[DRAFT] Fueling Stacks Builders & Growth, Meet SIP-031

rainer · June 1, 2025, 5:58am

I think this is the most dangerous moment for Stacks. If SIP-031 passes, the entire vision for sBTC will vanish into thin air. Stacks will forever be branded as a centralized VC chain. What truly supports a brand’s premium positioning is its unwavering commitment to its founding principles and beliefs, even in the face of adversity – just as Porsche, in its toughest times, never abandoned development support for the 911, proving its commitment by cutting executive salaries to ensure its funding.

In 1957, when Ferrari racing cars were involved in a major accident resulting in multiple fatalities, the company refused to abandon its racing program or motorsport development. Following the tragedy, Ferrari focused intensely on improving vehicle safety, elevating safety standards for both race cars and production models to restore its reputation. Simultaneously, the launch of the 250 series—renowned for its exceptional performance and design—achieved tremendous market success, gradually steering the brand back on course.

Similarly, Huawei succeeded in establishing its premium image in China precisely because it did not capitulate during its most challenging period under US sanctions, persistently continuing the development of its independently developed chips.

In contrast, a negative case is Tesla: its sharp sales decline is significantly linked to Elon Musk’s perceived support for Russia. Previously, Musk was widely seen as relentlessly striving for humanity’s future. His apparent alignment with the aggressor, Russia, shattered that carefully cultivated public persona.

Brands lacking a distinct identity and unwavering core values and convictions will struggle to command premium pricing.

If SIP-031 gets approved, sBTC will become untrusless in the future, and STX will super hardly command the premium narrative pricing for BTCfi in the capital markets.

enjoywithouthey · June 1, 2025, 1:10pm

Replying to both @franco_79001 and @rainer, these are important points.

In the greater crypto purview, SIP-031 will undoubtedly divorce Stacks from various Bitcoin ethos and associate Stacks as more of a “VC-chain”

But is this a bad thing?

Stacks’ goal is to enable Bitcoin to compete in DeFi. DeFi is dominated by VC chains… ETH, XRP, SOL, AVAX and more are gaining traction SUI, NEAR, etc.

In order for BITCOIN to compete with VC chains in DeFi, Bitcoin will need to adopt a VC-style approach. Especially in today’s economy where regulations are being lifted.

(It turns out, given the new regulatory environment the Reg-A may have hurt Stacks more than it helped, but that’s a discussion for a completely different thread).

Back to the matter at hand. Bitcoin is the pristine L1 asset. The goal is not to change Bitcoin. Stacks enable smart contracts on Bitcoin AND VC-like powers to be able to change the chain tokenomics to adapt to a highly dynamic and every changing crypot arena.

I am NOT 100% behind this narrative, as I am a decentralization maximalist, but this appears to the new narrative SIP-031 is forging whether intended or not.

Both your comments address reputational risks, which I addressed previously in this thread, and if this new narrative is the direction our community is going, the community must understand these are the risks we are taking.

But seeing Stacks have all the right weaponry and a playbook enjoyed by the other Top 10 coins would be a site to behold. I’m here for it.

mcjazz · June 1, 2025, 9:35pm

As a long-time Bitcoiner who only arrived at Stacks before Christmas last year - entirely due to the emergence of sBTC - I think it’s important to realise Stacks is not competing with Bitcoin. It’s competing with the other pegged/wrapped versions of Bitcoin that exist on other chains. For example WBTC on Ethereum and Solana - both of which do not share the decentralised ethos and characteristics of Bitcoin or any technical linkage.

I see Stacks as a DeFi chain and it should be compared with others in the space. The difference is that it shares important technical connections with Bitcoin, making it a legitimate L2 chain and setting it apart from wrapped versions like WBTC.

Bitcoin’s strength is that it is largely ossified, a secure base layer with immutable fundamental characteristics. Legitimate L2 chains need to be nimble and open to continuous innovation. This requires investment of time and money. I believe SIP-031 represents a legitimate attempt to face up to reality in this fast moving DeFi space and while it changes emissions at the protocol level, it does not do anything to undermine the technical aspects of the chain and how sBTC will function.

mark07 · June 1, 2025, 9:41pm

I fully support your opinion.
I even feel some big guys behind this decision.
This can not be chosen.

PauCity · June 1, 2025, 10:25pm

Many against printing are being banned, messages deleted in chat apps even this forum is controlled by gatekeepers.

SIP-031 brink of bailout
Hash 0xa3ecd36867dc3a7dd8cbd6129f31ac9cd1845f0cbef1d8935aa60779e47e2f16

Stacks whales on a Tryannical Tirade.

mrwagmibtc · June 2, 2025, 2:05am

The Mr. Wagmi Rally Cry

I’m letting you know upfront: this is long.

I’m not hard lining on any of the points below; I’m simply bringing to light what I’ve heard in the community, along with some of my own thoughts.

