[RFC] Proposal to Tie RSR Emissions to RSR Burns Instead of the Milestone Approach

Ideas & suggestions
21

The “burn gauge” or “gear shift” is interesting. It is essentially a DAO-like ratification process.

If I understand correctly, judgments such as “going really well” or “growing nicely” would require current receipts and arguments and get signaled with non binding community consensus votes. Please correct me if that is wrong.

If correct, I support the concept. It helps address a core RSR-health problem: trust debt accumulating around centralized decisions whose consequences are shared across the ecosystem and create an overall drag. That resulting feedback loop has been costly and distracting for both the team and community.

Wearing an operator hat, I would suggest avoid over-instrumenting it. Don’t think you need a fancy name or to precisely define in Aug 2026 thresholds that may be obsolete in 2027 or 2028. Use a simple semiannual review and ratification vote in the context of that market’s conditions. Retain flexibility for ad hoc proposals if conditions materially change.

TLDR: Keep the parameters flexible, but make community review and ratification predictable like clockwork. Get people invested on the choosing, then get them ‘proudly’ sharing DTFs and collecting feedback with their friends.

2 Likes
22

Update on this governance process:

In light of the ongoing productive discussion of alternate systems, we’re going to delay voting on the NARR proposal by one week, to give time for alternate system proposals to be more fully developed.

This way, holders can consider options back to back and choose which they like most, rather than voting on whether to adopt one, then shortly thereafter voting again on wether to switch, which would be confusing and would invite a more chaotic outcome.

This gives us one week to turn this direction into a final proposal version. Since Confusion Capital’s role in this process is to propose and then RSR holders vote, I will take responsibility for posting the final proposal, but I welcome any further input or suggested details and language from everyone here!

I think we should aim for:

  • Simplicity
  • Covering our bases – working in the futures we can imagine
  • Concreteness – making it easy to understand and imagine what the future will be like

For concreteness, James I disagree with leaving it open ended. I’ve discussed the “gauge” version with several folks and one thing people seem to like is how you can picture the gauge itself as an anchor for how the system works, and think in simple terms about the options the holders have for moving it back and forth.

5 Likes
23

I think this is very important. Decoupling the parameter space from a commitment to decision mechanism.

It’s totally viable to commit to:

  • who decides (at the moment all RSR holders including all stRSR and vlRSR)
  • what gets voted on (emissions, buybacks, burns, unlocks)
  • when these decisions get made (could be quarterly after the community / earnings calls, might move to semi-annual, annual later)

And leave the exact nature of the proposals open.

I heard a beautiful story that is relevant here yesterday. A very successful real estate developer here in Germany celebrated their 50th anniversary, in an industry where companies count on lasting 10 or so years before going bankrupt and reforming.

They asked themselves how they could ensure their 100th anniversary.

After struggling with grandiose visions and plans they came up with an “anti-vision”.
In all honesty they had no way of knowing how their economic landscape would look in 25 years, let alone in 50. What they do know, and what is in their complete control is how they show up today.

So they asked themselves: “How can we act today, so we’re going to be around in 50 years”.

This can be applied here: What do we know that won’t change, and will ensure alignment in 2, 5 and 10 years?

And the answer is simple:

  • Dependable, public, legible votes to ensure token holder rights and participation
  • Continued exploration on the mechanisms that improve token holder rights, participation and access to information
  • Honest communication on the challenges involved and how they are addressed.

Reserve and ABC Labs / CC already excel in point 2 and especially 3. Now is a good chance to make the process legible and dependable.

2 Likes
24

Likely I am not yrt understanding the mechanics.

Are the periodic votes for mid burn, mid growth, neutral, etc determined via consensus single choice voting or does someone decide a single option is best e.g. mid growth, and put up a yes or no vote for the community?

25

Part of what needs to be defined still, open to ideas.

In general I would want to:

  • Share and balance influence between Confusion Capital and external RSR holders
  • Not be too anchored to the past setting when deciding the new setting
  • Re-calibrate the setting regularly enough that we can switch gears when appropriate, but not so often that it’s a constant attention consumer
3 Likes
26

Confusion Capital should abstain from voting on this. Its influence over community opinion is likely sufficient to affect how other holders vote.

The gauge could be reviewed and voted on quarterly—for example, on the first day of each quarter.

The main design question is how to select a winner when there are several options. A simple plurality outcome does not seem ideal, because an option could win without majority support.

One approach would be a two-stage vote:

Stage 1: Choose the broad allocation direction: Burn, Sustain/Neutral, or Growth.

Stage 2: Choose the intensity within the winning direction:

  • If Burn wins: Mid Burn or Full Burn
  • If Growth wins: Mid Growth or Full Growth

This would allow holders to first agree on the general direction, then decide how strongly to apply it.

Reserve - State of Things 2026-09-11
27

We need an agreed starting point and I would say Neutral is the right one for now: nothing extra unlocked, nothing extra burned from the locked pile.

After each quarterly review, ABC Labs starts a vote. Holders do not pick from all five positions. They only choose whether to move the needle one step or leave it.

