Hey everyone, please see here for a link to the Pocket Network Foundation’s Q2 Quarterly Transparency Report and here for a link to the Foundation’s Accounts for Q2.
While in Q1, there was a focus on planning and setting our goals at PNF, Q2 was all about a shift to execution, pushing these keystone projects out to the community and steering Pocket on the right path for success.
We want to thank all of you who have contributed to the work we have completed over the past months in some way, and we thank you for your feedback and support in helping us shape the future of Pocket.
Thank you for the update and transparency @nelson
Did the team consider the option of temporarily banning spending of POKT tokens due to very low price in USD? For instance, a temporary measure that spending POKT tokens from the treasury is disabled until POKT price exceeds $0.15 USD. Now it’s clear that Pocket DAO made a big mistake by not selling POKT to USD when price was above $1 USD, but time cannot be turned back. Spending USD (precisely, USDC and USDT) while preserving POKT until better times seems like a reasonable decision at this point. What are your thoughts?
Did the team consider implementing variable part of salary instead of paying out $150k per employee which currently represents quite significant hit on sustainability. For instance, base salary is lowered to $100k, and variable part of salary for PNF executives varies between $0 and 100k, depending on the achieved KPIs, such as:
- POKT price goes and stays above $0.10 USD measured by trailing 30-day average → an extra of $2.5k USD on base salary for that quarter
- POKT price goes and stays above $0.20 USD measured by trailing 30-day average → an extra of $5k USD on base salary for that quarter
- POKT price goes and stays above $0.30 USD measured by trailing 30-day average → an extra of $7.5k USD on base salary for that quarter
- POKT price goes and stays above $0.40 USD measured by trailing 30-day average → an extra of $10k USD on base salary for that quarter
…and so on and so forth.
Such KPI based work would be encouraging for all involved parties, both executives and community/investors. It’s how salaries for executives are usually being paid out.
Your hands are free to do the best you can think of, and your work is rewarded depending on the successes achieved. The current way where you get paid regardless of success does not give investors and the community a sufficient level of confidence that you will truly pursue the given goals in the shortest possible time.
The proposed change in salary payment would send a strong signal to investors and community that executives are truly financially motivated to make positive changes for the project.
The second part of this is already partially in operation:
Keep in mind PNF employees get an additional 15% of their salary in POKT (vesting), to make them quite considerable bag holders over time and put it in their incentive to push price up.
I suggest further increase of variable part of the salary. It gives stronger signal and assurance that their work is perfectly aligned with community and investors. Such change works in favor of strengthening trust among all involved parties, by solving well known Agency Problem. I gave an example in which base salary goes down from $150k to $100k, but variable part increases up to $100k (can be made up to $150k to reward their working efficiency). It’s about ensuring goal alignment between executives and investors.
Hi Steve, thanks for these questions.
In regards to POKT spending, we are certainly doing what we can to spend in stables over POKT at current prices. In Q2 we spent just over 2m POKT, which is a smaller amount of our operation expenses in USD terms. We also feel getting POKT in the hands of grantees is a great way to align incentives for the long term and bring on new community members.
PNFs goal right now is to achieve our keystone projects which we feel are critical to Pocket’s success. We feel now is the time to invest in achieving these keystone projects with these new hires and through doubling down on scaling through community grants.
As Cryptocorn mentioned everyone at PNF takes some compensation in POKT with a vesting schedule to align incentives. These grants including new grants which are anchored at prices roughly double where price is now, so everyone is taking some cut in pay via a lower price for POKT.
As for salaries we are competing in a market for new hires in crypto and must remain competitive to win talent, but staying lean is a focus. It’s safe to safe everyone at PNF could be earning more elsewhere, but we are here because we believe in Pocket and the vision. I won’t rule out temporary pay cuts in the future, but it’s not something we are implementing right now.