First, I want to thank everyone for their efforts over the past week in bringing clarity to the community (no pun intended). It’s been an incredible couple of years actively participating in the Stacks ecosystem. I love the community, the tech, and the memes. I truly believe we hold the key to unleashing Bitcoin in the most secure, fast, and programmatic way that extends Bitcoin’s ethos—better than anyone else. The tech is top-notch, and those here don’t need me to say it to know it. Still, I want to tip my hat to all you builders. It’s a shame we’re not yet where we’d like to be compared to other blockchains. But the more I’ve reflected on it, that’s exactly why we’re here with this proposal: to compete. We’ve been running a race with weights because we wanted to do things right even in the face of a hostile environment. Many companies out there focus so heavily on go-to-market strategies that they neglect their own product. I’d argue many other blockchains are just transparent Web2 apps masquerading as innovation—vaporware with slick marketing teams.

But, we know decentralization was the true innovation.

In contrast, Stacks has prioritized its product from the ground up. This focus started long before my time, rooted in building as closely as possible to Bitcoin. When I joined, I felt it and saw it: the mission has been laser-focused since day one. It’s taken time, but as they say, good things come to those who wait.

Alright, enough rambling. From my review of the SIP and discussions within the community, I’ve distilled things into three key focuses: representation, transparency, and accountability. I apologize in advance if some points overlap with existing comments, but I wanted to share them in this level of detail.

Opening

Quick point: as the saying goes, “look out for the little guy and gal.” Of all the points mentioned, this one is closest to my heart. We have a chance to do something truly inspiring, to ensure people are seen and empowered. We are the pioneers navigating the real decentralized Web3 frontier.

When we plant our flag, let it be a beacon to builders on every other blockchain, signaling that this is the place to be.

May they seek us because they know our foundation empowers and uplifts others.
May they seek us because they know it’s not about who you know but what you know and do.
May they seek us because they know their efforts here can do good and change the world.

Diving In…

Representation

Small Builders: Emphasizing specific plans or allocations for small builders would go a long way. You never know what innovation is lurking in the mind of a community member—it could be the next big thing. These could be founders of applications or established artists. Stacks has attracted incredible talent. P.S. When people see “builders” listed as stakeholders, they often assume it refers only to legacy, established applications, leaving them feeling excluded and like they’re fighting for scraps.
Meme (Collectible) Communities: Specific plans or allocations for these communities would also be impactful. Some have been here for years, showing up day in and day out, waving the Stacks flag through all market conditions. They’re warriors for the brand, fostering environments and friendships like no other. I see no difference between these communities and IRL clubs or memberships—they’re groups of people from around the world, united by a shared passion. Personally, I’ve built lifelong friendships through these communities.
Media & Champion Orgs: I’d love to see emphasis on media programs like DeOrganized Media or businesses like my own Block9, which focuses on consulting and services to onboard and educate individuals and businesses. We love this space and invest our time to inform and grow the ecosystem. But, if you don’t have an application you’ve built, it’s like a lost corner out there. Artists could potentially also fall into this bucket.
Committees & Appointees: Representation for the above ecosystem corners at the decision-making table is strongly encouraged. The community wants to be involved in decisions, not have people selected for them. They want people chosen by them. (This ties into the last point in the next section.)
Small Note: Some have proposed a Community-Led Grants Program. I like this idea, and I believe they’ll submit more formal details soon.

Transparency

BTCFi: If the goal is a BTCFi-focused SIP, please name it such. Many feel unseen or unheard due to the heavy emphasis on BTCFi. While I think it’s important, it’s not everything. Most core community members use Stacks for much more than just BTCFi.
Specificity: More granular details on how and where funding allocations will go. For example, instead of broad categories, specify (if possible) amounts going to specific applications or businesses.
Selection Process: Sharing “who” picks appointees and committee members.
Community Voice: Community members feel their voices are drowned out by large stakeholders in voting on people, processes, and applications. I understand their perspective, but I also know not everything can go to a mass vote, or we’d never get anything done. Furthermore, I imagine some decisions certainly require a level of experience or accomplishments for the success of the greater good. That said, reserving seat(s) at the table for the community would be a game-changer. (Insert Maximus Gladiator meme here: win the hearts of those in the Colosseum!)
Voting Integrity: Could we use ecosystem apps like BlockSurvey for voting on initiatives? This would minimize “botting” concerns, as authenticated users vote via their wallets, especially in cases seeking public consensus with one vote per wallet.

Accountability

Reporting: The more frequent the reporting from those receiving public funds, the better.
Individual Performance Idea: Those receiving public funds should also receive a community scorecard alongside other performance reviews. This ensures the public’s voice is heard on how their investment is performing.

Side Note

Not sure if this is the right time or place, but here are some areas I’d love to see more momentum for adoption:

Customizable Point-of-Sale Systems: Enable businesses to transact using Bitcoin and Stacks blockchains, with features like easy-to-configure NFT coupons baked in. This is an untapped market with a one-to-many effect, reaching all the consumers businesses touch.
Low-Code/No-Code Development Tools: Empower builders to create without deep technical expertise. Build builders.
AI, AI, AI: Industries are transforming, and AIs will gravitate toward the most friendly blockchains. Stacks should be ready and own the race.
Layer 3 Innovations: Thinking forward and building on innovations like Rozar’s Blaze, where near-instant transactions could power gaming and more. Or, where new coming applications need an alternative approach to architecture.
Lastly: Can we get an apology letter from Gary for the hostile environment all these years?

