Restructuring GM NFTs: Investment Parity & Progressive Weights
Executive Summary
The GM NFT upgrade system is economically stalled. Upgrading beyond Moon makes little financial sense because each higher tier actually gives less reward weight per B3TR invested than Moon. Reaching Saturn costs 250,000 B3TR, yet pays out at a 94% efficiency penalty compared to holding a Moon.
At the same time, past proposals to expand the GM reward pool have hit a wall: why add more DAO funds to a system where there is no reason to upgrade above Moon?
This proposal presents a straightforward, fair, and technically ready solution:
- Match Free Upgrades to Real Investment: GM NFT upgrades attached to VeChain nodes reset to Earth (Level 1). Any node holder who spent B3TR to upgrade keeps their paid tier, and any leftover B3TR is credited as an on-chain discount for their next upgrade.
- 10% Progressive Efficiency: Each upgrade step provides +10% more reward weight per B3TR invested than the previous tier. This creates an attractive payback ladder (1.27 to 2.42 years across all tiers) while keeping Moon holders protected with a solid >50% Year 1 ROI.
- Ready to Execute: Requires zero new smart contracts and zero proxy upgrades. It uses existing administrative functions executed cleanly at the weekly round transition.
Fixing this foundation restores motivation to upgrade, sends B3TR to the Treasury, and paves the way for future proposals to expand GM NFT utility across the ecosystem.
Part 1: The Problem
Quick Intro
Right now, GM NFTs are only worth buying at Moon (Level 2). Once you spend 5,000 B3TR to get Moon, upgrading to higher tiers makes no sense. The next tiers cost huge amounts of B3TR, but reward you with tiny point increases. Because the DAO’s weekly emissions decay over time, you will never earn back the B3TR you spent to upgrade above Moon. As a result, nobody upgrades and the entire GM tier ladder is frozen.
Detailed Analytics & Technicals
The issue comes from how Upgrade Costs in GalaxyMember.sol match up with Tier Multipliers in VoterRewards.sol.
Current On-Chain Costs & Efficiency:
- Moon (L2): Cost: 5,000 B3TR | Weight: 110 | Efficiency: 22.00 pts / 1,000 B3TR
- Mercury (L3): Step: 12,500 B3TR | Weight: 120 (+10) | Efficiency: 0.80 pts / 1,000 B3TR (96.4% drop)
- Venus (L4): Step: 25,000 B3TR | Weight: 150 (+30) | Efficiency: 1.20 pts / 1,000 B3TR (94.5% drop)
- Mars (L5): Step: 50,000 B3TR | Weight: 200 (+50) | Efficiency: 1.00 pts / 1,000 B3TR (95.5% drop)
- Jupiter (L6): Step: 125,000 B3TR | Weight: 250 (+50) | Efficiency: 0.40 pts / 1,000 B3TR (98.2% drop)
- Saturn (L7): Step: 250,000 B3TR | Weight: 300 (+50) | Efficiency: 0.20 pts / 1,000 B3TR (99.1% drop)
Moon (L2): 22.0 pts / 1k B3TR (Baseline)
Mercury (L3): 0.8 pts / 1k B3TR [-96.4% efficiency drop]
Venus (L4): 1.2 pts / 1k B3TR [-94.5% efficiency drop]
Mars (L5): 1.0 pts / 1k B3TR [-95.5% efficiency drop]
Jupiter (L6): 0.4 pts / 1k B3TR [-98.2% efficiency drop]
Saturn (L7): 0.2 pts / 1k B3TR [-99.1% efficiency drop]
The Financial Dead End:
In any logical membership tier system, putting up more capital should give you at least equal efficiency, if not a bonus. Here, the system penalizes you for upgrading.
- Moving from Moon to Mercury costs 12,500 B3TR (2.5x the price of Moon), but grants only +10 extra points on top of Moon’s 110.
- With the protocol’s 4% compound emission decay every 12 cycles, upgrading to Mercury, Venus, or Mars takes over 15 to 25 years to recoup—longer than the remaining 511 weeks (~9.8 years) of B3TR emissions.
The Philosophical Roadblock:
Whenever the community talks about growing the GM reward pool, the conversation hits a dead end:
“Why add more DAO emissions to a system where the math is broken and upgrading doesn’t make sense?”
Fixing the weight structure removes this roadblock.
