchanges.
Therefore, if the reduction is made, K STADIUM R2E will proceed, and the KSTA buying trend will continue by newcomersโ inflow on the exchange, although it is true that they will receive a better benefit, we expect that existing members will also gain an increase in the volume of their assets, as the value of the KSTA will increase in the long run. -
Secondly, K STADIUM plans to apply a maximum cap to the total amount of SOP issued.
K STADIUM plans to apply a maximum cap to the total amount of SOP issued, so that the rights and profits of existing members can be protected compared to latecomers.
This will create scarcity in SOP, the governance token which is received for investing in the CommunityPool, and we expect that this will be linked to the value of KSTA, which will further increase.
In addition, since R2E is a structure that burns SOP to receive KSTA rewards, there will be a virtuous cycle of the base currency (KSTA) and governance token (SOP) in the K STADIUM ecosystem, and this is also expected to be a factor in the increase in the value of KSTA.
3. Inflation allocation adjustment is intended to encourage community and increase overall value
In addition to the reduction, we understand that our members are concerned that the inflation rate will change, reducing their current rewards.
The ratio(1:3:4:2) we mentioned in our previous announcement is the reward ratio we set to drive K STADIUM R2E project.
This allocation was designed not only to prevent the community from becoming stagnant, but also to prevent more rewards to those who make the effort to active the community.
We understand that many people feel that R2E is difficult to engage in.
However, we believe that by providing more rewards to those who are active in the community and encouraging them, new users will be attracted, which will drive the value of KSTA and ultimately have a positive impact on the entire community.
Moreover, since this is an adjustment to increase the value of KSTA itself, it is ultimately a way to increase the overall value of the rewards invested in the Community Pool.
As such, we would like to encourage our SOs and SOMs to participate in the upcoming R2E pilot event.
We understand that many of our members are already working on various preparations for the R2E Pilot.
We hope that many of you will participate here and earn rewards that exceed current CommunityPool rewards.
Internally, if this pilot event goes well, we will prepare a larger fund for rewards and try to keep it before we launch the full version of R2E.
4. Planning extra benefits for existing investors for their contributions.
Finally, the K STADIUM team has listened to the opinions of many SOMs through the proposal, and we are considering ways to provide more benefits to SO/SOM who were early contributors if the vote approves.
After the internal discussions, we will airdrop a unique token to SO/SOM who cut their SOP through the vote.
These tokens will have the role as K STADIUM OG membership, including access to private sales for token holders, special airdrop, and priority investment opportunities in K STADIUM LaunchPad service.
In this way, we plan to differentiate from new users and give them a separate token with priority to receive various benefits as well as respect from new users for โmaking great contributions to K STADIUMโ just by holding this token.
More details and plans will be shared in a separate announcement in case the vote is passed.
As the owners of K STADIUM DAO VC, SO and SOM, we would like to ask you to consider this proposal for the start of K STADIUM R2E, which will allow the ecosystem to develop and move forward.
The K STADIUM Team will always do our best for the K STADIUM ecosystem.
Thank you.