From Neutral the ballot would be:

  1. Leave at Neutral
  2. Move to Mid burn
  3. Move to Mid growth

The full line is:

Full burn → Mid burn → Neutral → Mid growth → Full growth

So a move from Full burn back to Neutral takes two quarters (6 months). Full burn to Full growth takes four quarters (12 months). The same is true in reverse.

That keeps the choice small, lets people push in the direction they actually want, and makes the next vote matter: reaching either extreme means coming back and moving the needle again.

28

I believe the protocol should be able to move immediately when circumstances require it. If an initiative clearly benefits the protocol and requires additional funding, moving one step at a time may be unnecessarily restrictive.

The reserves are substantial, but a 12-month path from Full Burn to Full Growth could be too slow and may deplete the available reserves before the protocol can act.

Instead, the community could set the position anywhere on the gauge through a quarterly vote.

If Burn wins: choose between Mid Burn and Full Burn.
If Growth wins: choose between Mid Growth and Full Growth.
If Neutral/Sustain wins: choose between Neutral and Sustain.

1 Like
29

@Ranger I thought about it a bit more and tend to agree. I’m not a fan of jumping from one extreme to the other, but we probably shouldn’t restrict ourselves artificially either. That also seems to match @nevin.freeman preferences:

Timing the vote with the quarterly report still makes the most sense to me. The report gives people the context, and the vote sets the gauge for the next quarter. One decision per quarter.

Regarding the options: If holders want to move from Full Burn to Full Growth, they should be able to do that in one vote. I also wouldn’t put all five settings on a normal single-choice ballot, or a setting could win with a small plurality and no real majority.

I’ve researched a bit and Snapshot seems to offer a ranked choice via Instant Runoff Voting (Voting types - Snapshot).

That seems like the cleanest fit. Voters rank the settings in order after the quarterly report. If one setting already has a majority of first-choice voting power, it wins. If not, the last-place setting is dropped and those votes transfer to each voter’s next choice, until one setting has a majority.

That keeps it to one proposal and one signature. It still allows a big move if that is actually the consensus. It also makes Neutral or a mid setting the natural compromise when the room is split, instead of letting a 25% first-choice pile win.

What do you guys think?

1 Like
30

Okay, so far we have:

  • Voting happens quarterly after the update call and report so that Confusion capital can share what’s going on and, if we have an opinion, make a suggestion for the direction we think makes the most sense for the next quarter
  • Nevin Freeman, Confusion Capital, ABC Labs, Best Friend Finance, and any future companies incubated by Confusion Capital shall not participate in the vote with any RSR they hold

@Ranger I like the idea of aiming for an outcome that is majority-endorsed and I think I see why you proposed adding an additional setting. I’m thinking about how to keep the process as simple as possible though, so I’m thinking about:

  • What’s the smallest number of gauge settings that wold get the job done while keeping the system simple and easy to think about
  • Is there some way to keep voting to one step so that we don’t need people to vote two weeks in a row as that could reduce participation

To these ends, what about:

Burn Gauge Settings:

  • High burn: 1:4 burn:burn
    • For every 1 RSR burned by protocol, 4 treasury RSR burned
    • No RSR unlocking
  • Low burn: 1:2 burn:burn
    • For every 1 RSR burned by protocol, 2 treasury RSR burned
    • No RSR unlocking
  • Low growth: 1:2 burn:unlock
    • For every 1 RSR burned by protocol, 2 treasury RSR unlocked
    • Additional treasury unlocking is at 1:2 ratio of burned:unlocked
  • High growth: 1:4 burn:unlock
    • For every 1 RSR burned by protocol, 4 treasury RSR unlocked
    • Additional treasury unlocking is at 1:4 ratio of burned:unlocked

There are a few ideas behind this version:

  1. This keeps your “sustain” setting and calls it “low burn”
  2. It maximizes simplicity by just having two variables:
    a. Burn or Growth
    b. Low or High
  3. It keeps the symmetry of ratios:
    a. Low = 1:2
    b. High = 1:4
  4. It uses 1:2 for low so that meaningful burning or unlocking is happening on the low setting
  5. It uses 1:4 for high so that the high setting is substantively higher but not so extreme that we can never collectively decide to choose it
  6. It allows for a simple voting process, see next section

Voting Process:

Version 1:

  • We only vote once, but each voter answers three questions:
    • Question 1: Do you prefer Burn or Growth?
    • Question 2: If Burn is selected by this vote, do you prefer Low burn or High burn?
    • Question 3: If Growth is selected by this vote, do you prefer Low growth or High growth?
  • We tally the Burn vs Growth vote first
  • Then for whichever one wins, we tally the Low vs High vote, and that gives us the final setting

Or, I think we could get the same results with simpler vote casting if we did:

Version 2:

  • We vote once, and each voter only answers one question:
    • Only Question: Do you prefer High burn, Low burn, Low growth, or High growth?

