GIP 152 - Should GnosisDAO spin out the Gnosis App into an independent company?

Governance GIPs
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TL;DR

Money created by people instead of banks, spendable on a normal debit card - that’s the Gnosis App, and nothing else like it is live in Europe. We spent the last 3 months rebuilding it around one cohesive story centered on Circles, massively simplifying what used to be a complex product - and initial user feedback on the new version is positive. This proposal is about finally giving it the conditions to win, in a new structure.

Despite years of work and millions invested, Gnosis’s consumer app in its various forms has had limited success. We considered shutting it down, like many other projects, but present here a better solution: it fixes the structural issue that held the app back, caps the DAO’s downside at a one-time investment, and keeps meaningful upside if the product wins.

We propose to spin the Gnosis App out into an independent company led by the team that built it. GnosisDAO invests $3M cash and contributes the app’s product and IP (valued at $1M): a $4M SAFE position at a $15M post-money cap with a 20% discount on the future priced round. The app leaves the DAO’s ongoing budget entirely. The DAO stops paying an open-ended cost and becomes an investor instead.

Where the app is today

The Gnosis App is an alternative money app for Europe’s ‘sovereignty seekers’ - where money is created by people instead of banks.

You sign up and start creating Circles, 1 CRC per hour, that you can spend anywhere by topping up your debit card (powered by Gnosis Pay). Your reputation determines how many of the Circles you create become spendable on the card; you build it by being vouched for by friends, using the card, inviting others, or buying Circles. You can also direct the Circles you create to communities and causes you care about.

The strategy

Under the hood, it’s a neobank: slick UX, low fees, familiar card payments. But hundreds of neobanks are chasing the same European audience on commoditised infrastructure. Winning requires differentiation in both product and distribution.

Circles is the product differentiation. The audience is the distribution differentiation: people who feel the financial system is drifting away from individual freedom and ownership, but still want modern financial tools. Not necessarily hardcore crypto natives. Not necessarily libertarians. Not necessarily anti-government. People who want control over their money and identity, dislike depending on centralized systems, are drawn to alternatives, and care about fairness, autonomy, and self-determination.

Creating money every hour is the acquisition hook; belonging via communities, identity and gamified progression are the retention layer.

Revenue comes from card fees (ATM, FX, interchange), app fees, stablecoin yield, and backers: users who commit capital behind personal currencies and are therefore Circles buyers. Friederike posted a deeper dive at the model here. As an independent company with a lean team, we turn the fee switch on from day one and restructure incentives to be sustainable far earlier.

Progress

The app is live as a progressive web app, rebuilt Circles-first over the last two months. App Store approval just landed; the iOS release is imminent, with Android right after.

As of end of Q2 2026:

  • ~800 card users, up 60% from ~500 at end of Q1 (on-chain data)

  • ~900 backers, up 30% from ~680 end of Q1 (on-chain data)

  • ~1,600 daily active users up 60% from ~1000 end of Q1 (on-chain data)

  • ~4533 weekly active users, up 40% from 3225 end of Q1 (on-chain data)

  • Week-4 retention: ~20-25% (off-chain)

  • 27% of referred users go on to invite others (off-chain)

The honest part: we haven’t found PMF. Growth is real but linear, with no explosive word of mouth growth yet. The ingredients for virality are there, but getting from linear to exponential takes a speed and focus that’s very hard to sustain inside a larger organization.

Why spin out, and why now?

Inside Gnosis, decisions about the app are made - rightly - with the whole of Gnosis & the ecosystem in mind. That can work, but it can also hold a consumer product back from doing what it needs to do right now and with the right speed, regardless of a multi-year Gnosis-wide strategy. A consumer app hunting for PMF needs one accountable owner instead of multiple stakeholders, a small focused team, quick iterations, and full operational freedom.

This community has fairly pointed out that the app changed strategy more than once, and each turn was expensive because a large, distributed team (2-3 teams, in this case) had to turn with it. This proposal is not another strategy funded the same way. It’s a change of structure: the app leaves the Gnosis Ltd budget entirely, and the DAO’s exposure goes from a recurring cost line to a capped, one-time $3M that converts into equity while giving the project the right conditions for success.

