Adoption, metrics, treasury spending and ROI - open discussion thread

This post builds on points raised in All metrics are imperfect, but many are useful. Let’s make them more available and the in voting GMI Crypto Media Podcast proposal which aims to use differentiated original media initiatives, strategic distribution and wallet-less onboarding to drive new and active addresses on Kusama and beyond.

It also builds on experience gained developing, structuring and managing over 30 on-chain proposals / teams, developing the Kabocha parachain from scratch via fully on-chain processes with no external capital or legal entity, cofounding Copa90 and corporate innovation at Nike, The Guardian, BBC and Channel 4.


Rn there are about 22,000 active addresses in the ecosystem, though actual numbers are likely a lot less given most people / teams operate multiple addresses.

Currently there is no basic agreement on how to calculate the most basic metrics that define the relative adoption and activity of substrate based chains.

At the same time investors and the retail that follows are reaching for credible approaches to assessing fair value of crypto-networks - with daily transation volumes (fiat / units of value) x number of active users being used as a proxy to value networks.

In general, crypto has been bootstrapped on the incentives of legacy social media, with the whole industry developing in lockstep with the data monopolies and influencer economies of Google, Meta and TikTok. As ICOs and crowdloans have proved, a highly active discord, Twitter or YouTube is a good way to assess initial hype, but a very poor proxy for maintaining sustained activity and adoption through anything other than financial speculation.

Edgeware, Polkadot and Kusama treasuries exist to drive adoption of the underlying technology and yet for the most part marketing spend (and spend in general) does not have a clear focus on the return on investment (ROI) to token holders.

Since treasuries are denominated in the native token of the network, their relative valuations are something of a mirage. Right now the Polkadot treasury has c.$270m to spend, however this fiat denominated total is not all it seems, since if there is no sustained adoption that closes the gap between valuations and network adoption, these treasuries will disappear as fast as they appeared.

To make things even more complex, treasury spending to teams creates natural sell pressure as they need working capital to deliver projects that provide a path to the next wave of adoption - so in effect, if funds are deployed by the treasury to builders, this may result in a steady devaluation of the native token, and its reserves, which results in more conservatism from token holders who react negatively to this perceived ‘loss’ - basing their expectations for growth of the network valuation on today’s parity, plus 10x etc.

The resulting contradictions - high valuations, low adoption, large treasuries, natural sell pressure and the political machinery of majority rule creates frictions that are likely irreconcilable without rethinking some of the basic governance, funding and organisational structures that represent current orthodoxy.

Only by accepting the current state of affairs and understanding the conflicting incentives that are locking up the resources and talent within the ecosystem, can we begin to pick our way through what are highly complex and interdependent issues.

Areas of improvement

This is a non-exhaustive list, feel free to add any thoughts.

Standardising basic metrics

Per All metrics are imperfect, but many are useful. Let’s make them more available we need to standardise the measurement of basic on-chain metrics such as new and active addresses to provide consistent and trusted data for teams, proposers and external parties.

Valuing treasury spend

We need to move towards assessing. valuing and rewarding treasury spending using key performance indicators (KPIs) and return on investment (ROI) related to driving new and active addresses (aka engaged users) of Kusama and Polkadot in the first instance - and from there towards driving utility of parachains.

This doesn’t mean curtailing existing education initatives, but it does mean beginning to value performance over just activity and hard work. Busy ≠ effective even if it sometimes can feel that way - we can work smarter.

Trustless mechanisms for performance related proposals, spending and rewards

We need to then define ways to establish trusted (trustless) on-chain mechanisms to track spending and the effectiveness of that spend, then play that back into the spending process in a way that avoids the requirement for a council, or some other assessment body to ensure payout based performance. This may be required in the first instance - e.g. Bounty / curator type structures, but there needs to be a roadmap towards this being automated and therefore more scalable.

Diversifying funding sources

We need to diversify funding - taking the pressure off the treasuries to solely fund ecosystem innovation, but requiring them to be the first money at the table.

The first money is always the hardest to find, then you tend to find that this de-risks the decision of others - in venture capital its known as leading a round. The treasuries need to be seen through this lens.