Part 2: The Bottleneck – Why Addressing Free Upgrades is Unavoidable
Quick Intro
We cannot fix the weight curve without addressing free node upgrades. Under current protocol rules, anyone who acquires a VeChain Node can attach it to a GM NFT and immediately receive a free tier jump up to Saturn (Level 7) without spending a single B3TR in the DAO. Today, 394 wallets that have not contributed B3TR to the Treasury occupy high-tier GM positions.
Crucially, this is not a one-time legacy issue that will fade. In GalaxyMember.sol, the free upgrade privilege travels with the node. Whenever a node is sold or traded on secondary markets, the new buyer can immediately attach it to a newly minted GM NFT and claim a fresh, free high-tier upgrade. Without resetting these parameters, secondary sales act as a permanent circulating backdoor that continually spawns uninvested high-tier weight into the pool.
Before writing this proposal, I modeled the alternatives:
- Adjusting weights alone: This heavily backfires. It channels millions in extra B3TR to uninvested nodes, dilutes regular Moon holders, and still fails to motivate anyone to upgrade.
- Lowering prices alone: Fails because high tiers remain crowded with free nodes, leaving paid users with poor returns. Furthermore, slashing upgrade prices directly undermines existing investors.
Addressing free node allocations is the only way to build a functional foundation.
Detailed Analytics & Technicals
A full mainnet check of all 1,179 Upgraded events and 1,891 NodeAttached / NodeDetached events gives us the exact on-chain numbers:
On-Chain Node Status (Block 26,395,797):
- Total Active Attached Nodes: 542 tokens
- Node-Attached Tokens with 0 B3TR Contributed: 455 tokens
- MjolnirX (Saturn - Level 7 Free): 53 holders (100% of all current Saturn holders)
- ThunderX & Mjolnir (Jupiter - Level 6 Free): 49 holders (90.7% of all Jupiter holders)
- StrengthX & Thunder (Venus - Level 4 Free): 149 holders (74.1% of all Venus holders)
- Strength & VeThorX (Moon - Level 2 Free): 143 holders
- Non-qualifying / Stargate: 61 holders (stay at Earth)
- Node-Attached Tokens that Paid B3TR: Exactly 87 tokens (paid levels and leftover credits are fully preserved).
- Zero Mjolnir, MjolnirX, Thunder, or ThunderX holders have ever upgraded their GM NFT beyond their gifted level.
Weekly Economic Impact on the GM Reward Pool:
Under our current baseline pool of 132,966.53 B3TR / week, here is what the 394 uninvested node attachments receive in active weekly voting:
| Tier Group | Free Nodes (0 B3TR) | Est. Weekly B3TR | % of GM Pool |
|---|---|---|---|
| Saturn (Free L7) | 53 | ~18,416 B3TR | 13.85% |
| Jupiter (Free L6) | 49 | ~14,188 B3TR | 10.67% |
| Venus (Free L4) | 149 | ~25,886 B3TR | 19.47% |
| Moon (Free L2) | 143 | ~18,219 B3TR | 13.70% |
| Total Free Nodes | 394 | ~76,709 B3TR | 57.69% |
In the upper tiers (Venus through Saturn), free node attachments take over 44% of all active weekly GM rewards, making up between 74% and 100% of all holders in those tiers.
Exact On-Chain B3TR Earned in V2 to Date:
Looking at all 79 cycles of the V2 GM reward pool (Cycles 46–124, during which exactly 13,340,537.19 B3TR was emitted):
- Each 1 point of GM weight that voted in every cycle earned exactly 95.44 B3TR.
- At 100% participation, these 394 uninvested tokens accumulated 6,321,113.35 B3TR (47.4% of the entire V2 GM reward pool).
- A single gifted Saturn earned up to 28,632.55 B3TR, and a gifted Jupiter earned up to 23,860.46 B3TR without spending B3TR.
Why Other Options Don’t Work:
- Option A (Just increase high-tier weights): If we boost Saturn’s multiplier without touching free nodes, the 53 free Saturn holders capture over 740,000 points. Rather than motivating new upgrades, it diverts almost the entire weekly pool to free nodes and cuts retail Moon earnings down to pennies.
- Option B (Just lower upgrade prices): Paid users still face 394 free nodes in the higher tiers, keeping returns unattractive. More importantly, discounting upgrade costs penalizes existing investors who already paid full price.
Resetting free nodes to real investment is a simple mathematical necessity to make GM rewards work for everyone.
