Breaking Down Token Economics into Simple Terms

So, think of token economics as falling into two big buckets. First, you've got tokens that let you share in the profits of a protocol, kind of like having a stake in a company. You lock up some tokens, like CRV or veCRV, and you get a slice of the earnings pie.

Then, there's the other type, where tokens are pretty much just for voting on protocol decisions. No direct cut from the profits.

Here's the kicker: a lot of governance tokens haven't really hit the mark. Why? They're not cathing a real share of the protocol's success. I saw this firsthand with data from February 29, 2024 – users pay fees, but the token holders aren't seeing the benefits. Sure, some projects get it right, using staking or the veCRV model to let token holders feel the value. But many don't.

At a high level, token value comes down to two things: getting some of those protocol profits and having a say in protocol changes.

Some projects are nailing the profit part with strategies like staking. But boosting the influence token holders have? That's the tough part.  Enter the genius of veCRV and CVX with the whole bribe market scene. They've made it competitive and interesting to sway decisions, which is awesome. Yet, a lot of tokens are missing out on this action for various reasons, like regulatory headaches, and complex upfront development to adopt veToken, CVX-like projects.

Aside from staking and profit-sharing, there's a big question hanging in the air: how do we unlock the real value for token holders in terms of influencing protocol governance? The game-changer could be what's known as the “bribe” market, or incentives market. Imagine a place where vote power isn't just a silent nod but a tradable asset. We're talking about setting up a whole marketplace where this vote power can change hands.

Take a look at platforms like Votium, where the dynamics of this market come to life. There was this one-week snapshot that showed just how eager vote buyers are to sway decisions. Picture this: each vote valued at $0.89, with a whopping $19 million on the table from buyers looking to shape the outcome. Furthermore, there's even more to the scene with places like bribe.crv.finance, where veCRV holders can snag extra rewards, pushing the value even higher. These snapshots are proof of just how much action and value can swirl around in this space. (Yes, I did little contribute to bribe.crv.finance)

So, how do we generalize this concept? How do we create a tool that encapsulates the intrinsic value of vote power for any token? Fortunately, we have a cornerstone to build on: Snapshot.org. With its reach across 64 networks and engaging over 56,000 token projects in voting, it's the perfect foundation. And that's precisely where QuickSnap Finance comes into play.

QuickSnap Finance: Universalizing the Vote Power Marketplace

We crafted QuickSnap Finance around three big ideas: it's

• permissionless,

• decentralized,

• and doesn't charge token holders a dime.

It's like opening the doors wide open for any token that uses Snapshot to jump into this “bribe” marketplace. Vote buyers can seek the support of token holders with incentives by using any token listed on CoinGecko.

Every project utilizing Snapshot automatically gains entry into the market. and allowing them to join the flywheel dynamics.

Imagine token holders of platforms like AAVE and Lido stepping into the market. This move would unlock new opportunities for them, engaging in the strategic play of incentivized governance and influencing key decisions, thereby becoming active participants in the evolving dynamics of the flywheel game

Bonus: The Thrill of the Vote Market with Shielded Voting

Last year, Snapshot added this cool feature called shielded voting with help from Shutter. It's like a game of hide and seek with vote tallies – you've got no clue what the score is until the game's over. This spices things up for vote buyers because they have to play fair, offering solid incentives without peeking at the ongoing results.

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Mixing QuickSnap with Shutter: What's the Big Deal?

Imagine you're playing a hidden-score game, kind of like being in a dark, dark forest where you can't see a few steps ahead. That's what Shutter does – it keeps the vote count secret until the end.

Now, mix that with QuickSnap, where you can throw in some rewards for voting a certain way. It's like adding a mystery box to the game;  For those providing incentives, the lack of visibility into ongoing results means navigating the unknown. They're tasked with offering sufficiently appealing rewards, aiming to garner the necessary support for their preferred outcome, all without direct feedback. This approach encourages a more thoughtful and equitable distribution of rewards, ensuring that every vote is courted with genuine value.

What Happens When You Throw Incentives into the Mystery?

So, What's This Mean for the Future of Voting?

Putting QuickSnap at the forefront really changes the game. It's designed to make voting not just more engaging and fair but also more rewarding on its own. QuickSnap, working seamlessly with Snapshot, already offers a fantastic solution for tokens to really harness the power of their vote, ensuring everyone's voice can have real impact.

Throwing QuickSnap and Shutter into the mix could really shake things up in a good way. It's about making voting more engaging, fair, and maybe even a bit more rewarding. By encouraging everyone to think independently and offering a little something for their trouble, we could see more folks getting involved and making choices that reflect what the community really wants.

It's like we're at the dawn of a new era in how decisions are made in the crypto world, making the whole process a lot more interesting and inclusive. This could be the start of something that changes the game for good.