This proposal initiates the unwinding of the THX token and its veTHX tokenomics beginning in the week of December 2nd, 2024. The process includes early unlocking of veTHX for penalty-free withdrawals during that week, followed by the removal of community-owned liquidity from specific pools on Balancer and Quickswap in the week of December 16th. The liquidity removal, totaling approximately $35,000, will be converted to USDC and redistributed proportionally to THX token holders. Additionally, the community’s veBAL holdings, worth approximately $10,000 and unlocking in June 2025, will be incorporated into the distribution plan. Any undistributed funds by December 31, 2025, will be donated to Amnesty International via The Giving Block.
Motivation: Due to recent setbacks, including issues encountered during the Coinstore IEO, irreversible damage has impacted the demand for THX tokens. Additionally, the current liquidity levels are insufficient to sustain the token model moving forward, limiting its long-term viability. Sunsetting the THX tokenomics structure is therefore the healthiest option, allowing the community to redeem the remaining value of their tokens in a fair and transparent manner.
Risks:
- Liquidity Disruption: The removal of liquidity from Balancer and Quickswap pools may affect trading volume and price stability in the short term. THX token holders are advised to withdraw their liquidity positions before December 16th to minimize exposure to any fluctuations.
- Market Volatility: The removal of community-owned liquidity could introduce temporary volatility. Structured communication and a clear timeline will help manage expectations and mitigate the impact.
Specification: The execution of this proposal will proceed as follows:
- Early Unlocking of veTHX: allowing withdrawals without penalties. This step will take place in the week of December 2nd, 2024, and withdrawals can be processed through the THX Network portal (https://app.thx.network). This early unlocking is the first step in the unwinding process.
- Liquidity Removal: In the week of December 16, community-owned liquidity from the specified pools will be removed and converted to USDC.
- Pools targeted for liquidity removal:
- Balancer Pool
- Quickswap Pool (link provided via GeckoTerminal)
- Distribution Plan via Sablier Airstream: A Sablier Airstream on Polygon will be used to distribute USDC to THX token holders proportionate to their holdings. With an estimated 13,000,000 THX in externally owned accounts (EOA), this equates to an estimated return of $0.0036 per THX at current prices.
To determine eligible THX holders, a snapshot will be taken at the end of November and again in mid-December. The exact snapshot dates and eligible accounts will be communicated after the fact to prevent potential manipulation. Eligible holders will be able to claim USDC directly against their THX holdings in this airstream model.
- Donation of Undistributed Funds: Any remaining undistributed funds by December 31, 2025, will be donated to Amnesty International using The Giving Block’s on-chain donation functionality.
Note on Estimates: All monetary values provided in this proposal, including estimates of liquidity and expected USDC returns per THX, are subject to change. Fluctuations may occur due to market risks and changes in THX holders entering or exiting the ecosystem or other unforeseen factors. No rights can be gained from these estimates, and final distribution amounts may vary.
Next Steps:
First, this proposal will be open for discussion for a minimum of three days. Afterwards, it can be signaled to move to a vote. It is then subject to validation by the @governance-council and, once approved, will proceed to be posted on snapshot.org for voting. This process is described in the Proposal Workflow.
The responsibility for approving this proposal falls on the THX community and will be voted upon by token holders. Upon approval, the execution is up to the multisig holders.
