The following reflects the views of GMX’s Governance Committee, and is based on the combined research, evaluation, consensus, and ideation of various committee members.

CyberCash offers a promising approach to driving real-world crypto adoption, but the proposal has significant gaps in execution, feasibility, and alignment with Arbitrum DAO’s goals. Below is a structured review with some feedback and questions.

1. What existing merchants or Web3 projects have shown interest in integrating $CASH?
2. Can you provide detailed mechanics of the dual burn system and how it prevents abuse?
3. What marketing and user acquisition strategies will be deployed beyond hackathons?
4. How do you ensure sustainable liquidity after the initial grant funding? What are your plans to create sticky liquidity.

• Requesting 200K ARB for liquidity is too high without clear proof of adoption. • The proposal should clearly address how the ecosystem will sustain itself after the grant funds run out. • The project still appears to be in its early stages. It would be ideal to demonstrate some partnerships, pre-signups, or merchant interest for the app. • As suggested by Gabriel, the team could consider applying for a smaller grant through the Questbook program initially and then pursue a larger request from the DAO once they have demonstrated progress.

There must be a misunderstanding. It's a 7 minute read, not 7 readers. For referrence, we attach our stats of the post on X that links to the medium article.

To emphasize, we're a small startup building on Arbitrum, not a mammuton project bringing millions of eyeballs to Arbitrum. We build innovative applications with the goal of growing big over time and surely that is valuable in its own right. Feel free to help us with the reach! :)

Thank you for the suggestion! This is precisely what we aim to accomplish over time. It should be understood that such integrations require a certain economic mass and transaction volume to be attractive for the service provider. Hence, the first adoption phase of CyberCash will happen on-chain.

Like @BlockworksResearch mentioned, the request is missing some important details like KPIs and a clear process to really convince the DAO to spend.

I don’t see how Arbitrum really benefits from collaborating with CyberCash in the liquidity pool, apart from a TEMPORARY bump in demand for ARB (assuming CyberCash succeeds in getting token adoption in real transactions :)).

And when it comes to potential, I’m not sold on CyberCash helping Arbitrum become more popular as an L2. The only thing I found on CyberCash was a Medium post called CyberCash: The currency that pays. with just 7 reads, seems very low reach tbh.

So here is my suggestion: If you want your token to be used in everyday transactions, maybe look into integrating it with Web3 e-commerce platforms like Uquid (https://x.com/uquidcard) or WOO, where users can actually spend $CASH on digital or physical goods.

Just my two cents :), will vote against at this time.

Thank you for all the comments & questions.

We noticed that most criticism is directed at the proposal’s structure or the process itself, e.g. waiting for grant frameworks to launch instead of making a direct proposal to the DAO right now, or lack of KPI forecasts.

While we laid out our opinion on this already, we take the lack of detailed criticism of the fundamental idea of CyberCash as encouragement to move forward.

If you have critical feedback on the core economics of CyberCash, please do let us know, we’re happy to engage. As long as the LP is not launched, changes can be made. If you want to share your thoughts, best to join our Discord for public discussion or reach out via DM.

To not further delay the launch, we decided to withdraw our grant request.

Meanwhile, we want to maximally align with the Arbitrum network and its community / DAO.

Therefore, we decided to launch the Genesis LP with CASH/ARB pairing instead of CASH/ETH. Possum Labs will purchase 5k ARB to seed the LP. Further, we decided to permanently lock 100% of that liquidity – no vesting for Possum Labs as originally planned. CASH is supposed to be a neutral currency, and we concluded that reserving vested tokens for us, even in LP form, counteracts this purpose.

A “migration” of the Genesis LP to UniV4 will not happen, however, free market participants can create additional pools on V4 and we fully expect those to emerge. V2 was chosen because the LP burn mechanism would cause issues with the singleton architecture of V4 which is only a problem regarding the Genesis LP, not regular LPs.

Since multiple commenters questioned how the pairing aligns interests between ARB holders and CASH users, we’re happy to give a short explanation.

The Genesis LP is the primary and initially the only way to buy CASH. This means, if buyers don’t own ARB, they must first purchase ARB to then buy CASH. Of course, this process happens automatically via DEX routers. Hence, all buy pressure on CASH translates into equal buy pressure on ARB. A great showcase of this effect is the TRUMP memecoin launch. Do check the price of SOL on Jan 18/19. People needed SOL to buy TRUMP, which drove up SOL price significantly – the two tokens marched in lockstep for multiple days. Similar transfer of value effects for the benefit of ARB are a mathematical consequence if CyberCash is successful.

CASH’s goal is to become an international, multi trillion-dollar currency over the years to come, following Bitcoin’s original ambition. Thus, we think it is vitally important to align long term financial interests between the network that hosts the currency and users of the currency.

While we would have been excited to receive financial support from the DAO in this endeavour, we’re still convinced that Arbitrum is the best home for this experiment and would appreciate your support in any other form that may help us succeed together.

We’ll launch the LP in exactly one week from now on Feb 28.

The official CyberCash twitter profile. https://x.com/CyberCashMoney

CyberCash homepage: www.cybercash.money

We’re ready for the journey and hope the Arbitrum community will join us in this effort.