This is analogous to taking the role of a novel crypto academic/political/technical institution such as MIT who seeded the MIT Media Lab, which then moved towards a model where external organisations (tech/fashion/governments/consumer electronics) paid membership fees to support specific research initiatives and could in return access the talent and license free IP / tech developed.

Membership, available in several different options, provides a unique opportunity for corporations to have access to a valuable resource for conducting research that is too costly or too “far out” to be accommodated within a corporate environment. It is also an opportunity for corporations to bring their business challenges and concerns to the Lab to see the solutions our researchers present. Membership levels - MIT Media Lab.

The recently developed Crypto Patronage app by Shokunin is a very basic version of what can become far more effectively crypto-native machinery for connecting external patrons with adventurous on-chain collectives and radical forms of public R&D, of the sort that is chronically underfunded and ultimately inaccessible to most people who do not have the ability to access or contribute in existing forms of academia.

Smoothing the innovation process

Currently teams approach network treasuries and voters with a discussion post that may be interated a few times, before putting forward an on-chain proposal that requests funding of some amount.

In the current process, this proposal is assessed by:

An expert body such as a council.

Limitations of this model

  • a single council of c 10 people cannot possibly assess all proposals and domains well
  • due to the sheer administrative weight, this is not a scalable solution.
  • we can add more members to a council, but then we introduce coordination issues.
  • Currenly rank weighted voting such as that presented by The Fellowship attempt to square this circle, giving more experienced members of the collective greater decision-making weight. This is an interesting solution, but also introduces potential issues over time with concentration of power and a reduction in the collective’s ability to make radical leaps of imagination that is the hallmark of more chaotic and open systems.

Or a binary yes/no vote that is decided through token weight.

The challenges of this model are well known - low voter turnout, whales driving decisions and majority rule leading to reduced innovation as familiar ideas are funded, since on the surface they make more sense, than ideas that may be seen as more abstract, experimental or expensive.

We need expert bodies, but we also need to sustain a democratic and open mission that stays in line with the principles, rather than just the slogans of Web3 - is there a way to square this circle, and also leverage the emerging capabilities of OpenGov and agile delegation?

Proposals as organically evolving governance delegates

The ability for token holders to delegate their votes to addresses (on-chain organisations) is a fasinating capability of the Polkadot system, especially within OpenGov’s framework of agile delegation.

If we begin to see proposals as a potential pre-formation process for project teams and R&D collectives, rather than an end point to be voted on, we can radically rethink the user journey of treasury proposals.

How this could work in practice:

A proposal is presented in its most abstract form within a new governance system - it could be the length of a tweet, or a novel, it might be primarily represented as written text, code, or visually - sketches, diagrams or moving image.

From the moment it is published - no matter its form or perceived completeness it becomes a governance delegate - anyone can pledge their votes to this proposal.

In addition, we allow anyone, anywhere to comment, contribute and develop on the first iteration of the idea - they can even fork the proposition, into a new proposal delegate should they wish.

From this moment on, every proposal is an emerging experiment in co-creation, collaboration and coordination, where those who contribute meaningfully become part of an emerging collective endeavour - that can in turn offer them economic upside in the future income of the group. It might begin as a small group, but who is to say this collective won’t eventually launch a new parachain?

When we apply this model to existing social media, we can see there is a path to onboarding values aligned creators with pre-existing fan-bases, and gradually transitioning their followers, into collaborators, with stake in the creative direction and economic upside of the initiative.

With each collective emerging organically - we can begin to communicate their stories, and naturally as their work becomes less abstract, and more understandable, they should receive more governance delegations from holders who will each understand and relate to the relative merits of each proposal in their own time.

If we partner the concept of fluid proposals with on-chain ROI and more diversifed funding models we can begin to drive more radical innovation in the ecosystem from grass-roots - discovering more interesting and effective approaches than will emerge from the current structures.

You can read more on this alternative approach here.


We still need to address the funding issues for the instigators of these atomic ideas when they at their most delicate - providing some sort of initial funding that can enable groups to persist with their exploratory work ahead of gaining the votes they need through agile delegation.

