New Governance Proposal | Transitioning Ad Fees to Token Burns Gains Momentum
A growing coalition within the community is pushing a governance proposal to shift advertising fees from the Donut DAO treasury to token burns. This comes as Reddit limits ad revenue on r/EthTrader, sparking debates about economic sustainability.
Context: Why the Shift Is Necessary
The current model had advertisers sending Donuts to the Donut DAO treasury for posts and pinned comments. But Reddit's new rules ban payments for mod actions, forcing changes to ad strategies.
Proposal Details
Advertisers will now purchase and burn DONUT tokens instead of transferring them to the treasury. The pricing model will stay dynamic, calculated as:
AF = UMV / (1000 x MV) x M
UMV: Unique monthly views
MV: Market value in USD
M: Multiplier established at 2 due to fewer ad formats available
The discount structure will remain, encouraging longer ad placements and supporting hidden token deflation as per the Moderator Code of Conduct.
Mixed Reactions from the Community
Many community members are excited about the new proposal. One noted,
"This is a crafty way to keep ads while boosting the value of DONUT 🍩!"
Another expressed enthusiasm, saying,
"Bullish on the burn! ❤️🔥"
However, some comments revealed concerns about losing treasury income. Suggestions included reintroducing banner ads on the Donut Dashboard or the new website to generate some revenue.
Pros and Cons of the Proposal
Advantages:
Sustains advertising on r/EthTrader
Aligns with Reddit's compliance guidelines
Encourages deflation of DONUT tokens
Disadvantages:
Loss of treasury income from ads
Uncertainty around advertiser interest due to limited ad formats
What Lies Ahead for DONUT Economics
If the proposal gains enough support, it could alleviate some issues in the DONUT token market. However, skepticism remains. The effectiveness of this move might send advertisers looking elsewhere.
Key Insights
🔹 Shift to token burns instead of treasury payments is underway
🔹 Discount structures remain intact
📈 Enhanced deflation may improve token utility
⚠️ Opinions show mixed sentiments about long-term viability
✅ "Bullish on the burn!" - Favorable feedback
This proposal marks a pivotal moment for the future of advertising and token economics within the community.