Now the question everyone is asking: How do we know which threshold should be set?
If the value is too low, then it could create a large inflation which might not be fair to users holding REG already.
If the value is higher than spot market, the users with right to mint will feel it is unfair for them to mint REG higher than TWAP market price.
We could adjust the threshold like DRKTT proposes, but how low do we go?
To answer this, I think we should come back to the original situation and ask the question: Is it fair to mint REG PURELY based on an ILLIQUID market (less than 0.1% of total REG)?
While 99.9% other REG are sitting aside in idle mode.
One of the solutions is evaluating the REG ecosystem in its current state and its full potential (RMM, YAM, future DEX, NFTs,...).
- On the base layer, we have 120M+ real estate tokenization, which brings renter yield every week. But this is not contributing directly to the DAO, so it should not be counted in DAO valuation.
- Lending activity (RMM): currently it has 14M stablecoins (11M borrowed) + 30M RealTokens, at 8% borrow APY, it brings 800k USD revenue (90% to LP, 8% to DAO, 2% to Aave). At full potential today, if the DAO can do marketing and bring more liquidity, with 120M RealToken in total, with 60% LTV, it can generate 5-6M USD revenue.
- Trading activities (YAM + future DEX): YAM has less than 20M trading volume, it could have generated 20-50k USD to the DAO with 0.1-0.3% fees. For comparison, Uniswap has less than 4B TVL, and 2B daily volume, with around 700M annualized fees. Of course, real estate tokens will have a lot less trading activity than exotic tokens on Uniswap, but we could expect 200-600M annual trading volume. This can bring 1.8M USD revenue from RealToken YAM/DEX.
- Other activities with NFTs (collector selling + fees on marketplace): no number for now.
These are projections and not certain, but they give an overall picture of the ecosystem. The total value of RealTokens will mostly increase over time with more properties. There are also a lot of other types of RWA assets that the DAO can explore.
Once the REG ecosystem is somewhat evaluated, the DAO can say, hey this is the range for fair valuation, and the minting limit should be at least >= this value.
I think this gives a bigger picture than purely basing on an illiquid market (with 0.1% of REG, of course, the market can overvalue/undervalue the ecosystem).
