PIP10-A: A whole new world

GM, I’m excited to present a transformative DAO improvement proposal – perhaps the most significant one since our inception.


PathDAO was built upon the vision that gaming is that door that will onboard the masses to web3. And we wanted to built an ecosystem that catalyzes that and capture value along the way.

Our journey began with an NFT project supporting Axie scholarships, rapidly evolving into a Gaming DAO. Our initial approach as a Gaming DAO was to invest in Web3 gaming at a VC level, bringing exclusive private sale and seed opportunities to our Treasury and holders. In our first year, we deployed around $5.4M in seed capital across various promising ventures. However, the market’s volatility impacted many projects, prompting us to pivot our strategy.

By the end of 2022, we shifted from the VC model, which had limited control over risks and dwindling opportunities, to a more robust Liquid Fund x Venture Studio model. This new strategy expanded our horizons beyond gaming, yielding $1.5M from a $4M deployed fund in 2022, buybacks executed in alignment with PIP6B. The Venture Studio model focused on incubating projects, positioning us as a central distribution layer for Web3 games. We’ve launched several projects in areas such as gaming influencers, NFT financing, SocialFi, competitive platforms, and UEFN. You can view the ongoing progress of these incubations on our website at pathdao.io.


However, we’ve come to two critical realizations:

  1. A token backed primarily by a treasury has a ceiling on growth potential.
  2. To truly captivate investor interest and build a unicorn, we must develop a protocol or platform that offers genuine market value beyond just investments.

Meanwhile, our venture studio has been at the forefront of developing consumer applications within the gaming arena. The breakthroughs in Large Language Models (LLMs) earlier this year brought new dimensions to our work. Through some exploration, we’ve further identified unique and valuable opportunities at the intersection of gaming and AI. This insight is guiding us towards new frontiers, blending advanced AI applications with the dynamic world of gaming.

What if we move into building an AI x Metaverse Protocol?

You can dive into the Litepaper (virtual.pathdao.io), but here is the gist of it compressed in a few statements.

Statement 1: Metaverses and gaming are effectively social layers. Be it whether you interact with NPCs, other gamers, or content creators. Most of the interactions today are parasocial, lacking the ability to hyperpersonalise and be more engaging for the user. AI changes this. AI Personas are the future of any virtual and gaming interactions. Use cases range from virtual companion chats (think Character.ai), AI NPCs (think InWorld), to gamer co-pilots, to AI procedural storyliners.

Statement 2: As interactions with AI characters become more prevalent, it is crucial to guarantee their impartiality and neutrality. There has to be an open, transparent system where the development and input of these characters are overseen by a collective community. This approach ensures that AI characters are not biased by a single entity’s agenda, promoting a fair and balanced interaction environment.

Statement 3: The rise of AI-driven content creation poses a challenge to intellectual property rights and the economic incentives for original content creators. Using blockchain technology can safeguard copyrights and ensure that creators are rightfully compensated. This system aims to strike a balance between the infinite possibilities of AI content generation and the rightful interests of IP owners.

Statement 4: As AI technology advances, addressing long-tail edge cases becomes increasingly complex and costly. Many passionate individual users and developers are hobbyists who may lack the resources to contribute effectively. There has to be an incentive layer to unite these diverse forces, channeling their efforts towards creating superior AI Personas. This collaborative approach democratizes AI development, allowing everyone to contribute to and benefit from the system.

Statement 5: In a rapidly evolving AI landscape, entrepreneurs often find themselves preoccupied with backend technicalities, such as keeping up with the latest AI model updates. A library protocol addresses this issue by taking over the backend complexities, allowing entrepreneurs to concentrate on their go-to-market (GTM) strategies. By providing a stable and up-to-date AI character platform, we empower entrepreneurs to focus on user engagement and business growth, without the distraction of constant technological updates.

We believe in a future where virtual interactions are hyper-personalized and hyper-immersive, enabled by AI, built in a decentralized manner.

We do this by (1) building up a protocol layer that incentivises and aligns all actions in the creation and usage of these AI Personas and (2) build up an ecosystem of DApps that will monetize our AI Personas in metaverses, gaming and beyond.


