Proposal: AmpleSense AMPL Grant

Appreciate you coming forward and speaking your mind. I will have to correct you on a few things you made mention of;
You say this was created at the height of ampl… This was not launched in November 2020, which at that time ampl had spent the majority of its time at $0.80 or below, now I remember vividly being in telegram chats crying why they lose tokens everyday. None ever read the white paper or red book, it tells you how you can use it. If you read any information about the things you are investing in there would be no issue, so to me that means a lot of people are putting money in to things they dont know they are doing. Now unfortunately this is a big kids ground, ive worn a 1.1 btc loss today for stupidity on my behalf.

Now the COMMUNITY has built utility to assist with incentivising people to purchase ampl in negative & steady rebase environment, ASSISTS with sell-side pressure (as gives people a reason to hold in negative rebase environment), we now also have an option on ampl with EeFi.

I have heard Brandon & Evan speak on multiple podcasts about the community building utility, Brandon even shouted out the team. This is all proving that what is being created here is the new money!!! You all need to look way way bigger than you currently are… When the banks own all the forth, will you still be sad at the community building utility?

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So, I want to come in and provide everyone with a sense of next steps.

First, we have received some excellent and constructive feedback regarding our proposal. We are currently working on revisions based on this feedback and will submit a new proposal soon that takes into account the conversation and the advice we have received. The time frame for the new proposal is the week of April 24.

Second, I want to say something regarding the state of the community and the level of vitriol, toxicity, and hate our segment of the community (AmpleSense) has received from a small segment of their fellow community members.

1: We the founders of the AmpleSense DAO will not be deterred from developing utilities and pushing forward the Ampleforth ecosystem. We have been at this for more than 2 years, and we don’t plan to stop our efforts anytime soon. In fact, despite the impression some may gather from this thread, there are many, many community members who have reached out to us to indicate how they much they appreciate our efforts, the protocols we have developed and our focus on creating third-party-developed AMPL utilities. It is their support that helps us move ahead in the face of persistent negativity that may have deterred others from building in the AMPL ecosystem (more on this issue below). Thank you to everyone who has provided support and encouragement for our efforts. We know who you are and we appreciate you.

2: The charge that we are “taking away from Ampleforth, conducting vampire attacks or leeching” from the community and protocol is patently and demonstrably false. From the beginning of the AmpleSense DAO effort, we have been in constant communication with the Ampleforth founding team about our products, services, and even the name of the DAO and our governance token, which were created in honor of the Ampleforth team and what they have accomplished. We have been very pleased that the core team has been nothing but welcoming and supportive of our efforts (reference). And, these efforts will continue – despite what it seems like a concerted effort to undermine our segment of the community and cast doubt on our motivations.

3: Some have problems with the mechanics of the Elastic Vault, which are very much in line with the incentive structure and mechanics of AMPL itself. First, the protocol’s mechanics are designed to encourage a stable unit price, as seen below (image from the Redbook).

redbook

And a discussion of protocol incentives from the Ampleforth white paper.

whitepaper

The Elastic Vault is designed specifically to respond to protocol incentives – and provide additional incentives to engage with the protocol during periods where market actors have been reluctant: negative rebase and equilibrium. And, it provides additional crytpoeconomic incentives (in the form of the EEFI token), to encourage these behaviors. There is nothing unusual about how the Elastic Vault functions in general (from a traditional perspective in crypto), or in the case of Ampleforth (in terms of the vault responding to and participating in incentives the protocol itself has put in place – i.e., selling additional AMPL supply generated by the rebase. In the case of the Elastic Vault, rather than the proceeds from sales of excess supply going to traders or other entities, individuals who have locked up their AMPL into the Elastic Vault receive the benefit of their rebased AMPL being used to buy and burn EEFI from the market. Again, this is completely in line with AMPL’s mechanics as designed, and an example of how excess supply generated from the rebase is being utilized within a self-contained cryptoeconomic system.. In fact, the Elastic Vault protocol encourages AMPL stability, which is a stated goal in the Ampleforth whitepaper and Redbook (referenced above). More on how this happens can be seen in the Elastic Vault documentation.

To those who believe there should be alternative hedging mechanisms and incentive structures beyond what we have developed: I have only one message: Put the effort in developing your alternative protocols, having them audited and finding a user base. Ampleforth an open source protocol and all development efforts are both welcome and needed. Our approach is not the only one and I look forward to seeing what other members of the community bring forth.

4: I am withdrawing this particular proposal because we plan to revise it and I do not wish this to be the one that is sent to Snapshot for a signalling vote given the edits we are planning on making to the proposal.

