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Youtube link: https://www.youtube.com/watch?v=9PzIcXWZH1g&ab_channel=Tellor
Project website: www.tellor.io
https://twitter.com/WeAreTellor?s=20
Discord: https://discord.com/invite/n7drGjh
https://www.reddit.com/r/TellorOfficial/
A couple of general topics discussed briefly, also going through the questions asked in the google forms, and then the main topic of this call was the upcoming Tellor treasuries. How will it work, who can participate, and what are the goals of it? Read on to learn more.
Whole discussion
Nick: Hey everybody! Welcome to Tellor community call. It is December 14th. Everything’s moving along nicely. Not any huge announcements today, just the normal stuff. We are beginning work, Tellor X is launched, it’s doing great, still no hiccups so far. We’re dealing with, a lot of new reporters are coming in, which is super exciting. We’re making a lot of improvements and pretty quickly on the Telliot, so on the reporter software. If you guys are doing that, be sure to follow the repo, be sure to follow in the reporter’s channel on our discord, keep up to date. Probably...
Mike: Are we doing a reporters’ call tomorrow?
Nick: Yeah, that was the other news. So, tomorrow at 11AM Eastern time, an hour before this one, we’re going to do a reporters’ call. You’ll be able to... So, Mike Bapps here, Tally, Owen, they’re kind of the devs of the reporter software, I’ll be there as well, so you can just ask any question like if you’re having trouble setting it up. We will literally, you can share your screen and we’ll walk you through setting it up. If you have other concerns about how it works, you just want to know what’s the roadmap, what should we focus our dev priorities on, we’re happy to just talk anything reporter. We have a few things on the agenda to begin with, but really anything that you guys want to talk about, we’ll be there for an hour or so. Hop on and we’ll give it a call. We’ll see if anybody joins, we’re going to record it and post it on YouTube, so it should be fun. Yeah, and other than that, we’re working on Tellor Flex. Tellor Flex is the system for Tellor. It’s basically identical for Tellor, you’re just taking away certain pieces, so that way it can function on any chain. You can go look at the Tellor Flex repo, keep up to date with it. We should be done probably within the next week or two and we’re going to be deploying on Polygon with that structure early in January. That’s super exciting, so I think that’s it as far as dev announcements go. Anything from you guys?
Ryan: I did want to just bring up really quick. This Thursday at 2PM Eastern time we’re going to start doing office hours. I don’t know if you guys join, but we did the twitter spaces last week and had a good response and good outcome, so we want to try to keep that going. It’ll be like a kind of AMA but more like an office hours if you guys have any questions you want to ask the team, we will be in the twitter spaces on Thursday 2PM Eastern time and we’ll throw reminders out there so you’ll know that it’s coming up.
Nick: Cool.
Mike: I think that’s it; I think you should kick on with the presentation.
Nick: Well, do we have any questions first?
Ryan: We do, we do.
Nick: We’re going to answer those first.
Question1: Why supply increased 200k TRB in a day? You must be thinking about your TRB holders that is why TRB is down. How many TRB are staked?
Nick: It was the “Why we printed so many in one day”. So, the printing in one day question. The way the new Tellor structure works, in the past what we had done was, we had, every new block you would mint new tokens to the reporter and for the dev share, and the problem with doing that is that’s actually really gas expensive. So, every single time you have a new Tellor report, you’re minting a whole bunch of new. You have to do some transfer events. So, we switched with the Tellor X structure to, we just mint everything at once, and then we can send it to the reporters and then also the team’s dev share. It just slowly unlocks over time. Although it looks like 200k new tokens came into existence, it’s actually unlocking at 1/10th the rate that they were before. So, it's much better thing, they’re all currently locked. We actually thought about, we were like “man, we should just mint like 10 million new tokens and go lock them somewhere forever and then our market cap can just go through the roof and we can go compete with some of those bigger guys”. But we did not. Not playing those games, but we also had a question in the zoom, if you see that one.
Question2: Wen airdrop for people who voted on Tellor X upgrade? Question by Zach here.
Nick: I mean maybe we can put a proposal up for it. I think...
Mike: We had talked about, maybe having to do that if we struggled to get quorum, which we didn’t.
