$HALO: The Charitable Token — part 4

Governance: The Key to It All

So, we know that $HALO has utility via its access to endowment yields, and its overarching benefits to the Terra ecosystem. The inevitable question that arises is: “Isn’t $HALO a governance token?”

Yes. Yes, it is.

Governance of Angel Protocol itself and governance of the individual charities that benefit from the endowments and donations. More of the latter in due course, as that topic deserves a paper in its own right.

As the token that determines parameters for crypto’s first charitable protocol, $HALO offers both power and responsibility. Too many existing tokens are “valueless governance” tokens, offering little opportunity to shape meaningful decisions. By contrast, $HALO holders enable Angel Protocol to pursue a mission of impact and purpose: to solve humanity’s greatest challenges by empowering charities with financial freedom.

The key to this mission is the DANO (Decentralized Autonomous Non-Profit Organization). In contrast to governance forums with limited participation and whale-dominated votes, the DANO is responsible for ensuring that an ever-larger pool of donor funds are distributed equitably among members of Charitable Indexes.

Ensuring maximal transparency around donor funds is critical to making people feel comfortable enough to donate. In this way, $HALO holders form a community who bears shared responsibility for showing that “blockchain for good” isn’t just a buzzword: that the transformative power of cryptocurrency, expressed through decentralized governance, is about far, far more than making people wealthy.

$HALO holders will also wield substantial power over the Community Fund: the 20% supply of $HALO tokens reserved to foster community incentives and grants to build out Angel Protocol’s platform and reach.

Given the scope of our mission, we know that we cannot accomplish everything alone. $HALO holders will be responsible for helping select and reward partners and builders who will reshape the face of charitable giving. The Cambrian explosion of crypto projects offers a dizzying variety of opportunities for partnerships and grants. So too, the pandemic’s lasting impacts on human flourishing and wellbeing offer a wide range of challenges that will require careful discernment. We anticipate and expect that $HALO holders, far from being inactive participants or speculators, will take an active role in guiding the DANO to address these challenges and seize these opportunities.

$HALO Distribution: Towards a Fair Allocation

We anticipate intense demand for the token;. As well, we understand that many who chase the token are doing so simply to “make a buck.” As such, $HALO is designed to incentivize long-term vision and to reward those who are willing to contribute not only their capital, but their passion for helping their chosen charities make the world brighter.

In line with this ethos, there will be no snapshot and two airdrops. The first will go to all $LUNA stakers and to Anchor Protocol stakers, based on quadratic weighting to ensure fair distribution.The second will be provided to stakers with Angel’s validator, based on transparent, on-chain data.

Going even further, $HALO’s “tokenomic” design greatly incentivizes 1) early adoption and 2) maintaining a position rather than dumping the tokens. As mentioned prior, stakers who deposit $HALO with a charity receive charity shares. These shares are based on a concave bonding curve: the earliest stakers receive the greatest number of charity shares. This grants them the lion’s share of the charitable yield. In short: it pays to be an early supporter of a charity.

For a full discussion of the tokenomics, the fundraising and the distribution of $HALO, see this recent in-depth paper.

Conclusion: What Comes Next?

With the launch of $HALO fast approaching, we hope that our litepaper and the articles of the last few days help explain the origins of the token’s value and how it can be used.

$HALO will be a powerful addition to the Terra ecosystem and the charitable giving landscape. We are confident in the sources of its power:

☛ in the Terra Charity Alliance as a major driver of recurring charitable donations, which create a “$UST magnet” that permanently locks $UST supply, with inevitable effects on $LUNA price;

☛ in attracting charitable donations from outside the Terra ecosystem, using other crypto and fiat currencies that are again locked as $UST, driving even greater demand for $LUNA

☛ in the dozens of charities we have already onboarded and the hundreds yet to come, and in their abilities to create hope, fulfill promise, and inspire positive change;

☛ in the opportunities that decentralized finance (DeFi) and crypto creates, and their ability to drastically improve the financial situation of the majority of charities for whom fundraising is the challenge;

☛ in Anchor Protocol as the yield generation engine;

☛ in other Terra protocols, who are already planning airdrops for $HALO stakers and partnerships to build on the tidal wave of charitable auctions and offerings that has already begun during “Terra Autumn”;

☛ and in the source of our greatest power: you, and others like you, who know that there is no better way to profit than by giving from the heart

For all these reasons, Angel Protocol isn’t doing a private sale. Instead, we plan to offer $HALO tokens, with all the mighty promise they contain, directly to the Angel and Terra communities. As a reminder, details on the community sale can be found here.