Merchandise Store pricing in ADA
Problem
Custom T-shirts are a common way to raise brand awareness and funds online however sales are not done in ADA due to exchange volatility.
Solution
Create a smart contract allowing fixed price merchandise to be sold in volatile ADA while ensuring direct funding of causes or creators.
Total to date
This is the total amount allocated to Merchandise Store pricing in ADA.
About this idea
[IMPACT]
DAO Coders to raise additional funds for development costs of its DAO-NET and Alternative to Tyranny (A2T) product lines would like to sell t-shirts, caps and other merchandise, with community generated slogans, memes and artwork, online using ADA with a publicly known portion of the purchase price being automatically redirected to the community creator.
The rapid volatility of ADA exchange rates are not suited to merchandise manufacturers who are dealing in fiat currency costs. A possible solution would be to price merchandise in a stable coin however since DAO Coders operates primarily using an ADA budget this would result in multiple cryptocurrency exchanges which are time consuming and inefficient.
The proposed solution starts with partnering with one or more merchandise vendors willing to accept payment in a stable coin or cryptocurrency that can be paired with ADA. If a vendor was willing to accept payment in ADA then this would greatly simplify this solution but none were found while researching this proposal.
DAO Coders will create a smart contract that will use a third party oracle to determine the exchange rate between ADA and the stable coin or cryptocurrency that the merchandise is priced in. The smart contract will provide the real time price to the purchaser along with the division of ADA between DAO Coders (or other DAO/organization), the content creator and the merchandise Vendor. If the transaction is executed then the smart contract will send the appropriate ADA to DAO Coders and the content creator while the vendor ADA will be directed through an appropriate exchange process before being sent to the Merchandise Vendor.
An example transaction:
- community member Amy creates a funny meme for DAO-NET and uses the smart contract to setup T-Shirt sales with a 2 ADA surcharge to herself as the content creator and a 2 ADA surcharge to DAO Coders the organization which she wishes to support on each sale.
- Bob's Custom T-Shirts agrees to the smart contract with a base purchase price 20 USDT (Tether)
- Cathy wants to buy the funny meme T-shirt from Bob's Custom T-Shirts using the smart contract
- The smart contract checks with the oracle and determines that 20 USDT at current exchange rates is 24 ADA
- Cathy sees a purchase price of 28 ADA with 24 ADA going to the vendor, 2 ADA going to the Creator and 2 ADA going to support DAO Coders plus the transaction fee
- Cathy agrees to the purchase which sends 2 ADA to Amy's Shelley address, 2 ADA to DAO Coder's Shelley address and 24 ADA to another smart contract that converts the ADA into 20 USDT and sends the USDT on to Bob's wallet
The proposed smart contract is intended to be readily usable by any DAO within DAO-NET as a means of fund raising and as open source software could be used by other Cardano community members.
The long term strategy is to have multiple income streams for DAO Coders to support the DAO-NET and A2T product lines including in this case merchandising revenue. This same merchandising solution is also intended to be used by DAOs within DAO-NET and game developers within A2T to fund their development costs. Third party organizations will also be welcome to use the solution and they will be encouraged to direct a small portion of their sales towards future enhancement and support costs of the solution however it will not be a requirement.
Raising funds for development costs addresses the challenge of meeting real business needs while most of the key metrics in the challenge directly align with the project including # of Cardano Dapps supporting business solutions, # of existing companies proposing Cardano-based solutions, # of partnerships / joint ventures created between companies, $ additional funding from other sources for the funded proposals and % growth in mainnet / testnet activity due to business solutions.
The outcome of the project will be communicated in a Town Hall and professionally marketed if the DAO-NET & A2T Marketing proposal is funded.
The use of a third party oracle to determine the exchange rate between ADA and a stable coin or other cryptocurrency and the amount of time that price is valid is a very large challenge, as is automating the process for converting ADA and redirecting the new currency to the vendor.
Alternative solutions may be required for instance using fiat currency merchandise pricing and an oracle for current ADA pricing in that fiat currency to determine the real time ADA price. ADA could then be transferred to the vendor who would need to manually convert the ADA to fiat currency in a timely fashion.
The objective is to automate the process as much as possible to be close to real time and minimize pricing volatility risk. It is doubtful that the process of converting ADA to fiat currency can be automated which is why the conversion to a stable coin is the preferred option.
Djed may offer some solution options that will simplify this proposal and these will be actively investigated as part of the project.