Spinning out is also Gnosis’s proven playbook: CoW and Safe became category leaders as independent projects. The community’s fair criticism was never that the spin-outs failed; it’s that the DAO’s share came as vested tokens with weak value capture. This deal fixes that: a direct claim on the company, no vesting on the DAO’s stake, no non-transferable token. When the company raises a priced round, the DAO’s SAFE converts to equity and marks up directly in treasury NAV; if the company is acquired or distributes profits, the DAO participates through that stake.

This is not a restart. Same product, same users, same momentum, app renamed to Circles in a quick rebrand, inside a structure built for iteration speed required to find PMF.

Terms

Term Detail
Instrument Post-money SAFE
GnosisDAO cash investment $3M
Product & IP contribution / incubation equity $1M
Total DAO SAFE position $4M
Valuation cap $15M post-money
Discount on future priced round 20%
Resulting DAO ownership ~26.7% to ~33% depending on the next priced round

Example to understand the DAO ownership in different scenarios:

If the next round happens at $15M, Gnosis would own 33% as the 20% discount would kick in (4M/12M).

In case the next round happens at, let’s say, $50M: after the discount Gnosis would own just 10% (4M/40M), but at that point the valuation cap would kick in and thus Gnosis’s stake would be 4/15, i.e. 26.7%.

So Gnosis would always own between 26.7% and 33% depending on the next round’s value, and incentives are aligned for both parties.

Use of funds

The $3M funds roughly 18 months:

  • ~65% team and operations (the lean team, security audits, infrastructure and AI tooling, legal and accounting)

  • ~30% growth (marketing, referral rewards, user incentives, liquidity)

  • ~5% contingency

About me & my mission

I’ve been with Gnosis for 3 years, and have worked across almost all product lines. I joined Gnosis Pay as part of the founding team, working as a generalist across different parts of the business before heading growth and user acquisition. Much of Gnosis Pay’s B2C growth stands on foundations I helped build: I took the card from its first few thousand active users and stayed through the $100M cumulative payment volume milestone, at a blended CAC under $20, in a category where incumbents routinely pay several times that. Before Gnosis, I worked with multiple zero-to-one venture-backed companies, including a Sequoia-backed scaleup, and I’m a London Business School alumnus, where I co-founded the most active student blockchain society in London.

I’m proposing this because I believe the product can win and I’m willing to leave a comfortable seat and put my own name and years on that belief. It is my personal mission to empower people with more financial sovereignty, especially the people who are excluded, ignored, or failed by existing systems and institutions through no fault of their own. I spoke about exactly this at DappCon this year: my talk on self-sovereign money. My operator experience building companies from zero to one, my passion for building & growing consumer products, and the potential of Circles to realise this mission are what make this a unique founder-market fit.

The team

Me as founder and CEO, plus eight across engineering, design, growth, and operations, the people who built and run the app today. Between them: they built the first non-custodial on-chain passkey signer on Safe (used by Worldcoin and Gnosis), a founder whose identity startup was acquired, a co-founder of a $3M funded UBI startup on Celo, a founding team member at Peanut wallet, and compliance experience from a Swiss-licensed crypto market maker.

There will be a 10-15% ESOP pool for the team, on standard 4-year vesting with a 1-year cliff. My own founder shares vest on the same 4-year schedule.

Relationship with Gnosis

  • The Circles protocol stays open-source; a small team inside Gnosis Ltd maintains key protocol infrastructure. The spinout entity takes over the Gnosis App’s product and IP, and is the flagship app running on top of Circles protocol.

  • The card program runs on Gnosis Pay rails as a B2B client on standard commercial terms; every transaction the app generates earns revenue for the payments network the DAO owns.

  • Martin Koeppelmann will be a key strategic advisor.

Direction

The immediate focus is to:

  • Continue improvements from user feedback as planned to the new Gnosis App we’ve been building over the last couple of months, rename the app to ‘Circles’.

  • Launch the mobile app on the App Store and Play Store.

  • Run focused acquisition experiments for this rebuilt app, tightly coupled with product, until one channel shows word of mouth growth. Then pour everything into it.

  • Complete the spinout operationally.

Mid-term: the need for more sovereignty is felt most where institutions and governments have failed people. As the payment rails expand beyond Europe (with the imminent launch of Gnosis Pay V2 on Gnosis Chain), it will enable us to follow that need and serve the regions where Circles & an app that gives more sovereignty isn’t a novelty but a necessity.

The goal is to get to 100,000 weekly active users within the next 12 months.

What’s in it for the DAO?