Nick: I don’t think we’ll be doing it for people who voted specifically on the Tellor X upgrade you know, the one thing that I’ve thrown around as an idea in the past is just like airdropping to our community members a small amount. Just to show a proof of concept for how Tellor, how flexible Tellor X works. You could airdrop to people and it could be linked to the number of discord plus twitter messages related to Tellor, and then the Tellor oracle would have to bring on chain how many twitter and discord messages you had. And you could do something fun like that and then we could set aside say a thousand tokens to be split up amongst people who were active community members and I think something like that would be fun. We’re still playing around with the ideas though, so it’s definitely not like within the next month for sure.
Question3: Why Tellor price always dumping? Make good partnerships and marketing.
Nick: Yeah, sorry man. We’re in a system-wide drop, it’s, you never know what’s going to go down the most, or what’s going to go up the most. And it’s unfortunately... if anything Tellor is stronger than ever over the past two weeks, we’ve just been having such great conversations with potential users, everything sort of went well with Tellor X. So, from a technical standpoint everything’s looking great and how do we get rewarded... the price dumps. So yeah, I mean nothing makes sense in this market, don’t try and make sense of it.
Question4: When Tellor launches on other chains, what will, will the reporters have to wrap their TRB so that they can then stay confirmed on the new coins network, i.e., Polygon and report in the same way reporters are reporting now on Ethereum? This is a good a way to lock up TRB similar to how wBTC works on Ethereum.
Nick: I mean, whoever asks this question obviously knows how it’s probably going to work, because that’s exactly how it’s going to work. So, yeah, you’re going to have to bridge them over. Stake some TRB over there. The cool thing about it is it’s much faster chain, the stake amounts are probably going to be a whole lot less, so we’re probably going to be targeting like a 10 TRB staking amount on Polygon. So, you’ll be able to be a reporter probably on Polygon for much, much cheaper, which is going to be cool.
Question5: I’m not too concerned about marketing itself, could we have a real overview of marketing achievements as we have with developer status? It would help a bit to quiet those moaners in the discord.
Nick: Mike, would you like to quiet the moaners?
Spuddy: Is it possible to quiet the moaners?
Mike: No. I mean we could talk about what that would look like. I’m not sure it’s clear in my mind what sort of things would fit that criterion for you, so hop on our marketing channel in the discord. I think if we can get a conversation going there a little bit more robustly and more consistent.
Spuddy: There was some really great conversation happening there last week.
Mike: Nice.
Ryan: I was just thinking we could have like a reservoir of all the marketing pieces that we do have currently, so that people can just go to those and share them out if they like. It might be a good start.
Question6: Would it be possible to make marketing related bounties?
Nick: I think we have a few, don’t we?
Spuddy: We definitely have content bounties.
Nick: I mean, it’s tough, like what’s a marketing bounty you know. If you get us 100 twitter followers, are we going to pay you? That leads to some weird incentives you know; how do you judge the success of marketing? It’s always really hard, especially in terms of paying somebody like we have. If you go and you write a Tellor tutorial article or you make a video how to use Tellor or something, we have those content bounties up, and we want people to take them, but the other ones like we’ve had, people will be like, can I have thousand bucks, I’ll go show you in my Chinese discord group or something, and we’re always like, we don’t even read Chinese so we don’t even know if we’re going to do it and then how do we judge success? Is it discord followers, is it price movements? No, because that doesn’t have anything to do with it. If you can find a way to say “I’ll go do X and this is the metric that you can judge me on, and then pay me based on this metric and it makes sense, we’ll pay for it. It’s really hard to come up with those ideas.
Ryan: Also, if you go to the bottom of the website, to the bounties list, you can filter by type and if you filter by content, that’ll probably be a good place to start for what bounties we currently have.
Okay, that’s it for the forms I guess, we can open it up if there’s anybody on the call that wants to ask a live question, feel free to. This will be your chance right here and no pressure, you don’t have to ask a question. Alright. I guess it’s Tellor treasury time.