  1. Prioritize core contributor efforts into the establishment of this protocol. (PIP10-A)
  2. Migrate token and modify tokenomics to be relevant to the protocol layer. (PIP10-B)
  3. Allow for DAO members who are not aligned to the proposal (if passed) to redeem their DAO tokens (PIP10-C)

A. Let’s go ahead into the AI x Metaverse Protocol space
B. Stay the same as today

1 Like

Just to add some behind the scenes insights as well:

In the venture studio operation, the technical team has been building up the AI architecture stack for many weeks already now, mainly for an incubated venture. ie. we can hit the ground really hot, really fast.
After exploring with several thought leaders in the space, we also realised that there can be a lot more innovations baked in. We are detailing those out more in a technical whitepaper that will be released soon.

We are likely able to release 3 flagship DApps by Jan/Feb to consumers if all goes well. One of the DApps already have their GTM machinery ready, as they have been testing a relevant use case MVP already.

1 Like

protoman — Today at 8:50 AM
How about the tokens that were bought back already? Are they part of the 35% treasury? If it is that’s weird. Are you guys gonna still keep a dashboard for the investments?

I think you guys didn’t go deep enough in the tokenomics breakdown, what happens to the path that is not migrated? I think beam put some sort of expiration date, which would be pretty good.

Elon.Kongz.Eth (Twinkle) — Today at 10:43 AM
Tokens not migrated or bought out should be distracted to me :KEKL:

EtherMage | Sage — Today at 11:26 AM
Yeah, the bought back tokens are DAO-owned, hence part of the 35% treasury. Would love to hear your thoughts on that bit further.

EtherMage | Sage — Today at 11:28 AM
Yes, we will. Most of them are high time frame investments. And they are DAO owned assets. Hence, the dashboard will be there to show the status of these assets.
We still will have a treasury management team (liquid) since they have been EV positive so far after 1.3 years of operation. The goal is to extend runway and supply for liquidity for the Ecosystem Fund in the long term. So we can grow the DApp ecosystem better

EtherMage | Sage — Today at 11:30 AM
We are proposing an airdrop not a migration. It’s more complicated for us but it helps resolve a lot of issues due to migrations.
gas fees, people who are left out of the migration, etc. We don’t want to leave people behind. I personally chatted with many folks who are in with us from Day 1 and dont check their bags even after years haha. They are long term believers in the team and needs to be part of the new protocol too.

Been looking at the AI Space and how fast it is moving. Definitely the right move. Smart choice!

VR though
AI x VR lfg

Nice, generally in favor for regardless of my concerns below (cause I think solvable):

  • From a token/shareholder POV, this move +EV in pricing/speculating on future expectation of value created for AI-powered entertainment use cases, and also building valuable capabilities + specific domain knowledge. This versus status quo.

However, several concerns:

  1. Hyper personalisation built/trained in a decentralised manner is counter-intuitive.
  • Personalisation comes from empathising with a customer and building for them. If you have multiple heads wanting to add their own flavor/agenda, this would likely spoil the product and impede progress on any measurable front (at least in the early stages)
  • The incentives aren’t significantly favorable for an entrepreneur to choose this approach vs solo indie hacking, venture studio funded, etc. (tldr: revenue → forced buybacks is bad use vs reinvestment for innovation/growth, more ppl in cap table translate to wasted time in a never ending cycle of pleasing stakeholders if company at small scale, performance of value created by one dapp is overall weighted down if other dapps are not performing which)
  1. More evidence and clarity needed for this approach - at least for believability + resource efficiency in execution
  • The proposal aims to build a solution in search of a problem use case which is suboptimal. In this case, building a protocol/library of AI models without clear understanding of who wants/needs it (with supporting evidence). Which this also impedes the personalisation bit which makes making your model less valuable. [Perhaps this is already known and you could share with us what are the DApps and traction.]
  • What market proof in size, growth, and adoption does the protocol answer - not so much in TAM but where money is paid today for an alternative, and why would they pay these dapps because they’re 10x better? The value of the protocol is a sum of the dapps EV + protocol model accretion + speculative premium, knowing what this is would help price discovery. [Perhaps this is already known and you could share with us how large of a problem these dapps are solving so we can be turned on]
  • Given the personalisation focus, decentralisation doesn’t make sense as stated above. It’s the same problem with DAOs in general. Not an impossible problem to solve, just needs clear roles, responsibility, accountability, power, and incentive. The question is what does this governing/operational model look like that’s a win-win-win. [Perhaps you could share with us a table/diagram on this.]