Wagmi Out.

bogachevanton · June 2, 2025, 6:37am

Great post about the reputational risk—thanks for sharing it. I will insist that such conclusions must be included in the structure of the every SIP whenever its potential implementation alters the financial aspects of the chain.

P.S. The post states that the 100 million STX minted immediately after the SIP’s approval do not affect the total token emission—this is incorrect. All tokens issued under SIP-031 increase the total emission of STX.

There’s also an excellent post by @blockface.btc with calculations on token depreciation at the start of SIP-031 and after 5 years https:// x (dot) com/attractfund1ng/status/1928896325292003781

enjoywithouthey · June 2, 2025, 1:01pm

P.S. The post states that the 100 million STX minted immediately after the SIP’s approval do not affect the total token emission—this is incorrect. All tokens issued under SIP-031 increase the total emission of STX.

The language I am quoting in directly from the SIP.

I’m under the impression the 100M mint affects circulating supply, not total supply. If wht you say is the case, the SIP should explicit state something along the lines, Due to SIP-031 emissions changes the total supply of $STX will increase from X to X.

Regarding all aspects of tokenomics, the SIP language needs to be crytsal clear, concise and accurate as to avoid any confusion.

codeonedotzero · June 2, 2025, 1:05pm

SIP-031 Critical Feedback

Note: This document was authored by an individual, but is written in the first person plural to reflect the collective feedback of the Stacks ecosystem. If you agree with the feedback, please let your voice be heard.

This document outlines critical feedback regarding SIP-031: Five-Year Stacks Growth Emissions. While the SIP presents ambitious goals for ecosystem growth and development through the creation of a new “Stacks Endowment,” there are several significant concerns that need to be addressed before this proposal should move forward.

The Stacks ecosystem has historically operated like a Thanksgiving dinner, with two distinct tables that, while part of the same family, experience different levels of participation and influence:

The “Grown-ups” Table

The primary seat-holders include established entities focused on core infrastructure and BTC DeFi:

Trust Machines, Hiro, Bitcoin L2 Labs
Bitcoin Frontier Fund
StackingDAO, Zest, etc…
Bitflow, Hermetica, Alex, Velar, etc…

These entities typically drive strategic decisions and control significant resources.

The “Kids” Table

This diverse group includes a wide range of contributors:

Creative Projects (Skullcoin, Charisma, BoostX, Blaze, Bolt, etc…)
Community Tools (FakFun, PropertyX, Gated, DeOrganized, Stx Tools, etc…)
Wallets (Boom, etc…)
Meme Communities (Welsh, NOT, Leo, Roo, Bitcoin Pepe, Stone, etc…)
Artists and NFT Projects (MegaPont, Stacks Invaders, Giga Pepe, Spaghetti Punk, etc…)
Many other builders and content creators

Historically, these groups have benefited indirectly when the ecosystem prospers - “the kids eat well when the adults eat well.” However, SIP-031’s Endowment structure threatens to widen rather than narrow this divide. While you will see in the suggestions below that we are not against the idea of SIP-031, we do believe that just because an effort may not be in perfect alignment of the core strategic vision, it does not mean that it should be left out of the conversation. There just is not enough in the SIP that leads us to believe that the community driven initiatives will be given the same consideration as the core strategic initiatives.

Understanding this existing ecosystem dynamic is crucial when evaluating SIP-031, as the proposal’s structure and focus areas could significantly impact the balance between these two groups. While the SIP presents itself as a comprehensive growth strategy, careful analysis reveals several concerns about how it might affect the ecosystem’s existing power dynamics and potentially exacerbate rather than address these historical divisions.

Three major concerns have been identified:

DeFi-Centric Approach: The proposal narrowly focuses on DeFi growth while neglecting other crucial ecosystem sectors.
Precedent Setting: This creates a template for neglected sectors to make similar funding requests.
Governance Vulnerabilities: The combination of concentrated power in an Endowment structure and the SIP voting mechanism creates potential centralization risks.

Each concern is detailed below, with supporting analysis and potential implications for the Stacks ecosystem.

Concern #1: DeFi-Centric Approach

While SIP-031 presents itself as a comprehensive “Stacks Growth” proposal, careful analysis reveals it is primarily focused on Bitcoin DeFi growth. This is evident throughout the proposal:

Evidence of DeFi Focus

Direct quotes from the SIP showing DeFi emphasis:

“Treasury deployment will be focused on accelerating sBTC adoption and driving Bitcoin capital onto the Stacks network”
“Enabling DeFi vaults with native liquidity pools ensures deeper markets for Stacks DeFi”
“Strategic efforts to scale TVL, liquidity, and user adoption through DeFi incentives”

All comparative data examples focus exclusively on DeFi metrics, while overlooking or ignoring other many sectors:

Sui: “TVL increasing by ~50x, DEX volumes by ~20x”
Avalanche: “$180M DeFi incentive program”
NEAR: “TVL jumped to $237.4 million”
Arbitrum: “support the network’s real-world asset (RWA) ecosystem”

Limited Scope

The proposal heavily emphasizes a narrow set of priorities: sBTC development, DeFi liquidity programs, TVL growth, DEX volumes, and stablecoin integration. While these are crucial components for establishing Stacks as a premier Bitcoin L2, the proposal largely overlooks many vibrant sectors of our ecosystem.