I’ll submit a revised proposal sometime next week, which will be developed in consultation with our advisors in the community.

Finally, let me end with these words: “A house divided cannot stand.”

We are a small community of AMPL enthusiasts. We all want the same thing: for AMPL to succeed. We may have different opinions about how best to achieve this goal, but none of us are looking to harm the protocol. Instead, we are looking to create new utilities and drive its adoption widely. Whether that be via SPOT, the Buttonwood protocol, derivatives like EEFI, a rising tide lifts all boats.

I ask those who have nothing but negativity to share, to look beyond themselves. The example you set here has a big impact on whether others will be willing to engage with the Ampleforth community to drive utility for this asset. For other developers and builders … what they have seen over the last few days from some community members in response to our efforts and this proposal, is disturbing to say the least and off-putting in the extreme. I wouldn’t be surprised if some community members looking to develop applications for AMPL are saying “no way” due to what they’ve witnessed in this thread.

As I said in a previous community call: Let’s create an attitude of abundance, open-mindedness and trust, as opposed to distrust, animosity and negativity. We should be here to to lift up each other, not tear each other down.

@Brandon: Note that this proposal, in its current form, is withdrawn pending the submission of a revised proposal (taking into account the constructive feedback we have received) scheduled for sometime during the week of April 24.

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I like crypto because of the lack of trust. I think hostility goes a long way to ensuring ideas are properly assessed and the most robust survive and thrive. I don’t want someone to approach me say I should trust them for X and Y reasons, I want them to approach me and say I don’t need to trust them for X and Y reasons.

Anyway, looking forward to the revised proposal :+1:

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"2009-02-11
I’ve developed a new open source P2P e-cash system called Bitcoin. It’s completely decentralized, with no central server or trusted parties, because everything is based on crypto proof instead of trust.

Give it a try, or take a look at the screenshots and design paper: Download Bitcoin v0.1 at http://www.bitcoin.org

The root problem with conventional currency is all the trust that’s required to make it work. The central bank must be trusted not to debase the currency, but the history of fiat currencies is full of breaches of that trust. Banks must be trusted to hold our money and transfer it electronically, but they lend it out in waves of credit bubbles with barely a fraction in reserve. We have to trust them with our privacy, trust them not to let identity thieves drain our accounts."

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I encourage people to have an an adversarial attitude toward all crypto projects, including Ampleforth, which has had – and continues to have – its share of detractors.

We have a track record, and this should be taken into account. We are not Jonny come latelys to the Ampleforth community.

But the level of hostility we have experienced, not from you, but from others, deserves a response, and is completely unwarranted and unbecoming of this vibrant, positive and diverse community. There is a distinct difference between adversarial, critical thinking and what I’ve witnessed (and experienced) over the last 2 years.

Every cryptocurrency, from Bitcoin to Ethereum to Ampleforth requires some level of trust.

After years of hard work on behalf of the Ampleforth protocol, I think our actions speak for themselves.

You provided some useful feedback, it will be incorporated into the next version of the proposal. Thank you.

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Look all these words are nice, but if a protocol is crap, im going to call it crap. I don’t care who made it, what the history is, whatever. I never attacked the Amplesense DAO or any of its members, but it appears they verbally targeted me. When I said the word leech it was always targeted at the elastic vault protocol, which is what it does. It sells new AMPL to buy EEFI and burn it, and then mints EEFI on the way down. That is sucking monetary energy from AMPL and transferring it to a new token. If AMPL expands 5x in market cap, That sells about 0.3 * 0.8 = 24% of the AMPL that would have been in the vault for EEFI. Then after that what if AMPL goes down 80% in market cap? EEFI will just be printed over time. If there is no buyback of AMPL in the base layer protocol then what this has done is profited off of AMPL growth, and if EEFI holders are quick to sell before the negative rebase period, those that deposited right before the expansion are left with less AMPL, and a bunch of lower value EEFI tokens. Instead of hedging you moved the trading game from the AMPL rebase to this EEFI token, which I still have not heard any concrete reason why that is good, and does not seem like a good hedge at all.

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So according to this logic, I take it you disagreed with the AmpleForth team wanting to be on Aave? Can you point me to anything you were writing during that time when Aave as a utility was being pushed? Its current implementation INCENTIVIZES borrowers to sell near 100% of what they borrow. Not just a portion of the positive rebase. And our founders were praising this functionality last year. Just want to see something you wrote about it…

EEFI cannot be printed indefinitely. You would know that if you actually read AND UNDERSTOOD the Vault’s documentation. The Vault is designed for “buybacks” to happen during negative and neutral rebase (this includes borrowing AMPLs to deposit into the Vault). We’ve even had people openly expressed strategies about buying AMPLs during positive rebase periods too (in connection with the Vault)! And obviously we are having an on going discussion about making this process much easier to do for everyone without just assuming it. The fact that this now has been explained multiple times, we’ve told you to stop assuming a failed AmpleForth protocol (which your logic desperately relies on), and you continue to blatantly ignore it lets me know this conversation is currently in bad faith.