Apart from narrative riding, the crux of the execution in answering above is simply making sure the org can attract technical builders/entrepreneurs. The rest is solvable along the way.

Critiquing the tactical details of litepaper:

  • Contributors + validators (whoever that works on this) should be compensated both in $USDC (or wtv money) + $V (quasi-equity). To kickstart attracting knowledge workers. Given $V only and early on plus having it tradable on open market literally endangers their stream of income for contributing. The instability is disincentivising and skews focus (from financialisation/volatility of token), e.g., token pumps - I’m rich fk this, watch your mouth; OR token dumps, damn I need to earn somehow, my efforts don’t match value being paid, fk this.

  • How will your grant system work to attract contributors, etc. - same Q to the roles responsibility power etc. from first reply

are there any additions to the team? This plan is interesting but very different from running a fund. Who has the AI expertise?

its good to see the team is constantly innovating, bringing together AI and metaverse is a good way to move forward.

interesting proposal to read, clearly a lot of effort and time went into this.

couple of things/questions that are raised reading through the proposal 10-A:

this year was supposed to be path labs’ year, but all deliverables/milestones have been marked as either exploring or in progress (https://pathdao.gitbook.io/pathdao/about-pathdao/2023-strategy). what has been substantiated from this year in terms of deliverables? and are we abandoning the ‘2023 strategy’ altogether with the pivot to AI + MLM?

i think the idea is interesting indeed, but i have doubts if the current budget / talent can deliver given how few was delivered this year by the current team and how broad the idea has been setup/proposed. can we attract decent talent in this AI space to create a competitive product? for instance, how do you see us compete against a discord bot + chat gpt integration which already can isolate your responses to certain constraints/character customization. why dont you start smaller and rapidly innovate with feedback from community. see if we can find a product market fit by creating great middleware before setting up our own LLMs and such.

i believe the token doesnt add any value if you are making pivot to software company and token will only complicates things, especially doing a token migration. path token is just like share of the company. contributors are paid from treasury (the proposed 3 million) and we can budget it with milestones like grants to incentivize builders/contributors fairly.

personally i wouldnt want to chase this AI hype, simply because we dont have cash to compete with big tech. the idea proposed is way too big, start small and innovate rapidly, continue to be sensible with the money. you have a full community who is rooting for you and has a stake in this succeeding if chosen, i miss any consideration about how we employ the best capital we have , the community/DAO :blush:

By FK BP [Telegram, 09:54 PM]

So, “virtual” will be listed on CEX after migration?
I liked propasal for migration to virtual

Ethermage [Telegram, 12:56 PM]
Will be in phases.
Phase 1 is getting the migration up, and establishing the protocol. launch 3 flagship DApps. 3-4 months.
Phase 2 is expanding ecosystem and marketing. Hackathons for contributors, getting attention from KOLs and then listings for liquidity.

protoman — Yesterday at 7:05 PM
tbh I dont understand what any of this means, this AI stuff is too abstract for me, but sounds like an improvement so I will be voting yes for all the PIPs. at first I thought PIP10c was kinda nonsense but its pretty good, sets a floor for the path token price until december so we will have a smoother transition

protoman — Yesterday at 9:26 PM
do you guys have any marketing material available for the proposed new token? like logos and stuff @EtherMage | Sage
also, path team is not gonna change names, right

EtherMage | Sage — Today at 12:56 PM
yeah, team is building up these collaterals as we speak.
From a branding perspective, it’s likely going to be a full transition. Path > Virtual.
Team will still be the same, and expanded to include capabilities we need in this new front.