The creator economy of artists, musicians, and writers; the thriving NFT ecosystem; emerging gaming initiatives; AI integration possibilities; social applications; real-world asset tokenization; digital identity solutions; and content platforms all represent significant opportunities for ecosystem growth and user adoption. These sectors have historically contributed to Stacks’ unique value proposition and continue to drive grassroots engagement with the platform.

Equity Concerns

This DeFi-centric approach raises questions about equitable ecosystem development:

Would other sectors receive similar consideration if they proposed comparable funding requests?
How can non-DeFi builders and creators benefit from this substantial treasury allocation?
Does this create an implicit hierarchy within the Stacks ecosystem, prioritizing DeFi over other use cases?

Concern #2: Precedent Setting

The approval of this SIP would establish several concerning precedents:

Scale of Request

The SIP requests:

“A one-time mint of 100m STX to provide initial working capital”
“New emissions over the next 5 years that temporarily bring Stacks’ annual emissions from 3.52% to an average of 5.75% per year”

This creates a situation where:

Neglected sectors will be incentivized to create similar proposals
Each vertical could justifiably demand equal treatment
The ecosystem could face a wave of large funding requests
The total impact on token economics could be multiplicative

Concern #3: Governance Vulnerabilities

The combination of Concerns #1 and #2, coupled with the proposed Endowment structure, creates significant governance risks:

Endowment Structure Concerns

The SIP proposes creating:

A new Endowment Foundation with its own governance
A Treasury Committee/Board making allocation decisions
Executive leadership positions (Executive Director)
A separate operational entity

This creates multiple layers of control:

The Endowment makes funding decisions
The operational entity executes
The community’s role becomes increasingly indirect

Voting Mechanism Vulnerabilities

The SIP voting requirements compound these risks:

Only 80M STX needed for a valid vote
80% approval required
Therefore, controlling 64M STX could theoretically control outcomes
At current prices, this represents a relatively small investment for potential control

Key Recommendations

As ecosystem participants, we propose three core solutions that could help address these issues while maintaining the spirit of ecosystem growth that SIP-031 aims to achieve:

1. Strengthen Governance Safeguards

The Endowment structure should be split into two distinct decision-making streams to enable focused and agile execution. Rather than creating complex oversight between groups, each stream should have clear autonomy within its domain:

The primary stream (80%) can maintain laser focus on the strategic vision, particularly Bitcoin DeFi and core infrastructure
The community stream (20%) can operate independently to support ecosystem growth initiatives without requiring alignment with the strategic vision

This separation allows each group to move quickly and efficiently within their area of focus, without creating unnecessary bureaucratic overhead or cross-stream approval processes. The goal is not to create oversight between groups, but rather to ensure each has the autonomy to execute effectively in their domain. While we suggest an 80/20 split as a starting point for discussion, the exact allocation could be adjusted based on community feedback and strategic needs.

To implement this structure effectively, we propose organizing the new operational entity into three key groups:

Shared Services Group

Provides operational efficiency through shared admin, legal, finance, and other support functions
Reduces overhead and duplicated efforts across all initiatives

Core Strategic Group (80%)

Focuses on BTC DeFi, protocol development, and core infrastructure
Aligns with the primary strategic vision outlined in SIP-031
Maintains “laser focus” on establishing Stacks as the premier Bitcoin L2 (specifically in the context of BTC DeFi)

Community Growth Group (20%)

Operates independently through programs like DeGrants
Supports diverse initiatives across art, gaming, social apps, and more
Functions similar to an ecosystem accelerator/incubator

This structure, led by a single CEO who understands both strategic and community priorities, allows for efficient resource sharing while maintaining the autonomy of each group to execute within their domain. The 80/20 split applies primarily to resource allocation rather than organizational size, ensuring both the strategic vision and community growth receive appropriate support.

2. Ensure Equitable Growth

We propose an 80/20 allocation model for the Endowment’s resources (up for discussion):

80% dedicated to the strategic vision of the chain, supporting core infrastructure, DeFi growth, and protocol development
20% specifically allocated to community-driven initiatives, creators, artists, and “boots on the ground” projects that, while not directly aligned with core strategic initiatives, provide vital ecosystem growth through community building and grassroots marketing

This split would maintain the ecosystem’s strategic focus while ensuring consistent support for the diverse projects that make Stacks vibrant and help attract new users. Success metrics should reflect both strategic goals (TVL, protocol usage) and community growth (user engagement, ecosystem diversity).

3. Protect Against Governance Exploitation

Our community needs additional voting safeguards to prevent potential manipulation. This could include multi-stage approval processes for large funding requests, time-locks for treasury deployments, and separate voting requirements for different types of proposals. These mechanisms would help ensure that no single group can dominate the ecosystem’s direction.

Summary

This critique represents our collective feedback on SIP-031’s core mission to accelerate Stacks’ growth and competitiveness in the broader blockchain ecosystem. The goal of establishing Stacks as the premier Bitcoin L2 and capturing significant sBTC fee-based revenue streams is both admirable and necessary.

