Proposed Next Steps For Aragon Court

Dear Aragon Community,

This is our proposal for what we believe should happen provided the community votes to deploy Aragon Protocol with $ANT as its native token.

Since putting together our latest thoughts on single vs multi-token tradeoff here, we’ve spent a lot of time speaking to various $ANJ/$ANT stakeholders as well as collaborating with the Aragon One and Aragon Association teams. Informed by these discussions and by our own thinking, we now believe the best path forward to avoid protracted negotiations, align incentives and enable the Court to be successful is to merge $ANJ into $ANT. Crucially, this must be done while appropriately rewarding $ANJ holders to reward their early belief in the Court, reflect the upside they’re now giving up and, most importantly, avoid splintering the burgeoning community.


Before we get into the proposal, a few preliminaries:

  • The recent discussions have demonstrated the strength of the $ANJ community and its conviction in the Aragon Court thesis. While $ANT holders ultimately have governance power over the Court, we think it’s important to at least understand $ANJ holders’ views and use these to inform $ANT voting. From our perspective, the worst case outcome for both sides is a contentious $ANJ “fork” in which the community is split and Aragon Protocol now has a competitor with the same name (Aragon Court Classic?). Avoiding this outcome is crucial and, our research indicates, easily achievable.

  • Given any proposal will be decided on and paid for by $ANT holders, we feel it should be primarily framed in terms of dilution paid by $ANT holders vs premium received by $ANJ holders. The former will be used to derive the latter, but we believe it’s easier for $ANT holders to conceptualise the tradeoffs in these terms and determine whether a given level of dilution justifies the benefits.

  • We think $ANJ jurors who remain committed to the Court vision post merger are more valuable and are worth paying a higher premium to provided they convincingly signal this commitment. Projects such as Synthetix have exemplified the positive effects that locking up users can have on a community and on bootstrapping a supply-side and we feel there are lessons to be learned here. $ANJ holders who want to exit the system should still be allowed to do so and compensated for the upside they’re giving up, but this should entail a much lower premium.

Our proposal

As such, we propose that $ANJ holders who are willing to signal their commitment to the Court post-merger by accepting a lock-up on their converted $ANT are paid a higher price than those who aren’t.

  • No lock-up (0-2% dilution): $ANJ holders who wish to convert their $ANJ to unlocked $ANT should be offered a price that is at least equal to the price on the bonding curve before it was suspended (0.015 ANT). This would require 1.37% dilution. An additional premium could also be added to reward them for their early belief in the Court, but this should be minimal.

  • 12 Month Lock-up (3-10% dilution): $ANJ holders who convert their $ANJ to $ANT locked and activated for 12 months should be offered a higher premium. These will be active court jurors and can be seen as Aragon paying not just for a community but also for a supply-side.

We suggest the range is from 5-10% but ultimately, we believe the most important data point is the percentage of $ANJ holders that would be willing to lock up their $ANT at different dilution levels and resulting premia. As such, we suggest polling $ANJ holders directly and using this data to inform the resulting $ANT vote. For reference, we’ve included a table with different dilutions, ANJ/ANT prices and premium multipliers.

Next steps

We propose a 3-step process to help $ANT holders arrive at the right conversion premium to pay for locked and unlocked $ANT.

  1. As a first step, we propose polling $ANJ holders with the following question: “What is the minimum conversion price in ANT you would be willing to accept in order to lock and activate your converted $ANT for 12 months?”. The poll options would be 0.02, 0.024, 0.028, 0.032, 0.034, 0.04, 0.044 and 0.048. The results of this will serve as valuable data points to inform the subsequent $ANT holder votes.

  2. Informed by the results of the poll, and assuming the current vote to deploy $ANT as the native token of Aragon Protocol passes, we suggest two separate votes are initiated for $ANT holders with the following questions:

“How much dilution should we sustain to buy out $ANJ holders who are willing to lock up and activate their $ANT for 12 months?”. The poll options would be 3% (0.02ANT/ANJ), 4% (0.024ANT/ANJ), 5% (0.028ANT/ANJ), 6% (0.032ANT/ANJ), 7% (0.036ANT/ANJ), 8% (0.04ANT/ANJ), 9% (0.044ANT/ANJ) and 10% (0.048 ANT/ANJ).

