DIP-66: sTokens, NFTs mirroring DEV staking has been approved by Governance vote, on this article I’ll explain how this will improve the Dev Protocol Ecosystem by adding a ‘new Layer of Monetization’ and increasing Composability. To make it easier to understand, let’s divide Monetization in 2 Layers:
Up until this point Dev Protocol has successfully developed a unique way to sustainably fund Open Source Software projects. Patrons stake DEV on their favorite Creator and both receive DEV tokens as Rewards. 49% goes to the Patron and 51% to the Creator. This is what I call the 1st Layer of Monetization of Dev Protocol.
Dev Protocol is moving to the 2nd Layer of Monetization, that is, we are working to make it easier for Creators to further Monetize their projects. sTokens are an essential part of this process, it adds complexity to the process of funding of the 1st layer.
When a Patron stakes his DEV tokens on his favorite Creator Pool, sTokens (NFTs) are issued, they are tokens that indicate ownership of individual staking positions. It can be seen as a ‘Proof of Patronage’, and brings staking proof as a financial instrument, since it allows users to trade their staking positions. These characteristics make it easier to integrate DEV Staking with many other projects.
Layer 1 is currently available for OSS projects, we also announced μ-zomia and soon it’ll also be available for the Music Market. The Expansion consists of making Layer 1 and Layer 2 available for all Creators, growing to new markets and funding projects that can’t be properly monetized currently.
This way we want Dev Protocol to be the first choice for Creators when launching a new project and the favorite method for fans that want to support them.
Since the announcement of sTokens, we’ve got many questions asking how they work and how they would benefit the DEV ecosystem.
The key concept to understand the impact of sTokens is Composability - the interoperability of different projects, protocols and dapps that ends up accelerating innovation. In DeFi, this has often been described as ‘money Legos’, since they can be seen as building blocks that can be combined and built on top of each other, combinations of a few of these blocks allows for almost infinite different outcomes.
Keeping this in mind, I decided to simplify the Dev Protocol Ecosystem as Lego blocks and help you visualize the impact that sTokens can have in the future of the project.
Think of it as a thin Lego brick, the Dev Protocol technology can expand and different dApps of different markets can fit perfectly on it.
Stakes.social was the first dApp developed and can be represented as the first Lego block that represents the 1st Layer of monetization. Up until this point it was tricky to integrate Stakers and Projects individually with other crypto projects - it was hard to fit other Lego blocks on top of Stakes.social.
sTokens makes composability easier, from a single staker to the app as a whole. It can be seen as Lego studs that fit perfectly into other crypto projects.
Once these other projects are integrated, Creators can offer more benefits for Stakers, which are incentives that can potentially attract more Stakers, create use cases for their Creator Tokens and further monetizing their projects while empowering their communities.
Expansion can be seen as Layer 1 and Layer 2 bricks advancing over the technology flat brick, this is the same as Dev Protocol technology advancing and unlocking the potential of the Decentralized Creator Economy.
Here we can see μ-zomia advancing and developing the Music Market and blocks representing potential integrations which could benefit Stakers.
In the future, Dev Protocol will expand to new markets and the Ecosystem will grow in all directions. These infinite combinations of Lego bricks will make the DEV Ecosystem extremely valuable for both Creators and Stakers.