Look I do not know what I or Davoice did to you personally but understand these conversations are etched in history forever. Your hostility, general condescension, and ad hominem attacks on the Vault are disturbing to say the least. I’ll leave it at that for now. For now…

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Oh god more personal attacks trying to discredit my opinion. C’mon guys it’s getting old.

Borrowing AMPL is a valid use case, again these comparisons don’t make any sense. Lots of people borrow and hold during positive rebases. AAVE takes a fee of the interest and they hold it in their treasure. I’m struggling to see the issue here. aAMPL provides a utility that was not there before without systematically selling AMPL for another token.

I knew this and it’s irrelevant for my point.

Still does not explain why you need the EEFI token to store that value, it can be done with literally any stablecoin. And I’m not going to support this on some “good faith” that the protocol will eventually make it easy to market sell their token to buy the token this DAO is fundamentally based on.

It’s laughable that you think:

  1. I care about what you or davoice think about me
  2. That I was targeting you or davoice in my comments in any way.

I was always talking about the protocol and I am still trying to but you keep trying to make it personal and it’s getting frustrating.

While this discussion has been constructive in many ways, we’ve all had to bear the burden of witnessing an appalling degree of ignorance - and that too, from community members who are ostensibly aligned with the growth of the ecosystem. It can be rather taxing.

People are under the impression that value is somehow siphoned away from the Ampleforth protocol. If that is the case, then do you think it is merely co-incidence that AMPL has been in neutral territory since the launch of the Elastic Vaults?

Value is not purely monetary, and there are various positive externalities resulting from AmpleSense DAO:

  • As mentioned above AMPL has been in neutral rebase territory and this correlates tightly with Elastic Vault launch, strongly suggesting causality.
  • AmpleSense DAO has educated numerous community members via their Educated Amplifiers Badge. Given that we - Ampleforth Ecosystem - have not been the most successful at driving AMPL’s widespread adoption (we’ve had to literally hire a marketing agent/manager and still AMPL is not very well known), this initiative has been overlooked and undervalued. When the time comes to educate the world about various Elastic Finance derivatives (e.g., tranches) and applications (Mooncake, Hourglass), it is again community that leads the helm.
  • Depositing AMPL into the Elastic Vaults entails a 90-day lock up period. This reduces sell pressure and further incentivizes the movement of AMPL into neutral to positive rebase territory.
  • When AMPL mega-expands in the future, things will be flowery and hunky-dory. But what happens when your average Joe buys the top and feels the same degree of pain that many of us did in the previous negative rebase correction? That is when the Elastic Vaults will again shine. This will also shift incentives for borrowing and lending of aAMPL on Aave during negative rebases.
  • EEFI minted during the positive rebases is rewarded to our own community members, not the bad actors that many of these responses make us out to be. This is a better alternative than allowing the value to be arbitraged away by opportunistic actors. Moreover, EEFI’s utility will also increase as we drive its utility across the ecosystem (lending, borrowing, collateral, etc.) → this will ultimately benefit Ampleforth Ecosystem and FORTH DAO.
  • AmpleSense DAO has existed for the past two years with a solid community that is not interested in flipping a quick buck. This patience, and the diverse range of enriching discussions on TG and Discord, are effectively Proof-of-Community.

The list can go on.

Importantly, we should be encouraging speculative use cases of AMPL at this time in its fledgling stage of growth, particularly if it is again being granted to a trusted group of people. This value is effectively being recycled back into the Ampleforth Ecosystem anyways…where else will it go? Cash? Pfft. 3.5% of AMPL is really not a significant amount of value…the protocol is barely $100M. Yes, there is unfathomable potential - but it is that only, potential - kinetics are needed to get there. We have to get there, together.

Much of the criticism is reflective of web2 mentality where zero-sum games are played. In web3, we play positive-sum games. Since DeFi Summer 2020 we’ve learned that Community is the rate-limiting agent, so in order to succeed we play long-term games with long-term people.

In closing, I will say that we should continue to foster healthy discussions. Vitriol and deriding criticism should be avoided - that is low value behavior. It signals that you are incapable of thinking beyond yourself, and that you have no idea about the Dunning-Kruger Effect.

If we are going to move forward with a revised version of the grant, then that is fine as it signals the voice of the community has been heard. But let’s also ensure it is not solely the vocal minority that rocks the boat for everyone.