“How much dilution should we sustain to buy out $ANJ for unlocked $ANT?” The poll options would be 1.37%, 1.5%, 1.6%, 1.7%, 1.8%, 1.9% and 2%

  1. Execute the conversion according to the prices determined by the $ANT vote. $ANJ holders would be offered two different prices based on whether they want to convert to locked or unlocked $ANT. The conversion would take place over a week, after which prices would no longer be honoured.

Provided a reasonable outcome is reached that satisfies the community, we will work closely with the Aragon team and community in order to design some updated token economics. This will include a fee model, distribution plan and liquidity mining incentives for Aragon Court and the newly merged $ANT token. Our goal is to have a V1 of this by December so that a decision can be reached by the end of the year. This will be the first of many proposals we release, and we also have plans for a Court reputation system and new sub-court Architecture, among others.

We look forward to hearing the community’s feedback on our proposed plan of action. We’re excited to get this conversion finalized so we can all collectively shift our focus to what really matters: growing the Court and making it the decentralised judiciary of the world’s first digitally sovereign jurisdiction.


Thanks for all your work on this, Jose Maria.

From Aragon One, we are happy to co-author a proposal using this as a base (there are some slight modifications we might want to make) and take it to the ballot in the coming weeks and integrate ANJ into ANT. Directionally we support this proposal and think this is the right thing to do and the best possible outcome for both ANT and ANJ holders


What if I would be willing to lock up my ANJ for 12 month but can’t be an active juror cause of different circumstances?

I think there should be 3 option with different rates:

  • not lock up your tokens
  • lock up your tokens for 12 month without being an active juror
  • lock up for 12 month and being an active juror.

Interesting point, but IMO in that case you should not lock up your tokens, instead of there being a different option. The higher premium would be given for guaranteeing a certain service, not because of locking up tokens


What about delegating to jurors? Is it possible to delegate ANJ? Delphi Ventures would be for example a delegate candidate. If the proposal pass and I agree to stake my ANJ for 12 month would my ANJ get locked for 12 month or would my ANJ be converted to ANT which gets locked up for 12 month? With the new ANT token delegation is possible correct. I can delegate my ANT to any wallet, my hot wallet or other person wallet. That would be so nice!

If I lock up my ANJ for 12 month is it possible to transfer the locked ANJ to another wallet (private key) or do the ANJ have to stay the entire time on the same wallet?

What if the lock up premiums are so high that it would be worth staking ANJ without being an active juror? In this case the court get less secure. I think delegation is a really nice option.

What if I missed the conversion from ANJ to ANT for 4 month and then i want to lock up my my funds for 12 month would this be possible?

What if I lock up my ANJ for 12 month but then need money and want to unlock ANJ earlier?

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Answering to the best of my ability, given our current design of Aragon Protocol and our technical evaluation of the in-flight proposal.

If the proposal pass and I agree to stake my ANJ for 12 month would my ANJ get locked for 12 month or would my ANJ be converted to ANT which gets locked up for 12 month

It would likely be designed such that your ANJ is immediately converted to ANT, which is then locked up as activated ANT for your account in the Protocol.

I can delegate my ANT to any wallet, my hot wallet or other person wallet.

Correct. You will be able to delegate your guardian duties to another party, whether that be a hot wallet, someone else, or even a multisig or DAO.

If I lock up my ANJ for 12 month is it possible to transfer the locked ANJ to another wallet (private key) or do the ANJ have to stay the entire time on the same wallet?

It would have to be locked as activated ANT for the same wallet throughout the entire lock-up period.

What if the lock up premiums are so high that it would be worth staking ANJ without being an active juror?

This would likely be a governance decision down the road to adjust the penalty amounts for non-active jurors.

