DRAFT: The Revenue Surge and Sustainable Growth Plan

Governance Proposals
1

Introduction

Tezos Domains is poised to unlock unprecedented financial success through a targeted strategy that delivers immediate and substantial revenue generation while establishing a foundation for sustained growth. This proposal presents a clear and decisive plan to secure reliable cash flow from the very first month by driving early renewals and incentivizing multi-year commitments.

Grounded in proven economic principles and behavioral insights, this strategy ensures consistent user engagement while avoiding abrupt pricing changes that are known to disrupt demand and erode trust. Instead, it leverages incremental adjustments to foster loyalty, sustain core revenue streams, and position Tezos Domains as a cornerstone of the ecosystem’s economic infrastructure.

Key considerations that inform this proposal include:

  1. Maximizing Immediate Revenue: Focusing on five-letter domains—the platform’s most active and widely registered category—this plan generates the largest possible upfront cash flow without alienating users.

  2. Protecting Core Value Generators: Five-letter domains are the platform’s financial backbone. Strategic pricing adjustments ensure they remain accessible while driving substantial revenue growth.

  3. Empowering Devoted Users: By aligning pricing with user behavior, this approach motivates early renewals and multi-year commitments, minimizing churn and reinforcing engagement.

  4. Preserving Premium Assets: Protecting two- and one-letter domains for strategic future releases avoids undervaluing these high-demand resources and ensures they generate maximum returns.

  5. Building a Scalable Framework: Predictable, incremental pricing fosters user trust while creating a reliable revenue stream that scales with demand and supports the platform’s financial health.

This proposal delivers an actionable and data-backed roadmap to address immediate revenue needs while securing long-term stability. By combining strategic pricing with user-centric insights, Tezos Domains can achieve financial sustainability, user loyalty, and unparalleled market growth.

Goals

  1. Immediate Revenue Generation:
    Drive upfront cash flow through early renewals and multi-year registrations.

  2. Long-Term Revenue Stability:
    Establish a predictable and scalable pricing framework to ensure the platform’s ongoing financial health.

  3. Preservation of High-Value Assets:
    Protect two- and one-letter domains for future strategic releases under optimal market conditions.

  4. User Trust and Engagement:
    Reinforce user confidence through transparent communication and incentivized participation.

Proposed Pricing Adjustment

The pricing adjustment focuses exclusively on five-letter domains, introducing incremental increases to balance immediate revenue needs with user retention. The schedule is as follows:

(This approach also builds on insights from behavioral economics, particularly loss aversion, which shows that users are far more motivated to avoid perceived losses (such as future price hikes) than to seek equivalent gains. By framing price increases predictably, this plan reinforces loyalty while encouraging earlier and larger commitments.)

Expected Revenue and Engagement Impact

Month Price per Domain (Tez) Increment % Increase from Previous Expected Outcome
Month 0 1.00 - - Generate awareness of upcoming changes. Early renewals. Highest 2 months of revenue begin.
Month 1 1.25 +0.25 +25% Early renewals; those who missed out don’t want to miss out further; highest revenue month expected.
Month 3 1.50 +0.25 +20% Continued strong renewals driven by urgency.
Month 6 2.00 +0.50 +33% Continued multi-year registrations stabilize revenue.
Month 9 2.50 +0.50 +25%
Month 12 3.00 +0.50 +20% Anticipated long-term renewal spike ahead of further increases.
Month 15 4.00 +1.00 +33%
Month 18 5.00 +1.00 +25%
Month 24 6.25 +1.25 +25% 5-character domains reach 6.25 tez/year, aligning with a consistent 4x multiplier across tiers and correcting the current 25x imbalance.

The incremental pricing structure is designed to achieve:

Month 0: Immediate boost as users act early to lock in lower rates. (Potentially the strongest month of revenue generation in the history of the platform)

Month 1: Contrary to assumptions, FOMO is even stronger when users feel they missed out on the most optimal pricing, but feel that they still have the opportunity to benefit from current pricing before prices increase again.

Month 6: Sustained growth from multi-year registrations and renewed engagement.

Month 12: Significant upfront revenue from long-term renewals ahead of further price increases.