Thanks again to all commentators, LFG! :fire:

@0xDonPepe @danielM @jameskbh @Zeptimus @Gabriel @Sinkas @cp0x @karpatkey @GensDAO @Euphoria

The following reflects the views of GMX’s Governance Committee, and is based on the combined research, evaluation, consensus, and ideation of various committee members.

CyberCash offers a promising approach to driving real-world crypto adoption, but the proposal has significant gaps in execution, feasibility, and alignment with Arbitrum DAO’s goals. Below is a structured review with some feedback and questions.

1. What existing merchants or Web3 projects have shown interest in integrating $CASH?
2. Can you provide detailed mechanics of the dual burn system and how it prevents abuse?
3. What marketing and user acquisition strategies will be deployed beyond hackathons?
4. How do you ensure sustainable liquidity after the initial grant funding? What are your plans to create sticky liquidity.

• Requesting 200K ARB for liquidity is too high without clear proof of adoption. • The proposal should clearly address how the ecosystem will sustain itself after the grant funds run out. • The project still appears to be in its early stages. It would be ideal to demonstrate some partnerships, pre-signups, or merchant interest for the app. • As suggested by Gabriel, the team could consider applying for a smaller grant through the Questbook program initially and then pursue a larger request from the DAO once they have demonstrated progress.

There must be a misunderstanding. It's a 7 minute read, not 7 readers. For referrence, we attach our stats of the post on X that links to the medium article.

To emphasize, we're a small startup building on Arbitrum, not a mammuton project bringing millions of eyeballs to Arbitrum. We build innovative applications with the goal of growing big over time and surely that is valuable in its own right. Feel free to help us with the reach! :)

Thank you for the suggestion! This is precisely what we aim to accomplish over time. It should be understood that such integrations require a certain economic mass and transaction volume to be attractive for the service provider. Hence, the first adoption phase of CyberCash will happen on-chain.

Like @BlockworksResearch mentioned, the request is missing some important details like KPIs and a clear process to really convince the DAO to spend.

I don’t see how Arbitrum really benefits from collaborating with CyberCash in the liquidity pool, apart from a TEMPORARY bump in demand for ARB (assuming CyberCash succeeds in getting token adoption in real transactions :)).

And when it comes to potential, I’m not sold on CyberCash helping Arbitrum become more popular as an L2. The only thing I found on CyberCash was a Medium post called CyberCash: The currency that pays. with just 7 reads, seems very low reach tbh.

So here is my suggestion: If you want your token to be used in everyday transactions, maybe look into integrating it with Web3 e-commerce platforms like Uquid (https://x.com/uquidcard) or WOO, where users can actually spend $CASH on digital or physical goods.

Just my two cents :), will vote against at this time.

Thank you for all the comments & questions.

We noticed that most criticism is directed at the proposal’s structure or the process itself, e.g. waiting for grant frameworks to launch instead of making a direct proposal to the DAO right now, or lack of KPI forecasts.

While we laid out our opinion on this already, we take the lack of detailed criticism of the fundamental idea of CyberCash as encouragement to move forward.

If you have critical feedback on the core economics of CyberCash, please do let us know, we’re happy to engage. As long as the LP is not launched, changes can be made. If you want to share your thoughts, best to join our Discord for public discussion or reach out via DM.

To not further delay the launch, we decided to withdraw our grant request.

Meanwhile, we want to maximally align with the Arbitrum network and its community / DAO.

Therefore, we decided to launch the Genesis LP with CASH/ARB pairing instead of CASH/ETH. Possum Labs will purchase 5k ARB to seed the LP. Further, we decided to permanently lock 100% of that liquidity – no vesting for Possum Labs as originally planned. CASH is supposed to be a neutral currency, and we concluded that reserving vested tokens for us, even in LP form, counteracts this purpose.

A “migration” of the Genesis LP to UniV4 will not happen, however, free market participants can create additional pools on V4 and we fully expect those to emerge. V2 was chosen because the LP burn mechanism would cause issues with the singleton architecture of V4 which is only a problem regarding the Genesis LP, not regular LPs.

Since multiple commenters questioned how the pairing aligns interests between ARB holders and CASH users, we’re happy to give a short explanation.

The Genesis LP is the primary and initially the only way to buy CASH. This means, if buyers don’t own ARB, they must first purchase ARB to then buy CASH. Of course, this process happens automatically via DEX routers. Hence, all buy pressure on CASH translates into equal buy pressure on ARB. A great showcase of this effect is the TRUMP memecoin launch. Do check the price of SOL on Jan 18/19. People needed SOL to buy TRUMP, which drove up SOL price significantly – the two tokens marched in lockstep for multiple days. Similar transfer of value effects for the benefit of ARB are a mathematical consequence if CyberCash is successful.

CASH’s goal is to become an international, multi trillion-dollar currency over the years to come, following Bitcoin’s original ambition. Thus, we think it is vitally important to align long term financial interests between the network that hosts the currency and users of the currency.

While we would have been excited to receive financial support from the DAO in this endeavour, we’re still convinced that Arbitrum is the best home for this experiment and would appreciate your support in any other form that may help us succeed together.

We’ll launch the LP in exactly one week from now on Feb 28.

The official CyberCash twitter profile. https://x.com/CyberCashMoney

CyberCash homepage: www.cybercash.money

We’re ready for the journey and hope the Arbitrum community will join us in this effort.