What if I missed the conversion from ANJ to ANT for 4 month and then i want to lock up my my funds for 12 month would this be possible?

The proposal does not go into this detail. It could be, but further input on the lock-up entry and reward structure here would be appreciated from the forthcoming proposal’s authors (@jose_delphi / @jorge).

What if I lock up my ANJ for 12 month but then need money and want to unlock ANJ earlier?

As stated above, if you anticipate this case, you may not want to lock up your tokens.

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I think we shouldn’t support those edge cases for simplicity. In my opinion the proposal should only offer two options, either get ANT immediately or lock ANT for 12 months for the higher premium, in which case, as @sohkai states, you’d be able to delegate to another guardian if you cannot fulfill those duties yourself (note that you’d need to make sure that the guardian you delegate to will actually rule on your behalf, otherwise, you’d get penalized and not them)

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Will there be a tool or instruction how to delegate ANT to another party once the ANJ to ANT proposal pass?

If I delegated my ANT would I be able to change my delegation ?

There will be instructions if the Aragon Protocol deployment proposal passes as part of its user guide


How long do I have time to swap my ANJ to ANT (i guess i can do this whenever i want) and how long do i have time to convert my ANJ to ANT and lock them for 12 month and get the premium?

I am wondering how this ANJ to ANT swap technically works. So the first transaction would be the ANJ to ANT swap. Everyone can do this anytime. After I did this i have a time window within I can lock up my converted ANT into a smart contract for 12 month. I can ether delegate those ANT to another wallet (how does this delegation work? do I lock my ANT into a smart contract which then selects a wallet for certain delegation actions?) or stake them directly into the smart contract without delegation. If the ANT are delegated I can re-delegate the ANT at any time during the 12 moth lock up period. Can I also delegate the ANT after i locked them up before without delegation?

There will likely be two separate paths. If you choose to convert ANJ into ANT directly, without the lock up, you will be interacting on one of those paths.

On the other hand, if you would like to participate in the lock up, the contract you interact with will do all these steps for you automatically: convert ANJ into ANT, stake and activate on your behalf, and then set the activation lock up period for one year.

how does this delegation work

You simply specify the delegate’s address in one of the Protocol’s modules (Voting), such that if that account is ever drafted, someone else can commit votes on your behalf. You staked (and activated) ANT is continually associated with and owned by your “principal” account; this balance is never delegated.

You will be able to update your delegate at will, by interacting with the Voting module.

So if i want to lock for 12 month I have to unstake my ANJ on Aragon Court and then interact with the “12 month activated lock up contract”. Once I did this I will be then able to delegate my ANT in the “12 month activated lock up contract” to another address by using the Voting Module. Can I do this delegation without programming skills?

Thank you Jose Maria – your efforts are appreciated. There are two reasons why this event is perturbing the growth of both networks right now, and we need resolution asap:

  1. Contentious decisions reflect negatively on network value in the form of fear/uncertainty/doubt. We saw the same with segwit and bitcoin back in 2016. After the split, the value of the two networks combined was more than pre-fork bitcoin. This situation is similar but flipped around: a unification outcome will result in the value of the merged network being more than the value of ANT and ANJ combined, as contention dissolves and we can push onwards and upwards.

  2. Synergistic effects of bringing two highly motivated networks together. Their cooperation and interaction will generate value above and beyond anything that the two individual projects could have achieved alone.

They sound similar but are driven by vastly different mechanics. Both will stimulate value generation for Aragon Protocol if the networks are merged. Consequently, it should be in both ANT and ANJ holders’ interests to reach an agreement to merge. So, what is a fair premium?

Frankly, the premium initially offered for ANJ was rather insulting – and still, after all the back and forth, I cannot understand how or why it was ever thought of as acceptable. No credible explanations have been offered, despite various individuals saying they would be.

