Signaling Proposal: Recovery and PHOTON Conversion of Dormant ATONE Airdrop Allocations

Original Proposal Text

# Signaling Proposal: Recovery and PHOTON Conversion of Dormant ATONE Airdrop Allocations ## Abstract This proposal asks the AtomOne community to consider a mechanism for addressing original ATONE airdrop allocations that have remained completely inactive since distribution approximately two years ago. The objective is to improve ATONE staking participation and strengthen the network's economic security by addressing a portion of the ATONE supply that was distributed to wallets but has never been put to use through transfers, staking, delegation, or governance participation. Under the proposed approach, only verifiably identifiable original airdrop allocations that have remained untouched since distribution would be eligible for consideration. Before any conversion, affected holders would receive a final three-month period in which to move, stake, delegate, or otherwise demonstrate control and active use of their ATONE. If an allocation remains untouched after that notice period, the community could consider authorizing its conversion into PHOTON under a transparent, technically and legally reviewed mechanism. This is a signaling proposal only. It does not itself authorize or execute changes to account balances. ## Rationale The original ATONE airdrop took place approximately two years ago. Holders have therefore already had a substantial period in which to access their allocations, move their tokens, stake, delegate, or participate in governance. However, some original airdrop allocations appear to remain entirely untouched in their recipient wallets. These inactive allocations contribute to the amount of ATONE that remains unlocked and outside the staking economy. A low staking ratio can weaken the network's economic security. When a significant amount of ATONE remains unlocked and is not bonded to validators, a smaller proportion of the total supply is actively contributing to proof-of-stake security and participating in the network's governance. ATONE is the network's staking and governance asset. Holding ATONE without ever using it for staking or governance provides no direct contribution to these functions. The proposal therefore seeks to distinguish between holders who actively use their ATONE and allocations that have remained dormant since the airdrop. The intention is not to penalize people for being inactive or to take away value arbitrarily. Instead, it is to explore whether demonstrably unused original airdrop allocations could be converted into PHOTON. This could offer a mutually beneficial outcome: - **For the network:** reduce the amount of dormant, unlocked ATONE originating from unused airdrop allocations and create an opportunity to improve the staking ratio and economic security. - **For inactive holders:** preserve value in PHOTON rather than leaving an unused ATONE allocation in a wallet that does not participate in staking or governance. - **For active holders and validators:** support a healthier staking economy in which a greater proportion of circulating ATONE is actively contributing to network security. The underlying principle is straightforward: ATONE should serve its purpose as the network's staking and governance asset. Holders who do not wish to participate in those functions could retain value through PHOTON instead. ## Proposed Mechanism The community is asked to consider the following framework: ### 1. Identify eligible dormant allocations Eligibility would be limited to original ATONE airdrop allocations that can be independently and verifiably identified. An allocation would qualify for consideration only if reliable on-chain records establish that: - The ATONE originated from the original airdrop. - The relevant allocation has remained in its original recipient wallet. - There has been no outgoing movement or other qualifying on-chain activity involving that allocation since distribution. - The allocation has not been transferred, staked, delegated, or used in governance. The eligibility assessment must distinguish original airdrop allocations from ATONE subsequently acquired by the same wallet through other means. ### 2. Provide a final three-month notice period Before any conversion is implemented, eligible wallets must receive a clearly announced three-month period to demonstrate that their holders wish to retain and use their ATONE. During this period, holders could: - Transfer their ATONE to another wallet. - Stake or delegate their ATONE. - Participate in governance. - Perform another clearly defined qualifying on-chain action. Any qualifying activity during the notice period would remove the affected allocation from consideration for conversion. The notice period should be publicly communicated through official AtomOne channels and include clear instructions explaining how holders can preserve their ATONE. ### 3. Convert only allocations that remain dormant After the three-month period, only allocations that still meet all eligibility requirements would be considered for conversion. The conversion must use a transparent, community-approved ATONE-to-PHOTON formula. The exact conversion mechanism, supply treatment, accounting, and technical implementation must be determined through a separate review and approval process. No conversion should occur automatically as a consequence of this signaling proposal. ### 4. Publish transparent eligibility and conversion records Before implementation, the community should be provided with: - The methodology used to identify eligible original airdrop allocations. - The total amount of ATONE potentially eligible for conversion. - The criteria used to determine whether an allocation remained dormant. - The final three-month notice and exclusion process. - The proposed conversion formula and its supply implications. - A verifiable record of any conversions ultimately authorized. ## Implementation Requirements If the community supports this direction, developers and relevant contributors should investigate the technical and legal feasibility of the mechanism. Any implementation must include: - Reliable identification of original airdrop allocations. - A method of distinguishing dormant airdrop allocations from other funds. - A clear definition of qualifying activity. - A publicly verifiable three-month notice period. - Protection against mistakenly including active holders or unrelated ATONE balances. - A transparent and auditable conversion process. - Appropriate technical, constitutional, and legal review. - A separate governance authorization or other required approval before any account balances or token supplies are changed. ## Safeguards This proposal must not be interpreted as authorization to confiscate or modify any holder's balance immediately. The following safeguards are essential: 1. Only demonstrably traceable original airdrop allocations may be considered. 2. ATONE acquired independently of the original airdrop must not be affected. 3. Any qualifying activity during the three-month notice period must exclude the relevant allocation from conversion. 4. Holders must have a reasonable and publicly communicated opportunity to preserve their ATONE. 5. The conversion formula and its economic consequences must be disclosed before implementation. 6. The mechanism must be independently auditable and subject to the required governance and legal approvals. 7. No balances may be modified solely as a result of this signaling proposal. ## Requested Community Decision This proposal asks the AtomOne community to express its support or opposition to the following principle: **Should the AtomOne community investigate and, subject to all required approvals, implement a mechanism to convert original ATONE airdrop allocations that have remained completely untouched since distribution into PHOTON, after providing their holders with a final three-month opportunity to demonstrate activity and retain their ATONE?** The primary objective is to improve ATONE staking participation and strengthen the network's economic security by reducing the amount of permanently dormant, unlocked ATONE originating from unused airdrop allocations. Holders who wish to participate in the network's staking and governance economy should have the opportunity to retain their ATONE. Holders who do not wish to participate should have the opportunity to retain value through PHOTON. The goal is a healthier staking economy, stronger network security, and a more productive use of the assets distributed through the original airdrop.