Thanks again to all commentators, LFG! :fire:

@0xDonPepe @danielM @jameskbh @Zeptimus @Gabriel @Sinkas @cp0x @karpatkey @GensDAO @Euphoria

Thank you for submitting your proposal, @PossumLabs. After reviewing it, we’re not inclined to support it at this time. Here’s our reasoning:

The project itself seems quite new, and there isn’t enough clarity about the “PSM swap to CASH.” Specifically, it’s unclear what was the PSM token for, who the PSM holders are, and why it needs to be swapped into CASH.

The proposal also raises a red flag with the 1bn annual inflation. Given the limited traction so far, such a large inflation rate could significantly undermine the value of CAS even with a burn mechanism in place because the growth in supply likely won’t be offset by usage.

Additionally, the referenced “audit” appears to be conducted internally rather than by a third-party, which raises more questions than it answers. If you do secure funding, we’d like to see a clearer plan for how these funds will be utilized beyond simply denominating the token in ARB rather than ETH.

We also share the concerns expressed by others:

Nothing in this proposal convinces us that the project is positioned to make that leap successfully. Likewise, as @BlockworksResearch has pointed out, the proposal requires a complete overhaul and a refinement of how it will positively impact Arbitrum:

In its current form, we don’t see a compelling case for Arbitrum to provide a grant. We appreciate your effort so far, but we believe more substance, transparency, and a stronger roadmap are needed before we can support this proposal.

The following reflects the views of L2BEAT’s governance team, composed of @krst and @Sinkas. It’s based on their combined research, fact-checking, and ideation.

We appreciate the ambition behind this grant request for CyberCash and the outlined plans to boost ARB’s on-chain utility. However, we have several questions/points that we believe should be addressed before the proposal is even at a stage where a temp-check is needed.

1. Liquidity Pool

   The majority of the grant is supposed to help bootstrap the liquidity pool which while we understand, we find a bit premature. But aside from whether the timing is correct, there are a bunch of other things that make us skeptical:

   • Why was Uniswap V2 chosen? Apart from the fact that there are native Arbitrum DEXs you could maybe use, there are also newer deployments of Uniswap that can provide a fair launch (e.g., V4 and Flaunch).
   • If we’re providing the sole counterpart for the CASH, we’re basically taking on all the risk and none of the upside of LPing. And since CyberCash is a relatively new protocol, there is a high chance that the DAO’s funds will simply be used as exit liquidity.
   • To mitigate the point directly above, we could either match the ARB that your own team puts up in the liquidity pool. Or, you could provide the CASH, the DAO provides the ARB, and we use a multisig wallet to jointly provide liquidity, sharing both the risk and the upside.

2. Additional Budget Breakdown:

   Aside from the 200,000 to the liquidity pool, the proposal also requests 60,000 ARB for ‘Developer Onboarding & Support’ and another 40,000 ARB for ‘Community Engagement & Growth.’ There’s little in the way of justification for these amounts or an explanation on how they’ll be used or what success would look like.

3. Custody of the funds

   This isn’t really feedback for the proposal as much as it is us pointing out something that you might not be aware of. In August 2024, the DAO established the Multisig Support Service (MSS), which is the way most funds that need to be held in a multisig are held. It’s worth updating your proposal and pointing out that the funds will be held by the MSS.

Hi @Gabriel, thank you for the well meaning feedback.

We did not receive any grants to date and this is our first and only grant application in this context. Possum Labs is not VC funded but rather supported by our community which gives us the freedom to explore these "crazy" ideas. :slight_smile:

Speaking personally, I'm familiar with Olympus DAO, but their economic model didn't solve the part where spending and organic integration of OHM is natively incentivized. This is the core mechanism and innovation of CyberCash because it allows developers and businesses to earn from integrating CASH.

We agree that 150k is not enough to instantly establish a new medium of exchange. That would take hundreds of billions, realistically. Though, BItcoin itself started merely as an idea with little to no capital. An experiment to solve the flaws of fiat money which happened to gain traction to everyone's surprise.

Upfront cost can be replaced with effort over time, if the fundamental game theory is sound. The main purpose of the grant is to align economic incentives between CASH and ARB by pairing them in the Genesis LP.

To clarify, contrary to the LTIPP or STIPP, the granted ARB is not distributed as incentives to create a temporary farming opportunity, but it is locked in the Genesis LP.

Could you please elaborate on your doubt? Why do you think it is designed for insiders? In case you mean early adopters, then yes, they certainly have a huge opportunity if the project takes off. But they also take the biggest risk which must be compensated, otherwise nobody is incentivized to participate early.

Appreciate your constructive criticism! :slight_smile:

Thank you for submitting your proposal, @PossumLabs. After reviewing it, we’re not inclined to support it at this time. Here’s our reasoning:

The project itself seems quite new, and there isn’t enough clarity about the “PSM swap to CASH.” Specifically, it’s unclear what was the PSM token for, who the PSM holders are, and why it needs to be swapped into CASH.

The proposal also raises a red flag with the 1bn annual inflation. Given the limited traction so far, such a large inflation rate could significantly undermine the value of CAS even with a burn mechanism in place because the growth in supply likely won’t be offset by usage.

