Gov/en/Portal:Economy/Cashout-Mechanism

💡 In simple words: When people pay their small yearly fee to use WikiDeal, that money is shared among everyone who helped fund the project. Each fee gives everyone a tiny piece, so savings grow slowly. You only pay when signing a contract.

🎯 In 20 seconds (scientific summary): Reward cash-out is funded by user subscriptions, redistributed pro rata across activated Rewards; with tens of millions of Rewards, each payout is tiny but non-zero and grows over time. Several allocation percentages are envisaged (100%, ~50%, or degressive). Subscriptions stay non-invasive, required only to sign a contract.

Cashout mechanism

Status: initial hypothesis, under construction, proposed as a basis for discussion.

How the cash-out works

People take subscriptions to use WikiDeal, and each subscription paid is redistributed across all the holders of activated Rewards, pro rata of the Rewards they hold.

Concretely: if Rewards have already been activated through donations and early supporter contributions for, say, 30 or 40 million, then one franc of subscription is distributed in one thirty-millionth per Reward across all holders. That is very little, but it is not zero either: holders see their money grow progressively. They see the cash-out grow.

The cash-out comes from subscriptions, and subscriptions are not invasive

This point matters and is worth repeating: the cash-out is funded by subscriptions, and subscriptions are not invasive. There is no insistence. People can use the platform without paying: they are only asked to take one month of subscription once, to see how it works, and they can then stop paying as long as they have not made a transaction, as long as they have not signed a contract for a loan, for babysitting, or for any other starting use case.

It is a freemium type of model: at the beginning, people put one franc once, and it stops there. By default, the subscription is written as inactive by default: it is the user who clicks to reactivate it. Registering the credit card only tests that the person has a means of payment, nothing more.

It is therefore possible that there are few subscriptions at the beginning. Subscriptions would really start growing when marketplaces are active, since signing a contract in a marketplace requires an up-to-date subscription.

Three options for the cash-out percentage

Three options are envisaged for the percentage of each WikiDeal subscription that is attributed to the cash-out of Rewards:

1. 100%: all subscription money goes to covering the cash-out of Rewards. This option is considered unlikely, because it raises a dilemma: repaying the commitments first, at the risk of fragilizing the operating costs of the platform (operating costs do exist).
2. A fixed percentage, estimated at 50%.
3. A degressive percentage: it would start at 100% and progressively decrease to 1% as holders receive their cash-out, so the cash-out goes slower and slower over time.

For the donors of the first million, the commitment is that the percentage stays between 50% and 100%, that is, at least 50% on average over Prototype 1. This commitment does not cover early supporters: for them, the terms may change in order to preserve some liquidity, so that the system keeps working.

An open call on the best formula

Which formula is the best one? This question is a full open call in itself: see the dedicated open call Cashout policy (wave 2). Its deadline will be determined once at least CHF 100,000 in donations have been obtained.

One round at a time

One point is considered settled: there would be no second financial donation round before the first one is at least well advanced.

See also

• Rewards
• Subscriptions
• Open call: cashout policy
• Open Call: main page