I invite ANT holders to consider ANJ’s investment made and value generated. Remember, these are actors who bought in to the original vision of the court and put capital on the line to support said vision (the time value of money). Beyond that, they invested other resources in the interim; research, analysis etc. – all of which has an intangible quality but nevertheless has value, especially in learning that can assist in the evolution of Aragon Protocol (Delphi’s efforts are testament to this). Furthermore, tangible value was generated with their active court participation, demonstrating proof of concept through their own “proof of work”.

I will be advocating for the higher end of what I believe is a conservative proposal from Jose Maria. Rephrasing this stance from another perspective, is the value of the current ANJ stakeholder base going to be worth 10% of the future Aragon Protocol? Furthermore, to what extent will a forked Court drain value from the future Aragon Protocol?

To really put Jose Maria’s proposal into perspective for ANT holders, one way to think about the effect of dilution is to compare it to price volatility.

  • It has been 30 days since the original proposal to merge ANJ with ANT (marked below in the blue arrow).
  • On 7 of those days, volatility has exceeded 5% (the lower end of the proposal)
  • On two of those days, volatility >= 10% (the upper end of the proposal).

This is visualised by the lower panel in the graphic below, where the light grey bar is 0-5% and the two blue bars represent 5-10% volatility.

Just looking back over the course of 2020, volatility regularly exceeds the impact any dilution would have as per the proposal. From this perspective, it is a no brainer for ANT holders to accept a 10% dilution, retain community harmony, and move on from this debacle.

Jose Maria’s proposal is inspired insofar as it more effectively placates the main stakeholder group (ANJ holders) who can cause the most disruption (pushing forward with a fork) by providing optionality.

This group were, to an extent, held hostage by the unannounced freezing of the bonding curve and the original ANJ<->ANT merger proposal. They are now presented with the following options: (a) get out immediately at an insignificant premium (negative in USD terms) should one have been disillusioned by the discourse of Aragon One during this event, or (b) demonstrate continued commitment to the longer team vision which is something that their fellow Aragon Protocol holders (old ANT holders) will never have to do.

If I were to amend the proposal in any way, I would introduce a mechanism whereby the premium multiplier received by ANJ holders increased as a function of timelock duration. For example:

0 month – no premium multiplier

6 month – 1.5x premium multiplier

12 month – 3.2x premium multiplier

24 month – 7.0x premium multiplier

This is, in effect, generalised mining (similar to liquidity mining), and should be welcomed by ANT holders as something that will provide a long lasting core network. Its value to the future of the network is WAY larger than a mere 10% dilution, I just hope that the majority of ANT holders recognise this.

There have been such perverse incentives involved in the coordination of these proposals that it raises question over the internal decision-making processes, governance and remuneration within Aragon One. Aragon Court is the only legitimate value capture mechanism in the Aragon Network. Of course it is going to be “coerced” by ANT holders if possible. We are in the midst of an attempted “hostile takeover” rather than a cooperative “acquisition/merger” and anyone who doesn’t recognise this isn’t paying attention.

I spoke to disillusionment above – allow me to explain. As an investor in the Aragon ICO (as well as ANJ), who has never sold a single token, this was the first time I questioned my original investment and emerged from silently lurking the forum having been here for almost two years. Unlike broken tokenomics, where comfort was sought from the fact that protocol upgrades will fix things, this whole debacle has illuminated something much more concerning. The actions of some Aragon One team members do not align with the ethos/philosophy of this decentralised movement. I would go so far as to say that some individuals are a danger to the future of the organisation and its ability to deliver on its vision. They actively engaged in intellectually dishonest debate and downright misrepresentation. Look within yourselves, and try to be better…


Agree with everything in your message.
Hope our concerns get addressed.
The community has to progress united and in a cohesive manner, individuals that with their approach pull in the opposite direction, enphasizing divisions, create a toxic environment.

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First of all, thank you for listening to the community and involving Delphi in this second proposal!

I also agree with James, it’s important to get to a resolution swiftly. Let’s vote on this and move on, it’s best for ANT, ANJ holders and the project in general to move onwards and upwards