Elon.Kongz.Eth (Twinkle) — Yesterday at 10:37 PM
I’m waiting for the AMA before I make any judgments, the virtual AI sounds like a big brain move in gaming but is going over my head a little bit :patnut:
Would definitely be nice to rebrand though into the hottest trend (AI) and give the token a new chart since the Path token looks quite bad :Sadge:

EtherMage | Sage — Today at 12:58 PM
Yeah, that’s one of the key reasons as well. New chart, give non-aligned members an exit, go into a new valuation discovery zone → delivers way more value to token holders vs status quo.

EtherMage | Sage — Today at 1:00 PM
Haha im here, can AMA anything.
We have an intern thats compiling all questions and thoughts in the gov forums.

I echo Camantha’s points, budget size to ambition means approach matters. A question I have vs previous approach is how focused should resources be and where in this new way forward. Focus being the key on getting 0 to 1 (pmf, capability building).

From an external POV, a refresh is fine despite being told as a top-down story - most of CT would buy it regardless. But from an internal POV, I can see the dread the team has to go through in figuring things out and leadership + culture here will be hyper critical.

I dont think CT is going to buy an Investment DAO pivoting to an AI project. Those are vastly different skills required and all we have right now is a couple weeks old litepaper.

This is a completely different company, not a simple pivot, and should be treated as such.

Well, I was going to abstain from voting, or even commenting since I was banned from tg/discord after asking for transparency in the treasury. MC (Beam) doubled down on their gaming agenda and are now thriving because of it. Their agressiveness towards their token burn and community-centric values had their price soar last few weeks. Our team never managed to focus and/or create a flourishing community, all you had to do was copy and paste. And I’ve said that from the beggining, the burn was not only about tokenomics, but also to retain your community engaged, non-toxic, or even existent. You do know that y’all gonna have to basically buy a new community now through marketing, is there a plan for that?

I am not against turning into an AI-project, the problem is that you guys learned nothing from all of this. Why should we trust you? I was not the only one to warn you guys, many people tried to help y’all. The price went literally 99% down and the community vanished.

Be more transparent about the tokenomics, who are the angels? Who are the VCs still involved? I know for a fact that you guys bought a bunch of them out.

I think a great way to solve this is to improve the tokenomics. Burn some of the team tokens, burn some of the project treasury, burn most of the incentives. From the community point of view what you are asking is for us to basically give all the treasury for y’all for a “AI PROJECT” in return. What y’all being doing for the last 2 years?

Turn this 1b tokens into 600-700m. The vesting thing will be easier to swallow, remaining community will be happier, it will be easier to build a new one.

Anyway, the decision has being made, if this is turned down is a lose-lose anyways because you guys are already focused on this AI stuff. It’s time that was already lost instead of turning this into a reputable gaming DAO. Having said that, I generally am in favour of this change, just fix the tokenomics for christ’s sake I have being saying that for 2 years and y’all f’up anyways.

Taellun — Today at 2:31 AM [Discord]

The rebranding/pivot is a good move, it brings fresh starts and a new set of individuals into the community.

I will say it’s crucial to take the learnings from PATH and not repeat the same mistakes. Although we’re shifting from a treasury management DAO to a SaaS (at least what I read implies this), there are still commonalities. Rebuild the trust, rebuild the community and we should be on the PATH to uptrend again.

Hope y’all can execute, cause the last AI persona hype train (PxN) during the bull rugged :rofl:

protoman — Yesterday at 6:54 PM
A few questions then:

1- To the people that actually take the exiting deal, is this gonna be part of the treasury? Shouldnt then the public percentage vs treasury percentage change depending on the amount of people taking the deal?
2- You said 3-4 months to implement dapps and stuff, and then start the marketing, but if we change in december/january to the virtual token with no public awareness, isnt it going to defeat a lot of the purpose of changing the token?
3- Are you guys in touch with any market maker? Our chart is recovering but still, is VERY low volume right now, even if we are going up (which is good) we need volume or we shouldnt bother switching tokens
4- How are you guys going to get this new talent? Why should awesome devs come here instead of looking to other places?
5- Have you considered any other chains other than Polygon?
There are a few other “newer” L2s like OPT and ARB that can hype up the public awareness factor, why not choose them

Some other points I would like to touch:

