As Vega moves from the initial launch and bootstrapping phase toward wider adoption, the project will dedicate funds to the network’s on-chain treasury, empowering VEGA token holders to allocate funds to protocol rewards and various initiatives. #FreeTheMarkets TL;DR The introduction of the Community Adoption Fund gives active community members more control…

<p>As Vega moves from the initial launch and bootstrapping phase toward wider adoption, the project will dedicate funds to the network’s on-chain treasury, empowering VEGA token holders to allocate funds to protocol rewards and various initiatives. #FreeTheMarkets</p><img src="https://sosovalue.s3.us-west-2.amazonaws.com/sosponge/web3image/24/01/17/vwqftt0b1w1d.png" alt=""/><h3>TL;DR</h3><li>The introduction of the Community Adoption Fund gives active community members more control over how project resources are used to reward participants and fund other initiatives</li><li>The funds in the on-chain treasury and their use will be entirely controlled by token holders. The Community Adoption Fund will supply VEGA tokens to the on-chain treasury for the community to use in the belief that this will accelerate the development and adoption of the Vega software and protocol</li><li>A community call is scheduled for the 18th January 2024 to begin an open dialogue with the community and share more details on the next steps. The invitation is extended to all network participants.</li><p>The release of <a href="https://blog.vega.xyz/mainnet-v0-72-14-deployment-road-to-cosmic-elevator-cc826477d11f" target="_blank">Cosmic Elevator</a> introduced perpetual futures markets and Ethereum oracles, continuing to deliver on Vega’s mission to revolutionise and decentralise finance. In the ~six months since trading started, massive improvements have been made to both the protocol and the <a href="https://vegaprotocol.eth.limo/" target="_blank">Console</a> UI, driven by extensive feedback from diverse community members. These have been important milestones for Vega’s ambitious mission to build the tools to create and participate in free and open financial markets.</p><p>The next phase will follow on from this groundwork with a focus on community growth and adoption of the Vega software. It will of course include continued efforts from the project team to improve the protocol, and front end software, documentation, and other supporting resources, however the community plays an increasingly crucial role in this phase and beyond.</p><h3>Announcing the Community Adoption Fund</h3><p>As Vega enters this new phase, the project team is pleased to announce the Community Adoption Fund (“CAF”). The CAF is a planned allocation of VEGA tokens that will be issued and irrevocably placed in the protocol’s on-chain treasury (<a href="https://docs.vega.xyz/mainnet/concepts/assets/accounts#network-treasury-accounts" target="_blank">for more details, read more about this here</a>). The total amount of tokens available and precise timings will be determined and announced at the end of the consultation process beginning today, as described below. (Note, however, that the CAF issuance will not take the total issued tokens above the 64,999,723 ‘mint lock’ which expired on 01/01/2024.)</p><p>This is being done now for two reasons:</p><p>Firstly, it is in the DNA of the project team to continuously decentralise and open more aspects of the project’s organisation and development over time, in addition to the already decentralised protocol and network.</p><p>Secondly, and even more importantly, we believe that the success of the Vega project will come from its community, and that the community itself is often best placed to make decisions and evaluate how to advance the project. The initiative we are announcing today will empower the community and provide it with the resources and tools to do this.</p><p>Read on to learn how this will work…</p><h3>What is the on-chain treasury?</h3><p>The on-chain treasury is a set of accounts (one per asset) that were automatically created along with the Vega network. The treasury is funded from the insurance pools of closed markets but can also receive funds from other sources such as users of the network. Funds in these special accounts can only be spent or transferred with a governance vote.</p><p>This means that the on-chain treasury is under the control of Vega token holders. Governance-initiated transfers can be used to fund specific initiatives with one off or recurring payments. They can also be used to set up regular token reward payouts for trading and market making, or to fund on-chain individual or team trading competitions.</p><h3>What exactly is happening and why?</h3><p>Over the next few months, a significant amount of VEGA will be transferred to the treasury in order to allow the community to take a larger and more active role in the next phase of Vega’s adoption. These tokens will be referred to as the Community Adoption Fund, and will replace some of the existing reward pools (which will wind down over time), as well as allowing the community the freedom to pursue other initiatives.</p><p>This will happen in three phases:</p><li>Consultation: the project team will conduct a series of community ‘townhall’ calls to seek feedback and further discuss and refine the details and timing of the approach and ensure the community are given the opportunity and resources to plan for this.</li><li>Test run: an initial (smaller) allocation of tokens will be deposited in the treasury and the community will take control of these and begin to build the structures and governance needed to effectively administer the treasury.</li><li>Implementation: the remaining tokens will be irreversibly committed on-chain to the treasury. The “deliver on” feature (<a href="https://docs.vega.xyz/mainnet/tutorials/assets-tokens/transferring-assets#one-off-transfer-to-vega-key" target="_blank">read more here</a>) of the protocol may be used so that even though these tokens are all visibly committed on-chain at once, they may be set to arrive in multiple stages over time, to ensure funds continue to be available for a minimum time period.</li><p>There are many reasons for doing this, and doing it now. Vega has always been designed to decentralise each aspect of the protocol and network at the right time, and this is the next step in a process that has included the token sale and launch, restricted (governance and staking) mainnet, and most recently, alpha mainnet. It also represents a turning point, as Vega officially moves away from the initial bootstrapping and iteration phase and prepares for growth and adoption.</p><p>The community has grown in activity and engagement through 2023, starting with the Mainnet Sims, through ongoing feedback and incentivised testing, to the crucial market creation and governance, without which Vega would be nothing. It’s now time to take the next step and ramp up community involvement and engagement.</p><h3>How can/should these funds be used?</h3><p>Funds in the on-chain treasury can be used for anything. From engaging contractors or service providers to funding rewards and trading competitions. They can be used to incentivise partnerships and promotions, or build new features and front ends.</p><p>The project team has no formal say in how funds are spent. The project does not have any voting tokens, and team members and their associates do not control a majority of tokens. The project will also not direct team members on how or whether to vote, nor ask them how they voted.</p><p>That said, the project team see some obvious starting points:</p><li>As the current on-chain reward pools wind down, it is hoped to see the community take a role in deciding the allocations to on-chain rewards (including new features like competitions) in future.</li><li>The on-chain treasury would be a great source of funding for new initiatives to help Vega gain recognition and adoption through community outreach, promotions, etc.</li><li>The community may also want to explore partnerships and developer contributions in the form of front ends, new features, or integrations with other protocols and software.</li><p>When making proposals, it is expected community members use the forums and Discord to debate and discuss their ideas before taking them to an on-chain vote. Having a proper discussion process will help ensure funds are spent effectively and that any risks or issues have been properly considered before taking action.</p><h3>What happens next?</h3><li>The project team is currently in the process of reaching out to the most active and engaged community members to seek their input and feedback.</li><li>This will be followed by the first in a series of community calls on the 18th January 2024 at 17:00 UTC. During these calls, questions and feedback will be taken, and more details of the process will be shared.</li><li>After this step, new sections and channels will be created in the community forums and on Discord, followed by the release of an initial tranche of tokens to the community.</li><li>If all goes well, the full Community Adoption Fund will be committed to the on-chain treasury soon after. Community calls and engagement will continue as needed.</li><h3>About Vega Protocol</h3><p><a href="http://vega.xyz/" target="_blank">Vega</a> is Web3’s native derivatives layer. The community is creating the building blocks for a new financial system. One that puts control of the markets, the products, and the fees in the community’s hands. Vega is a decentralised network that supports the creation of derivatives markets for a variety of crypto assets. #FreeTheMarkets</p><p>Join the community
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