Circles and Gnosis Pay stay at the core of the product, so the app’s growth keeps driving economic activity to Gnosis Chain and the Gnosis Pay network. A win compounds for GNO holders twice: through the DAO’s equity, and through the rails.

It also takes the app’s entire cost off the DAO’s ongoing budget: a recurring cost-line for a very early stage company becomes a capped investment holding 27-33% of a company plus the rails revenue it generates. It’s the ‘incubate, spin out early, keep ownership’ model this community has been asking for. The DAO gets quarterly updates in this forum.

Looking forward to hearing from all of you. I’ll be active here daily for any discussions!

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A few random thoughts:

  1. The strategy section doesn’t really explain how to achieve PMF and customer growth, does it? I think that should be added if the DAO is supposed to become an “investor.”

  2. As things stand now, CRC isn’t a product differentiator. It’s simply a cashback coin. The vision Circle describes, which could make it a true differentiator, lacks technical support within the app itself. For example, the average user doesn’t know how to create their own Circles.

    1. I don’t understand why, to this day, no additional revenue streams have been developed in the Gnosis app, which would reduce the need for capital from other sources such as the DAO. A lot of time has passed since lending features or additional swap options could have been introduced.

  3. Will the spin-off ultimately signal that the Gnosis Chain will be left behind or will no longer be the focus? And that the Gnosis App will finally become multichain? (Just as happened with COW, etc.?)
    That’s what it seems to imply between the lines. Without the Gnosis App, it should be clear to everyone that this is the final nail in the coffin for Gnosis Chain. Given the current landscape, that’s probably the logical conclusion anyway. However, I think this could be stated more clearly, since it’s important for validators.

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Thanks for putting this together, like to share some thoughts too:

I am not sure if circles, as a core element of the gnosis app, will be PMF soon…since it’s first iteration several years (even more than a decade?) ago it has changed several times, and most likely it will so in the future. I see this as a great field for R&D but not so soon as a commercial product. Do you think this will give you enough time/capital to build it to success?

Another point is the metrics I am not too happy with although commonly used not only here:daily/weekly active users don’t means too much to me if it’s triggered by things like: you have to claim crc in a certain time interval or get points if you do it daily or whatever…sure this enhances the numbers but don’t prove any usabillity…actually it consumes time of users that could be better spend.

I would be glad to see you bringing circles to a viable system, and if you think this proposal will help I am in support of. If it’s just to save the DAO money I would oppose.

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for validators it’s even more important that gc shall be changed to an L2 with EEZ coming…I have no idea if and how validators then are need anymore.

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  1. 1. As I have mentioned before I don’t use my gnosis pay card in the Gnosis App since I don’t want to associate it with the public profile. Please fix this so I could fully use the app
  2. You said you have not found PMF due to the numbers not exploding but just linearly growing. I would counter here with setting expectations. If your numbers grew in 2026 at all you are doing something right. Most retails projects I know in crypto have suffered heavily this year. Definitely reduction in users. Some very extreme loss of userbases. So be happy with positive numbers.
  3. How do you intend to get more users and increase PMF? It’s the mobile apps mostly and then try to run experiments to find what the best thing is and hunt it down aggresively?
  4. The team burn rate seems a bit excessive. $3m for only 1.5 year is a lot. Espeically for such a simple app. Have you thought of reducing the burn rate by adjusting number of people/devs/resources? Lean teams nowadays can do A LOT with a lot less money.
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Last time I talked to some people from the Gnosis service companies, they have told me the only thing that may be PMF is Gnosis Pay.

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might be, and I like to use it right now. But in long term I would prefer a payment system not dependend on Visa or other centralized payment companies.

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I agree, but we are going circles here, because outside of the Gnosis chain itself with the powerful EURe liquidity, there is honestly not much left. At this point, looking at the money drain these products are, it might actually be a better decision to just shut them down and stop the bleeding.

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I was confused what the f you are even talking about when trying to get 3M here. Now, I get it.
I hate to break to you. The DAO already owns all of these product. They fully financed them.
There is no need to throw more money into the furnace. Shut it down, open source everything, done.

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Thanks for sharing the proposal.

Can you clarify a few things? I would like specific answers to the below if possible.

  1. How are daily / weekly active users calculated?
    1. E.g. is a daily user defined as someone who opens the app and mints circles, or is there a deeper sign of product engagement?
  2. When you talk about “800 card users” what does this mean?
    1. Are these users who have simply associated a card with their Gnosis App profile, or users who have signed up for Gnosis Pay via the app?
  3. What’s the weekly payments volume via Gnosis Pay processed via Gnosis app?

