Articles
“I Want Free Reward Levels”
5 min read
Dear Plutus Community,
I hope this message finds you well. I want to address an important matter regarding our Reward Levels and the path to ensuring Plutus’ sustainable growth. Here’s a detailed overview of our journey, current status, and future direction:
In 2016, we raised $1M with the promise of delivering a rewards card integrated with a DEX. By 2017, we had successfully launched a working card that has now facilitated over $1B worth of transactions and issued nearly $50M in rewards value. A DEX followed soon after, facilitating over $20M in crypto-to-fiat conversions over five years.
We absorbed a loss of $5M to provide liquidity and cover 100% of the GAS fees for our customers, even paying in the range of $200 a transaction for $30 worth of trades. PlutusDEX was unique in a sense that it enabled non-custodial crypto-to-fiat swaps, it hasn’t been emulated since because it’s difficult. Nevertheless, PlutusSwap is going to be even better!
The legacy DEX and tokenomics, while suitable for growth, lack scalability to millions. Thus, we took the platform offline to improve our core banking infrastructure, adding features that were necessary for day-to-day use. Now, with our scalable app and a focused brand strategy aimed at mainstream growth, we have a term sheet from a major VC. However, there is a condition which requires a self-sustainable tokenomics model.
We have 235,000 all-time signups, over 125,000 cardholders, 21,000 stackers, 7,000 customers on Reward Levels.
We have 1,000 Metal Card holders, with 70% on Reward Levels. Of these, 60% have earned triple their stack, and the remaining doubled theirs, excluding 1% new joiners, totalling $5.8M in value among ~700 customers.
Historically, our growth was driven by offering services at low or no cost, aligning with our community-focused approach. However, being community-focused does not mean we have to be net-loss forever. We are a business and like all businesses our goal is to get to a profitable stage and get to millions of customers. We cannot do that if we continue to emit 3x more PLU than one stacks for free, or at £9.99 a month due to the demands of a small group.
Excluding Metal Card holders, 60% of reward level customers have doubled their initial stack, and nearly 50% have tripled it. This unparalleled achievement is often under appreciated due to a lack of understanding and the low cost offered to customers.
Reward Levels are currently priced over 90% below their true cost (TVM breakdown) and enable customers to earn 3x their stack in a year, all while being non-custodial. However, many greatly undervalue the rarity of this feature due to its low cost and lucrative nature, causing sustainability challenges without proposed upgrades.
The demand from a subset of customers to receive a free Reward Level or to be grandfathered in for a year will have a negative impact on the system, and it’s not fair to all other customers for the following reasons:
Those demanding high token value need to understand that it cannot be achieved if lucrative features are offered for free or at a 90% discount for life. For example, if Rolls-Royce were sold at a 90% discount for life, every other Rolls-Royce would be almost worthless. A sustainable system requires balanced and fair contribution!
To avoid a failure scenario and add value to the ecosystem, our new proposal, verified by Ernst & Young (EY), aims to create self-sustainable features and utilities, reduce emissions and project a supply shock by 2026.
Readers well-versed in technical LaTeX documents and economic principles of intrinsic value and TVM will comprehend this strategy by reading the whitepaper. For those less familiar, a marketing site featuring third-party data audits and a report from a ‘Big Four’ firm will be available next week to assist in making informed decisions.
Another AMA will be hosted later this week to address your questions, and the team has set up a dedicated channel for whitepaper discussions to collect your feedback. Additionally, an easy-to-understand marketing version of the whitepaper will be available on our website next week, followed by the vote (details will be emailed). This process will allow you to debate and decide on the proposed changes. Everyone has a say!
However, we are a business, not a community faucet. Our hardworking team consistently goes beyond the call of duty for its customers. Despite being self-funded, we have delivered 100x more than companies that have raised 100x more and yet delivered less. This success is a testament to the team’s values and personal goals to build a lasting, valuable system.
We invite you to participate in the discussion and voting process. If you are not convinced, we offer a full refund for your Metal Card and all your subscription costs, followed by an account closure. Please read the terms and fill out the provided form if you wish to opt for this.
We are at a pivotal point, with all elements in place to reach millions of customers. Achieving sustainability through the proposed changes will unlock funding opportunities, enabling rapid expansion and the realisation of our entire whitepaper roadmap, including tangible value through planned utilities and PlutusSwap in 2016. We are not a 'memecoin' offering a `get-rich-quick` scheme. Plutus started as a one man team and has grown into a business poised for worldwide expansion. We offer a loyalty rewards card, and our token serves as an in-game utility token, delivering unique value for day-to-day card spending that cannot be matched elsewhere.
To those who are familiar with our values and mission, see you next year!
Best regards,
Danial
.png)