Historically this R&D has come from the Web3 Foundation Grants, however their resources are limited, their time is scarce (same scaling issues as council) and their mandate is generally towards purely technical areas, rather than a more experimental entity that aims to push beyond the boundaries of existing domain expertise.

We can think of this phase of R&D funding akin to the artists and representation (A&R) work that has been historically done in record labels - finding raw talent and then helping them develop over years, before presenting their work to a more general audience who would not have recognised potential that early.

Establishing a Polkadot Innovation Bounty

A potential way we can bootstrap this R&D funding ahead of making a fully fledged MIT Media Lab work would be to create an evolving Polkadot Innovation Bounty with a set of curators with a track record at pushing forward novel concept, projects and approaches, dedicated to kickstarting ideas that can demonstrate success in the aforementioned areas:

  • Standardising on-chain metrics
  • Demonstrating more effective treasury spend ROI when related to on-chain metrics
  • Trustless mechanisms for performance related proposals, spending and rewards
  • Diversifying funding sources by onboarding external public innovation patrons
  • Smoothing the innovation process
  • Seeding talent and their ideas at their most delicate
  • Kickstarting agile delegation to emergent proposals


Why doesnt Kabocha start implementing these changes?

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Hi - thanks for the question.

Simple answer

We are aiming to in stages, but Kabocha does not have the financial resources to fund the work.

It is a continuation of the public governance experiment first initiated by Edgeware at the beginning of the Polkadot ecosystem - a chance to learn the pros and cons of on-chain governance, the challenges with funding, of managing and allocating a treasury and of recruiting and supporting a diverse set of contributors to try out their ideas.

Kabocha is a resolutely grass-roots initiative, with no VC backers and no lead team, or race to token listings - it is constructed from a wide range of on-chain proposals from a diverse collective of contributors, we do not have the financial resources to just execute this stuff without support or a diverse mix of patrons.

Complex answer

We are not the only parachain in this position - worth reading @sam’s discussion document on the funding of grass-roots parachains.

To see Kabocha, or Imbue, or any parachain tbh as an individual project, misses the cooperative nature of the connected social system of which parachains are merely a part.

The simple fact is Kusama is a partner to Kabocha, as will Polkadot once there is a bridge between the two networks. The partnership and co-dependence of a security provider and a parachain is what makes the basic ecology of this ecosystem different to other ecosystems.

The life (and death) of Kusama/Polkadot are inextricably linked with the success (and failure) of the parachains that benefit from the umbrella of shared security.

Can you please propose what makes sense for you?


This is a high level outline of issues and we’re working on improving all of the above, but in general the issues are not commonly understood or discussed - hence the forum post.

The challenge is for the most part identifying issues in the first place then finding those already in the ecosystem who are either aware of, struggling with, or have talent and resources to make impact as part of a collective of contributors.

What most makes sense to us is addressing these issues in a collaborative way. Everyone has some small part of the puzzle.

Thanks, but maybe you have ideas/suggestions to help talks going on?

Hey, thanks for putting this together @rich. :raised_hands:

It clearly requires coordination on multiple layers and from multiple parachains. Hence I am sharing some prototypes to help visualize it together. Disclaimer: They are kinda rough, the data might not be accurate.

The potential end result
After standardization, it would be possible to get an overall idea of where the ecosystem is headed or what areas need more attention. The metrics in this image are only suggestive, together as a community we can decide what metric matters enough to show up here. And from there we can architect standards and tech metrics to capture this data.

What minor change can we take today to eventually lead us to the end result
Storing more elements from the current proposal structure on-chain, to start capturing more meta-data
For example, the category of the proposal or the payment structure is simple enough to capture on-chain

Hope this helps :slightly_smiling_face:


Standardising on-chain metrics

Demonstrating more effective treasury spend ROI when related to on-chain metrics

Based on discussions so far around the podcast proposal and on AAG this is moving in a direction where there will be an ROI requirement in all future Kusama treasury proposals.