However, the “meta” issues introduced by this SIP require careful consideration and explicit safeguards:

Ecosystem Balance: While the “kids table” has historically benefited from ecosystem growth, this SIP threatens to formalize rather than bridge existing divides. The success of programs like Degrants demonstrates the value of supporting diverse ecosystem initiatives, yet this funding model isn’t given equal consideration in the current proposal.
Stacks Ethos: Our ecosystem’s foundational principle of “Can’t be Evil” needs to be reflected in the governance structure. The current proposal’s “Trust me, bro” approach to centralized decision-making doesn’t align with this core value. We need explicit mechanisms to ensure decentralized control and equitable benefit distribution. This does not mean that it needs to be a complicated process, as the strategic vision can be executed separately from the community driven initiatives.
Inclusive Growth: The strategic vision of core entities is crucial but shouldn’t come at the expense of our broader ecosystem. Success metrics need to expand beyond DeFi and TVL to include community growth, developer adoption, and ecosystem diversity while allowing each group to measure success by the proper metrics.

The proposed 80/20 split and additional governance safeguards would help align this SIP with Stacks’ ethos while maintaining its ambitious growth objectives. By ensuring the entire ecosystem benefits from this initiative, we can accelerate Stacks’ growth while preserving the innovative and diverse community that makes it unique.

As authors of this feedback, we stand ready to contribute constructively in two specific ways:

We can provide detailed metrics and concrete examples demonstrating the historical success and impact of community-driven initiatives like Degrants, showing how these efforts have meaningfully contributed to ecosystem growth
We are prepared to assemble a group of experienced community representatives to join the SIP-031 authorship team, bringing broader perspective and helping craft language that serves both the strategic vision and community needs

The path forward isn’t about choosing between strategic growth and community support - it’s about thoughtfully designing mechanisms that enable both to thrive together.

HeroGamer · June 2, 2025, 2:48pm

On Tuesday, Stacks builders introduced a draft of SIP-031, aimed at fueling builders and bringing Stacks into an era of traction and scaling.

Coming on the heels of an ambitious new roadmap—enthusiastically received by builders—the SIP-031 draft has sparked conversation across the community. Many recognize that meaningful resources will be essential to turning this vision into reality, and SIP-031 is a key piece of making that possible. At the same time, thoughtful refinement through open discussion and community feedback will be crucial to shaping the SIP into its best and final form.

With this in mind, community leaders and organizers are working hard to host meaningful conversation in the open. Many concerns, questions, and discussions have been addressed directly in various AMA sessions on X last week
1.check out the Mr. Wagmi’s space recording if you weren’t able to attend
2.check out the Stacks Asia’s space recording
3.check out the Alex Miller’s space recording

Below is a summary of the main feedback themes —gathered from X, forums, AMAs, DMs, and beyond —along with additional perspective on concerns raised.

Builder Support

Many builders have shared that this SIP is a major step forward for Stacks. There’s strong appreciation for its commitment to transparency, with more detailed financial reporting, regular updates, and community oversight.

Another major theme is the shift toward professional treasury management. Many in the community see the value in establishing a dedicated operational entity with experienced leadership and transparent processes. This approach signals that Stacks is serious about wise resource stewardship and is positioning itself to operate and compete alongside the top projects in the space.

There’s also real excitement about the SIP’s potential for growth. Many builders have pointed out that this is the first time Stacks will have the capital and structure to compete with top projects, unlocking new opportunities for builders, innovation, and adoption.

Finally, the SIP’s approach to sustainable, predictable funding is earning praise. By diversifying the treasury across STX, BTC, and USD, and committing to public reporting, Stacks is positioned for long-term stability—giving builders and community members the confidence to invest their time and creativity here.

Questions & Concerns

Naturally, big changes bring important questions—here are the main themes that have surfaced so far from the community feedback, along with how the builder SIP aims to address them:

Token Dilution

Concern: Increased STX emissions could dilute existing tokens.

The proposed change is a modest adjustment to inflation, rolled out gradually over a long period of time. Even with this adjustment, our inflation rate remains well below that of other leading projects during similar growth phases. This is a targeted, temporary investment designed to create long-term value for everyone.

Centralization

Concern: Too much control might concentrate in a new committee or entity.

The SIP addresses this risk by ensuring strong community oversight, transparent reporting, and clear accountability—striking a balance between efficient decision-making and maintaining decentralization. Importantly, the community remains in control and retains the ability to adjust committee membership or make other changes through the established SIP process.

Transparency and Accountability

Concern: Will there be sufficient safeguards to ensure transparency and accountability?

Yes. The proposal includes regular public reports, independent audits, and on-chain transparency measures, all of which represent an improvement over current standards. The SIP also mandates clear documentation of all treasury activities and requires community review periods before major expenditures, ensuring ongoing community oversight and engagement.

Effectiveness of Increased Funding

Concern: Will additional funding actually lead to meaningful growth?

Evidence from other ecosystems indicates that well-managed treasuries can accelerate adoption and innovation. For example, NEAR’s $800M funding initiative in 2021 correlated with significant growth: TVL increased by 4x, fees by 3x, and daily active users by an impressive 160x (for additional comparisons, see SIP draft). Additionally, SIP-031 incorporates clear KPIs and regular reporting to monitor progress and make adjustments as needed.