Additionally, the referenced “audit” appears to be conducted internally rather than by a third-party, which raises more questions than it answers. If you do secure funding, we’d like to see a clearer plan for how these funds will be utilized beyond simply denominating the token in ARB rather than ETH.

We also share the concerns expressed by others:

Nothing in this proposal convinces us that the project is positioned to make that leap successfully. Likewise, as @BlockworksResearch has pointed out, the proposal requires a complete overhaul and a refinement of how it will positively impact Arbitrum:

In its current form, we don’t see a compelling case for Arbitrum to provide a grant. We appreciate your effort so far, but we believe more substance, transparency, and a stronger roadmap are needed before we can support this proposal.

The following reflects the views of L2BEAT’s governance team, composed of @krst and @Sinkas. It’s based on their combined research, fact-checking, and ideation.

We appreciate the ambition behind this grant request for CyberCash and the outlined plans to boost ARB’s on-chain utility. However, we have several questions/points that we believe should be addressed before the proposal is even at a stage where a temp-check is needed.

1. Liquidity Pool

   The majority of the grant is supposed to help bootstrap the liquidity pool which while we understand, we find a bit premature. But aside from whether the timing is correct, there are a bunch of other things that make us skeptical:

   • Why was Uniswap V2 chosen? Apart from the fact that there are native Arbitrum DEXs you could maybe use, there are also newer deployments of Uniswap that can provide a fair launch (e.g., V4 and Flaunch).
   • If we’re providing the sole counterpart for the CASH, we’re basically taking on all the risk and none of the upside of LPing. And since CyberCash is a relatively new protocol, there is a high chance that the DAO’s funds will simply be used as exit liquidity.
   • To mitigate the point directly above, we could either match the ARB that your own team puts up in the liquidity pool. Or, you could provide the CASH, the DAO provides the ARB, and we use a multisig wallet to jointly provide liquidity, sharing both the risk and the upside.

2. Additional Budget Breakdown:

   Aside from the 200,000 to the liquidity pool, the proposal also requests 60,000 ARB for ‘Developer Onboarding & Support’ and another 40,000 ARB for ‘Community Engagement & Growth.’ There’s little in the way of justification for these amounts or an explanation on how they’ll be used or what success would look like.

3. Custody of the funds

   This isn’t really feedback for the proposal as much as it is us pointing out something that you might not be aware of. In August 2024, the DAO established the Multisig Support Service (MSS), which is the way most funds that need to be held in a multisig are held. It’s worth updating your proposal and pointing out that the funds will be held by the MSS.

Hi @Gabriel, thank you for the well meaning feedback.

We did not receive any grants to date and this is our first and only grant application in this context. Possum Labs is not VC funded but rather supported by our community which gives us the freedom to explore these "crazy" ideas. :slight_smile:

Speaking personally, I'm familiar with Olympus DAO, but their economic model didn't solve the part where spending and organic integration of OHM is natively incentivized. This is the core mechanism and innovation of CyberCash because it allows developers and businesses to earn from integrating CASH.

We agree that 150k is not enough to instantly establish a new medium of exchange. That would take hundreds of billions, realistically. Though, BItcoin itself started merely as an idea with little to no capital. An experiment to solve the flaws of fiat money which happened to gain traction to everyone's surprise.

Upfront cost can be replaced with effort over time, if the fundamental game theory is sound. The main purpose of the grant is to align economic incentives between CASH and ARB by pairing them in the Genesis LP.

To clarify, contrary to the LTIPP or STIPP, the granted ARB is not distributed as incentives to create a temporary farming opportunity, but it is locked in the Genesis LP.

Could you please elaborate on your doubt? Why do you think it is designed for insiders? In case you mean early adopters, then yes, they certainly have a huge opportunity if the project takes off. But they also take the biggest risk which must be compensated, otherwise nobody is incentivized to participate early.

Appreciate your constructive criticism! :slight_smile:

Hi @PossumLabs, thank you for the proposal. I really like seeing new ideas coming to Arbitrum, especially in DeFi.

First, I’d like to ask if you’ve received any other grants or funding for the project. Also, I don’t think this makes sense to fund as it seems the protocol lacks a way to attract users and become a medium of payment. Other protocols, like Olympus DAO, have tried in the past to become a medium of exchange through innovative coin distribution methods, and they have failed to do so even though they once got traction and thousands of users. I would like to point it seems your tokenomics are strangely designed for insiders to get most of the profit. I’m not really convinced by how the project is structured.

I don’t want to go into too much detail, but I agree with other delegates that $150k is not enough to create a medium of exchange, which even ETH or BTC have yet to achieve.

I think this would be better designed if it aimed to become a stablecoin with a more innovative design, including payment features.

Finally, I don’t mean to sound rude, but Arbitrum has already gone down the path of doing LTIPPs, and they have not been that impactful in the long term. So, I disagree with all the benefits to ARB that you mentioned. I think if you want a lower grant to fund development and specific objectives, you should consider applying to Questbook in the next season.

Obviously nobody except you can check who else got banned. I don't remember when I was kicked for asking questions about the state of the project and the direction it's going. But obviously you can now state it's toxic behavior pointing to a flaw in the protocol.

What kind of "several times" did I state something wrong?

I think your post should also shed some light to the DAO showing that you are only here looking for a grant although you should have made at least the same amount of money with your other successfully projects. So why not use those funds?