[FEASIBILITY]
May 2022
- Partner with one or more merchandise vendors
- Research Djed and other stable coin integration options
- Research ADA pricing oracle options
June 2022
- Prototype smart contract purchasing process
July 2022
- Prototype smart contract ADA conversion process for vendor to complete Merchandise Store process
August 2022
- Third Party Smart Contract Audits
September 2022
- Test Merchandise Store smart contract on Testnet
October 2022
- Launch Merchandise Store smart contract on Mainnet
Plutus Developers ($4000/month):$24,000
Third Party Smart Contract Audit: $10,000
Product Manager ($1,000/month): $6,000
Total: $40,000
Product Manager
- have a holistic understanding of the DAO-NET suite of proposals
- experienced in managing multidisciplinary teams in up to a dozen projects simultaneously
- ability to articulate and fluently translate between business and technical requirements
- able to manage large complex budgets
- experienced in hiring consultants and third party contract negotiations
Lead Developer
- Full stack developer experience
- Plutus development, especially algorithmic DAO smart contract primitive
- Define technical requirements
- Integrate multiple software components into a larger solution
Plutus Developers
- Full stack developer experience
- Plutus development of smart contracts, Plutus Pioneer preferred
Team
Product Manager: Dwayne Collard - 20 years+ IT Consultant, Solutions Analyst, IT Manager, Veteran Community Advisor https://www.linkedin.com/in/dwayne-collard/
Lead Developer: Jude Ben - 9 years+ Software Development , Plutus Smart Contract Development , Cloud and Infrastructure Engineer https://www.linkedin.com/in/judeebene/
Plutus Developers: As part of previous DAO-NET funding, DAO Coders has been building a small pool of, currently 3, contractors. This work will be done by new contractors that will be added to that pool.
[AUDITABILITY]
Development progress will be tracked using an agile methodology and weekly team meetings. Specific quantitative indicators to be tracked will be Total Number of Pull requests in Github, Total Numbers of Github commits and the Total Number of Errors Fixed.
Success Criteria
- Content creators are able to setup smart contracts dividing payments between themselves, merchandise vendors and organizations they are seeking to fund.
- Merchandise vendors are able to set pricing in an acceptably non-volatile currency.
- Purchasers are able to see the purchase price in ADA broken down by how much ADA goes to each party before submitting a purchase.
- Smart contract distributes payment to various parties with vendor amount ideally automatically exchanged into acceptable non-volatile currency or at a minimum with the amount of ADA being calculated using near real time exchange rates.
- Relevant smart contracts successfully pass security audits from a credible third party
This proposal is a member of the DAO-NET suite of proposals originally submitted in Fund 7 and continued in Fund 8. This proposal is new addition to the suite.
In Fund 7, the following DAO-NET suite of proposals were funded: DAO-NET: DAO Deployment Platform, DAO-NET: Legal Defense DAO, DAO-NET: Auditor DAO and DAO-NET: Multilingual Translation.
In Fund 7, there were a total of 8 other DAO-NET proposals that were approved but not funded.
All of the DAO-NET suite of proposals are interrelated but each proposal in Fund 7 could be standalone funded. The core DAO smart contract coding was funded with the DAO-NET: DAO Deployment Platform project which means that this work no longer needs to be contingency funded in Fund 8.
DAOs are a paradigm evolution in how societies organize themselves and the DAO-NET vision is to systematically progress towards that evolution by breaking the larger vision down into small incremental steps with each proposal. As part of that vision all DAO Coder Inc intellectual property is intended to be freely shared with the world so that any insights can be duplicated in other experiments to rapidly advance decentralized governance therefore:
- All software developed as part of this proposal will be Open Source under Apache License, version 2.0
- All documentation will be licensed under the Creative Commons Attribution 4.0 International Public License
In Fund 8, DAO Coders Inc has submitted 2 categories of proposals Alternative to Tyranny (A2T) proposals which are decentralized wargame simulator modules for testing decentralized idea implementations against probable authoritarian responses and DAO-NET proposals which are real world implementations that can be implemented immediately.
A2T and DAO-NET share a lot of base smart contract code and are meant to be interoperable to the largest degree and conceptually share similar designs. As new features are added in either suite then the transfer to the other suite of those improvements should be straight forward however since each suite is designed to be independently community run, after launch, this easy interoperability may diverge over time.
In Fund 8, DAO Coders has submitted the following proposals:
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Team
DAO Coders Inc is an experienced team of Blockchain developers, Plutus pioneers, Veteran Community Advisors and Solutions Analysts that was incorporated after previous round funding for several DAO-NET suite proposals.