Month 24: By Month 24, the price of 5-character domains will reach 6.25 tez/year, bringing logical consistency to the pricing structure across domain lengths. Currently, the price jump from 5-character to 4-character domains is 25x (1 tez → 25 tez), while the jump from 4-character to 3-character domains is only 4x (25 tez → 100 tez), creating a clear inconsistency. Adjusting 5-character domain prices to 6.25 tez corrects this imbalance, aligning with a consistent 4x multiplier between each tier: 6.25 tez → 25 tez for 5-character to 4-character domains and 25 tez → 100 tez for 4-character to 3-character domains. This predictable, proportional structure improves fairness and strengthens the platform’s pricing strategy.

The [end] 6.25 tez/year pricing aligns with logical proportionality across domain tiers, fostering fairness while reinforcing the platform’s robust pricing strategy.

Why Five-Letter Domains?

Five-letter domains represent the lowest hanging fruit for revenue growth, making them the ideal starting point for strategic adjustments. This focus is supported by several key factors:

  1. Highest Volume of Registrations:
    Five-letter domains consistently account for the majority of registrations, providing the largest potential revenue base.

  2. Devoted User Base:
    Buyers of five-letter domains are among the platform’s most active and loyal users, often owning multiple domains. These users are highly engaged and more likely to respond to incremental pricing changes.

  3. Potential for Multi-Year Commitments:
    The relatively affordable price of five-letter domains increases the likelihood of users opting for multi-year registrations to lock in current rates, generating substantial upfront revenue.

  4. Minimal Risk of Alienation:
    Incremental adjustments in this category are less likely to disrupt user behavior, ensuring stable demand while maximizing revenue.

  5. Core Revenue Generator:
    As the platform’s largest and most consistent revenue stream, five-letter domains provide a strong foundation for financial growth without the risk of undervaluing premium assets like two- and one-letter domains.

By starting with five-letter domains, this proposal leverages the platform’s most active product to achieve immediate financial results while minimizing risks and fostering long-term user loyalty.

Economic and Behavioral Framework

Elasticity of demand demonstrates that incremental price adjustments are the optimal strategy for maintaining engagement and maximizing revenue. Abrupt changes, such as tripling prices from 1 tez/year to 3 tez/year, are almost certain to suppress demand, alienate users, and reduce revenue.

1. Price Elasticity of Demand:

Elasticity measures how sensitive users are to price changes. Abrupt, dramatic increases are known to disrupt user engagement, suppress demand, and inevitably reduce revenue. Incremental adjustments, on the other hand, provide users with a sense of predictability, maintaining stable demand while encouraging early renewals and multi-year commitments.

For example, jumping from 1 tez/year to 3 tez/year is an extreme pricing change that is almost certain to backfire. Even doubling the price to 2 tez/year would alienate users, sharply suppress demand, and undermine trust in the platform. By contrast, gradual increases—such as moving from 1 tez to 1.25 tez and then to 1.50 tez over time—avoid these issues entirely, sustaining user engagement while maximizing revenue generation.

(More on Elasticity of Demand: Investopedia, Khan Academy, Economics Help)

Equation:

image

Where:

image
Elastic demand—price increases reduce total revenue.

image

Inelastic demand—price increases raise total revenue.

2. Behavioral Insights (Framing Effects):

Incremental price adjustments are designed to generate significant revenue while sustaining user engagement. For example, a 25% increase from 1 tez to 1.25 tez in Month 1 is calibrated to prompt action without deterring users, unlocking substantial gains across all renewals. By aligning with behavioral principles like loss aversion and maintaining a predictable framework, this approach ensures consistent demand while maximizing revenue potential.

  • Loss Aversion:
    Users are more motivated to avoid future losses than to seek equivalent gains. This principle, from Prospect Theory, ensures that users act early to secure lower prices, resulting in higher renewal rates and multi-year commitments.

    • Example: A user paying 1 tez annually may opt for a 10-year registration to avoid predictable price hikes, generating 10 tez in upfront revenue.

  • Framing Effects:
    Predictable pricing creates urgency. Users perceive price increases as avoidable penalties, encouraging earlier renewals and reducing churn.

    • Example: The incremental increase from 1.00 tez to 1.25 tez in Month 1 is small enough to maintain demand but large enough to drive action.

  • Creating Compounding Urgency:
    Each scheduled price hike builds momentum. Month-by-month increases sustain engagement by leveraging FOMO (Fear of Missing Out), creating a recurring cycle of renewals and new registrations.