Every proposal is different, and so this ROI can be outlined differently, but given the large spend so far on general marketing initiatives and content production with success based on legacy social media metrics, there is an inevitable move towards assessing proposals on their ability to drive on-chain adoption and valuing and rewarding them as such.

You can continue this discussion in Kusama Direction. Alternatively you can join metaKSM a space that aims to bring chaos back to Kusama.

Trustless mechanisms for performance related proposals, spending and rewards

How this achieved is up for discussion and relies on the first two areas. It is in some ways a parallel/adjacent stream of work to @shawntabrizi’s A Better Treasury System.

Again - if you have thoughts, ideas of talents to contribute here - great.

Diversifying funding sources by onboarding external public innovation patrons

This relates to any relationships with external orgs who may want access to the sort of tech and talent this ecosystem has in abundance. We have connections in media, government and consumer hardware but are also trying to join the dots to other W3F initiatives such as Cogency.

If you or anyone else has relationships with external groups who you think could benefit from access to talent and tech here, then that’s a definitive way to help.

Smoothing the innovation process

This is being worked on via Root - now with the Polkassembly team - and W3F (hoping grant approved soon).

This will itself likely become a governance focused R&D collective - contributions welcomed in metaKSM.

The aim is to rethink the whole proposal / voting process, UX/UI from first principles to make it more open, collaborative and productive for all involved. Right now its an increasingly bureaucratic and politically charged system that is simply not scalable (or fun) for most people, let alone newcomers.

Seeding talent and their ideas at their most delicate

Figuring new basic funding models for stream funding innovation at low levels is a big question mark. Ideas there would be useful.

This is not tipping, it’s not bounties, nor treasury props. Its closer to the sort of drip fed funding that Kappa Sigma Mu receives via the burn. See Rethinking The Burn thread.

ideas welcome here…

Kickstarting agile delegation to emergent proposals

This is again work underway with Root and Polkassembly team, but there are many areas that will need to be figured out - discovery of collectives, user experiences - completely new wallets since this isn’t gonna work well within Nova etc.

Loads to think on here.

Oh, ways to innovate around egg boxes :slight_smile:

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thanks :slight_smile: this is great, definitely one to share as part of the root / polkassembly discussions - its another big puzzle, but this helps add colour. might be worth sharing the image in Kusama Direction and your thoughts and join metaKSM :slight_smile:

Thank you for the simple and complex answer.
This post is staged as adoption metrics with data about active wallets and treasury spending ROI but for me I feel the real issue is getting funds from Kusama to Kabocha so I will get straight to that point.

These are examples of projects on Kusama who have made some significant progress without VCs or lead teams.

Shokunin Network living in a discord managed to attract a community and supported projects starting from grass roots level and yet they are not a parachain like Kabocha and do not have token like $KAB.

Kodadot has managed to bootstrap coders to contribute to it’s repo build and improve with numerous contributions from freelance devs all over the world.

GM Chain managed to bootstrap a parachain without a VC and release a product where users can use through community volunteers.

Imbue Network which you are quite familiar with also managed to release an MVP prior to even launching a parachain for the community to test out. They had hoped to inspire community confidence and raise funds from them but due to some circumstances this did not go as planned.

Therefore i’m still confused as to why Kabocha wont do anything on their chain that allows the community to have a discussion forum, voting platform to experment with governance which you’ve been advocating for, incubate ideas, reward builders and contributers through $KAB?

You were ready to present $KAB to Kusama treasury as collateral for a loan and fixed a value based on a solo chain right? This proves that Kabocha community recognises $KAB as a currency with value.

Lets assume perhaps its a prerequisite for the Kabocha founders that for them to be active on Kusama, Kusama MUST sponsor their early development costs?

Why don’t you again take Shokunin approach and try to reach out to Kusama community who are not VCs to fund you using the Patronage app.
There several smaller DAO’s on Kusama not as large as the Kusama treasury but can quickly evaluate your proposal and if they like your idea fund you.

No it’s not. Decent Partners business model is chain agnostic. Decred, Edgeware, Kabocha, Kusama etc. There will be others. I have spent the last three years full time in this ecosystem, earning very little and spending my own money (ironically the product of investments into DOT, to support projects others wouldn’t.