Just making the DAO aware about this.

Hi @PossumLabs, thank you for the proposal. I really like seeing new ideas coming to Arbitrum, especially in DeFi.

First, I’d like to ask if you’ve received any other grants or funding for the project. Also, I don’t think this makes sense to fund as it seems the protocol lacks a way to attract users and become a medium of payment. Other protocols, like Olympus DAO, have tried in the past to become a medium of exchange through innovative coin distribution methods, and they have failed to do so even though they once got traction and thousands of users. I would like to point it seems your tokenomics are strangely designed for insiders to get most of the profit. I’m not really convinced by how the project is structured.

I don’t want to go into too much detail, but I agree with other delegates that $150k is not enough to create a medium of exchange, which even ETH or BTC have yet to achieve.

I think this would be better designed if it aimed to become a stablecoin with a more innovative design, including payment features.

Finally, I don’t mean to sound rude, but Arbitrum has already gone down the path of doing LTIPPs, and they have not been that impactful in the long term. So, I disagree with all the benefits to ARB that you mentioned. I think if you want a lower grant to fund development and specific objectives, you should consider applying to Questbook in the next season.

Obviously nobody except you can check who else got banned. I don't remember when I was kicked for asking questions about the state of the project and the direction it's going. But obviously you can now state it's toxic behavior pointing to a flaw in the protocol.

What kind of "several times" did I state something wrong?

I think your post should also shed some light to the DAO showing that you are only here looking for a grant although you should have made at least the same amount of money with your other successfully projects. So why not use those funds?

Just making the DAO aware about this.

A lot of community members ask critical questions in our Discord and they all get answered thoroughly and respectfully just like we did here. In fact, we encourage critical questions because that helps us to potentially uncover blindspots and improve. It is part of the startup process that some ideas simply don't work out as expected. But we're still here building and improving.

Aside from bots and scammers, there was a single person banned from our Discord because of toxic behaviour. He was spreading false and damaging information about the project and team and continued to be rude after multiple warnings. That happened on October 21st last year. Apparently you were that person.

We're always happy to engage in respectful conversations, but we have basic rules of communication on our server and we do enforce them.

Your disapproval of the proposal is noted, but the above context should shed some light on the situation for everyone else.

If anyone wants to verify the truth, feel free to join our Discord and ask the community about that incident and/or scroll back in history of the general chat to that date. People remember.

Like several times in the past, you're stating objectively false information trying to support your negative opinion. The current TVL of Portals is still around 300k USD despite being in withdraw-only mode for a while already. The original grant request is for 300k ARB, ca. 150k USD and does not even relate to our existing protocols which makes a comparison pointless to begin with. But even then, your statement is simply false.

Thank you for the initial feedback @BlockworksResearch, we're happy to respond to your questions and explore how to refine the proposal.

We have highlighted the benefits for the Arbitrum DAO in the proposal, kindly refer to the respective key points under Rationale.

KPIs can only be measured in retrospect and any forecast is guesswork as it hinges on too many variables. Since we don't see value in practicing pseudo-science, we kept the benefits statement qualitative so that it's easy to understand. In our opinion, this experiment either becomes the most successful project on Arbitrum over time or a total flop. A middle ground is hardly imaginable in the long run, given the incentive structure of CyberCash. This makes KPI forecasts useless in practice.

UniV4 is very new and while certainly developed and audited by the brightest minds in crypto, it does not yet have the Lindy effect that we seek for the foundation of our project. Since the Genesis LP will be full range anyways, there is no significant benefit of using V4. In contrast, V2 is tried and true, easy to handle and does the job we need.

It can be expected that additional liquidity pools on V4 will emerge organically as market makers want to express their view in concentrated ranges and dynamic strategies, but this is up for market participants to decide.

We would highly recommend reading the linked deep dive where these details and more background information is outlined (we wanted to keep the proposal concise).

In short: the initial supply is 10Bn with an annual inflation of 1Bn.

However, we would caution against the mental shortcut to think of 10% inflation. Not only does the inflation amount stay constant, meaning the percentage inflation declines over time, but due to the burn effect it's even likely that CASH is deflationary at times, especially during the early adopter phase.

The starting parameters were chosen after careful modelling of expected adoption and inflation dynamics and observable cashflow return expectations for a new DeFi / crypto project. (The burn can be compared to long term staking)

The goal is to incentivize strong adoption early with incentives gradually shifting towards spending over the long term. This solves the hoarding dilemma that BTC experiences albeit its significant market cap. Hoarding is desirable in the beginning to reach size fast but excessive hoarding reduces liquidity and increases volatility, which is bad for a currency.

CyberCash is not yet available for trade and has no holders. If you refer to PSM, the liquidity has dried up almost entirely in anticipation of CASH, making the market cap meaningless. It was multiples higher not long ago. Metrics of our past product can be viewed on DefiLlama.

We think there is a misunderstanding and would like to clarify that the proposal is requesting 300k ARB tokens, not 300k USD in ARB. Since the market didn't look friendly upon ARB either these days, the USD value is more like 120-150k.

Agreed. The goal of this proposal is not to bring immediate awareness to Arbitrum from our community (which we brought to Arbitrum already) but rather cement alignment between ARB and CASH's success via LP pairing, higher on-chain activity and long term growth opportunities that attack the biggest market, money itself.