Nick: Tellor Treasury time! I’ll probably avoid drawing on it because you guys couldn’t even see it last time, but so we’re just going to talk really fast about what the Treasuries are, what our current ideas are for how to use them and then kind of the timeline on doing it. We’re trying to implement some novel, almost traditional if you will monetary policy into the crypto space, but what’s the purpose of it and there’s really just one purpose of a treasury contract and can you guys read that? Price stability. That’s why you would use the treasury contract and believe it or not, this is actually part of the purpose of what the US government would use it for. Let me get into it, I’ll explain.
The first question would be obviously why do you want price stability? Don’t you just want number go up? Yes, overall treasuries should help the price of Tellor go up, because if you’re locking more in a treasury, that number should go up and I’ll start explaining that, but the reason you want stability in the price of an oracle token is assuming that we’re very well used, you can take the price of our token and you can calculate it out very easily how much does it cost to break Tellor. We do this analysis in Tellor white paper, I’ve done it on multiple security articles we’ve written, we’ve shown that even at a low price, it’s still very secure. But, whenever we start securing say bigger things, you know stable coins worth hundreds of billions of dollars and things that number, making sure we have a high price is actually very important, and making sure more so than just having a high price that it’s a stable price, because what you wouldn’t want to do is, kind of what happened over the past two weeks is, if the price really tanks, and you really can’t do anything about it, so that’s why price stability is important. Just allowing projects to know that “hey, this is how much Tellor token’s worth, this is how much security it can provide me in my oracle and making sure that we can provide that”. So, I’m an economist, so this is price, this is quantity. Anyone know what this guy is? What’s the upward sloping one Brenda?
Telly: Supply, that one’s demand.
Ryan: Nick, really quick, can you tilt the white board to the door a little bit? There’s a glare that, yeah horizontally, perfect.
Nick: Yeah, so this is the supply-demand curve, obviously. So, I believe Tally’s going to mess me up here. If you have more of something, the price... so this is demand and then this is supply. So, like the supply line is, if you have more of it, the price is going to go down. If people demand more of it, the price is going to go up and this is the equilibrium as far as what the price is and this is where you have the Tellor token. So, the Tellor token also has a supply-demand curve you can think of tokens, everything falls on a supply-demand curve and there are ways... so what are some ways that you can raise the price? So what are the ways that you can increase the price?
Brenda: You can pull back the supply.
Nick: Yeah, so you decrease the supply, that’s one way. Yeah, so if this is the supply, if you decrease the supply here, you maybe go over to here, that is now your new price, so it’s higher. How and that’s another thing, another way that you can increase the price is by increasing demand. So, if you go like this, on your new demand curve this would be your increase, so what are some things that we can think about? How would we increase demand of the Tellor token, so where does demand come from in this Tellor X token and this is... unfortunately we don’t have too much control over demand, so demand is going to be things like, I won’t write because you guys won’t be able to see it down there, but very well, so there’s speculation. This is the big one here. For crypto the vast majority of demand is going to be speculation. People buying it on COINBASE and Binance and then people, if there’s high demand for it the price is going to go up, and if there’s low demand the price is going to go down. That’s just crypto at the moment, there’s nothing, very little marketing we can do, but you know, you’re almost just beholden to market cycles there. Other demand pieces would be like staking/tips, so this is what we want over time, everyone to be using the Tellor token for. Staking it to become a reporter and pay them. That’s ultimately where you want most of the value to come and kind of this is one that yes, we want more people to do it, but it moves slowly. You know we can increase the staking requirement; we can get on other chains and all this stuff helps, but it’s one of those things you know as we’ve seen, getting users is a slow process and it takes time, so over time we expected this one to overtake it more and then we’ll have maybe a little bit more flexibility there, but it’s ultimately on the demand side we’re just beholden to the market forces of who’s going to use this as an oracle and who’s speculating on us. Those can be, the latter one is relatively stable, the top one is wildly volatile as we all know. And then on the supply side what we can do to... Right now, we always have a constant increase in supply, but what can you do to decrease the supply?
Brenda: Circulating supply.