  • Incentivizing Multi-Year Registrations:
    Clear communication about future price increases encourages users to register domains for multiple years to lock in current rates.

  • Regret Aversion:
    Missing out on the initial deal (e.g., 1 tez pricing) creates a sense of regret. Regret is a powerful motivator, often prompting individuals to take corrective action to avoid experiencing the same feeling again. In the next pricing tier (e.g., 1.25 tez), users are more likely to act decisively to avoid missing another opportunity.

  • Escalating Fear of Loss:
    With each incremental price increase, the stakes feel higher. Users perceive not acting now as a compounding loss:

    • Example: “I missed 1 tez. If I don’t act now, I’ll miss 1.25 tez too, and then it’ll be 1.50 tez.”

  • Anchoring to Initial Prices:
    The original price (1 tez) serves as an anchor, making the next-best price (1.25 tez) still appear relatively attractive compared to future increases (e.g., 1.50 or 2 tez). This anchoring effect combines with regret aversion to amplify the urgency to act.

(Framing Effects: BehavioralEconomics.com, Investopedia, Decision Lab)
(Prospect Theory: Investopedia, HBR)
(Loss Aversion: Investopedia, HBR)

3. Revenue Equation:

Total revenue (R) is calculated as:

R = P x Q

Where (P) is price and (Q) is the quantity of registrations. Incremental increases maintain or grow Q while raising P, ensuring R increases consistently.

Methodology

  1. Elasticity Testing:
    Measure changes in registration volume (Q) and total revenue (R) at each price increment to validate future adjustments.

  2. Key Performance Indicators (KPIs):
    • Monthly revenue growth.
    • Multi-year registration trends.
    • User retention and engagement rates.

  3. Governance and Adjustments:
    • Monthly reviews will evaluate user behavior against key metrics, including registration volume, revenue growth, and user retention. These metrics will validate the next price increment, ensuring the platform remains responsive to market dynamics.
    • Adjustments (via monthly vote) can be paused, modified, or reversed based on observed demand trends.

  4. Transparency Through Reporting:
    • Regular updates will be shared with the community, detailing revenue growth, elasticity testing results, and the impact of price adjustments.
    • This approach builds trust by aligning the platform’s actions with user interests and ensuring accountability.

Expected Outcomes

The plan ensures immediate and substantial revenue growth from Month 0 through early renewals and multi-year commitments, setting a foundation for sustained growth and user retention over time.

  1. Immediate Revenue Boost in Month Zero:
    Predictable and incremental price adjustments will encourage early renewals and multi-year commitments, generating substantial upfront revenue within the first month.

  2. Sustained Revenue Growth Over Time:
    The compounding urgency created by incremental increases will sustain user engagement over time, reinforcing loyalty and driving long-term commitments.

  3. Compounding Urgency and FOMO:
    Incremental increases build urgency, ensuring steady renewals while creating predictable, growing revenue streams for the platform.

  4. Increased Multi-Year Registrations:
    Users locking in current rates for longer durations provide immediate revenue and reduce future churn risks.

  5. Preservation of High-Value Assets:
    Protecting two- and one-letter domains ensures their value is maximized in future strategic releases.

  6. Data-Driven Decision-Making:
    Elasticity testing informs ongoing strategies, ensuring pricing aligns with user behavior and market conditions.

  7. Reinforced User Trust:
    Gradual, scheduled, and transparent changes enhance user confidence in the platform’s governance and strategy.

Conclusion

This proposal outlines a confident, data-driven strategy to achieve immediate revenue growth and long-term financial stability. Incremental pricing adjustments foster engagement and loyalty while driving sustained success, securing Tezos Domains’ future as a cornerstone of the ecosystem. Additionally, the plan’s adaptability ensures that future changes are informed by data, maximizing both revenue and user trust. This is not just a solution to current challenges—it is a framework for the platform’s enduring success.
2

Accepted post even though very late in proceedings to the ongoing DAO proposal.

I don’t think 3 XTZ is expensive. Nor would ‘alienate’ users. Even being at 3 XTZ (currently) would still be one of the cheapest naming services out there.

I don’t think causing users artificial FOMO is a great strategy for the long run, and even without actual financial incentive, FOMO wouldn’t work in this case.