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At this point I’m not going back and forth with you. This is embarrassing. You do not just want to have your opinion. You want everyone to treat it as facts. That is not how life works. Your position is a purely “religious” one in the sense you have blind faith the Elastic Vault does not work and EEFI has no value. Warren Buffet also had blind faith Bitcoin does not work, has no value, and is rat poison squared. And if you ask the Bitcoin MAXI’s AMPL does not work, has no value and is a Ponzi (they’re WRONG). But I guess we all have to be someone’s devil. Please go build this better Vault you keep talking about. And let me know when the code is audited.

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Everyone: Thank you for your comments.

@Brandon: I’m requesting that you please close comments on this proposal. We are working on a revised proposal and the energy and focus should be on that moving forward.

Thank you.

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I think it’s easy for everyone to see who is doing personal attacks and trying to smear others, and who is trying to keep the topic on the protocol and proposal at hand.

Not knocking the effort that’s gone into it but my understanding is the vaults currently have ~$150k worth of deposits? I don’t believe it has had a tangible impact on AMPL’s ($100mil) market at this stage, and instead I ascribe AMPL crabbing lately to the wider crypto market crabbing lately.

This has been touched on before but if you account for the hopes and expectations people have for AMPL’s price action then that measly 3.5% becomes worth quite a lot more. I don’t find it reasonable to handwave concerns on the premise that it’s a paltry sum. (Indeed, if this was a small enough sum that it’s not worth worrying about, then surely it could be easily obtained through means other than a grant proposal?)

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What I’m seeing in this thread are people who aren’t involved in Amplesense saying “This set of smart contracts automatically sells AMPL into EEFI with no corresponding automatic buyback method,” and people supporting Amplesense saying “You should trust us to buy back AMPL with our EEFI and ETH gains.”

I like Nick Szabo’s description of smart contracts like a vending machine. You put tokens in, the machine performs some operation, and it spits something else out. What Amplesense has built is a vending machine that accepts AMPL tokens and performs a bunch of operations that result in new positive rebase AMPL supply being sold for ETH and EEFI in a way that hedges negative rebase risk. That’s just how the smart contracts work.

A lot of AMPL holders here don’t like that vending machine design because it is only automatic in one direction: selling AMPL. I suggest to the Amplesense team that you need to re-think your vault design before asking for a subsidy from the wider community. Your product appeals to a subset of the AMPL community who want to hedge, but not everyone wants that and they are making their opinions known. That is not an attack on your community, it’s a reflection of differences in investment strategy.

If you want a grant from the Forth DAO, I suggest that your vault should be provably neutral between AMPL buying and selling. This means automaticity in both directions. That is the way to accomplish true countercyclical pressure that the broader AMPL community will find valuable (and subsidize for you, hint hint).

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@ducc

I think we need to differentiate between various motives behind comments we’ve received.

And we’ve acknowledged the interest – both from people in this thread, and people who are using the vault - to have a means of making buying AMPL with EEFI easier.

From a smart contract perspective, the Elastic Vault contracts are immutable, and the vault design is sound from the perspective of what it is designed to do. We’re not scrapping the Elastic Vault because we’ve received pushback on the design from SOME members of the AMPL community. In fact, re-designing it isn’t feasible, but creating proxy contracts that add to its functionality is certainly doable.

That being said, the focus of the next version of the proposal will be setting up an infrastructure where EEFI → AMPL sales are made possible for vault users, with the added need of ensuring any additional functionality serves the needs of vault users while further strengthening the AMPL ecosystem.

The lack of recognition of the impact of the vault on the demand-side dynamics of AMPL is curious to me. I don’t understand why that demonstrated benefit is being ignored, or under-emphasized in these discussions. There is a demonstrated positive demand-side impact on AMPL with the Elastic Vault that is more important than what happens during positive rebase.

So, I don’t want anyone reading this conversation to think that the MAJORITY of AMPL holders share your view. What I do think is that many feel it would be good to have a facility to encourage easier EEFI → AMPL sales. However, that will require three things:

  1. Additional development time: This will require funding
  2. Additional audits: This will require funding
  3. Sufficient liquidity for EEFI/AMPL, which will need to be incentivized and provided

We are happy to develop a proposal along these lines, but the benefits that the Elastic Vault have on demand-side dynamics (during negative and neutral rebase) for AMPL should not be under-emphasized – these benefits have been demonstrated. Demand-side benefits are even more important than what happens with the vault during positive rebases. Because this benefit has been demonstrated, I think we can agree that the Elastic Vault has been overall, a net positive for the ecosystem (because it is stimulating additional buying behavior during negative/neutral rebases, additional borrowing activity and reduction of sell-side pressure during a period when stimulating demand/reducing sell pressure for AMPL is essential), as opposed to the net-negative that some have suggested in this thread.

