In this expanded edition of our quarterly economic update, we are introducing groundbreaking information that will shape the future of Upland’s economy and lead us to a more community-driven, decentralized ecosystem.
Before we get to the heart of the economic update, we want to share a milestone we’ve recently achieved: As of July 2022, Uplanders have officially exceeded $7,000,000 in the NFT-to-USD program. Congratulations! That kind of cash will buy a lot of llamas.
As you know, Upland is firing on all cylinders. And with developments such as Metaverse Motors (MV Motors), asset manufacturing in factories, our FC Porto soccer club partnership, and the first international city launch, the Upland economy is more dynamic than ever. We’re keeping our foot down on the gas, and we’re glad you picked a front-row seat with us as we race toward a revolutionary digital economy.
With that said, let’s dive into the economic update!
Toward the end of Q3, it will be time to put planned funding for the Upland Pool into motion. The original funding mechanism outlined in the Upland whitepaper was to mint additional UPX to the Upland Pool. That could work, but it comes with unnecessary risk (which we detail below). After analyzing the Upland economy and the flow of UPX from Upland Pool to user wallet to Community Pool for years, we are putting forth a simple, efficient, and more scalable way to fund the Upland Pool.
We’re excited about this new mechanism, as it optimizes the circulation of UPX within the Upland economy while opening new doors for a more decentralized, user-centric economy.
If you’ve read the Token Pools section of Upland’s whitepaper, you know that 100 billion UPX was minted and allocated equally into two pools: the Upland (operator) Pool and the Community Pool. Paraphrasing the whitepaper, the Community Pool receives funds from property sales, marketplace fees, and other mechanisms, while it pays out UPX for property earnings, rewards, etc. The primary functions of the Upland Pool are to fuel in-game activities and fund operator development. Players purchase UPX from the Upland Pool using fiat or cryptocurrency. Then, they spend UPX building their Upland empire. As the platform’s operator, the company Uplandme, Inc. uses proceeds from these transactions to grow the Upland platform in a variety of ways, including:
In short, funding the Upland Pool is funding the maintenance and growth of the Upland metaverse. However, as a credit to the tremendous growth of Upland’s player base, in-game activities, and the overall economy, the balance of UPX between the two pools has shifted heavily toward the Community Pool. This was intended and described in the whitepaper. We haven’t deployed additional Upland Pool funding methods yet for two simple reasons: there was no urgency to do so, and waiting allowed us to study the economy so we could deploy the right funding method at the right time.
As stated in the whitepaper, mechanisms to fund the Upland Pool would be needed to continue Upland’s development. The whitepaper also describes how this funding could happen: monthly UPX minting based on active user counts. Earlier, we mentioned that this method could work, but it would not contribute to our overall objective of “progressive decentralization.” We see the following downsides:
After years of growing the Upland economy, our knowledge has grown and our ideas have evolved. Rather than simply pouring more UPX into the ecosystem, we believe the UPX in circulation should reflect player activity and economic velocity. As of the publishing of this report, approximately 87.7% of the 100 billion UPX in circulation is in the Community Pool. That percentage, in relation to what is in circulation, does not warrant monetary expansion.
These details lead to this key point: We’ve found a better approach for funding the Upland Pool. First, instead of minting UPX to the Upland Pool, 100% of minted UPX goes to the Community Pool. This would occur only when monetary expansion is necessary (such as if UPX in the Community Pool reached certain thresholds over a certain amount of time). Under this methodology, the Community Pool will fund the Upland Pool directly, following the same formula that calculates user activity and in-game economics. It’s a simple, efficient, and scalable plan.
We’re endorsing this funding method because it optimizes the flow of UPX while supporting the in-game economy and the operator’s funding needs to grow Upland as a platform. Even more exciting, this path provides the foundation for the economic loops needed if Upland is to shift to a more decentralized platform.
The formula for this funding method is as follows:
Monthly Blockchain Mints / Transactions:
Monthly Active/New Users:
At the beginning of each month, the Upland team will review the blockchain records as well as user counts from the previous month, and apply the above calculation to calculate monthly UPX funding.
Additionally, we would apply the above formula retroactively to the period from January 2021 to June 2022. This was a critical 18-month period in Upland’s development. It was important to study the economy over that time rather than implement UPX funding mechanisms so we could do the right thing for players and the ecosystem.
Determining the funding method for the Upland Pool will be a major proposal in the new in-app voting system (and likely the first-ever proposal). The voting system serves as a temperature check to gauge the Upland community’s sentiment. Upland Pool funding is a great use case in these early days of this voting system because we’re suggesting a course correction from materials outlined in the whitepaper.
The nature of the voting system may become more self-governing in the future. However, future community governance voting proposals have yet to be determined. This system, expected to launch in Q3, is a milestone and stepping stone for Upland’s journey to become a more decentralized platform.
To be fully transparent, the community governance proposal will list two UPX funding options for players to vote on:
This community ballot does not cover funding formulas or other details regarding funding methodology.
We are still finalizing our in-game voting system and getting ready for launch. Right now, we are just letting the community know that a voting system is coming and that the first proposal for voting will be for Upland Pool funding. We’ll follow up with more details soon to explain how voting works.
This is a major step toward Upland’s vision of a decentralized economy, and we’re excited to bring the community closer to direct involvement with Upland’s economic planning.
MV Motors. Manufacturing. Stadiums. Structures. These big endeavors require resources to bring to life. They require Spark. Our initial 50,000 Spark minted into the ecosystem continue to fuel these features, and there’s so much more to come. Due to the increased player demand for Spark and to support the development of various core elements to the Upland metaverse, we plan to mint additional Spark every month.
The amount of Spark minted into Upland will be calculated based on current active users and new Uplanders from the prior month.
Here’s the calculation for monthly Spark minting:
Note: In addition to the monthly Spark, additional one-off batches of Spark may be minted to support the release of new features that require Spark. This is to ensure there’s enough supply to meet demand. More details will be announced prior to minting.
There will be no change to the property earnings for this quarter. The property earnings will hold at 14.7%
Upland wants to encourage activity – the economy needs to be inviting. We feel that in these times of economic hardship and headwinds due to global economic challenges, decreasing property earnings would discourage activity at a time when Upland needs to be a driving force for empowerment.
As always, we will provide the next property earning adjustment changes in subsequent quarterly economic updates.