The Wearable Submission Fee: The History and Reasoning Behind Changes
The Wearable fee change will be postponed until further notice to give the community time to reassess the situation and propose changes through the DAO.
An adjustment of the Wearable submission fee from 100 MANA to 500 USD was originally scheduled for May 26. The Foundation decided to halt this change after listening to community feedback and taking into consideration the many new creators who had joined Decentraland since the original proposal was voted on. Now, the community will have the time to reassess the situation and propose changes through the DAO government framework.
To set the groundwork for this community discussion, the Foundation has compiled this document to make more available the history of the Wearable submission fee with a timeline of events and to provide context for the most recent planned adjustment to the fee.
When the Wearable submission process was first being established, this proposal was passed through the DAO to define the submission fee. It proposed that the fee for every Wearable should be 500 MANA along with the rationale to set that particular price. At that time, the price of MANA was 0.857 USD. This means that the Wearable submission fee was 428 USD per item submitted.
In October, the price of MANA started rising fast. By the end of the month, MANA cost 3.0481 USD and rose to an all time high of 5.4872 USD on November 24. This meant that the fee to submit a Wearable was 2,746 USD per item which was of course unreasonable for most creators. In response this proposal was created with the goal of establishing a more predictable and stable fee.
It was decided that the submission fee should be pegged to a stable FIAT value that would help control volatility and keep the submission fee at a reasonable and unrestrictive price. To do this, a mechanism needed to be developed that would constantly adjust the amount of MANA a creator needed to pay to submit a Wearable to always be equal to 500 USD.
Developing such a mechanism would take some time though, so while the Foundation team worked on that project, a manual mechanism to keep the fee close to the original voted-on $500 USD was implemented. This set the fee at 100 MANA per Wearable at the time. However, as the process to change the fee is costly and requires the Security Advisory Board to meet and sign a transaction, the fee was not adjusted again, despite the price of MANA changing quite a lot. This resulted in the cost to submit a Wearable steadily dropping from ~500 USD to ~100 USD.
By May of this year, the development of the feature to peg the fee to $500 USD per item (but still paid in MANA at the current exchange rate) was ready to be deployed, and its planned implementation was communicated via this tweet.
However, during the development process of the feature, not only did the price of MANA decrease by a large margin (thereby decreasing the Wearable submission fee), but many new creators joined the Decentraland community. They took the 100 MANA fee to be the norm, not knowing that it was a temporary fee put in place when MANA was ~5 USD and represented the previously-voted-on submission fee of 500 USD.
Understandably, the announcement that the fee to submit a Wearable was essentially jumping from ~100 USD to ~500 USD, without the necessary historical context, came as a shock to many in the Decentraland community. In light of this, it made sense to halt the change of the fee to give the community time to reassess the situation, become informed, and submit new proposals to the DAO so that a fee the whole community agreed was fair could be decided on.
Since the beginning, the Wearable submission fee was meant to be $500 USD per item, or at least somewhere around that value as per the proposal voted on by the community. Not $100 USD, not $2000 USD. The development of the mechanism to peg the fee to USD honored that community decision.
However, the purpose of Decentraland continues to be to serve as an open and decentralized organization in which community sentiment and DAO votes shape the future of the platform. As Decentraland’s community has welcomed many new creators over the past few months, the composition of the community has changed a lot since the original proposal from November 2021 was voted on.
After listening to the community’s thoughts on our announcement about the change, it makes sense that our new community members should also have a voice in this big decision.
The Foundation team will not implement the Wearable submission fee change on May 26 as was planned in order to give the community more time to decide what will be the best way to go forward using Decentraland’s established DAO government framework.