In terms of section 2, points 1,2,4,6; the community is aware of possible price changes already so we should already be seeing this more activity on renewing/purchasing names already.

I do think in general this is a very good counter for current voting options, however its fairly late into the proceedings and should’ve been brought to the table much earlier on.

We will have to wait on the DAO voting period to end to finalize results. If current proposal passes, this post will be closed and you would need to wait for changes to be implemented to be able to submit a new pricing structure proposal for voting.

1 Like
3

Thanks for putting this in @Kevin

I have to agree with @Snorlax.tez specifically the last part when it comes to the execution and timing of everything.

We should start working on making this draft a properly formatted proposal so it can be debated on and put into the voting system when it’s ready.

The strategy outlined above has a few great spots and I’m sure over the next several months it can become a formidable way forward if you keep working the proposal system and gathering feedback from all the key stakeholders.

4

We can easily supersede the previous decision, which barely passed and was made arbitrarily in a flurry of ideas. It lacked an understanding of present sensitivity and, quite frankly, basic economic principles. The approach taken was the exact opposite of what sound decision-making and economic reasoning would dictate.

Rejecting this plan based on effort justification—the idea that prior effort justifies sticking with a flawed decision—would miss an opportunity to make a meaningful improvement. Before I even presented this plan, the argument was already being made that we’ve come too far to change course. This makes it clear that any rejection isn’t based on sound economics but on a flawed and unproductive justification.

We absolutely have the time to correct this. Let’s lobby for the support we need, get the votes, and make this happen. This plan is rooted in solid economic principles and represents the best path forward for everyone involved.

5

We can’t use the current plan—the one that was recently put to a vote. It would destroy all of the economics, irreversibly. We have to consider this an emergency situation and get the proposal out now so we can start getting the votes.

6

As far as I am aware, you’ve had a very long time to put in a compelling argument or counter proposal for the current plan that has succeeded in voting. If a vote has passed, it can’t just be rejected because the minority has said so. As mentioned in my previous comment, you would need to wait until changes have been implemented, and make the proposal in the correct format to push it to vote. If in any case you made a comment on the previous passed vote, giving a compelling argument against, then sure, it wouldn’t have gone this far.

1 Like
7

I appreciate your passion about this, up to the point of getting into concern trolling.

As a delegate in TED, I suggest moving forward with the proposals as passed and as discussed. The time to put out a competing proposal, that’s properly formatted, was weeks ago. This way it would have had enough time to be properly discussed and voted on.

I suggest you read the founding documents and explore any provisions open to you to address your concern. Whether your opinion is a good idea or not is yet to be seen once more feedback is gathered. The main points I want to stress are doing the due diligence in both proposal formatting and following the founding documents of the project as well as the established proposal logistics.

8

I actually think Kevin’s point of backlash is justified. Its why I’ve been preaching in spaces all this time!

That being said, we voted to change the price to 3xtz but we did not discuss “how” this would be done. That’s on the table still, and I think there is some useful stuff here.

Small thing would be to tweak the increments to weekly instead of monthly. We can increase by ~0.5 a week starting on Dec 3 and go until 2025. This idea is worth discussing further in my opinion!

9

Your rationale is baseless. We’re talking about preventing economic disaster that won’t even meet the revenue needs, and you’re saying “well…it’s been a long time…so…”

No we don’t have to wait for this to be implemented and destroy us before correcting it. That makes no sense whatsoever.

Governance includes repealing past decisions.

10

You are much smarter than this! Once again you’re talking about “THE TIME” and not any basis of economics. I’m saying this is terrible and destructive, and you’re justifying it for the worst of all reasons saying we’ve come this far, so let’s keep going. This is fundamentally flawed thinking, which is the nicest way I can say it.

11

Yup yup. and I’d say starting with 0.25 (see table above) which I was apprehensive about starting with (it’s honestly really pushing it when it comes to price sensitivity…my preference would have been .10 increase) and that’s when people including myself will spend thousands of dollars in Month 1 to renew ALL OUR domains for 10 years or more so to lock-in that price. Let alone the people who find out about it in Month 2 who have to now deal with the .25 increase, having missed that original price, they’ll be damned if they miss the 1.25 opportunity before prices go up again to 1.50 in the month after. That’s why those 2 months will be the most fruitful in our history.