Nick: Yeah, Brenda has the important points. There’s a difference in Tellor between the actual supply and the circulating supply. So, the actual supply we can reduce, so we burn tokens, so you have things such as: whenever you tip right now half of it is burned or you know some other token, like what was the one that burned like 50% of the supply. Stellar, right. The lumens, they burned like 50% upon releasing, upon giving it to the community, so the team didn’t hold that much. Basically, you just burn tokens, that’s how you reduce the supply to increase price. But as Brenda pointed out, there’s a difference between these. I don’t have a paper towel here, so I’ll just use my hand. It’s not actually about the supply supply, it’s about the circulating supply. The circulating supply is, well it’s actually out there. So, you can have, like three buckets as far as you know, so this is circulating, but then there’s other ones, so in Tellor, we have the staked ones over here, so this is like reporters who are staked, that’s rough, those are roughly locked, they’re not necessarily moving them, people can move them into circulating. What we mean by circulating is people who are actively selling or buying. They’re moving it based upon market conditions, so you want, if something changes next week, who’s, who could be dumping these tokens and lowering your price? That’s what circulating is you know. Another one that’s sort of non-circulating is team funds. So, you know our word, we do sell a little bit and put it into circulating but if we dump all of our tokens next week, you guys have much bigger concerns as far as token holders. This is in general for all projects. ChainLink who holds like 50% of the supply by the team, those are kind of non-circulating tokens, and even though you have a fixed amount of tokens all across these, if this one’s huge and you slowly are releasing it into circulating, that’s like an inflation rate. If ChainLink is slowly unlocking say 10% of their tokens every year, that’s like a 10% inflation rate on your token even though you don’t have one or probably even more so if you’re doubling the circulating supply because it’s coming from a huge team fund, you have 100% inflation in your token and that’s what a lot of people don’t realize. They see like they only printed initially a million tokens. Well, no, they printed a million tokens, the team holds 900k of them, so there’s actually a hundred thousand circulating and when the team dumps another hundred thousand next year, you just doubled the circulating supply, so your token’s going to halve. This is where we are, how do we take money out of circulating supply and lock it up, and this is the whole game of how to increase token prices. This is yield farming in general. You pay people, obviously, they’re not going to give it over here to the team, you want more people to stake it and if you have more people staking it and if you have more people staking it. What’s the lock-up on Hacks Spuddy, do you know?
Spuddy: I do not.
Nick: I think it’s like years or something. But you can have, the longer you have them locked up, the longer it’s taken out of the circulating supply and the less likely they are to be able to put it back in and dump it and cause a price drop. So, what we want to do is make people go lock up their tokens and, ideally the ones out of circulating, because you could farther do this into, there’s like the diamond hand holder, who you don’t want to take from and then there’s the weak paper hands, who sell on any whim and that’s the people that you actually want to take from. That’s for this analysis, it’s circulating, we want to take out of circulating and put it in here. How are we going to do that and that’s what treasury contracts are. We’re going to incentivize people using treasury contract. So, this will be Q1, we’re going to be doing quarterly ones, Q2 and Q3. Alright, so we’re going to be doing quarterly treasury tokens and basically, we will pay you an interest rate to put your tokens over here. Yes, by paying you an interest rate, that means we’re printing more tokens in the long run, but we’re fine with that because we think ultimately the Tellor tokens is going to go up, because if you remember the other things that I just erased, if we do get demand, if we get more reporters, if we go on more chains, that’s the part that doesn’t fluctuate and is going to go up, so we’re going to be... Right now, we just have like, we’re oscillating around going up number because speculation is so wild. If we know we’re going to go up, we’re fine say, printing five percent a year into these treasury contracts, so we can dampen some of those effects. You guys might be asking, okay, well cool, you’re causing people to lock it up, how does it actually dampen the price? Obviously, if we issue a hundred thousand tokens here in Q1, the price should go up because we’re hopefully taking out of circulating supply, we’re reducing the supply number and then it should cause the price to go up. But then, what do you do in Q2, so these ones will get released and let’s say the price is, we’ll do down here. We’ll do the price in red. It’s like the price is down here and