[Discussion] Compensation Valuation in light of Token Price Volatility


To solicit thoughts regarding fair bounty/opportunity valuation considering crypto price volatility and NEAR ecosystem objectives.


Currently, Catalyst enables communities to post opportunities (bounties) that people can accept and complete. Example:

When posting, the proposer of the opportunity currently sets a base reward in NEAR. Once someone accepts the opportunity, that NEAR gets reserved in escrow ensuring that when the work is done and accepted there is NEAR available to pay it out. The only way to move it back to the community fund is a proposal to cancel the accepted opportunity (thus protecting people who do work).

The challenge is that given volatility of NEAR, the value of that opportunity may go up or down by the time it is accepted and completed.


There are two actors in this situation with competing interests:

  • The community (opportunity provider) - who is posting an opportunity and selecting a NEAR price to value it based on the price of NEAR at the time of proposing; and

  • The contributor (opportunity accepter) - who is accepting the opportunity based in part on the current value of the opportunity.

When NEAR increases and no way to adjust the valuation of the opportunity, it favors the contributor at the detriment of the provider who is now paying a higher value for the work getting done.

When NEAR decreases without any way to adjust the valuation of the opportunity, it favors the provider to the detriment of the contributor who is now completing work for some fraction of the original opportunity value.

How are communities dealing with this? I’ve noticed a couple variations that include:

  • Adopting USD as a means of valuation/limits (e.g. OWS)
  • Adjusting payouts using a price based on a 7 day moving average (e.g. Vital Point AI)
  • Simply accepting the volatility and the associated risks that come with it

Couple Thoughts About These Methods

1. Adopting USD - while effective at stabilizing a valuation, it feels off to me and a little counterintuitive to the whole idea of the crypto space. Perhaps if NEAR had a stablecoin or projects valued things against something like DAI it would seem better. It also causes issues/complexity with automation without a trusted oracle providing the pricing information.

2. Adjusting payouts based on some average price - having done it, it requires manual work without implementing an oracle resulting in same issues as number 1. It’s a compromise where both provider and contributor bear a bit of the volatility risk, but potential is still there for it to be lopsided.

3. Accept it - Both parties enter the agreement knowing they could pay more/less or receive more/less. Bit of a speculator stance where contributors may accept lower valued work in anticipation of upward price movement and similarly opportunity providers may value it higher in hopes of getting more for less with a downward price movement.

When we talk about valuation there are also regional considerations to think about. |The inherent skill/competency required to do a specific piece of work remains constant but what one person living in one area might value it at compared to somewhere else can be drastically different. Where it might be normal to expect an hour of coding for $10 in one area, that would be below minimum wage in others. So, do we try and take that into account and localize community opportunity offerings?

Potential Way Forward

In deciding how to adjust things for Catalyst communities - we’re setting some principles (which are currently just thoughts) to help us head in a direction that we think will help create the future we want to see. Namely:

  1. Solution must enable crypto adoption (NEAR)
  2. Solution must enable automation
  3. Solution must ensure equality (preference of eliminating regional disparities - adopting global perspective)
  4. Solution must be fair and transparent

In our case, we think it is important that we protect contributors from doing work that they may not get paid for which means putting the agreed on value of NEAR (or other token) into escrow. Because of that, we’re thinking that:

a. Opportunity provider sets a valuation based on what they feel is fair in terms of what they know (likely some kind of stablecoin/USD reference point). Over time, we think that the market will determine what is actual fair market value for those opportunities within their community.

b. Contributor decides to accept or not (this is what will ultimately determine valuation in that community eventually).

c. At time of acceptance, valuation is automatically converted to NEAR at current NEAR price and that becomes the settlement amount that goes into escrow regardless of any volatility that may occur afterwards.

May not be the ideal solution - but we think it mitigates some of the issues while still providing the means for people to earn NEAR, be part of the ecosystem and share in the upside potential.

Would be very interested in anyone else’s thoughts on this/how you are approaching the issue in your communities/guilds.


This is something which I support entirely, the funds which are distributed are still NEAR, it’s just the volatility between time of proposal and payout is hugely mitigated:

AstroDAO does/will have the ability to support fungible token payouts and with the emergence of a native NEAR stablecoin, that might be one way to get around it.

That being said, it’s unlikely the stablecoin(s) will be on an exchange initially, so for those needing to fund their initiatives in fiat it may simply add another step in the process of being awarded funds to turn it to cash.

We did consider this, too. However, the workload required for the returns was deemed too high.

Definitely understand, but considering the global reach, why choose USD as the method of valuation? I’m certainly not attacking a decision to use it as it only makes sense to do something to mitigate the volatility. Always seems like USD is the easy default (maybe because it’s recognized worldwide). Why don’t we consider options like having mechanisms in place for valuation to be done in a currency of choice that resonates with the locale of the person posting an opportunity. Or, why not valuate using USDT or USDC to at least stay away from fiat as a matter of principle while remaining locale agnostic - in effect, does the same thing, but doesn’t suggest USD has a higher level of importance than any other nation’s currency.

Are you tracking an intent for Astro or other DAO to support a choice of payout in fiat?

Standard unit of value for markets generally, especially crypto.

Since USD is not that volatile, it’s generally the same approach. Happy to have proposals in any non hyper inflationary fiat tbh.

Quoting in USDT/USDC/any stablecoin which is pegged to USD and USD is exactly the same. I don’t think it elevates USD to a higher level of importance. If that were the case, wouldn’t it seem like we were elevating that stablecoin to a higher level of importance?

AstroDAO has this functionality, but I think it’s only working through CLI atm

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