The SMAC Lifecycle

The lifecycle of a SMAC involves several distinct phases, from the initial proposal to the final distribution of rewards. Here's a step-by-step guide:

1. Proposal & Vetting

• How to Propose a Target: Any community member can propose a target token for a SMAC. A strong proposal typically includes:

  • Target Category: Instead of a specific token, proposals focus on a category or type of token (e.g., "Abandoned DeFi projects with a market cap under $50k," "Rugged meme coins with over 1,000 holders"). This maintains the blind nature of the process.

  • Rationale: A clear explanation of why this category of token is a good candidate for a community takeover, and the potential for revival.

  • De-Rug Strategy: A detailed plan outlining how the community will attempt to revive the token's value. This could involve marketing campaigns, community building, development efforts, partnerships, or other initiatives.

  • Funding Goal: The estimated amount of SOL needed to acquire a significant portion of the target token's supply, based on current market conditions.

  • Success Metrics: Clearly defined, on-chain metrics that will be used to measure the success of the takeover (more on this below).

2. Blind Target

• Maintaining Fairness: To prevent front-running and insider trading, the specific target token is not revealed during the proposal or funding stages. Only the category or characteristics of the target are known.

• Eliminating Bias: This "blind target" approach ensures that SMACs are funded based on the merits of the proposed strategy, rather than speculation about a specific token.

3. Funding

• Contributing SOL: Once a proposal is approved, a new SMAC is created, and community members can contribute SOL to fund the takeover.

• $OGS Holder Priority: $OGS holders have priority access to contribute during the initial funding period. This incentivizes holding $OGS and rewards those who are most committed to the platform.

• 5% $OGS Allocation: 5% of the total SOL raised in each SMAC is automatically used to purchase $OGS from the open market. These $OGS tokens are locked within the SMAC and later distributed to participants upon successful completion of the takeover, creating buying pressure and aligning incentives.

• Funding Deadline: If the funding goal is not met within a specified timeframe, contributions are returned to the participants (minus the 5% used for the $OGS buy).

4. Target Selection & Reveal

• The specific target token is selected and revealed after the funding phase is complete. This ensures that no one can take advantage of early knowledge of the target. The selection process will prioritize transparency and fairness.

5. Acquisition

• The SMAC uses the collected funds to acquire the target token according to a pre-defined strategy designed to minimize market impact.

6. The "De-Rug" Phase

• Community Action: This is where the community actively works to revive the target token, executing the strategy outlined in the original proposal.

• Possible Actions: This could involve a wide range of activities, including:

  • Marketing and Promotion: Spreading awareness of the takeover and attracting new investors.

  • Community Building: Fostering a strong and engaged community around the target token.

  • Development: Contributing to the development of the token's ecosystem or building complementary products/services (if feasible).

  • Partnerships: Forming strategic partnerships to enhance the token's utility and adoption.

• Coordination: The success of this phase relies on effective communication, coordination, and collaboration among community members.

7. Vesting & Reward Distribution

• Performance-Based Rewards: The acquired tokens, and the 5% $OGS purchased during funding, are not immediately distributed to participants. They are vested and released gradually based on the achievement of pre-defined success metrics.

• Alignment with Success: This vesting mechanism ensures that rewards are only distributed if the takeover is successful, aligning the incentives of participants with the overall goal.

• Proportional Distribution: Rewards are distributed proportionally based on each participant's contribution to the SMAC's funding.

8. SMAC Completion & Fee Distribution

• Successful Completion: A SMAC is considered successful if all the pre-defined success metrics are met within the specified timeframe.

• Unsuccessful Completion: If the success metrics are not met, the remaining vested tokens might be burned, redistributed based on partial achievement, or handled according to a mechanism defined in the initial proposal.

• Fee Distribution: Upon completion of the SMAC (whether successful or not), a 5% fee (based on the initial SOL raised) is distributed as follows:

  • 2% to the De-Rug Vault: Used for $OGS buybacks and funding the treasury.

  • 1% to the OG.fun Team: To support the ongoing development and maintenance of the platform.

  • 2% to cover operational costs: These costs will mostly cover the fees for on-chain operations.