KPI Options using UMA Protocol

ANT has now been added as a collateral asset to UMA (see Github merge here). This enables ANT to be used in the creation of KPI options for the Aragon community. KPI options are synthetic tokens that will pay out more rewards if the KPI meets predetermined targets before a preset expiry date.

Nearly all DAOs created with Aragon are currently on Aragon v1. With the launch of Aragon v2, we would like to incentivise Aragon DAOs to transition from Aragon v1 to Aragon v2. To incentivise this upgrade, we’re proposing to use KPI options as a mechanism to accelerate the transition to Aragon v2.

The options would be distributed to all Aragon v1 DAOs immediately after the option creation. At the option expiry, Aragon v1 DAOs would then be able to redeem their options for the ANT collateral in the KPI option contract. The amount of collateral they can redeem will be dependent upon:

  • The DAO’s proportional share of AUM (USD denominated) relative to all Aragon V2 DAOs at 30th June 2021.
  • How quickly the DAO upgrades to Aragon v2 DAO relative to other v2 DAOs

The proposal below includes steps for an initial test of KPI options. Should it be successful, we’d propose increasing the collateral underlying the option to a much larger amount and expanding the use of KPI options to meet other targets deemed important by the community of ANT holders.

KPI option details

Contract Dates

The contract start date would be on 7th April 2021, 1pm UTC and end of 30 June 2021 1pm UTC.

KPI Methodology

The Key Performance Indicator (KPI) would be total value of assets (AUM), denominated in USD in all V2 DAOs by the 30th June 2021.

The KPI options would be distributed to all Aragon V1 DAOs.

We propose to place the KPI option in a bonding curve to incentivise early adopters of Aragon v2 in favour of late adopters.

Ahead of running a vote on Snapshot for this to get the signalling input from ANT holders, I’d like to post a draft of the planned votes here for community review.


Vote 1 - Amount of ANT to be used as collateral in the option creation.

  • 0 ANT (signals you’re not in favour of using KPI options)
  • 50k ANT
  • 100k ANT
  • 150k ANT

Vote 2 - Based on the amount of collateral from vote 1, what upper threshold should we set for USD AUM in V2 DAOs by 30th June 2021

  • 100 million
  • 200 million
  • 300 million
  • 400 million
  • 500 million
  • 600 million
  • 700 million
  • 800 million
  • 900 million
  • 1 billion

Exciting @joeycharlesworth !

One comment:

* How quickly the DAO upgrades to Aragon v2 DAO relative to other v2 DAOs

I’m not sure there’s any good way to do this. You could give a variable award to those who migrate, or some kind of bonus. But the actual KPI Options tokens themselves are fungible and would be redeemed for exactly the same amount as any other KPI Option token. This just means if you gave each DAO 100 of them, they will be able to redeem them for the same amount regardless of when they migrate or if they even migrate at all.

i think it works because of the bonding curve, but I also don’t understand how this work. What do DAOs have to do to upgrade to v2? how is it connected to the bonding curve?

Do you create new ANT for this or do you use existing ANT but then from where? from the aragon network dao ?

where can i see how many AUM the DAOs on Aragon have?

So on the 7th of April all DAOs will get X amount of Options and after June 30th they are able to redeem the x amount of shares and based how early they redeem (bonding curve) and how high the AUM of their DAO is the more or less ANT they will get (the higher or lower the price of the option)? Can i sell my options to a DAO which has more AUM and therefore value the options more than me?

Have you thought about using a collective KPI also. So the individual KPI would be the more AUM a DAO holds the higher their KPI-Options will be and the collective KPI would be the more AUM in the Aragon Network the more all Option are worth. So DAOs are not only incentivise to increase their AUM but also the AUM of the hole network. its like a referral program where the one who brings DAOs into Aragon will get a % of the options those DAOs receive.

(inspiration UMA KPI Options and Airdrop. UMA will be airdropping a new… | by Hart Lambur | UMA Project | Feb, 2021 | Medium)

The first vote is now live and can be accessed using the following Snapshot URL: Snapshot

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