When in Doubt, Ask the Builders

At the heart of this proposal are the builders—the creators and teams shaping the future of Stacks. SIP-031 was drafted in direct response to their calls for more resources, stronger support, and a clear path to sustainable growth.

This post offers a snapshot of current community feedback—supportive, skeptical, and neutral—as discussions continue. As more voices join the conversation, let’s keep engaging to refine the proposal and ensure it reflects both builder priorities and the broader community’s vision for this next critical phase of traction and scaling.

SIP-031 draft posted in forums

SIP FAQ and additional resources

marvin.id · June 2, 2025, 7:32pm

I had many thoughts on this SIP the day it dropped, but I decided to let it sit and also gauge community responses. The SIP has been authored by people a grew to respect and I doubt I would have given it much serious attention had it been written by anyone else. The knee-jerk reaction here is to be against any changes in emission policy. Having all of that set in stone is what blockchains are all about, right? Still, there have been successful cases. Jude’s evaluation in particular gives a lot of food for thought. Again, someone I respect dearly, so careful consideration must be given.

I will share below some concerns and questions I have regarding the SIP. Some of these came from earlier notes and others from when I reread the SIP again right before posting. Thus, they are in no specific order. It also means some might have been addressed on other platforms.

To me, the biggest gap in the SIP is the actual people process:

How will the executive director and CIO be chosen and hired?
Who actually makes that decision and why?
Regarding the treasury committee:
- Why are 5 key holders permanent?
- Why are there 4 rotating members?
- Why aren’t all members rotating members?
How are the appointment committee members be chosen? It is said they will be “proposed”. By whom?

Following points where I think the SIP needs more work:

In the “Specification” section, under “Part 1”, it talks about how the target was chosen by estimating total resources necessary. Where is this estimate? It should be added to the SIP.
The organisation, structure, and governance is unclear. No specifics are given why a Cayman entity is the best option. What other options were considered?
Reporting and accountability can use some more language to explain what communicating on a “regular basis” means.
What is the Stacks Foundation involvement in the new entity? The SIP talks about a community driven focus but is then assigned some type of “governance” to the Foundation. What does that governance entail? Is it purely supportive in managing the process of selecting treasure committee members or is it more? Can Stacks Foundation members also be committee members? In that case are they basically overseeing themselves?
From the sound of this SIP, a lot of significant steps in setting up the proposed structure have already started. Which entities are involved and how was that work funded?
I think the SIP would benefit tremendously from explaining how the endowment will be deployed, what the mechanisms are, and what the actual oversight is. Although the SIP mentions it will be informed by the community, there is no binding language. It says very little about what the constitution of the new entities will look like and where (legal) responsibilities lie. Given the significance of the SIP if adopted, it makes a lot of sense to include it.
Is everyone entitled to vote or will some entities abstain? Given the involvement and new responsibilities of some entities mentioned in the SIP, I’m specifically curious about the STX treasuries held by the Stacks Foundation, Trust Machines, Hiro, and so on. Voting transparency is key in the adoption of the SIP. Full transparency reports by all impacted entities stating exactly the number of STX held will also help the community and aid adoption of the SIP.
I have seen quite a few people worried about forms of self-enrichment by means of the endowment. (For example on X and even in this thread.) Are there responses to address these concerns? Will the people and entities involved or mentioned in the SIP recuse themselves from becoming temporary appointment committee and treasury committee members?
I quite like Friedger’s idea of utilising the PoB phase as a funding mechanism and adjusting the suggested emissions based on it.
Why is the massive frontloaded mint required? This goes back to the question about the estimates. It would be good to include those insights.
I think dilutive effects can be quite limited. It depends on when and how fast the endowment is deployed.
Has a thorough downside risk assessment if the STX price cannot be maintained been made?
I personally feel that treasury committee members should be up for reelection that involves the community.

When it comes to technical implementation:

Is it to be defined in a future SIP? I would be fine by that. However, it implies the mint cannot be immediate if the SIP is adopted. If the SIP must be adopted immediately, then technical language is required.
I assume it is akin to a protocol developer fee with a built-in hardcoded mint address. If so, mitigation strategies are needed in case something happens to the address. Proper wallet management and design are paramount. Keyholders must have a thorough understanding of key management and multisig.

I think Stacks as an ecosystem has been stagnating and SIP-031 is the first serious plan I have seen in a while that can turn the tide. I am not saying that it is the only way forward, but we have not seen a proposal of this magnitude in quite some time. There are some serious concerns to be addressed before the SIP can move out of draft. Still, it can definitely be a way forward for the ecosystem. In the end, even blockchains should serve the people and it helps nobody if the ecosystem runs out of steam. I have been involved in Stacks for as long as I have because I believe in the technology and what Stacks can bring to Bitcoin.

On that note, my vote would be a cautious yes, while I see the above points addressed as SIP-031 evolves.

Thanks Mitchell, whose insights have always helped Stacks move forward. I of course also speak as an ex-colleague but to me Mitchell has sometimes been an unsung hero that has done so much more for Stacks than many people realise. Also to Tycho for his keen insights and undoubtedly thorough research and work. The same goes to the other authors.