then it goes up in Q2 and then down. The size of the treasuries you would want it to oscillate, so if the price is low, you want to do a big treasury and then if the price goes up, you would want to issue a smaller treasury and then the other way around. So, if we say, issue 100k tokens in Q1, and then the price skyrockets that we go to ~250 Tellor, maybe we can release some of these back into circulation, so we’ll just do 50k in Q2. If you look at the roll-over, we let 50k out of the staking supply and into the circulating supply and then in Q3, oh the price went back down, let’s issue back up 150k and then hopefully we can take more out. And this is the general idea of treasuries, obviously we’re new at this, we’re not federal reserve chairman quite yet, but this is the general idea of how it’s going to work and then we’re going to be starting quarterly. The first thing that we actually need to do is build up a big supply, so right now we start at zero, so as you increase the number of treasuries, we sort of need a base oscillating number to work from before we can do it. You can’t just start oscillating from zero, there’s no negative treasuries, so at first, we’re going to want to build this up to something say, I don’t know, like 25% of the current supply and then we sort of oscillate around that number depending on how the price looks. And initially it’s going to be quarterly, but you can imagine in the future, let’s say you know you have a Covid-like event or a March 12th like event, something like the federal reserve we can have a special treasury meeting where “Hey guys, the price tanks by 50%, we’re going to issue another treasury” to try and stave off this downturn or something like that. And then you’re sort of rewarding people to lock it up, rewarding you big holders who want to stake it and make some money. The other thing too, they would be quarterly, you could see us going monthly, you could also see do a yearly one, I don’t know. You do a 50-year treasury... You can do any numbers, there’s a whole lot of experimentation here, we can see, there’s going to be a lot of experimentation with the interest rates as well. Initially we’re going to start off probably low, we’ll probably issue it in January just to kind of play around with these. We’ll probably issue like 100k tokens eligible lock up at 5% APR, something like that. If people aren’t buying it at that rate, maybe we have to raise the rate, to say, something like 10, it’s all going to be about trying to find these balances and we don’t really have any good numbers on it. You can look at like what current, if you’re going to be staking up your Ethereum, what’s the current cost there, if you’re going to be staking up your... a lot of these other tokens that there is some, it should sort of normalize around, okay, well what’s the price risk that I’m locking up for, so if Tellor’s more volatile than Ethereum, you would expect that Tellor should be paying a higher rate for causing you to lock it up, and potentially eat that volatility. So, we’re going to have to play around with the numbers, see what people want, see how much our token holders like it, but hopefully over time we sort of grow the size of the treasury contracts, we grow how this works and ultimately, we’re able to sort of dampen some of these price effects. So, if you have a big run-up, you can keep it capped, like you saw that big run up to 160$ and now it just sort of breaks our charts. Now everyone feels like “oh, man, the token’s down by 50%” and it’s like no, I mean we were at 160$ for an hour. We were above 100$ for a week, we’ve essentially, whenever we were at 80$, we had only been above 80 for two weeks ever, like it’s just, if there’s a way to dampen that, so then it you actually feel like you’re doing as good as you actually are. It makes things a whole lot better. That’s treasuries in a nutshell. We’re going to be putting out some documentation on, okay, what are we going to be issuing in January, it’s obviously all going to have to go through a vote, we need to hit a 5% quorum to get a treasury passed, basically we mint... so, if we do a 5%, that would be minting 5000 more tokens, so it’s not a whole lot, it would be five thousand more tokens that come in at the end of Q1 or whatever the duration is. The other thing to note if you are in a treasury, we force you to vote on things. So, if you want your 5%, you have to vote. It’s those, let’s say you invested all 100k tokens and you ‘re going to get 5k tokens at the end, let’s say there were five voting events and you only voted on 3, you only get 3k of those new tokens. Make sure you vote. The thing is, you can delegate your votes, so if you want to invest in a treasury and you don’t want to deal with the voting, you can delegate it to the team or to your buddy who you know votes. That’s like a way to get around it. Just ask us, we can help you do that.
Okay, we have a question from Zack. How will it be worth it if Ethereum gas cost would be more to lock the tokens through smart contracts than what the incentive would be. Also, what would we have to pay gas to get the tokens back out. Also paying the gas for the votes. How will it be worth it?