If the project is successful, it will logically result in higher awareness of Arbitrum, but that is not realistic for the immediate short term. In fact, it serves the other way around. If Arbitrum openly supports CyberCash with a grant, the chance of success increases, leading to a higher expected value for Arbitrum.

The LP budget of 200k ARB makes up for the majority of the grant request and should be self-explanatory.

Marketing & engagement amounts to 40k ARB, less than 20k USD which we frankly think is a one-line item. The usual practices can be expected here, like KOL collabs, competitions but also content and media production itself (infographics, videos, etc.). The budget request will be a contribution but not even cover the expenses that Possum Labs will have in this department and simply allow us to do more.

As for Developer onboarding, the 60k ARB would be split into two hackathons (a smaller pilot and larger follow up after evaluation and growth), and contribute to overhead related to support and guidance. A realistic split would be 10k/30k/20k.

All that being said, our main goal is to create alignment between ARB and CASH.

If we would eliminate all budget items and only leave the 200k ARB (ca 90k USD) for LP seeding, would this change your evaluation?

A lot of community members ask critical questions in our Discord and they all get answered thoroughly and respectfully just like we did here. In fact, we encourage critical questions because that helps us to potentially uncover blindspots and improve. It is part of the startup process that some ideas simply don't work out as expected. But we're still here building and improving.

Aside from bots and scammers, there was a single person banned from our Discord because of toxic behaviour. He was spreading false and damaging information about the project and team and continued to be rude after multiple warnings. That happened on October 21st last year. Apparently you were that person.

We're always happy to engage in respectful conversations, but we have basic rules of communication on our server and we do enforce them.

Your disapproval of the proposal is noted, but the above context should shed some light on the situation for everyone else.

If anyone wants to verify the truth, feel free to join our Discord and ask the community about that incident and/or scroll back in history of the general chat to that date. People remember.

Like several times in the past, you're stating objectively false information trying to support your negative opinion. The current TVL of Portals is still around 300k USD despite being in withdraw-only mode for a while already. The original grant request is for 300k ARB, ca. 150k USD and does not even relate to our existing protocols which makes a comparison pointless to begin with. But even then, your statement is simply false.

Thank you for the initial feedback @BlockworksResearch, we're happy to respond to your questions and explore how to refine the proposal.

We have highlighted the benefits for the Arbitrum DAO in the proposal, kindly refer to the respective key points under Rationale.

KPIs can only be measured in retrospect and any forecast is guesswork as it hinges on too many variables. Since we don't see value in practicing pseudo-science, we kept the benefits statement qualitative so that it's easy to understand. In our opinion, this experiment either becomes the most successful project on Arbitrum over time or a total flop. A middle ground is hardly imaginable in the long run, given the incentive structure of CyberCash. This makes KPI forecasts useless in practice.

UniV4 is very new and while certainly developed and audited by the brightest minds in crypto, it does not yet have the Lindy effect that we seek for the foundation of our project. Since the Genesis LP will be full range anyways, there is no significant benefit of using V4. In contrast, V2 is tried and true, easy to handle and does the job we need.

It can be expected that additional liquidity pools on V4 will emerge organically as market makers want to express their view in concentrated ranges and dynamic strategies, but this is up for market participants to decide.

We would highly recommend reading the linked deep dive where these details and more background information is outlined (we wanted to keep the proposal concise).

In short: the initial supply is 10Bn with an annual inflation of 1Bn.

However, we would caution against the mental shortcut to think of 10% inflation. Not only does the inflation amount stay constant, meaning the percentage inflation declines over time, but due to the burn effect it's even likely that CASH is deflationary at times, especially during the early adopter phase.

The starting parameters were chosen after careful modelling of expected adoption and inflation dynamics and observable cashflow return expectations for a new DeFi / crypto project. (The burn can be compared to long term staking)

The goal is to incentivize strong adoption early with incentives gradually shifting towards spending over the long term. This solves the hoarding dilemma that BTC experiences albeit its significant market cap. Hoarding is desirable in the beginning to reach size fast but excessive hoarding reduces liquidity and increases volatility, which is bad for a currency.

CyberCash is not yet available for trade and has no holders. If you refer to PSM, the liquidity has dried up almost entirely in anticipation of CASH, making the market cap meaningless. It was multiples higher not long ago. Metrics of our past product can be viewed on DefiLlama.

We think there is a misunderstanding and would like to clarify that the proposal is requesting 300k ARB tokens, not 300k USD in ARB. Since the market didn't look friendly upon ARB either these days, the USD value is more like 120-150k.

Agreed. The goal of this proposal is not to bring immediate awareness to Arbitrum from our community (which we brought to Arbitrum already) but rather cement alignment between ARB and CASH's success via LP pairing, higher on-chain activity and long term growth opportunities that attack the biggest market, money itself.

If the project is successful, it will logically result in higher awareness of Arbitrum, but that is not realistic for the immediate short term. In fact, it serves the other way around. If Arbitrum openly supports CyberCash with a grant, the chance of success increases, leading to a higher expected value for Arbitrum.

The LP budget of 200k ARB makes up for the majority of the grant request and should be self-explanatory.