Finally a disclaimer about myself: I joined Stacks (Blockstack) originally as a community member. I have been part of the Stacks Foundation in the beginning and was also a member of the first iteration of the Grants Committee. I thus like to think I experienced the ecosystem from multiple angles.

PeaceLoveMusic.btc · June 2, 2025, 7:33pm

There is a LOT of great stuff in here, Trip, but I think this governance structure proposal is a great idea.

Algorithm · June 2, 2025, 8:05pm

Just found this and I think it might help

sharky101 · June 2, 2025, 8:22pm

Scaling Responsibly: Why SIP-031 Should Include a Burn Commitment

I understand that SIP-031 needs to be ambitious to drive meaningful impact — and I support that vision. But a ~30% increase in supply is significant, and benchmarking against ecosystems that don’t share Bitcoin’s ethos misses the mark.

Stacks has a rare opportunity to lead by example, not follow the crowd. Our differentiator is not just our technology — it’s our values. We should lead with integrity, not justify dilution by comparing ourselves to fundamentally different projects.

A Clear Opportunity: Pair Growth with Discipline

To that end, I believe SIP-031 would be materially strengthened by explicitly acknowledging the tradeoff involved in emissions — and committing to long-term monetary discipline.

One clear path forward would be to introduce a deflationary offset mechanism: a burn of a portion of protocol revenues (e.g. sBTC gas fees, Endowment yield, or capital gains) equal to or exceeding the emissions introduced by this SIP.

Benefits of This Approach

Restores credibility

It signals to Bitcoin-native users and investors that Stacks truly upholds the values it claims to share. Many will understand the need for dilution today to fuel growth — if paired with a credible path to offset it over time, especially as TVL and adoption milestones are hit.

Strengthens the STX value proposition

By outlining a roadmap not just for growth but for eventual supply constraint, we reinforce long-term value through scarcity — a Bitcoin principle at heart.

Demonstrates fiscal and governance maturity

We can pursue bold action without compromising core principles — and doing so would send a strong message about what kind of ecosystem we are building.

If the Endowment succeeds — as we all hope it will — then returning a portion of its gains to the ecosystem via burns is not just feasible, it’s the right thing to do. A principled step that further sets Stacks apart.

In Summary

SIP-031 presents a strong and necessary growth plan. But growth alone doesn’t set us apart — many ecosystems have capital and roadmaps. What makes Stacks different is the foundation we stand on:

Bitcoin values. Long-term thinking. Responsible scaling.

Let’s not miss the opportunity to embed that into this SIP — clearly, explicitly, and with mechanisms future contributors and market participants can trust.

I support the ambition of SIP-031. Sometimes bold moves are necessary to unlock real impact. But I would support it even more strongly if it included a commitment to balance new issuance with future burns or equivalent value return as a statement that Stacks is different.

yukan · June 2, 2025, 9:01pm

Overall I am for SIP-31, with some recommendations. Having been a builder for a long time in the Stacks ecosystem, I’ve seen the technical progress that has been made over the years. It makes much more sense to invest into ecosystem growth now that the major technical hurdles have been overcome with the launch of Nakamoto and sBTC. The competitive landscape for Bitcoin L2s has also changed dramatically. There are several serious alternative L2s being developed and have raised a lot of funding. If Stacks continues to move along at the current pace, it seriously risks being overtaken by competition.

Changing the total supply is indeed a controversial topic. However, I feel the comparisons to Bitcoin itself is not relevant. Stacks was never meant to be digital gold or hard money that hedges against inflation. The purpose of Stacks is to scale and bring more utility to Bitcoin. If the alternative is being out-competed into irrelevance, some inflation of the supply is very acceptable. I have the following recommendations to reduce the impact of this inflation and improve efficiency.

Recommendations

Reduce emissions in the future in anticipation of price increases. If the growth efforts are successful, we can expect the price of STX to increase in the future and therefore the value of STX received by the endowment would also increase. In which case it would make sense to have scheduled “halvings” like the mining reward.
Alternatively, add a mechanism to burn the extra STX to be received by the endowment if the price of STX reaches a certain threshold.
In the spirit of operating more like a startup with a sense urgency. It would be beneficial to have a shorter mandate for the endowment. For example, the emissions could initially be set to stop at the 2 year mark. And the ecosystem must vote to renew the mandate past that. And there should be KPIs which the endowment is measured against.
On transparency and accountability, in addition to periodic reports, the endowment should make public the average pay of everyone employed by the entity as well as funds paid to contractors.
Having the right people on the team is important for success. How can the community or key contributors to the ecosystem like Xverse be part of the hiring decision making process? It would be good to see a process where the key contributors’ input are taken into account.

marvin.id · June 2, 2025, 9:15pm

Great points @yukan ! Especially having the ability to reduce or stop the extra emissions depending on certain factors like STX price thresholds.

sharky101 · June 2, 2025, 9:17pm

I like this.

franco_79001 · June 2, 2025, 9:59pm

This Treasury model ensures accountability and is a safeguard against corruption.

alexlmiller · June 2, 2025, 10:01pm

After a busy week of amazing conversations with others in the community, I realized I never actually shared my thoughts on the SIP here.

tldr: I’m for it, this is a key part of growing Stacks into a Top 10 ecosystem and fulfilling our mission of making Bitcoin programmable and usable. But it can be better, so I’m rolling up my sleeves

Thanks for the amazing level of engagement in Twitter, in spaces, and on the forum post here it’s clear that some meaty updates are needed to it and so ’m working with @codeonedotzero (aka tripnmonkey) on proposing a revision of the SIP that incorporates a bunch of changes based on all the discussion. Informally, I’m calling it SIP 31.1 and assuming we pull these things in we’ll also then add ourselves as co-authors to the SIP.

