We have seen new users joining our community but are quite lost as to how DigixDAO works. Hence we hope this blog post could provide some clarity on what DigixDAO is, and what DGD token holder rewards are, and what DGX 2.0 will be like.

The main questions we receive are:

How does DigixDAO governance work? DGX 2.0 tokens What kind of rewards / rebates do DGD token holders get? ETA?

DigixDAO Governance Model

When Vitalik and Rune was in Singapore in the month of June for various Ethereum conferences and meetups, we had an active discussion as to how to best structure DigixDAO’s governance. Some of the discussion can be found in our blog post here. This will be further detailed after the relaunch of DGX 2.0.

DGX 2.0

When we beta launched DGX on Jan 15 2016, it was deployed before the EIP-20 token standard was implemented. Hence, DGX 2.0’s relaunch is to fix this and make it compliant with the token standard to make it easier to integrate with any future DApps on Ethereum.

DGX tokens have two attributes, namely:

A daily demurrage fee on a DGX token holders balance due to the cost of carry of physical assets (insurance, storage costs) Transaction fees for sending DGX with an Ethereum Wallet.

Each DGX token represents 1.000 Grams of Gold in our custodial vaults.

Rewards / Rebates claimable by a DGD token Holder

DGD holders are currently structured to be able to claim rewards on transaction fees of DGX tokens on the Ethereum Blockchain, at 0.13% per transaction capped at 1 gram of gold, every quarter only when they participate in making decisions for the DAO that help build the DGX ecosystem.

We are planning to include demurrage fees as part of the rebate structure to DGD token holders on top of transaction fees of DGX tokens.

What will be the new Rewards / Rebate structure be like?

We look to :

Remove the cap on transaction fees of DGX tokens while changing transaction fees to 0.1% per transaction, claimable by DGD token holders Rebate at least 20 basis points per annum on demurrage fees back to DigixDAO, claimable by DGD token holders

Why did Digix do this?

We felt that DGX can be used for in the new ecosystem for both wealth preservation and/or for payments, hence, by providing both aspects as a reward to DGD token holders, this would better ensure participation in the rewards of DigixDAO on all aspects of DGX. Removal of a transaction fee cap may also increase the upside of rewards to DigixDAO.

Timeline

We understand that everyone is excited and looking forward to live Dapps on Ethereum. Enterprise software development and security takes time and may encounter unforseen delays as and when new bugs are discovered, attested by the recent The DAO and Fork fiasco. Releasing a product that has security flaws will also be detrimental to the the future of Digix and DigixDAO, so we are moving cautiously yet as fast as we can. Additionally, we now have to concern ourselves with Replay Attacks if DGX is to be available on both ETH and ETC in future.

Once DGX 2.0 is successfully launched, we will begin work on DigixDao’s governance contracts, so that we can have DGD token holders actively participate in proposals and rewards.

We entreat everyone’s patience as we develop a digital asset solution for the Ethereum community. Ethereum is currently only 1 year old and the ecosystem is still in early stages without a commercial Dapp for non Ether related businesses. Digix still aims to be the first live DApp to integrate blockchain technology with a traditional brick and mortar business on Ethereum, where the focus is on Ethereum’s technology, not ETH as a digital currency.