# kaal:claim:3949098-029

**Claim.** Shifting policy so that all returns on purchases are minted into fungible reputation tokens paid proportional to reputation holdings instantiates the shift from capital to reputation and functions as a form of best efforts underwriting on a token opportunity.

**Type.** design  **Support.** argued

**Holds when.**

- phase 2, capital allocation phase
- capital to reputation ratio moving toward 50/50

**Source quote.**

> All ROP is minted into FRT which, in turn, is paid out proportional to RNFT holdings. This instantiates the important shift from capital to reputation and shifts the incentives away from capital to reputation and can be seen as a form of best efforts underwriting on a token opportunity.

**From.** Wulf A. Kaal, *Reputation as Capital – How DAOs Upgrade Finance* (2021), III. Toy Model, 2. Phase 2 - Capital Allocation, page 21

**Cite as.** Wulf A. Kaal, Reputation as Capital – How DAOs Upgrade Finance (2021). SSRN: https://ssrn.com/abstract=3949098

**Verify.** sha256 of source PDF `04297905564a6092b2db7640561f58fd374d3114c79527357bad09d11b909819` at https://raw.githubusercontent.com/wulfkaal/Academic-Papers/main/papers/pdf/Kaal%20-%202021%20-%20Reputation%20as%20Capital%20%E2%80%93%20How%20DAOs%20Upgrade%20Finance.pdf

**Topics.** risk-and-incentives, reputation, tokenomics, defi

**Keywords.** minting-policy, incentive-shift, fungible-reputation-token, best-efforts-underwriting, phase-model

**Related claims.**

- restated_by: https://wulfkaal.github.io/claims/3962614-038

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