My goal is to discuss what people think of these updates or anything else we need on the Foundation space on Tuesday and then will draft those actual updates to the SIP and post that after.

With that said, here’s what we thinking about right now:

Clarify the Intent Behind Supporting All Builders & the Role of DeFi

Off the bat, the current SIP draft has a feeling of an over-emphasis on the resources being used for DeFi with other aspects of the ecosystem ignored. That’s not the intent and the strategic vision that has been discussed (at least in all the conversations I’ve been in) is that we want to be the home of the entire bitcoin economy and pushing defi right now is the means to get us the users and liquidity to do that (aka, our way of differentiating).

To that end, we’ll revise the language throughout to clarify this strategic approach of using Bitcoin DeFi as the hook to build the liquidity and user base that allows us to build the entire Bitcoin Economy on top of Stacks. We’ll specifically underscore that the SIP structure will provide funding, incentives, and support for a broad spectrum of builders— NFTs, gaming, consumer apps, AI, infrastructure, content creation, and entirely new innovations.

To me this is the single most important aspect of the SIP because everything else flows from whether we are all on the same page as a community and feel included in the overall vision of the chain.

Add an Explicit “Community Marketing & Engagement” Allocation

We’re still working on the exact format that this should take, but the general idea is that we should add a specific “Community Marketing & Engagement” allocation that is deployed at the discretion of the Stacks Community Marketing Working Group in order to grow the Stacks community and community driven marketing for a diverse range of Stacks projects. Think memes, twitter spaces, art collections, a memecoin fund, etc.

Add a “Reputational Risks” Section

We all know that there’s obviously some amount of risk to how people will perceive this move - we should capture that specifically discussing

Potential risks to include:

The ultimate point of this is to execute on product and market growth and there is execution risk inherent in that - we may raise the money, avoid any of the other issues, but still not be successful
Releasing more tokens could affect the STX price which would affect the ability of the endowment to reach its fundraising goals
Opening to criticism from others that Stacks is “money-printing” and there is no limit to how much may be printed in the future.
The appearance of the ecosystem becoming overly centralized
While many other ecosystems have changed emissions schedules or created treasuries to fund growth, there is no exact 1:1 corollary we can look to of an ecosystem with Stacks’ unique history and position in the market to predict how this will ultimately be viewed.

Add More Detail around Reporting Expectations

While there are commitments made in the SIP around reporting, there is not enough context as to why those are chosen or what some of the larger communication should be. In order to balance both operational efficiency with clarity for the community we should clarify both the minimum requirements as well as general principles that the reporting should follow.

Including:

A detailed annual report, similar in depth and content as US based non-profits issue, reporting on all monies raised and spent over the past year, the activities engaged in, the impact of those activities, and expected priorities for the future year.
A shorter quarterly report, similar to the Stacks Foundation’s current reporting, on progress against the years goal and priorities
All funds from the Endowment will flow through the primary mint address on chain so ever STX is traceable by looking at the public blockchain
The Endowment and Operational Entity staff should hold public engagement sessions (whether through X spaces, livestreams, forum posts, or others) and at least a monthly basis to ensure they’re always up to date with community thoughts and priorities.

Add Criteria for Evaluating Token Burns

The size of the emissions were chosen to ensure that the endowment has the resources that it needs to grow Stacks for the next few years while also building a base for the future. But if Stacks overperforms the model in the economic report (especially if it goes to $10+ /token), then the endowment will likely be sufficiently equipped without needing all of the planned emissions and a burn can be setup. This will also depend on the performance of some of the value accrual mechanism (like sBTC gas fees) that would provide more funds that could be used for burns.

To that end, we will propose language that will instruct the Endowment that, when the size of the endowment’s total liquid assets exceeds $1b USD, it will evaluate other options for use of the remaining emissions, including burning them, and conduct a public vote of the options.

Clarify Limitations on the Endowment

The SIP already contains a restriction on the Endowment not voting with its tokens on SIPs, but we should make sure this is clear enough and add that it will not Stack its tokens either in order to ensure it remains neutral and to remove any potential effect it would have on the BTCY yield for Stackers or the governance process.

Other Misc Updates

There’s a bunch of other small clarifications and things based on comments in this thread that we’ll also address when running through it, but focusing on this for now.

siriusbtc · June 3, 2025, 1:29am

Most successful projects like Uniswap, opensea, pumpfun, magic eden don’t got any funds from official foundation, in most cases, assistance could only help corruption rising and help those weak projects by nepotism.

A16z has great critical comments on foundation model recently.

1、Foundations have legal and economic constraints
2、Foundations introduce operational inefficiencies
3、Foundations have become centralized gatekeepers