Part 3: The Solution – Investment Parity + 10% Progressive Efficiency
Quick Intro
The fix has two parts:
- Match Nodes to Real Investment & Close the Secondary Loophole: Nodes no longer grant automatic free tier jumps. By setting
setNodeToFreeUpgradeLevelto 1 (Earth), we permanently close the secondary circulating loophole. Your GM tier is based on the actual B3TR sent to the Treasury. Zero B3TR spent = Earth (Level 1). If you spent B3TR, you keep your paid tier, and any leftover B3TR is saved as a discount for your next upgrade. - 10% Progressive Efficiency: Each upgrade step gives +10% more points per B3TR invested than the previous tier. Upgrading from Moon to Mercury is 10% more efficient per token than Moon; Venus is 10% more efficient than Mercury; and so on.
This creates a clear, fair path where upgrading always cuts 10 to 16 rounds off your payback time, while Moon holders keep a safe 50.8% Year 1 ROI.
Detailed Analytics & Technicals
1. The Post-Fix Paid Population
With zero-contribution nodes set to Earth (0 weight) and the 87 paid node holders placed at their funded levels, our active pool consists of 961 genuine capital contributors:
- Moon (Level 2): 821 holders (762 non-node + 59 node-attached paid)
- Mercury (Level 3): 65 holders (55 non-node + 10 node-attached paid)
- Venus (Level 4): 47 holders (37 non-node + 10 node-attached paid)
- Mars (Level 5): 25 holders (17 non-node + 8 node-attached paid)
- Jupiter (Level 6): 2 holders (2 non-node + 0 node-attached paid)
- Saturn (Level 7): 1 holder (1 non-node + 0 node-attached paid)
2. The 10% Progressive Weight Schedule & Weekly Payouts
- Moon Baseline: 100 points (5,000 B3TR → 20.00 pts / 1,000 B3TR).
- Compounding Efficiency: Each step adds points at 20.00 × (1.10)ⁿ per 1,000 B3TR.
- Total Active Pool Weight (100% Turnout): 236,276 points.
Full Tier Economics (Cycle 123/124 Baseline: 132,966.53 B3TR / week):
| Tier | Holders | Weight | Step Cost | Cum Cost | Est. Wkly B3TR | Step Payback (Rds / Yrs) | Cum Y1 ROI | Cum Payback (Rds / Yrs) | Lifetime Recoup |
|---|---|---|---|---|---|---|---|---|---|
| Moon (L2) | 821 | 100 | 5,000 | 5,000 | 56.3 B3TR | 126 rds (2.42y) | 50.8% | 126 rds (2.42y) | 219% |
| Mercury (L3) | 65 | 375 | 12,500 | 17,500 | 211.0 B3TR | 110 rds (2.12y) | 54.4% | 114 rds (2.19y) | 234% |
| Venus (L4) | 47 | 980 | 25,000 | 42,500 | 551.5 B3TR | 97 rds (1.87y) | 58.6% | 103 rds (1.98y) | 252% |
| Mars (L5) | 25 | 2,311 | 50,000 | 92,500 | 1,300.6 B3TR | 85 rds (1.63y) | 63.4% | 92 rds (1.77y) | 273% |
| Jupiter (L6) | 2 | 5,971 | 125,000 | 217,500 | 3,360.3 B3TR | 74 rds (1.42y) | 69.7% | 81 rds (1.56y) | 300% |
| Saturn (L7) | 1 | 14,024 | 250,000 | 467,500 | 7,892.2 B3TR | 66 rds (1.27y) | 76.2% | 72 rds (1.38y) | 328% |
Note: 100% turnout assumes every GM NFT votes.
Why 10% is the Sweet Spot:
I tested every rate from 1% to 20% across the full 511-week decay schedule:
- Protects Moon: At 10%, Moon holders keep a 50.8% Year 1 ROI (getting over half their investment back in Year 1). Rates above 11% push Moon below 50%.
- Motivates Whales Without Overpaying: Saturn delivers an 81.8% Step Year 1 ROI (recouping in 66 rounds / 1.27 years). It gives strong motivation to lock B3TR, without exceeding 100% in Year 1.
- Smooth Payback Steps: Every upgrade tier shaves 10 to 16 rounds off your payback time.
3. Stress-Testing: Isn’t 10% Progression Too High?
Won’t whales upgrade in bulk, crowd the pool, and push Moon holders out?
