TribeToken

What is Tribe (TRIBE)?

TRIBE is the governance token of the Tribe DAO that backed the Fei Protocol, a platform issuing algorithmic USD stablecoin Fei USD (FEI).

Fei USD was designed to be decentralized and capital efficient, using value locked to maintain liquidity of secondary markets. It also exploits the niche between custodial stablecoins and overcollateralized, decentralized stablecoins.

As a stablecoin, FEI played a crucial role in cryptocurrency by giving traders a stable safe haven in times of volatility. However, the Tribe DAO’s ecosystem wasn’t restricted to Fei. Turbo, a liquidity accelerator, and Rari Capital, a permissionless lending and yield protocol, also fell under Tribe DAO.

Unfortunately, an attack in April 2022 that drained close to $80 million from Rari Fuse liquidity pools required the Fei Protocol to minimize damage to its ecosystem.

The Fei Protocol founder announced Tribe DAO proposal TIP-121, revealing the company’s intent to reimburse Fuse victims. It detailed plans for asset redemption and the distribution of protocol-controlled value (PCV) assets that manage the liquidity and yield of the Fei Protocol.

The upshot of TIP-121 is that FEI has now become wrapped DAI, backed 1:1, and redeemable. TRIBE has also become redeemable for a pro-rata claim on each remaining asset of the protocol after setting aside DAI backing for FEI. This excludes TRIBE in the Treasury. The governance powers of the TRIBE token are no longer in existence, and the Tribe DAO and Fei Protocol are no longer under development.

When was Tribe Launched?

The Fei Protocol and the Tribe DAO were launched in 2020, and they received a significant amount of both interest and institutional investment. Nascent, Coinbase Ventures, Framework Ventures, and a16z, among others, provided around $19 million in funding.

The public were only able to get their hands on protocol tokens after the aforementioned hedge funds, with the platform even offering an early discount rate of $0.50 per FEI, a guaranteed 100% return on investment assuming a successful launch.

Who are the Founders of Tribe?

Tribe DAO and the Fei Protocol were launched by Fei Labs, a firm founded by CEO Joey Santoro along with Brianna Montgomery and Sebastian Delgado.

Santoro is a computer science graduate of Duke University and was a software engineer at Okta Inc. prior to founding Fei Labs. Montgomery, the project’s business lead, has worked with nCino, DefenseStorm, Coriant, and ConsenSys, while Delgado was previously at Dharma Labs and Uber.

How Does Tribe Work?

TRIBE was the governance token of the Tribe DAO, which in turn stewarded the Fei Protocol and the FEI stablecoin. Members were able to make proposals called Tribe Improvement Proposals (TIPs), which would be voted on by the DAO at large.

Following the Fuse attack, Fei and Tribe no longer actually work since they are under development. However, prior to the actioning of TIP-121, Fei was an elegant algorithmic protocol controlled by Ethereum smart contracts.

The FEI peg to the USD was maintained by direct incentives as well as protocol-controlled value, or PCV. In this system, if FEI deviated from its peg by a certain threshold, PCV would withdraw 99% of the protocol’s liquidity from the FEI/ETH liquidity pool to purchase FEI and restore the peg. A deviation in the other direction would trigger the printing of FEI by PCV, again establishing equilibrium.

What makes Tribe Unique?

Tribe DAO was unique in that it offered a look at how decentralized governance over complex protocols such as Fei could work. In hindsight, though, the view is even more telling.

TIP-121 gathered plenty of controversy, and the Tribe community expressed mixed sentiments in reaction to it. The lack of timelines and hard numbers within the proposal were questioned, and major Tribe backers, Frax Finance, were harsh in their criticism.

Frax even reportedly alleged that Tribe DAO had enough PCV to repay every stablecoin holder, make hack victims whole, and still have $65 million in value for TRIBE holders to redeem. Despite this, the proposal intended to repay major hack victims such as Frax, Olympus DAO, Balancer Labs, and Vesper Fi with only a fraction of their losses.

Of course, TRIBE is an ERC-20 token, and it’s possible to see who exactly holds TRIBE and stands to benefit from token redemption in a relatively transparent manner.

How is the Tribe Network Secured?

As mentioned, TRIBE is an ERC-20 token on the Ethereum blockchain, which means that it is secured by Ethereum itself. However, the token, the DAO, the Fei Protocol itself, and other on-chain aspects of the ecosystem are all enabled via smart contracts. These have to be written perfectly and audited, lest they be attacked or have vulnerabilities exploited.

What is the Use of TRIBE?

TRIBE holders could make and vote on proposals for the improvement of Tribe DAO and Fei Protocol, as well as earn a share of transaction fees by staking to Uniswap’s FEI/TRIBE liquidity pool.

However, Fei Protocol and Tribe DAO are no longer under development, and TRIBE holders are advised to remove any funds in Tribe DAO-related contracts. They can now redeem their share of Fei Protocol assets, which include stETH, LQTY, FOX, and DAI.

How Much TRIBE is In Circulation?

TRIBE has a maximum supply of 1 billion, with a circulating supply of just over 453 million. However, as TRIBE holders redeem their tokens for PCV assets, the circulating supply will decrease.

How Do You Buy TRIBE?

If you want to buy TRIBE to speculate on it, you can do so via Ethereum-based decentralized exchanges. It’s also possible to do it on a handful of major centralized exchanges.

How Do You Store TRIBE?

You can store TRIBE tokens using any Ethereum-based wallet. This is especially important if you want to redeem your TRIBE tokens for PCV assets since you need a non-custodial wallet to connect to the redemption portal.

Is TRIBE a Good Investment?

It’s very difficult to suggest that the TRIBE token is a good investment, considering that its core purpose, Tribe DAO governance, is no longer in existence.

It’s certainly possible that the token could see significant pumps in value based either on the actions of highly-capitalized holders or the movement of remaining PCV assets.

Nevertheless, it is no longer a token with any remaining utility, and the Fei developers appear to have washed their hands of the project for good.