The heart of my concern: One of the worst metas in crypto over the past decade was ‘quests’ and other points-for-user-behavior gimmics. These systems effectively give the onchain appearance of product fit and traction (e.g. daily users, card installs etc) even if the majority of people engaging in these behaviors are simply airdrop farming or point hunting.

It seems like the majority of Gnosis App product experiments over the past months have been versions of these systems (e.g. CRC minting streak mechanisms, see attached).

There was also a badge system (that seems to have been deleted in the past week?) which included badges for things like card installs.

Overall these are not good product patterns, because they incentivize a set of hopeful or desperate users into believing and behaving as if there will be a big payoff for [opening the app] / [minting circles].

It is a trivial problem to grow an app to a million DAUs if you give $0.10 per day to everyone who opens it. But, a cookie-clicker free money machine does not warrant a $4 million investment or a $15 million valuation.

With services like Instagram, app opening is a good metric because a user who opens the product is likely to spend a long time scrolling, posting, and engaging. But in this case, if users are simply opening the app, minting for their $0.10, and closing it again, the metric needs to be reexamined.

Also, I love the circles project. But, the act of daily / weekly minting is the lowest form of engagement with the idea. Where circles might thrive is in the creation of groups, peer to peer payments etc. So far, I only see people minting to offramp into cashback. Are there stronger signs of traction for the unique value proposition of circles that I’m missing?

Finally, the linear growth we’ve seen over the past year has been sustained by the Gnosis App literally being front and center of gnosis.io and other gnosis properties. You describe working within Gnosis as an impediment but it has also served as a big stamp of legitimacy and major distribution channel. Is it plausible that a leaner spun out team will be able to make back those advantages and more?

Final question: what are the key lessons that have been learned in building so far? Are there any high conviction hypotheses around circles adoption that suggest a sustainable path to adoption?

Thanks and looking forward to more details about the proposal.

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Note: Added a paragraph to the TL;DR with context on the rebuilt app - everything else including terms remains unchanged.

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With all the love in my heart: UBI simply does not work in developed countries.

No matter how many times you try to spin it as a “community currency” or a "cohesive story”, the underlying economic model is fundamentally broken. I analyzed this in technical detail on this forum last September, and the systemic structural flaws I pointed out then remain completely unaddressed (see my full breakdown: Circlesv2 is doomed to fail).

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Even the massive, multi-million dollar OpenAI UBI study proved the exact same thing: in developed, highly financialized economies, uncollateralized basic income models fail to generate productive economic loops.

As I highlighted in my post last year, the binary “Web of Trust” model faces an impossible catch-22:

  • The Sybil/Airdrop Mirage: On one hand, you get a flood of low-intent users spamming channels just to get “trusted” by whoever is already in the network to unlock the minting faucet. It becomes an artificial, farmable game.

  • The Trust Paradox: On the other hand, real users who want to protect themselves from getting drained will only extend trust to people they already deeply know. This naturally keeps the network tiny and completely defeats the purpose of an open, scalable currency.

We can certainly have a separate, long-term philanthropic conversation about developing countries, localized crisis zones, and unbanked communities where alternative survival networks (like traditional Hawala systems) are a necessity. But applying this to Europe as a “sovereign consumer neobank” is a category error.

We have to admit the cold, hard truth: people are greedy.

If you build a system that distributes free value on a transparent ledger, people won’t use it to build a beautiful peer-to-peer utopia. They will treat it as an adversarial extraction game. They will automate it, exploit it, and extract every single cent of value they can.

Changing the UI, rebranding the app from Circles to Metri to Gnosis App, or making the “cookie clicker” pink instead of green doesn’t change the underlying math. It’s still a cookie clicker. And the Gnosis DAO treasury should not be burning 2 - 30 million a year to fund the Ego of the Founding Team.

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hey Lefteris, great to hear from you.

  1. You’ve raised this before: Honest status: retrofitting privacy onto a protocol deliberately designed to combine identity and money isn’t trivial. We have a working POC using Bermuda’s privacy pools to delink the Circles safe from the Gnosis Pay safe, but I won’t give you a date I’m not confident in - it will take some time if i’m being candid.

