By separating multiple utilities of DEV tokens into individual tokens, we aim to improve the flexibility for reward design and improve governance security.
gDEV is a fixed supply ERC20 token used for Dev Protocol staking and governance. The supply of gDEV is the same as the total supply of DEV at the time of the genesis of gDEV.
DEV will change to be used only as a creator reward.
gDEV can be borrowed with DEV as collateral. This acts as the primary market for gDEV. The DEV collateral rate starts at 100% and increases with each increase in borrowing following an exponential curve. Inflation DEV as staking rewards will also be added to the immediate collateral pool, continuously increasing the DEV collateral rate for gDEV borrowing.
gDEV holders will benefit from the increased collateral rate in the background simply by holding the gDEV. In other words, if you redeem gDEV and get DEV after the collateral rate has increased, you are more likely to get more DEV than when you borrowed gDEV.
The gDEV staking user gets part of the Property tokens they staked. This acts as the primary market for Property tokens. Since Property tokens are value-formed by creators, users can expect more staking for creators who have added higher value to Property tokens.
The moment gDEV launches, we need to consider how to distribute it to existing users.
In my opinion, users who were staking at the time of gDEV launch will get gDEV at a 1:1 rate to the number of stakes. (This mechanism to be implemented by the Markle Distributor.)
The gist of the design is that gDEV staking users get some of the Property tokens instead of DEV. However, since Property tokens are finite, we need to consider the mechanism distributing property tokens to staking users.
How to distribute rewards to Property tokens holders.
In my opinion, distribute DEV according to the number of gDEV stakings they have. In other words, the mechanism is the same as it is today.
Another option is to aggregate all DEV token distribution logic into gDEV tokens. However, in that case, creators “require to get gDEV by themselves” to get the benefits for creation, so the protocol has no built-in benefits for creators and the uniqueness of Dev Protocol. May damage the ecosystem. So, Dev Protocol needs some mechanism to preferentially lend gDEV tokens to Property tokens holders for creator benefits. I thought it would be simpler to distribute DEV (rather than gDEV) to creators rather than building such a mechanism.
Note that this RFC is not the consensus of Pdot and me, as it contains content that was not discussed in the DIP thread.