This one has a slightly more complicated tally logic but I think gives us the same result:

  • First we tally:
    • (High burn + Low burn) vs (High growth + Low growth) to select between Burn and Growth
  • Then we assume that:
    • If someone voted for either Burn option they would prefer Low growth over High growth
    • If someone voted for either Growth option they would prefer Low burn over High burn
  • So then, for whichever Burn/Growth option got the majority, we tally:
    • High = (High votes for the winning option)
    • Low = (Low votes for the winning option) + (all votes for the losing option)
  • For example, if Burn won, we would compare:
    • High burn = (Votes for High burn)
    • Low burn = (Votes for Low burn) + (Votes for Low growth) + (Votes for High growth)

This would likely generate the same outcome as the first voting method, but would only require each voter to pick from the four options.

Please share any further ideas or feedback so we can draft this up as a full proposal.

31

I like Version 2, but Snapshot will not necessarily show the V2 winner. Example:

  • High burn: 40
  • Low burn: 15
  • Low growth: 15
  • High growth: 30

Snapshot winner: High burn.

V2:

  • Burn = 40 + 15 = 55
  • Growth = 30 + 15 = 45 → Burn
  • High burn = 40
  • Low burn = 15 + 15 + 30 = 60 → Low burn

Fine if that formula is written into the proposal before the vote, or it might confuse people.

The ranked choice I mentioned before (example), on the same first choices, tends more to the extreme, but can be fully calculated by Snapshot. However, V2 might arguably be the better fit for this gauge.

32

This is not the same function as my ‘Sustain’ function as it burns 2 RSR from the treasury for every RSR burned by the protocol.

The function I suggested unlocks 1 RSR for every 2 RSR burned.

I feel both burn functions have a negative incentive (which is allright for some timeframes), however a ‘Sustain’ function gives the team some unlocks while burning RSR and is inherently completely different from the Low burn setting.

This is a different idea that would quickly turn into an inflationary growth phase without a real middle ground applicable to certain timeframes.

2 Likes
0xd15c0 Delegate Platform
33

Can I try a simpler but still gauge-able approach, and which might allow ramping up and down without too much voting, and without making burning vs growth effectively opponents of each other?

Baseline Petrol Money

Unlock to the foundation 333M RSR a year - it’s 0.33% of total supply. Any analyst looking at the protocol from an emissions perspective will likely nod and move on. Community are unlikely to blink at it. It’s a small, predictable baseline emission as an ordinary cost of running Reserve that can be used or kept in reserves.

Doesn’t mean it’s not accountable, doesn’t mean it can’t change via vote. Do have the rule that Nevin said in the call that the most USD the team could sell in a bull year is $40 million or whatever.

In three years time, that’s an extra billion RSR to the treasury. In six years that’s two billion. It can be used or stored for future rainy days, and stops any constant renegotiation or running to the community because treasury is low. It ends up a grandfathered amount that no-one’s going to care about. The more firmly it’s locked in, the more the overhang story is killed.

RSR Burn Amplifiers

Ranger clicked on a strong, easy-to-understand approach, Nevin’s pointed out the nuances on it.

Let’s note this months’ figures:

$21,958.20 | 16,313,671 RSR burned

The USD value of the RSR burn is one of the truest metrics of protocol success. The monthly RSR burn is a metric built out of that, but obviously swayed by price, sentiment, macro conditions.

For this next bit, if by RSR burn we mean an individual RSR burned due to protocol mechanics (via minting and management fee), we could do Amplifiers (up to 3 RSR for each RSR burned) based off that:

You can start to do interesting things like:

1 RSR burned = null | null | null (this is where we are now, a default position)
1 RSR burned = 1 to treasury | null | null
1 RSR burned = 1 to treasury | 1 to burn | null
1 RSR burned = 1 to treasury | 1 to treasury | 1 to burn
1 RSR burned = 1 to treasury | 1 to burn | 1 unlocked for interesting promotions

They are pretty self-explanatory, but different combos can be interesting.

Interesting promotions could be an earmarked unlock to accumulate for a few months to a defined purpose - a vlRSR campaign, exchange partnership, community rewards, integration incentive, etc.

The only light rule I’d place is if the amplifier ever reaches 2x treasury unlocks, that the third slot must be an additional burn. The highest-growth setting therefore automatically becomes a higher-burn setting too.

I think one thing I’m trying to get away from is too much voting and too much justification before a vote of many options, and too much of it on-chain.

Reserve gets baseline petrol money, voted on once and then left in the background. Gauges can be handled more at a discussion level and only need an on-chain vote if it becomes contentious.

Agree the baseline and the available gears once, then let the protocol + community move between a handful of understood states without needing a new constitutional debate each time.

Governance, decentralization and votes are damn important to what we do, but I think we risk diluting their importance if we require them for every adjustment.

1 Like
34

A simple vote could also work.

Each vote carries a value.

Values

High burn = 5

Low burn = 4

Sustain = 3

Low growth = 2

High growth = 1

After the vote calculate the average, round it up and that’s it.

Simple.

1 Like
35

Can I do a full export of this forum thread? I want to analyze the posts locally.

36

Yes you can. Best way is to just crawl this thread

2 Likes
[Proposal] RSR Burn Gauge vs Milestone Plan
37

I urge everyone to vote here

1 Like
38

Congratulation everybody :saluting_face: :sparkler:

1 Like