  2. Thank you for this framing, and you’re right that context matters: growing at all in 2026’s retail environment, when most projects are shrinking, is a signal we’re doing something right. Internally though, we hold ourselves to the consumer bar, not the crypto-market bar - linear growth on a small base isn’t where this can end. But the point is taken, and appreciated.

  3. Re: PMF/Growth strategy: Great question, and a couple of others have asked the same - I’ll add this in detail to the Phase 2 proposal. Briefly in the meantime:

First, what the data already tells us: the referral loop is our best channel - 27% of referred users go on to invite others, and referred signups convert to card orders better than anything paid. Of the paid channels, Meta has performed best. The plan builds on those two facts rather than starting from zero.

  1. Mobile apps first. PWAs have been one of our biggest blockers on conversion and retention - people don’t know how to install them natively, and we can’t send notifications or do deeplinks. That’s why mobile ships before we scale any paid spend: every acquisition dollar works harder once the funnel holds.

  2. Communities as an acquisition channel. Instead of spending on traditional paid marketing, we leverage communities: anyone with an audience can effectively raise money from users on the app through community fees, which gives them a direct incentive to bring their audience onto the app. If we get this right, it’s an incredibly low-CAC acquisition tool - distribution the product pays for, not the marketing budget. There’s a retention side to this too: supporting the causes you care about with money you created yourself is exactly the belonging and identity our sovereignty-seeking audience stays for. And it’s self-reinforcing - the more they use the card and Circles, the more they have to give. The emotional layer and the growth loop are the same mechanism.

  3. Social, network-driven in-app loops. The next iteration of cashback will be social: your cashback depends on how many of your connections used the card in the past week (and their volume). We pay out a portion of the card fees we actually earn - cashback funded by revenue, not treasury subsidy, so it scales with usage instead of burning runway. Users are incentivised to turn friends into active card users.

  4. Once the first core loop works (hook, onboarding, aha moment, retention), we experiment with different hooks on TikTok. When one goes viral, we pour gas on the fire through Meta ads on the same hook. Paid is the amplifier, not the strategy - we only scale spend on cohorts that retain.

The goal is to keep blended CAC under $10 - I’ve done sub-$20 at Gnosis Pay scale, and the target is lower here because these loops are product-native. That’s why a bit over 30% (~$1M) of the use of funds is set aside for growth, and it’s what should carry us into an external raise with solid traction. A leaner team outside Gnosis with fewer distractions just makes all of this compound faster.

  1. Fair challenge, and I’ll answer it honestly. If I were building this from scratch & without a novel complex protocol, I’d do it with a sub-5 person team. We’re bigger for two specific reasons: we’re continuing a live product with existing users and momentum rather than starting clean, and we’re going to take over a large part of the Circles-related development previously handled by a separate team inside Gnosis - work the DAO was already paying for elsewhere. That second part is most of the delta. P.S : I wish the app was as simple, bringing Circles to the world upholding cypherpunk values in a consumer app for the masses makes for a non-simple product under the hood!

On the money itself: I treat the $3M as a runway ceiling, not a spend target - anything unspent extends runway past 18 months. Burn is one of the lines I’ll report quarterly, and your point is noted: I’m actively looking at where it can go lower.

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Thanks for the questions!

Re: PMF/Growth strategy: Great question, and a couple of others have asked the same - I’ll add this in detail to the Phase 2 proposal. Briefly in the meantime:

First, what the data already tells us: the referral loop is our best channel - 27% of referred users go on to invite others, and referred signups convert to card orders better than anything paid. Of the paid channels, Meta has performed best. The plan builds on those two facts rather than starting from zero.

  1. Mobile apps first. PWAs have been one of our biggest blockers on conversion and retention - people don’t know how to install them natively, and we can’t send notifications or do deeplinks. That’s why mobile ships before we scale any paid spend: every acquisition dollar works harder once the funnel holds.

  2. Communities as an acquisition channel. Instead of spending on traditional paid marketing, we leverage communities: anyone with an audience can effectively raise money from users on the app through community fees, which gives them a direct incentive to bring their audience onto the app. If we get this right, it’s an incredibly low-CAC acquisition tool - distribution the product pays for, not the marketing budget. There’s a retention side to this too: supporting the causes you care about with money you created yourself is exactly the belonging and identity our sovereignty-seeking audience stays for. And it’s self-reinforcing - the more they use the card and Circles, the more they have to give. The emotional layer and the growth loop are the same mechanism.