I have been an unpaid contributor to Shokunin from the start, which was, like Decent Partners funded by an individual who put his own money to work. The core insights underpinning that project were the results of conversations between Jam and myself about how broken the funding model was for creators contributing massive amounts of time, for very little pay, and how political, bureaucratic and dysfunctional treasury funding culture was becoming.

I know Kodadot well and Matej. he was first funded - guess where, in Edgeware. He was the first paid out in a meaningful sense by the treasury at the beginning of the bull market. He did very well. He bootstrapped Kodadot on that income. Sound familiar? Here’s his proposal - i’m the first comment under it.

GM chain afaik was launched by a team from ChaosDAO who were all being paid elsewhere mostly in venture funded projects - this was fun on the side, it was not their full time job.

Very familar. I’ve been speaking a lot with Sam and helping him craft the in progress grass-roots parachain funding guidelines. I have not been paid for this work.

Kabocha is not sentinent. The only way any of this happens, is if people actually do the work.

There is still a small group, working unpaid, developing things like Root, and Seeds and building relationships to external partners as well as those in the ecosystem - this take a lot of time.

Yes. And still are. There are already arguments about who can/can’t access funds and for what. There need to be on-chain metrics / performance no matter whether you’re an DApp, a YouTuber or a Parachain.

There are no kabocha founders - it was a project, delivered by a random group of people, to win a slot. We have to start again, with new people, new ideas and visions, based on the basic strategy we launched with - identity, rights and media.

The model we have is not far from that, but I’m not interested in funding Kabocha, I’m interested in funding people - Kabocha is just people.

See the MIT Media Lab model - Decent Partners will sit between creators, networks and external orgs and matchmake. We make money by creating a market and marketplace. We reinvest all profits into the people and projects we grow.

This thread is not about Kabocha. It’s about the issues facing the ecosystem, they are the same elsewhere - Kabocha is itself a product of noticing the issues others don’t. Just as all the other talent and projects we work with are.

Thanks for this post tying together the conversations around treasury improvements @rich.

@chi I think you also have some great ideas. It would be great to have more proposal related data on-chain! Especially things like category, payments and milestones.

Imagine if we had on-chain milestones on proposal submission that are tied to an array of metrics and payouts:

Milestone 1:
When?: 600000 Blocks after proposal approval

Condition: Active wallets (metric) increased 30% since proposal approval

Payout: 10000KSM to Wallet X if condition is met. Extra 0,5KSM bonus for each wallet above the 30%.

On-chain predefined milestones and payout conditions would completely remove the trust between proposers and community and align interests if used correctly. This does of course rely on a suite of on-chain queryable metrics that the milestones can be bound to.

Again, I really appreciate this discussion.

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Hello Rich, I hope you are doing well. I understand that you have some concerns about the current state of treasuries in the Polkadot ecosystem. While it’s true that treasuries exist to drive adoption of the underlying technology, it’s also important to ensure that the funds are being used effectively and efficiently. As a community member, I share your concern for the responsible use of treasury funds.

Regarding your proposal for GMI Crypto Media Podcast, I understand that it was rejected by the Kusama community due to concerns about the cost and the lack of clarity in the outcomes. It’s important to consider the concerns of the community when submitting proposals, and to provide clear information about the expected outcomes and costs.

I would also like to address the concerns raised about the dormant companies associated with Decent Partners. It’s important to ensure that all individuals and companies within the ecosystem are transparent and above board. I encourage you to address any concerns that have been raised about the use of these companies.

In general, I believe that standardizing basic metrics and valuing treasury spending using key performance indicators (KPIs) and return on investment (ROI) related to driving new and active addresses (aka engaged users) of Kusama and Polkadot is a good idea. It’s important to ensure that treasury funds are being used effectively to drive adoption and growth within the ecosystem.

Thank you for your contributions to the Polkadot community, and I hope that you continue to work towards the responsible use of treasury funds to drive adoption and growth within the ecosystem.