As I said before, we are revising our proposal to take the concern about driving additional demand-side momentum for AMPL into account. But the argument that the elastic vault is a one-way operation and does not incentivize AMPL buying behavior (or have other benefits for the ecosystem) is incorrect.

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Not knocking the effort that’s gone into it but my understanding is the vaults currently have ~$150k worth of deposits? I don’t believe it has had a tangible impact on AMPL’s ($100mil) market at this stage, and instead I ascribe AMPL crabbing lately to the wider crypto market crabbing lately.

Are there wider market dynamics at play? Of course. Causality is notoriously difficult to infer, but if we refer to the simple framework of, say, - Granger Causalities (change in X → change in Y) - then the relationship between Elastic Vault Launch + AMPL deposits and AMPL entering neutral rebase territory cannot be neglected. There is a strong temporal association that goes beyond pure statistical dependency (correlation).

Degree of Causality is another question entirely. I have observed AMPL for a while now and it does not just crab sideways in this fashion, especially when the wider crypto market is crabbing downwards. In fact, AMPL was in positive rebase territory for the past few days and was stronger relative to the blue chips. It is not lost on me that it could also be related to excitement around SPOT. In either case, Elastic Vaults are a net value add and there is strong evidence to suggest, at the very least, they have facilitated movement of AMPL into neutral rebase territory.

This has been touched on before but if you account for the hopes and expectations people have for AMPL’s price action then that measly 3.5% becomes worth quite a lot more. I don’t find it reasonable to handwave concerns on the premise that it’s a paltry sum. (Indeed, if this was a small enough sum that it’s not worth worrying about, then surely it could be easily obtained through means other than a grant proposal?)

I agree wholeheartedly with your point here, but at this point they are only hopes and expectations. Nothing more. So if there is a community of trusted benevolent actors that is adding value to the Ampleforth ecosystem to materialize those hopes and expectations, I’d prefer rewarding that kind of behavior. On the other hand, we run the risk of allowing entities like Alameda and 3AC to take off like bandits opportunistically when the expansion begins.

I’m still not sure why this proposal is perceived as adversarial.

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I’m going to be completely honest here, your reply addressed none of the points I raised and it’s getting to the point where it seems like continual deflection rather than a good faith engagement. If you are locked into a certain design, that’s fine, and I guess we’ll see how the voting shakes out on your revised proposal. For the record, I’m still a kMPL holder and I want your project to succeed but the way your team has responded to community feedback in this thread has been disappointing.

Maybe another option is to create a new vault design, separate from the existing elastic vault, which incorporates automaticity in both directions? If you can create a proposal for a new vault which can achieve true automaticity for AMPL countercyclical pressure I’d be very much in favor, including funding development. However, I don’t see how the additions to the existing vault you have proposed can address the problems people in this thread have raised.

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Not sure where I didn’t address your questions.

In terms of automatically selling EEFI for AMPL, which is the desired approach you’d like to see, that’s something that has to be discussed within our community. There are various ways to look at this, including enabling vault users to sell EEFI for AMPL easily with a button click.
Regardless of the solution, a proxy contract would have to be developed, which is the most efficient (and feasible) means of going about this.

And, I’ve mentioned the requirements for developing additional infrastructure for facilitating EEFI → AMPL trading, above: funding, and additional liquidity.

So, we’ll develop a revised proposal along these lines.

We’ve been nothing but responsive to people’s feedback on the proposal, in fact we’ve been highly engaged and have addressed critiques and suggestions since it was submitted. So, I’m not sure where we haven’t been direct.

I believe we’ve been quite flexible and open to the conversation. We’ll continue along these lines for future conversations about the new proposal.

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what you miss there is regardless if amplesense build a eefi/ampl pool to rebuy it easy via a zap fonction to make you happy ,that is upon the choice of those staker , WHEN reinvest those reward earn with that ampl position hedge there .They earn that yield , it is at there discretion WHEN and WHAT to do with , rebuy ampl or lp eefi/eth or what ever they want to do with that eefi and eth earn ,may be repay a ampl loan into aave that they put into the vault first .

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It’s you who attacked the whole project with a very aggressive word from the beginning, you want to decide the fate of the project like a judge: EEFI is a robber-like project, but there is no convincing reason. You have a very strong desire to control and want to control the entire FORTH DAO. Although there were other opponents, they were not attacked in any way. If you are attacked, I think you deserve it。

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