Over the past year, 469 users upgraded to Moon, while upgrades into Jupiter and Saturn completely froze due to poor financial returns. Modeling future upgrades shows the shared pool creates a natural economic brake:
- Whales Self-Regulate: Every high-tier upgrade adds thousands of points and dilutes the next whale. While Day 1 Saturn offers an attractive 81.8% Step ROI, just 10 Saturn holders cuts that return to 35.0%, and 25 holders drops it below 18% (unprofitable). Upgrading naturally freezes around 8–12 Saturns - whales cannot monopolize the pool without eliminating their own profit.
- Moon Remains Attractive: Even after heavy ecosystem growth (adding 300 new Moons and doubling high-tier upgrades), Moon holders still earn ~33 B3TR / week (~30% Year 1 ROI) and fully recoup in ~5.7 years.
- Treasury Benefit: Reaching this natural balance locks over 8 Million B3TR into the DAO Treasury from upgrade fees (compared to 5.48M B3TR deposited across all tiers in the past year).
Part 4: Technical Execution & Timing
This proposal requires no new contract code or risky upgrades:
Summary
1. Existing Contract Functions Used
Changes use existing administrative functions:
GalaxyMember.setNodeToFreeUpgradeLevel(nodeLevel, 1):- Resets free attachment levels for node tiers 1 through 7 to 1 (Earth).
- Permanently closes the secondary market loophole: any node transferred or sold in the future can no longer grant a free tier upgrade.
- Uninvested nodes drop to Earth. Tokens with B3TR contributions are automatically re-evaluated by the contract based on
getB3TRdonated(tokenId), with any extra B3TR credited as an on-chain discount for their next tier.
VoterRewards.setLevelToMultiplier(level, multiplier):- Sets the new weight schedule:
[L1: 0, L2: 100, L3: 375, L4: 980, L5: 2311, L6: 5971, L7: 14024]. - The contract automatically applies these multipliers starting in the next cycle.
- Sets the new weight schedule:
2. Frontend UI Clean-up
- In the frontend component
NodeGMSection.tsx, the code checkscanUpgrade = String(firstAvailableGM.tokenLevel) !== levelAfterAttaching. - With free levels set to 1,
canUpgradeisfalse. The UI automatically hides the “Attach Node” button and modal without needing an emergency frontend release. - Users who already have a node attached still see the “Detach” button if they want to unbind it.
- A standard frontend PR will follow to clean up deprecated modal code and copy.
3. Execution at the Cycle Boundary
Because the snapshot block shifts gradually across voting cycles, updates will be executed by Foundation administration at the cycle boundary (during the round changeover between voting cycles). This ensures every voter within a round votes under identical conditions.
4. Integrator Notice
Apps and analytics tracking GM NFT levels should read the view function levelOf(tokenId) via RPC rather than parsing historical Upgraded event logs. The official VeBetterDAO frontend already queries RPC view functions directly and will update immediately.
Research & Modeling Summary
Summary
- Diagnosed the Upgrade Problem: Proved mathematically that upgrading above Moon currently loses money, and showed why alternatives (like simply lowering prices or boosting weights alone) fail.
- On-Chain Blockchain Audit: Audited all 1,179 past upgrades and 1,891 node attachments on mainnet. Found that 394 uninvested wallets take ~58% of the weekly pool (having collected 6.3M B3TR), while confirming 87 genuine paying node holders keep their tiers and credits.
- Tested 20 Progression Curves (1% to 20%): Modeled rewards across the protocol’s remaining 10-year emission decay schedule. Confirmed that 10% is the optimal rate -protecting Moon holders with a >50% Year 1 return while motivating higher tiers.
- 1-Year Historical Demand Check: Analyzed 582 upgrades over the past year. Confirmed steady community interest for Moon (469 upgrades) and showed that high-tier upgrades completely froze in recent months.
- Future Stress-Testing & Whale Safeguards: Proved the system self-regulates. Whales cannot monopolize the pool because each new whale dilutes the next; returns naturally cap upgrades around 8–12 Saturns while Moon holders stay profitable (~30% Year 1 return).
- Secondary Market Loophole Check: Confirmed that free upgrades travel with nodes when sold, creating a permanent loophole that never fades away unless reset to Earth.
- Technical Safety Verification: Confirmed the fix requires zero new smart contract code, automatically hides the frontend button, and can be executed cleanly at the weekly round transition.