Marketing & engagement amounts to 40k ARB, less than 20k USD which we frankly think is a one-line item. The usual practices can be expected here, like KOL collabs, competitions but also content and media production itself (infographics, videos, etc.). The budget request will be a contribution but not even cover the expenses that Possum Labs will have in this department and simply allow us to do more.

As for Developer onboarding, the 60k ARB would be split into two hackathons (a smaller pilot and larger follow up after evaluation and growth), and contribute to overhead related to support and guidance. A realistic split would be 10k/30k/20k.

All that being said, our main goal is to create alignment between ARB and CASH.

If we would eliminate all budget items and only leave the 200k ARB (ca 90k USD) for LP seeding, would this change your evaluation?

Thanks, @PossumLabs, for the proposal. The idea of ​​rewarding users for spending instead of just holding tokens is very interesting and cool as for me.

However, I want to know about how CyberCash will attract new users and merchants inside and outside the crypto space?

I’m also interested to know why you didn’t apply to participate in the Stylus Sprint program to receive a grant for CyberCash project? It seems to me that there was a good opportunity for you to get financing if the project was able to prove its advantage for the Arbitrum ecosystem over others

Thank you for the welcoming words @0xDonPepe - Arbitrum is at the forefront of DeFi innovation, which is the reason why we're building on it for >1year. It is great to hear that experiments are welcome, irrespective of the proposal outcome. :slight_smile:

That is true! However, stable coins are not money. They are fiat currencies on crypto rails with all the related problems. On topic, fiat currency is not money as it is not a store of value.

Bitcoin is a great store of value but arguably too good at that because it incentivizes excessive hoarding. This perpetuates low liquidity and high volatility which counteracts its adoption as currency.

To prove the point, BTC is much more volatile against the USD than the USD/CHF albeit having a higher market cap already according to fiatmarketcap.com.

CyberCash has inbuilt incentives that foster liquidity and velocity of its supply at scale.

To reach scale, incentives are present that reward early adopters with signficiant upside potential. In short, CASH solves the coldstarting problem and the terminal adoption problem.

We could not agree more!

In our opinion, CyberCash is a multi-year, even multi-decade project.

It took Bitcoin over 10 years to reach the 1Tn dollar mark, which is ca. 2% of the goal that CyberCash has. Not by accident, CyberCash has precisely the same goal that BTC had when Satoshi conceptualized it. It is about creating sound, digital money according to the established definition of money.

The leap to the real world can only happen after CASH established itself within crypto as a desireable medium of exchange & savings instrument (store of value). Realistically, CyberCash must reach at least a billion USD in market cap before real world adoption is thinkable. We're prepared for a long journey.

And you're right, it is fundamentally an experiment. It either becomes the most successful project on Arbitrum after years of hard work, or it flops. We are prepared to invest our time and energy into this experiment and would love to see Arbitrum join forces with a little kickstarting of the LP.

Every resource allocation is a risk and we agree that potential payoff and probability of success should be weighed carefuly. The potential for tangible benefits has been explored in the proposal and we're happy to highlight the outsized potential once more in case of success.

Do you categorically decline the idea behind CyberCash, or do you have a specific concern that we can address?

Thanks, @PossumLabs, for the proposal. The idea of ​​rewarding users for spending instead of just holding tokens is very interesting and cool as for me.

However, I want to know about how CyberCash will attract new users and merchants inside and outside the crypto space?

I’m also interested to know why you didn’t apply to participate in the Stylus Sprint program to receive a grant for CyberCash project? It seems to me that there was a good opportunity for you to get financing if the project was able to prove its advantage for the Arbitrum ecosystem over others

Thank you for the welcoming words @0xDonPepe - Arbitrum is at the forefront of DeFi innovation, which is the reason why we're building on it for >1year. It is great to hear that experiments are welcome, irrespective of the proposal outcome. :slight_smile:

That is true! However, stable coins are not money. They are fiat currencies on crypto rails with all the related problems. On topic, fiat currency is not money as it is not a store of value.

Bitcoin is a great store of value but arguably too good at that because it incentivizes excessive hoarding. This perpetuates low liquidity and high volatility which counteracts its adoption as currency.

To prove the point, BTC is much more volatile against the USD than the USD/CHF albeit having a higher market cap already according to fiatmarketcap.com.

CyberCash has inbuilt incentives that foster liquidity and velocity of its supply at scale.

To reach scale, incentives are present that reward early adopters with signficiant upside potential. In short, CASH solves the coldstarting problem and the terminal adoption problem.

We could not agree more!

In our opinion, CyberCash is a multi-year, even multi-decade project.

It took Bitcoin over 10 years to reach the 1Tn dollar mark, which is ca. 2% of the goal that CyberCash has. Not by accident, CyberCash has precisely the same goal that BTC had when Satoshi conceptualized it. It is about creating sound, digital money according to the established definition of money.

The leap to the real world can only happen after CASH established itself within crypto as a desireable medium of exchange & savings instrument (store of value). Realistically, CyberCash must reach at least a billion USD in market cap before real world adoption is thinkable. We're prepared for a long journey.

And you're right, it is fundamentally an experiment. It either becomes the most successful project on Arbitrum after years of hard work, or it flops. We are prepared to invest our time and energy into this experiment and would love to see Arbitrum join forces with a little kickstarting of the LP.

