Alien Base Governance Updates and Community Engagement

Alien Base has transitioned from a fixed 1M ALB allowance to a **Line of Credit (LoC) system** for development funding. **Key Changes:** - Development funding now requires paying an interest rate through the LoC - The new system offers more flexibility while maintaining accountability - Removes direct development funding burden from the DAO **How It Works:** - Emissions for Protocol Owned Liquidity (POL) are tracked via the LoC - All generated yield automatically goes toward buying back and burning ALB tokens - This mechanism helps return debt while reducing token supply The Line of Credit applies to both POL accumulation and development funding, creating a more sustainable financial structure for the protocol.

**Token Contract Migration Ahead** Morpho is preparing to migrate its token contract to support new tokenomics, pending community approval through an upcoming vote. **Key Details:** - Migration timeline: Expected in a few weeks after vote passes - Purpose: Accommodate updated tokenomics structure - Requires: Community governance approval **Background Context:** In October 2024, the community voted to implement onchain governance, which led to: - Deployment of new token wrapper contract on Ethereum - Integration with Morpho App for seamless wrapping - Legacy MORPHO token remains but renamed - Base bridge deployment for cross-chain governance - New wrapped tokens distributed as rewards on both Ethereum and Base The upcoming migration represents the next phase of Morpho's governance evolution, building on the infrastructure established through the previous onchain governance implementation. *Stay tuned for the governance vote announcement and migration details.*

Alien Base is implementing a **Line of Credit (LoC)** system to track emissions used for accumulating Protocol-Owned Liquidity (POL). **Key Changes:** - All yield generated from POL will be used to **buy back and burn ALB tokens** to repay the debt - Development funding will now operate through a dedicated LoC with an **interest rate requirement** - The LoC system replaces the previous 1M ALB allowance, offering more flexibility while maintaining accountability - This structure removes direct DAO responsibility for development costs The mechanism creates a self-sustaining cycle where protocol revenue directly reduces token supply through buybacks, while keeping development funding separate and accountable through the credit system.

Alien Base is implementing its biggest tokenomics change since launch through AIP-5, completely phasing out farming mechanisms. **Key Changes:** - Farming is being eliminated entirely as market conditions have made it obsolete - The protocol is pivoting heavily to Protocol Owned Liquidity (POL) - Focus shifts to accumulating DAO-owned assets and liquidity pools - New approach aims to make emissions sustainable from day one The move represents a fundamental shift in strategy, acknowledging that what worked at launch no longer serves the protocol's goals. Rather than gradually reducing emissions, AIP-5 establishes a sustainable model immediately. Read the full proposal: [AIP-5: Building Alien Base 2.0](https://medium.com/@alienbase/aip-5-building-alien-base-2-0-96dc24984cd2)

**Design Progress** - New APR calculator iterations underway - Epsilon designs handed over to development team - Final design details being finalized **Tokenomics Update** - First tokenomics draft shared with council and DAO - Team collecting feedback and aligning on next steps - Broader community proposal expected next week to begin governance process The platform continues refining its user experience while advancing its economic model through collaborative governance.