-Our website is pretty fancy and pretty, but is not functional, its too slow with not a lot of information, in the new one we need fast and easy to understand. As of right now I still dont get what we are shifting towards (not that it matters), but I am sure I am not the only one, in the “new era” of our project you guys need better story telling
-I like our app, not sure it needs any changes, maybe change that ugly looking safe that moves a little bit with the coins
-Gaming is gonna ALSO be a big part of the next bull run, just look at MC (beam) doing 5x-6x with new chain and gaming, shifting to AI is cool but we also should continue to advertise that we still have our gaming stuff

Adding a few points for clarity:

  1. We’ve always been about web3 gaming, and this move is all about building on that. We’re going beyond just putting money into projects; we’re now going to be pushing the tech side of things in gaming and the metaverse. Look around, and you’ll see most gaming DAOs and guilds trying to be game publishers. But that space is crowded, and it’s tough to stand out. We’ve spotted a unique opportunity that nobody else is really focusing on with a large size of prize. If we get this right, it could be a game-changer.

  2. The DAO still governs the treasury in the new protocol. There will still be a treasury management team whose full focus is to keep growing it through liquid investments (gaming and beyond). The development of the new protocol uses the Venture Studio resources that we’ve built up over the past 1.5 years, within the 5% OPEX budget guardrails. From our current projections, this can still cover the dev work on the protocol layer, and the initial POC for flagship DApps. There will be requirements to fund new teams at the DApp layer, but each of those funding will have a proposal at the DAO level.

  3. There’s also questions around do we have the right to win here.

Key point A: We are not not aiming to recreate any foundational models. We are building an incentive layer to get finetuning and data contributors in building up these AI characters. We build at the middleware layer (multimodal aggregation and fine-tuning) and consumer DApps. For context for newer folks to this topic, it means we are not going to build a competitor to Llama, GPT4, Stable Diffusion. The public contributors will build upon them to fine-tune models.

Key point B: Capability to pursue this is already in-house, but we will still augment the team. When we started PathDAO, manpower at the core contributor team was 50% guild ops, 20% investment, 30% tech & product. Today, with the whole venture studio set up, we are at 80% tech & product, 20% investment.

Without augmenting the team today, we have

  • web3 architecture devs
  • AI/ML researcher/dev
  • consumer app devs
  • UIUX dev
    but that said, we will ramp up hires and advisory board to be relevant to the new direction upon approval from the DAO.


  1. Sorry don’t follow you on the hyperpersonalisation point. If you are referring to the value add VIRTUALs bring to the table, hyperpersonalisation comes into picture because of generative AI.

  2. 100% agree on the strategy here. DApps > blanket VIRTUAL creations. Mainly because the biggest question on whether protocol can get revenue can only be answered if the DApp is revenue generating.
    At phase 0, we actually start off with what flagship DApps we think is solving a problem.
    These DApps would require X, Y and Z VIRTUALs.
    It is then we direct protocol incentives on the creation of X, Y and Z virtuals.

2a. Generally the use case landscape is massive. Briefly touched here on how gaming worlds will change over the next few years. https://virtual.pathdao.io/the-vision/the-market-opportunity
Will share the flagship DApps thinking in a bit.

  1. On the incentive ecosystem. It’s a pretty standard behavior to incentivize protocol contributors with native tokens. In an ideal scenario, revenue generated > value needed to incentivise contribution = growth in token value.


  1. It depends on if we can fill the exit deals with OTC demand. If we have to use Treasury funds to buyback those exit tokens. Then yes. it will contribute to the treasury-owned percentage.

  2. Yeah, we can consider ramping up marketing efforts earlier.

  3. Market maker to create artificial volume? Sorry, need a bit more clarity here. Artificial volume makes sense if we are hunting CEX listings. But honestly, CEX is a low prior focus until we get more attention. CEX listings are expensive.

  4. 2 fold question. Talent to join at the core contributor to build out protocol infra and flagship DApps, thats on me and my co-founders to attract. Talent at the decentralised contribution of data, finetuners and broader DApp founders? That one requires brand building, hackathons, and incentives. Have a lot of room to build for this part, but we will.

  5. We are assessing. @Camantha brought this up earlier too.

  6. I hear you on these. Will get our marketing guy to digest. Also bro, why don’t we work with you closer on this as well. Let me know if you are keen.