I am heavily against this as a SPELL holder. I do not wish to be exposed to the ponzinomics of Wonderland nor pay 98B Spell to them so Dani/Sifu can rescue their failed project by combining it with abracadabra
I see your point - the trade was supposed to be at backing price⌠But itâs replacing a governance token with another governance token, not maintaining the value of whatever the token governing the treasury is. From the wMEMO side of things theyâre saying, âHere have this bribe (discounted governance token, essentially a rebase!) - but weâre not doing any more buybacks to maintain the price. If SPELL dumps you are f-ed.â Only people who benefit doing this instead of selling their wMEMO to buy SPELL are large holders, who canât afford dumping wMEMO lower. Most people are down significantly, the premium is insignificant to them.
But to your point - itâs at the expense of most current SPELL holders, absolutely; itâs horrible. Though I imagine some of the largest SPELL holders would love to buy large sums of BTC and ETH etc with no slippage and incoom from it. I know thatâs why they hold SPELL, itâs not short-term directionality. But to most holders this completely changes the fundamentals!
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Every wMEMO the Wonderland DAO holds will be part of the Spell treasury after the aquisition and therefore drive down the amount of Spell spent.
Currently it looks like >20% would flow back, 18B to cover the loan out of the team allocation, the rest as treasury assets.
We would have a larger treasury that generates yield. At current rates, Wonderland makes roughly 8M a week which could partly be used for revenue sharing through sSpell or replace emissions/liquidity in the curve wars.
Having a substantial treasury would also safeguard us to pay the team in a market downturn and allow strategic investments on the way to support the Abra ecosystem.
For us this is getting a diversified treasury and a larger community.
Both coins are at a low point currently.
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Do we know if Wonderland is going to keep doing what they have done up to this point after the merger? Have they fixed the liquidations below backing price? I know the answer to this is âNoâ but at the very least we as Spell holders need to know that they have. If Wonderland can not fix this then how can we fix it? Maybe Abra Team can figure it out?? Not trying to be difficult here, but these are some of the questions that need to be answered.
Edit 5 hours later: After this post most of these questions were answered on the AMA call. They are working on a ârage quitâ option, Going forward no backing price. In order for me to vote yes this is a MUST. I do think the Wonderland Treasury will be beneficial to Abracadabra moving forwardâŚjust no idea how large that treasury will be.
Disclosure: Spell holder, no Time
Can we get a proforma showing what the expected range of outcomes of this merger for both projects might look like?
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The available information remains inadequate to properly evaluate the merger proposal.
Can the team substantiate (with maths) why this deal is economically rational for abracadabra token holders and address valid concerns by the community re: (1) valuation and (2) dilution?
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For important context to everybody reading, inexact math would suggest (SPELL Mcap or 654m / 2 [the dilution of your holdings] / 8m in weekly revenue = 41 weeks before you made back your moneys worth). If you are optimistic on the outperformance of SPELL directionality compared to the treasury assets during that period then this would take even longer.
Though this obviously doesnât factor possible changes in demand made by the merger. But that is vague and shouldnât be considered right now.
They need to show us all their math. All of it.
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Love it. Letâs merge.
Best for both protocols.
Spell should be the brand from now on.
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Sounds good. Letâs do it.
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Yes, I think a merger is a good idea. Wonderland owners get insider access to the cauldrons and Spell owners get a massive treasury.
My primary concern is though is that wonderland has lower-quality holders. Wonderland has lots of frogs but they also have a lot of smooth-brains that donât understand the âAPYâ is just stock splits and they sell all their rebases, and they also have several mercenaries who understand the âAPYâ but just sell all their rebases as they view it as a ponzi to take money from the smooth-brains before moving on to their next play. If the merger happens most of the smooth-brains might panic dump their spell to buy some OHM fork or meme-token, which Iâm fine with, but we should all be prepared for the dump.
Also, a much more minor concern is that Wonderland has more aggressive opponents than Spell, such as butt-hurt Trader Joes and envious Ohmies. Ohmies are powerful so I wouldnât want their hate directed at Abracadabra, but perhaps with this merger under a different brand their vindictive feelings will fade. I just want to point out that the merger wonât just bring allies, it could bring enemies as well.
Full disclosure: I hold
sSPELL: 53,693,120
wMEMO: 6.12
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$8M/week is a widely inaccurate projection. If you donât agree, try to give everybody here a breakdown of where this $8M/week revenue would actually come from.
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You are replying to me when you should be replying to 0xMerlin, I took the figure from his post. I donât think itâs inaccurate though, itâs a 52% APR on a 800m treasury.
I think this sounds like a great idea. I have full confidence in the entire crew to know what´s best for the project. Will there still be rebasing or will that go?
I would like to keep my beloved stablecoin protocol as far away as possible from the time ponzi so that would be a no
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Proud SPELL holder from August, hard NO!
Anybody who wants exposure to the WL treasury can just go ahead and buy wMEMO at a discount right now. Thereâs no reason to merge 2 projects that are so vastly different.
Iâm sorry to Dani and the team, I trust you to handle each project individually, but I never bought TIME/wMEMO because Iâm not into ponzis.
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That will go, and that question makes it increasingly clear to me that many Wonderland holders love the proposal and most Spell holders hate it.
Couldnât be more obvious who is getting the short end of the stick. Iâm very disappointed.
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I have created a discussion around a potential improvement to the proposal. Please let me know what you think or add anything to the conversation that you feel is relevant:
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Under the assumption that the merger happens, 98B spell holding from Wonderland conversion is greater than the 81B spell in circulation right now (taken today from coingecko).
I see that as a problem from both a governance perspective and price action. Because I view wMemo holders and Spell hodlers as two very different demographics:
Wonderland holders are either:
a) in it for the rebasing meme (plenty still want the high APY to continue)
b) in it for the investment returns, I see discord asking âwen airdropâ, âwen revenue shareâ all day
Spell holders genernally:
a) want long term value, no ponziknomics, just hard earned dollars
b) invested in a lending/borrowing market
I donât see them being incentive aligned. I worry that Wonderland spell holders will also dump the spell the minute they receive them as many have suffered losses. This is very bad for spell price, which can cause another liquidation cascade on spell/sspell cauldrons.
I would propose that we institute a vesting schedule, or an incentive to hold converted spell / punishment for dumping spell. I would not even mind a bonus spell allocation for those who hold, although human psychology is werid, a penalty is usually a bigger force than a bonus 
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Based on the calls today I have to say that I am warming up to this proposal. It does need a few modifications.
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Wonderland owners must have the ârage quitâ option that will allow them to sell back to Wonderland Treasury before they are in SPELL, in fact I think an account similar to an escrow account in real estate would be good, so this could even happen after the merger and not impact SPELL price. wMemo holders would be given the option to stay for a period of time or liquidate using wonderland treasury funds and not SPELL.
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Backing price or option of buy back needs to be eliminated going forward. If people choose to leverage then they establish the liquidation price and if they are liquidated then they are on their own.
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This is the way and I agree, post snapshot plz.