Every resource allocation is a risk and we agree that potential payoff and probability of success should be weighed carefuly. The potential for tangible benefits has been explored in the proposal and we're happy to highlight the outsized potential once more in case of success.

Do you categorically decline the idea behind CyberCash, or do you have a specific concern that we can address?

Candidly, we would not support a proposal like this as it currently stands, and we ask if this proposal could be made more granular (additional details provided on GTM strategy, how the capital will be allocated, etc). Over the past few months the Arbitrum delegate community has debated over spending for incentives and grants, and this proposal lacks clearly defined KPIs, and an explanation as to what the protocol even does/accomplishes for the Arbitrum ecosystem and does not explain how the DAO benefits providing thi grant.

Some more high-level questions/points:

1. With Uniswap V4 out, why use Uniswap V2 for a fair launch mechanism (see Flaunch)? Is there a plan to transition?
2. What is the inflation fixed at and why? What was the reason for this?
3. The token is brand new, and has approximately 600 holders and under 30,000 transfers with a market cap of $266K. This proposal is requesting a grant that’s larger than the market cap of the token, and I have not checked how much value is locked within the protocol, but I would think these statistics would be provided to the DAO.
4. The social media account has very low numbers, so there is little to no visibility that can be provided to the DAO by providing this grant.
5. Can we see the exact cost break down for some of the steps involved?

With this in mind, we do not see the need to provide this grant at this stage in time. Furthermore, we would heavily recommend to rework the proposal, perhaps lower the funding, and consider alternative avenues of grant funding, or provide more tangible benefits to the DAO in the proposal.

Thank you for sharing your proposal, innovation is always welcome in Arbitrum. However, I am inclined to vote against this proposal for the following reasons:

One of the primary obstacles for cryptocurrencies to be widely accepted as money is volatility, a problem that stablecoins effectively address. CyberCash’s complex tokenomics, which include a dual burn mechanism and fixed inflation, require far more rigorous testing to ensure they don’t trigger unintended market dynamics. As it stands, these mechanisms may lead to considerable volatility, rendering CyberCash unsuitable as a medium of exchange, a role for which, arguably, even Bitcoin struggles to meet expectations.

Furthermore, the transition from incentivizing transactions to achieving true real-world adoption is a significant leap. Without a proven track record or robust empirical evidence, this initiative risks becoming a speculative experiment (and an expensive one) rather than a reliable solution to the “real-world adoption” challenge.

Finally, Arbitrum is at a pivotal moment, with the community favoring allocations that align closely with ARB’s long-term strategic objectives and deliver tangible impact. The request for 300k ARB tokens is substantial, and in a competitive environment, these resources could be better invested in projects that more directly help network security, decentralization, and overall infrastructure.

For these reasons, I do not support this proposal.

Candidly, we would not support a proposal like this as it currently stands, and we ask if this proposal could be made more granular (additional details provided on GTM strategy, how the capital will be allocated, etc). Over the past few months the Arbitrum delegate community has debated over spending for incentives and grants, and this proposal lacks clearly defined KPIs, and an explanation as to what the protocol even does/accomplishes for the Arbitrum ecosystem and does not explain how the DAO benefits providing thi grant.

Some more high-level questions/points:

1. With Uniswap V4 out, why use Uniswap V2 for a fair launch mechanism (see Flaunch)? Is there a plan to transition?
2. What is the inflation fixed at and why? What was the reason for this?
3. The token is brand new, and has approximately 600 holders and under 30,000 transfers with a market cap of $266K. This proposal is requesting a grant that’s larger than the market cap of the token, and I have not checked how much value is locked within the protocol, but I would think these statistics would be provided to the DAO.
4. The social media account has very low numbers, so there is little to no visibility that can be provided to the DAO by providing this grant.
5. Can we see the exact cost break down for some of the steps involved?

With this in mind, we do not see the need to provide this grant at this stage in time. Furthermore, we would heavily recommend to rework the proposal, perhaps lower the funding, and consider alternative avenues of grant funding, or provide more tangible benefits to the DAO in the proposal.

Thank you for sharing your proposal, innovation is always welcome in Arbitrum. However, I am inclined to vote against this proposal for the following reasons:

One of the primary obstacles for cryptocurrencies to be widely accepted as money is volatility, a problem that stablecoins effectively address. CyberCash’s complex tokenomics, which include a dual burn mechanism and fixed inflation, require far more rigorous testing to ensure they don’t trigger unintended market dynamics. As it stands, these mechanisms may lead to considerable volatility, rendering CyberCash unsuitable as a medium of exchange, a role for which, arguably, even Bitcoin struggles to meet expectations.

Furthermore, the transition from incentivizing transactions to achieving true real-world adoption is a significant leap. Without a proven track record or robust empirical evidence, this initiative risks becoming a speculative experiment (and an expensive one) rather than a reliable solution to the “real-world adoption” challenge.

Finally, Arbitrum is at a pivotal moment, with the community favoring allocations that align closely with ARB’s long-term strategic objectives and deliver tangible impact. The request for 300k ARB tokens is substantial, and in a competitive environment, these resources could be better invested in projects that more directly help network security, decentralization, and overall infrastructure.

For these reasons, I do not support this proposal.