  3. Social, network-driven in-app loops. The next iteration of cashback will be social: your cashback depends on how many of your connections used the card in the past week (and their volume). We pay out a portion of the card fees we actually earn - cashback funded by revenue, not treasury subsidy, so it scales with usage instead of burning runway. Users are incentivised to turn friends into active card users.

  4. Once the first core loop works (hook, onboarding, aha moment, retention), we experiment with different hooks on TikTok. When one goes viral, we pour gas on the fire through Meta ads on the same hook. Paid is the amplifier, not the strategy - we only scale spend on cohorts that retain.

The goal is to keep blended CAC under $10 - I’ve done sub-$20 at Gnosis Pay scale, and the target is lower here because these loops are product-native. That’s why a bit over 30% (~$1M) of the use of funds is set aside for growth, and it’s what should carry us into an external raise with solid traction. A leaner team outside Gnosis with fewer distractions just makes all of this compound faster.

hmm, what do you mean by this? From what we’ve seen so far, users are able to fairly understand this but would love to understand what you precisely mean.

  1. Fee switch will be turned on from Day 1 in the spinout company. Card ordering fees, fx fees, withdrawal fees, app fees, swap fees, if we add yield through defi protocols, we may take a portion of the yield, and so on.

  2. No plans to go multi-chain. Like the post clearly mentions, Circles is intended to form a core part of the product. Circles is native to Gnosis Chain. We use the Gnosis Pay infra for the card, which is on Gnosis Chain. Over time, if we need to add new features demanded by users that aren’t on Gnosis Chain for whatever reason, we’ll figure out a way to do it making it compatible with the existing stack.

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I appreciate the candidness in your reply to Lefteris, but reading through your growth strategy, there are some massive, flashing red flags that we cannot just gloss over. Let’s look at the actual mechanics of what you are proposing here:

1. The App Store & Gatekeeper Reality

What is your plan when the App Store and Google Play say: “Nah bro, we are not into uncollateralized, non-KYC token-minting extraction games” ? Apple and Google have notoriously brutal, highly protected walled gardens when it comes to crypto, unregistered financial instruments, and peer-to-peer minting protocols. If they reject or heavily restrict your native app, your entire “mobile first” funnel collapses on day one. What is the fallback?

2. The MiCA and Financial Literacy Contradiction

You want financially uneducated retail users (“the masses”) to navigate a highly complex, dual-token, trust-swapped economic model like Circles. Meanwhile, the entire European Web3 ecosystem is in the middle of a massive, painful cleanup just to survive the strict realities of the MiCA regulatory framework. Pushing a highly complex, non-simple, uncollateralized minting loop to everyday retail consumers under the guise of a “neobank” is a regulatory and educational disaster waiting to happen.

3. The “Community Fees” vs. Real-World Alternatives

They are called Patreon and Ko-Fi. They already exist, they are incredibly simple to use, and creators use them to receive real, stable fiat currency that they can actually use to pay their rent. Creators and influencers do not want to receive illiquid, uncollateralized local tokens that they can’t easily cash out. Supporting a cause with “money you created yourself” (out of thin air) only works if there is someone on the other side willing to hold the bag for that illiquid value.

4. The $10 CAC Math Problem

You say you are burning $10 for every user you acquire. But how much value are those users actually bringing in? If your CAC is $10, and the average user is depositing $0 of real, hard capital because they are just using the app to mint free Circles tokens and farm small cashback crumbs, you are running an incredibly fast cash-drain loop. A $10 CAC is only a “win” if the lifetime value (LTV) of that user is higher than $10. Right now, your LTV on paper looks like 0 cents.

We cannot run a $3 million treasury experiment on “TikTok virality” and hope. We need real, grounded economic logic.

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It seemed to me that Gnosis didn’t want to do spin-offs anymore?

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Yes, it should be enough time/capital to know whether this has product market fit.

Numbers have been provided not to paint a false picture of usability, but to reflect accurately where the app is. We have ~900 people who are backers (and contributed 100$ each) and about ~800 active card users, the rest use the app for Circles (whether they are ideologically driven or financially driven).

This is precisely the aim!

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And all of that for the cheap price of “only” 30 mil.

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Thanks for engaging seriously. I haven’t yet read your September post - I will, and I’ll come back if it changes anything below. And also, I find your hawala post quite interesting – I’d like to discuss it separately (I’ll reach out to you on X) - it’s actually similar to one of the paths we’ve discussed for the future.

