Although I’m having a hard time to get my head around all the story around the new legal entities, in general, I feel like supporting this proposal.
As @SCBuergel mentioned, there has been a discussion in the previous DAO experiment about the efficient liquidity management and (even) more available fund that we can make a good use of it.
My concern in this regard is that the experimental phase with Arakis and Hats Finance has not yet finished. I remember we talked about the report supposed to be submitted by the both parties to evaluate the actual outcome. I would feel much more confident with the proposal once we nail the efficiency of this Automated Liquidity Management (, although I believe they are doing a fantastic work).
In any ways, allocating the DAO’s available funds for helping the HOPR ecosystem’s grow seems to me the right move especially in the current market situation. Now is the time for DAO to support and boost the HOPR’s growth, which eventually benefits DAO, I believe.
Other members already posted the questions I have. So, I’m looking forward to seeing the response.
Thank you for sharing your proposal. It really helps to keep token holder involved. Btw, who is allowed to invest? and what is the estimated return on investment?
While I generally agree with the points raised about the lack of capital efficiency of the LPs/HOPR treasury, I will echo the same sentiment that several other posters expressed.
Before the proposal can be seriously taken into consideration there needs to be more transparency into how the holding AG will be structured, who will the people behind be and how decentralized governance mechanisms will be instituted/decentralized decision making will be guaranteed.
Is the community trust a smart contract? How will votes work out? How do we ensure that on-chain votes are actually enforced off-chain by HOPR rise holding AG? We’ve seen with Arbitrum that hybrid entities like what HOPR rise holding AG would be could easily engage in decentralization theater. Offering to token holders the chance to approve decisions that had already been token and then largely ignoring the outcome of community votes.
There is also no clarity into how much equity exactly would be obtained from the funding. Would the HOPR community trust become a majority shareholder? If not, what share would it get? What are the future investment rounds planned and how would the community’s stake potentially be diluted?
Until more specifics are available I find it risky for token holders to back such a proposal.
Good afternoon!
The question arose, how will investing in HOPERise Holding AG help the development of the HOPR network?
Which products will help increase the load on the network?
What would hopr rise look like going forward from initial liquidity provided. Would it be self sufficient after initial money provided, or would it need another infusion later on?
Thank you all for this massive participation here and the many great questions! I will try to answer as many of them as possible. Fantastic to see everyone’s support in this journey already :)
To be clear HOPR rise holding does not plan to engage in liquidity management on DEXs (there’s plenty of capital for liquidity management even after this proposal goes through). Instead, HOPR rise aims to commercialize products (the first one being RPCh).
The directors behind HOPR rise are Rik and myself (currently the same leadership as HOPR Association).
That depends on the valuation at which we will raise the next round. The investment that is being discussed here is being structured as a convertible note. That means the discount of 50% will be applied to that future round (which seems more than fair for a first money in investment of the HOPR community), the minimal participation will be 10% and the maximum would be 24% of all shares. The final amount depends on the valuation of that future round.
That is entirely unclear at this point but given the significant discount of the discussion here, it should be quite good.
The valuation has not been determined, that is the beauty about structuring such early rounds as a convertible note. One does not have to determine the valuation yet but can give a discount to be fair to the early investors. See my answer above for details.
Details will follow but effectively a very similar setup to what we currently have will be in place and the Trust will be under exclusive token-holder control.
The nature of all early-stage ventures is risky. That being said, HOPR Association is aligned and complementary with the Holding. HOPR Association is responsible for building the open network and the Trust is responsible for developing commercial applications on top of that network and drive value to it.
The transfer of HOPR and DAI is price neutral as both assets are to be taken out of the pool at exactly balanced quantities.
The HOPR Community (by means of the Trust) is a shareholder in the rise holding. That means they have a say in its major decisions and strategic alignment.
The HOPR liquidity pool is still massive (compared to market cap). Managing liquidity actively but transparently and objectively through Arrakis is making that even more efficiently than just deploying a wide range Uniswap pool as was done until Arrakis got activated.
Details will follow but through the Trust it will participate in major decisions.
Good idea, let’s keep that separate from this proposal - that is worth exploring.
The processes will not change much but instead be more formally defined than is the case this far. Stay tuned for full details on this!
We will do our best to structure proposals and responsibilities clearly. The most important things are quite similar to what it is today though. The Trust is simply an abstract mechanism to have legal clarity on management of the HOPR Community funds.
Success of ecosystem applications should be measured in applications that all of us can be use and which utilize HOPR as well as sustainable protocol revenue (USD per month). Protocol revenue will be our core metric for commercial applications going forward.
Yes certainly. This is a convertible note and there will certainly be a next investment round at which the conversion happens (see my answers above for some more details on that). The investment is into equity of a Swiss-based holding company. We are not inviting the general public to invest as that would be a a licensed activity and/or requiring an investment prospectus - instead we decided to keep it lean and give the community indirect exposure by means of the Trust which is holding equity and in turn being managed by the community. This means, the HOPR token is controlling equity in a real world entity. I find it quite remarkable that such crypto-legal constructions are actually possible!