Clarity on our Xirtam Proposal
Proposal #157 was a 13 Eth investment into Xirtam. A workshop in the discord (https://discord.gg/HnqQVgbSg3) was first opened on 13th March. In the workshop you can see the discussions taking place, video explainers on the project, as well as specific videos on how it fit into the CULT ecosystem. They even constructed a puzzle designed for CULT. They appeared to be forthcoming with answers and information.
We are extremely disappointed in the way that Xirtam have handled their launch, as well as their subsequent actions in the time since then. We would like to address some of the facts around CULTs involvement in the process.
To those not familiar with the CULT proposal and investment process, Cult DAO is a fully decentralized funding mechanism. There is no CULT team, only the community.
CULT also does not do any incubations, as some have described. Cult DAO is purely the governance process allowing $CULT stakers to decide where and who $CULT is sent to, and who is supported through the funding mechanism.
The extent of any “partnership” was purely an investment in the token ahead of launch, and the Xirtam team stating their intentions to also build on Modulus.
The proposal itself was submitted live on the CULT dapp on the 2nd April. It passed with 84.59% yes votes (~52.6 Billion) and 15.41% no votes (~9.6 Billion).
It is worth noting, that when the proposal for CULT investment was submitted, there had been no raises at all, and it was understood there was going to be a Fjord Foundry LBP, as well as a concurrent raise on Alien.fi (which was then cancelled: https://medium.com/@alienfiarbi/xirtam-iao-cancelled-c85185e9adeb). Subsequently this would then lead to open market on DEX.
However, they held a private sale for 310 Eth on 20th April, which sold out.
They then initiated an LBP on Fjord Foundry on the 23rd April. This raised another $2.1m USDC.
Finally they did a raise on Pincubator for another 600 Eth on 28th April.
CULTs investment fell outside any of those (as it preceded their first raise by nearly 3 weeks), and we were given tokens valued at 75% of the seed (Pincubator) price vested for 6 months, with 30% of the tokens unlocked at TGE.
The liquid funds are currently being held in this wallet, but we are yet to be given a vesting allocation for the remaining 70%:
Fast forward to the launch, and it is clear that the project overpromised and underdelivered.
They achieved a total raise of over $3.5m, however opened the liquidity pool with just 24 Eth, for less than 100k total liquidity compared to a $40m FDV valued project.
Needless to say the actions of the project since have been questionable at best, and despite multiple statements, the issues of the low liquidity and movement of the huge raise have not been addressed.
So moving forward as a DAO, we should make a decision. Is it in our best interests to cut all ties with the project, sell and recoup what we can from the investment, or do we hold on and hope that issues are addressed and they attempt to rectify it?
A snapshot has been submitted so the DAO and the community can make this decision: https://snapshot.org/#/cult-dao.eth/proposal/0x6c11614d87510a47da56bb9e0b54a3b32a449c2f2f2d0817966b7f20bce7c798
It has come to our attention that while writing this medium, the Xirtam teams funds have been frozen on Binance. We hope this will lead to further accountability and clarity on how they decide to move forwards.