Sharing my thoughts on a few points below:

  1. The GIP isn’t aiming to make UBI work in developed countries. The mid-term goal like the GIP suggests is to actually go to developing regions (like Africa for eg) – that’s precisely where we can find ‘hair on fire’ problems that can truly help people in need. Initially the GIP is prepared with a view to continue the existing momentum on product/team/users and then take it to the regions of need along w expansion of Gnosis Pay instead of shutting things down, especially the stuff that’s working, abruptly.
    GIP doesn’t ask the DAO to bet on UBI economics. The company monetizes as a fintech: card fees, app fees, and backers who voluntarily commit their own capital. Circles is the differentiation and the acquisition hook, not the revenue model.

  2. On the sybil/trust catch-22 - real tension, and it’s what the rebuilt design directly addresses. Minting is open, but spendability is gated by reputation, built through social vouching and economic contribution. Farming gets you CRC you can’t spend. The extraction game pays out nothing unless you contribute to the network meaningfully - and the actions that unlock spendability are the same actions that generate revenue for the company/make the social graph better. That’s not the cookie turning pink; that’s a different economic loop from the one you critiqued.

  3. On “burning 2-30M a year”: this proposal is the end of that model, not its continuation. $3M, once, capped, off the DAO’s budget entirely, for 27-33% equity. If treasury burn is the concern, this GIP is the largest reduction of it available short of shutdown - and it keeps the upside shutdown doesn’t.

I like the way you’re thinking about Circles, I’d love to discuss more on a call if you’d be down for it!

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1. The Product Pivot Loop & Ground-Level Reality

Let’s look at the actual trajectory of this project. First, the Circles 1.0 experiment underperformed. Then came Metri, which was pivoted into the Gnosis App, and now the strategy is to ask the DAO for another round of millions. Even the IP being negotiated here already belongs to the DAO anyway. The treasury is not a personal piggy bank and never will be.

While decentralized UBI architectures can technically function if built alongside genuine economic substance, the founding team has no real intention of doing the brutal, boots-on-the-ground execution required in developing markets. True systemic impact in places like an active conflict zone in Ethiopia means navigating severe infrastructure constraints to build highly resilient, localized mesh networks and authentic trust graphs from scratch.

Pushing TikTok and Meta ads from an air-conditioned office while hyping synthetic growth metrics is a world away from that reality. If you want to effect real change, you have to be willing to get your hands dirty. None of you are willing to do that. Instead, you are asking the DAO to approve another round of throwing capital directly into the furnace.

2. A Year Too Late on the Extraction Loop

While it’s nice that you finally acknowledge the structural Sybil and trust catch-22, this realization comes a year too late, and only after burning through $30 million. The community has spent over a year raising these exact technical flags while being met with defensive deflections.

You are still failing to fully admit the core extraction mechanics of the architecture you designed here. Implementing programmatic “reputation gates” that restrict spendability doesn’t fix a fundamentally broken user acquisition hook, it just shifts the frustration onto retail users who realize they have been incentivized to farm an asset they programmatically cannot utilize. No matter how you dress up these minor adjustments as a way to cap the downside, the baseline fact remains unchanged: the project is bleeding, and the runway has already been spent.

3. Equity Illusions & The BaFin Microscope

Let’s clarify the structural baseline: the DAO already holds 100% economic exposure of the product and its underlying IP. Attempting to wrap this spin-out in a shell game of private corporate entities to sell the DAO a 27 - 33% fraction of its own project is a complete inversion of reality.

Regulators like BaFin look directly at Substance over Form. If pressured with consistent, daily administrative scrutiny regarding these tokenized financial loops, this entire fragile entity framework will be ripped apart by authorities. You will see how quickly the illusion of proprietary control vanishes, because in fact, you don’t have it. No amount of self-gaslighting changes that legal reality.

A $30 million runway should have been more than enough to establish legitimate product-market fit. Instead, the execution strategy was to acquire more companies, expand headcount, and aggressively accelerate the burn rate. This sudden panic is the realization that you have finally hit the end of the line.

The DAO has given this team immense leeway out of respect for the historical SAFE relationship. But let’s be entirely transparent: no single one of us owes you anything. The treasury is not a furnace to continually subsidize these broken economic fever dreams.

If your personal ego and greed have run away with you, that is entirely on you.

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