BY CONTRAST, a sudden jump to 3 tez, will not increase revenues — it will reduce them

  • It will be counteracted by majority abandonments as people aren’t going to budget 3x as many tez, let alone for every year of renewal to come, so they might as well let go now (not all their domains, they’ll keep to good ones, but they’ll let go of most of the ‘hey this could be worth something someday, ya never know’ domains)
  • WITH no reason for a user to lock-in that price for an extended period.
  • No reason to kickstart increased registrations on day 1 which is when we NEED massive revenue (people will just wait until they have to renew…and probably abandon more because it’s 3x as many tez)

It’s suicidal!!!

–
Also, let’s be real. We had 4 yes votes when nothing else was on the table, and 2 no votes, and 2 abstentions. And even then we had a virtual tie. That’s not a mandate, and it’s not decentralized governance. We can repeal past votes. It’s called another vote. and given the option, it would obviously have a different outcome today.

This repeated argument relies on procedural matter-of-fact, RATHER than substantive realities. The actual answer is on the table, and refusing it for that reason is completely asinine.

We can totally do the right thing, and it’s as though we’re looking for a reason not to do it.

12

Well its far from baseless. You’ve had 2 months to conjure up a comment about the prices. You haven’t even said anything in that particular proposal thread about price changes and now all of a sudden we’re doing wrong? If you cared about it so much, why has it taken you 2 months and during the last 2 days of a proposal voting period of the change you’re not happy about to post a counter?

As mentioned TWICE, if you’re unhappy about the outcome, you can appeal these changes via DAO vote AFTER the changes have been taken place. I am not dismissing your efforts at all, I am simply telling you, there is a process to follow. If I dismiss that, you might as well disband the DAO considering what you’re talking about is very much the opposite of what a DAO is.

I get that you feel so strongly about being all doom and gloom, but you’re acting like it would cause a world-wide financial crisis or something, its very much FUD territory.

13

What difference does it make how long it took? You keep dodging this, and unfortunately, it makes me question your competency as Steward of Governance.

14

I’ve given you a firm answer and advice on the next steps for your proposal.

You put in a conflicting proposal 2 days before the vote ended as this was put to vote as there was no counter and met all eligible criteria. You did not express your feelings or opinions on that post at all. It was in discussion for 3+ weeks before being put to vote.

I am expressing timing due to it clearly being poor timing, and you’re saying it doesn’t matter, when it does. As mentioned before, I am not dismissing your efforts at all, there is a structure that the DAO follows. I’ll break it down for you in a simple summary.

  1. Proposal Creation. (someone posts a proposal on discourse forum)
  2. Proposal Discussion. (DAO members discuss said proposal)
  3. Proposal put to vote if all eligible criteria has been met. (for example, if nobody contests the proposal with a compelling context, is in correct format, and is in line with the constitution.)
  4. Proposal Vote Period.
  5. Proposal Vote End and Outcome Confirmed.
  6. Proposal Execution.

You cannot just reject an accepted proposal because Kevin said so. It has been accepted by DAO vote. It met all criteria within scope & the outcome was ‘FOR’ this change to go ahead, now, I mention time a lot, because if you didn’t wait for so long to post a comment, proposal or anything else, this vote may of gone differently, not only that, you could’ve posted your preferred in-depth view of how the pricing change should be, and it would’ve also been considered as a voting option, however you didn’t do this.

I am being as fair as I can be in this situation, the vote stands, the changes will go ahead as per DAO vote instruction and moving forwards, if you do want any changes to be made, please feel free to follow the correct process & I will place it to vote if it follows all criteria.

15

I will not be commenting on this moving forward. @Kevin I don’t mean any disrespect. If you need any help with the proposal, please DM on Discord.

16

Number 3 is not a place to insert baseless objections and call it a compelling context. Invisible rules cannot be created on the fly to say “well I think it’s late…” That deals with neither form nor substance.

17

That’s a good idea and I 100% agree.

18

It’s a good idea to have your proposal formatted accordingly before asking the governance process to move the heavens in the earth and undo its established results. Not a good look to not have your due diligence up to snuff whilst calling someone else out for for a similar offense.

The SoG is enforcing the governance process and facilitating as far as I can see.