Dogechain’s $DC Burn Proposal: Tiered Burn & FAQs
The Dogechain team has been working hard to improve the governance and tokenomics of $DC, following the request of its community. The team listened to the community’s feedback and suggestions and after weeks of Reddit discussions, developed a governance proposal that would benefit both current and future token holders.
The governance proposal aligns with the Dogechain project’s long-term vision and goals.
The main objectives of the proposal are:
- To encourage more $DC holders to stake their tokens in the veDC model, which is a way of locking up and vesting tokens for a certain period in exchange for voting power and rewards.
- To decrease the total supply of the tokens, which will increase the percentage of the circulating supply without adding new tokens to the market.
The veDC model will reduce the circulating supply and provide proof of lockup on the blockchain.
What Does Dogechain Mean By Tiered Burn?
Dogechain first burned 80% of its token supply reducing it from 1 Trillion to 200 Billion. That was a phenomenal moment. And now, there tiered burn proposal which could lead to a 10%, 15%, 20%, or 25% burn depending on what its community can lock up.
If the Dogechain community votes for a burn, Dogechain would follow the tiered burn mechanism would reduce the total supply of a token based on the following preset conditions:
- The number of tokens locked in a staking contract, and
- The average duration of the lockup period, depending on which tier is locked.
The goal of the burn is to create a scarcity effect and increase the value of the remaining tokens by decreasing the inflation rate and increasing the demand.
The tiered burn would be a burn of unreleased $DC tokens across various wallet allocations and will be determined based on the amount of $DC locked in the vote-escrow model (veDC), offering different burn percentages for different tiers.
The tiers are as follows:
- Tier 1: If 20% of the $DC circulating supply is locked in veDC, 10% of the unreleased $DC tokens will be burned.
- Tier 2: If 30% of the $DC circulating supply is locked in veDC, 15% of the unreleased $DC tokens will be burned.
- Tier 3: If 40% of the $DC circulating supply is locked in veDC, 20% of the unreleased $DC tokens will be burned.
- Tier 4: If 50% of the $DC circulating supply is locked in veDC, 25% of the unreleased $DC tokens will be burned (maximum).
The average lockup period must remain above 3 years for the specified burn sizes to apply. If the average lockup time falls below 3 years, the burn size will be proportionally reduced based on the decreased average timelock.
Let’s say that at the end of the vote, the proposal to carry out the burn is passed and from then till June 30th, Dogechain achieves Tier 3 (40% lock) & the average lock-up period is over 3 years, it stays as 20% × 1 = 20% burn.
However, if the lock-up duration is 1.5 years (i.e. 50%), the team will burn 20% × 0.5% = 10%. And it would be like that in other tiers with other percentages of lockups.
This tiered burn system, subject to the amount of $DC locked in veDC, aims to create a stronger incentive for token holders to stake and lock their $DC for extended periods. By tying the burn sizes to the lockup duration, the proposal encourages a longer-term commitment from $DC holders, fostering a more stable and secure ecosystem.
Why Tiered Burn?
The main aim of this proposal is to reduce the $DC total supply in such a way that while it improves its overall tokenomics, it also ensures that people stay committed to the long-term vision of Dogechain. Hence, the specific rule of a tiered burn and a minimum vesting of 3 years.
The burn will help Dogechain in increasing the $DC circulating supply percentage, where the number of tokens in circulation becomes limited and no other tokens are added to the market.
This can lead to the value appreciation of $DC and its sustainable growth. The improvement in tokenomics would attract more holders, users, and builders to the ecosystem.
However, at the same time, burning too much may be a short and “back on the wall” approach as this is a chain with a plan for growth strategies that would require a lot of funding.
For instance, the team already has many activities they plan to implement to improve Dogechain’s ecosystem adoption. Some of which include:
- Airdrops to decentralized platforms that synergize with Dogechain’s ethos.
- On-chain airdrop tasks to bring more users to Dogechain and educate them about utility.
- Learn & Earn campaigns through various high-level crypto institutions.
These options, among others, would help to bring in users from Web3 and make them believers.
Voting FAQs
1. Where do I vote?
Voting takes place on Dogechain’s DAO, www.dogegress.dog. The duration of voting lasts between May 18 and 25, 2023.
2. What makes me a valid voter?
To participate in the voting process, you need to have veDC tokens (vested $DC and governance token of Dogechain). veDC tokens are not directly minted or bought but rather obtained by locking DOG-20 $DC tokens in a smart contract called the vote-escrow model.
You can access this contract via https://dive.dogechain.dog/pos/locker.
The longer you lock your $DC tokens, the more veDC tokens you will receive, up to a maximum of 8x for 4-year timelocks. This way, long-term supporters can have more influence on the governance decisions, even if they have modest holdings. This also helps to reduce the circulating supply of $DC tokens and increase their value over time.
3. How many times can I vote?
This is a one-time voting opportunity. Once you cast your vote, you cannot change it or vote again. Therefore, you must decide how much veDC you want to allocate to either Yes or No before you vote.
4. Does the tiers have to be achieved during the voting period or can it be achieved later?
The tiers do not have to be achieved during the voting window. Even when the vote closes on 25th May 2023, if the proposal to burn passes, then users have until June 30th to lock their $DC for at least 3 years to reach the tier that they want to achieve.
On June 30, 2023, the Dogechain team will take a snapshot of the circulating supply staking percentage and will determine the amount of $DC to be burned from the treasury, based on this number. The burn will happen shortly after the snapshot, according to the tier that has been reached. Lock up your $DC in veDC today and join the tiered burn now.
5. What are the steps I have to take to vote?
First, veDC is what you need to vote. If you don’t have it, then we’ll start from the very top.
i. Buy DC from a CEX — MEXC, Kucoin, Gate.io, etc and transfer to your non-custodial wallet preferably MetaMask or buy direct from a DEX — Quickswap DEX, Wojak Finance, Kibbleswap, etc.
If you got ERC-20 $DC, then you have to change it to $DC on Dogechain Mainnet (DOG-20 $DC) because ERC-20 is not supported. To convert it:
- Bridge ERC to DOG using multichain.org (which often has high fees), or
- On MEXC, Kucoin, or Gate.io, there are ERC-20 DC and DOG-20 $DC pairs with which you can buy $DC and send them to your wallet.
ii. You need $wDOGE as gas fees for every transaction on the chain.
To get $wDOGE, you can:
- Bridge $DOGE to Dogechain using the official Dogechain native bridge: dive.dogechain.dog/bridge, or
- Buy on MEXC, Kucoin, or Gate.io and send it to your wallet.
iii. Lock your $DC for #veDC on dive.dogechain.dog/pos/locker
iv. Visit dogegress.dog & choose the governance proposal you want to participate in. Then, select the amount of veDC you wish to dedicate to your vote & confirm your choice.
⚠️If you already had veDC, withdraw from the validator, if staked & go straight to “step (iv)” to vote.
About Dogechain
Dogechain is a Layer 1 blockchain that leverages the Polygon Edge framework to become a stand-alone EVM-compatible chain. It was created to bring utility to Dogecoin ($DOGE) by enabling it to be wrapped by a smart contract and bridged to the chain where it can be used to engage in different Web3 and DeFi use cases.
Dogechain is popularly called the “memechain” and it is a community-first ecosystem for $DOGE believers and holders created by Dogecoin enthusiasts who believed that $DOGE can do more than just be held.
Connect and stay updated with the latest news and updates of the Dogechain Family by joining its social sites: https://linktr.ee/dogechain
