KIP-54: Reoccuring Trade Competitions (KIP-47 revision)

Author
StatusDraft
Created2023-01-10

Summary

Hold regular contests using $KWENTA reclaimed from Trade Rewards allocation

Abstract

Proposal to fund regular contests to acquire and retain traders, promote new initiatives and features, and support trade volumes.

KIP-43 reduced Trade Rewards from 20% of inflation to 5%, and it is anticipated that trade reward allocations will be further reduced. This proposal allocates some of those reclaimed tokens as a prize for a reoccurring trade contest.

Motivation

Trader acquisition and retention are critical targets for the next 12 months. A regular contest for a small prize could potentially generate reoccurring visits to the site, increasing likelihood that users will trade and stay. These tokens were already allocated as trade rewards, so using them to generate trade volume and assist user acquisition is appropriate.

Specification

This proposal allocates 10 $KWENTA each epoch as a marketingDAO budget to act as prizes to be distributed for promotion activities (contests). The intent is for these contests to be low overhead, targeting whatever initiatives or metrics we want to improve or emphasis that time period, while minimizing impact on developers. Simple leaderboard adjustments are preferable, although unique contests could be developed to highlight new partnerships or integrations. It is also important that these contests be consistent, predictable, and accessible, so traders visit the site regularly to participate.

Contests could be monthly, quarterly, or some other schedule as determined appropropriate by marketingDAO. The proposed allocation budgets for both monthly contests of 25 tokens each and quarterly contests of 40 tokens each.

This proposal will require time commitments from marketingDAO, as well as CCs or devDAO. There is a budget of 15 tokens each quarter intended for use as incentives to fund devDAO tickets or marketingDAO tickets to implement and advertise the contests.

These prize pools are sustainable for at least 2 years while staying under or around 1% allocation from inflation, which is well within the 15% of inflation reclaimed to the treasuryDAO in KIP-43. If, for some reason, a contest can not be held on the intended schedule, the tokens are accumulated by the marketingDAO, to be reallocated towards future contests or initiatives at the marketingDAO's discretion.

An initial allocation of 40 additional tokens paid from the treasuryDAO may be needed to kickstart the Trade Competition program, while the weekly trade rewards are pending accumulation towards the necessary levels for prize pools.

Copyright and related rights waived via CC0.