Your question raises a critical point: Yes, we should indeed take a deeper look into approving SNS sales, with higher standards for entry to ensure only projects with demonstrable viability and sustainable models are greenlit. However, the issue is twofold. While stricter approval criteria could filter out underprepared initiatives, the root problem lies in the current SNS infrastructure design, which treats treasuries as one-time capital infusions without mandatory mechanisms for ongoing replenishment. This creates a structural vulnerability where projects rely solely on initial raises, leading to inevitable runway exhaustion without built-in revenue generation.
From an economic and traditional finance perspective, consider each SNS as analogous to a company listed on a stock exchange. In conventional markets, an IPO (initial public offering) provides startup capital, but long-term survival depends on generating operational revenue—through sales, services, or other income streams to cover expenses and fund growth.
Companies that fail to establish sustainable business models post-IPO often face delisting, bankruptcy, or forced recapitalization, as investors demand not just initial promise but ongoing value creation. Similarly, SNS projects should be evaluated not only on their launch potential but on their ability to operate as self-sustaining entities, with treasuries functioning like retained earnings or working capital that must be replenished through mandated revenue models (e.g., fees, yields, or partnerships).
Without this, we’re essentially approving “companies” with finite cash reserves and no required profitability path, akin to funding ventures in a traditional market without scrutinizing their P&L projections or cash flow statements. This leads to systemic risks: Widespread depletion erodes ecosystem confidence, much like a stock market bubble bursting when unprofitable firms dominate listings.
I’m currently in the process of designing a system proposal—similar in spirit to the DEX liquidity pools design, but focused on revenue replenishment that could mandate inflow mechanisms for all SNS treasuries. This would ensure a balanced infrastructure where outflows are matched by inflows, promoting true economic resilience. I’d welcome input from the community and DFINITY on this when i have the framework complete.
If these sns launches are being compared to an ipo then more than half of them should never have launched.
The reality is most of the projects should have only been a token after creating a business that has a revenue stream already incorporated into the project.
But another option that companies use are share splits. Dkp and motoko are two tokens that did something like this.
Sns tokens could conduct more sales off the sns launch pad after doing a token split to raise funds.
Wtn did two additional sales after the initial sns launch with what was left in the treasury so it is possible.
“If these sns launches are being compared to an ipo then more than half of them should never have launched.”
I completely agree, and we need to consider that the network is also very young, but we see the effect now, we are currently staring at a train wreck about to happen like a domino effect, one for one those DAO’s will fall as they can’t sustain themself, there has to be a change in the Frame work design for SNS’s
If you want to be a SNS, you need to have a ROI plan, revenue stream, you do a SNS only for one thing that is to gather your community to evolve your product, you are selling power over this product in exchange for funds, like a IPO/Seed sale, but there is no guarantees or even plans from the DAO’s
I do not know if this is because they didn’t think that far ahead, or just should never been a SNS
I have applied for the Neuron voting grand in the SNS category to address this exact issue
Teams need to be fully prepared with a business plan, if your product or app can not generate reveneu they can not become a SNS, because they can not sustain themself in the future.
”More generally, if unsuitable SNS projects fail and stumble, especially as the SNS framework is just emerging, it will undermine its reputation and slow its adoption, in turn slowing down the development of the ICP economy, reducing the capital available for mature projects, and depriving important future projects of access to decentralized funding. If early SNS projects become rug pulls, it would be even more harmful, especially since the framework is designed to prevent that happening, and replace the largely failed ICO paradigm.”
Yeah if i get selected hahah then yes, i will try my best to ensure quality
I don’t agree. To me it’s more harmful to be naming projects silly hat dao, swamppies, etc… and showing that people can do hostile take overs of people’s projects after attacking the founders.
To me if the project fails it should be allowed to fail and shown as an example of what to not do as others look to launch tokens.
I am against “government bail outs.” It removes responsibility from founders and from investors and creates a weak economy.
This scenario only emerged when those “DAOs” that south to be self sustaining but have pulled the treasuries, did not do buybacks, their tokens plummeted and then some people with money could buy up the tokens aking to voting power, just like a hostile takeover
Its not the root cause but a symptom of a system that does not work
This is crypto and projects fail. They are important lessons for both investors and founders.
I do not think bailing out failed projects will do icp any favor. The only real solution is to have strict reviews prior to launch to ensure they are sustainable.
Fully agree, only a small tweak the “ensure they are sustainable.” needs to be enforceable with code, we have the most advanced system at our disposal, I think there is way to implement a certain SNS parameter / Design that will mandate inflows to the treasuries within the token design.
Think we agree on most part, will tag you once i come up with a solution that i think is worth debating
400.000 - 130.552 = 269.488 / 497 = 542 ICP A DAY x 6 = 3.252 $ of “operational” cost per day
130.522 % 542 = 240 Days left of operation ( if there are no big withdraws)
Daily volume of ICPS = average 500k if ICSwap took 0.5% of the volume they would get REVNEU back into the actual treasury not sure where its going now but that graph is going down
Just for a example
If there is a 0.5% fee on volume they get 2.500$ daily, 3252 - 2500 = 752 $ operation cost
542 = 3252
416 = 2500
______
126 ICP = 750 $
130.522 / 126 = 1035, That 3 Years of operational cost if offset by revenue
And yes you will make the argument of that 0.5% on volume fee the people trading will flee, but as stated above not sure if they didnt think that far ahead, but in 240 days if noting changes the treasury is empty, they claim tere is this revenue or whatever, but the pile of money is just going down, the buisness is not profitable, its early but the current trajectory calulates ICPswap going bankrupt on 12 april 2026, I do not have the full solutions, but consider that in 240 days on the current rate, ICPSwap will be bankrupt and not able to keep the Cyclerate burn rate up, the exchange dies a week later
Apr 6, 2024 - Apr 12, 2026 ICP swap blows through 400.000 ICP in two years, Value at raise 6M Value at approx death by rates today 2.4M
Additionally to this Balancer i will propose a more improved SNS Tokenomics Analyzer, which will also include Treasury simulations and proper cost to earning ratio and such, ensuring a heathy treasury to keep the app / company operating
It was a seed investment which is fine, but they are spending it like this is a series A raised which is not normal. Where is their cost of user acquisition? What are they doing about it? For ICP swap, they should be sharing detailed burn rate details and impact of each item, it’s time to extend runway and think of very creative ways to lower cost of user acquisition. Maybe there should be a reviewers group from consultant management, VC and IB rating their proposals and flagging unsustainable behaviour.
I would like to remind everyone how the investment world currently works. Amazon was formed in 1994. It didn’t have a profitable quarter until 2001. It didnt reach consistent profitablity until 2015.
Taking 21 years to become regularly profitable isn’t normal but taking 3+ years and multiple funding rounds to grow into the kind of mature business that is revenue positive is closer to average.
IMO we need products where users, volumes and yes valuations are increasing. These are the projects that will bring adoption and burn to $ICP. Once we get traction, $ICP will increase in value and everyone gets more runway. Let’s grow!