Great question. I’ll be honest, I don’t envision this being small players, if you’re locking up 10k Tellor tokens that’s really different than if you’re locking up 10 Tellor tokens. If you’re locking up 10 Tellor tokens it will probably not be worth it. We’re looking for the bigger guys here who are going to go and they’re going to lock up 10k Tellor tokens and they really don’t mind paying a 100$ in gas to do it. Right now, I’d say it’s probably going to be 50-100$ to lock and then unlock the tokens, so, yeah, it shouldn’t be a great like... if you’re locking up whatever, 200k $ worth of Tellor, you probably don’t care about 200$, so it’s okay. Unfortunately, that’s one of those things that just it is, I think maybe over time what we could do to mitigate those costs would be to make some staking pools over on Polygon or something to where you can, everyone can, like you wrap your TRB over on Polygon and then you guys can all pool it together and then go on Eth main-net and buy a treasury together. You could definitely write a contract that could do something like that and I think as these evolve over time, you’ll probably see something evolved out of that. But, no, great question!
Anybody else, thoughts? No? I explained it perfectly? This is.
Ryan: It’s one that’s sitting in my brain is, how do we prioritize it, just first come first serve, or is it? Is it going to be a white list?
Nick: It is going to be first come first serve. So, if anybody’s going to be able to do it, I think what we’ll probably do from, you know, like the team, the team right now, I would love to stake all of our tokens because we get a nice 5% bonus on just holding our tokens, which we’re going to be holding for 3 months anyway, but what we’ll probably do is give you guys 3-4 day, or whenever it kicks off, you guys can take the first crack at it if you want it and then we’ll go fill in the rest with our tokens. But there’s also no time limit on it. Whenever it opens at Q1 when it gets issues, you can buy it right away, or if nobody buys it, you can buy it you know with a day left so then if you buy it with a day left, you get the full five percent bonus with a day left. So, obviously somebody would buy it then, you’d be stupid not to buy Tellor tokens and you get a 5% bonus for locking it up for a day, but you know that would go into game theory, well if you know somebody’s going to buy the day left, somebody else would buy it with 2 days left and you might as well just buy it at the beginning. I think once people sort of get into playing these games and get into, okay, how can I make this money because this is a big thing with Olympus right now. They’re another project we’re working with, but that’s how the liquid staking, so the staking incentives work. They have, like, you own your own liquidity or you stake for seven days and then you get the opportunity to, then you get the token at a discount. If you stake for seven days, then you get a bit of inflation rate, but they’re doing something similar, but on a much shorter time frame and we could do something like that. It causes, obviously there’s like a whole bunch of weird games you can play, if it’s two shorts, or if it’s what you don’t want it to do is feel like a ponzi-scheme, you know that’s, the Hex token has a similar type scenario, where like lock your tokens up for five years and then you’ll make 500% return and like that’s just a ponzi-scheme. You know you’re never going to sit and wait that out, but at the same time, so you want it to be something real and you want to actually have a purpose and we want to make sure that whenever we get on these calls and talk about it, the ultimate purpose of it is, you know, we want to use it for price stability, honestly, and we want to make sure that when we’re doing it, we keep that in mind and it’s ultimately to benefit the Tellor holders in the long run.
Spuddy: Can we, when people ask about it, can I quote you on the 100k at 5%, is that what we’re going to go with do you think?
Nick: Brenda will yell at me if I say yes, but...
Spuddy: I’ll just say that’s what you said and it might change.
Nick: Yeah, perfect.
Brenda: It’s APR by the way, but we haven’t settled that yet. So, when you said 5%, it was APR.
Nick: Yeah, so it’s not like if you invest 100k and then we mint 5k, it would be at an APR, that would be whatever, 1/4th of 5k is. And then Zack also asked “When mansion tour Brenda?”.
Brenda: Buy me one first.
Nick: Next week on TRB cribs.
Spuddy: One mansion comes first.
Nick: Get our price back above 200$ or something and then we’ll do a mansion tour with Brenda. Alright, anybody else? Tally, questions? You look passive.
Tally: It looks really good.
Nick: Your economic studies can occur, this works.
Cool, alright, well thanks everyone for joining, hopefully this was a nice little econ 101 lesson on it, and feel free to reach out if you guys have any more questions.
Brenda: And Darrell, Zack, thank you for being interactive, glad to see more people coming in and actually asking questions live.
Nick: See you everyone!
