Refund for Unused Fuel Purchased Below Minimum Rail

[halcyon sage]

Title: Refund for Unused Fuel Purchased Below Minimum Rail
Author: Kieran Warwick
Status: Draft
Created: 19/03/25

Abstract
This proposal recommends refunding unused fuel purchased below the newly established minimum rail. Due to delays in implementing a structured fuel pricing model, some players were able to accumulate fuel below sustainable levels. This refund ensures fairness while preventing an unnecessary economic hit. The funds in the IMX wallet were never distributed as revenue, so this correction would not require a clawback from past distributions. However, as this involves withholding revenue anticipated for distribution, governance must formally approve the proposal. The approximate total refund amount is 70 ETH.

Simple Summary
The fuel system lacked a pricing floor, allowing some players to accumulate fuel below sustainable thresholds. This proposal suggests refunding purchases made below the new minimum rail to ensure fairness and maintain economic stability. This prevents excessive purchasing power advantages while maintaining fairness for engaged players. The refund will come from funds that were never distributed, making it a correction rather than a clawback. The total refund is approximately 70 ETH.

Overview
Fuel sales did not initially have a bottom rail, which resulted in players being able to buy fuel at unsustainable prices. The council discussed implementing a lower bound for months, and the team agreed, but development priorities and team size reductions delayed its implementation. This meant fuel accumulated below intended levels before the system was balanced correctly.
Key points regarding fuel accumulation:
10 people hold 40% of the fuel.
250 people hold 70% of the fuel.

Many who accumulated fuel acknowledged the risk in public discussions, understanding that the lack of a price floor was an unintended flaw.
The challenge is balancing the migration to the Unified Fuel economy while ensuring fairness for all players. The DAO is responsible for maintaining economic integrity for all participants, not just the few who leveraged the system's weaknesses. Refunds will target fuel purchased below 25% of the maximum rail, as that was the intended price floor.
Landholders who transferred fuel from their plots to the market below the 0.25 rail will also be eligible for a refund to ensure fairness across the board. This ensures landholders are not disadvantaged due to the system's incomplete state at the time.

Rationale
Implementing a bottom rail was essential for long-term sustainability, but delays allowed some players to take advantage of the old system. While it’s fair that players actively engaged with the game retain value, allowing excessive fuel accumulation to carry over would disrupt the economy.

This refund ensures:
Players who played the game still got value from their experience.
Those who leveraged an unintended system flaw don’t retain an outsized purchasing power advantage.
The overall economy remains balanced and sustainable.
The DAO loses some revenue, but it’s correcting an issue rather than clawing back funds already distributed.
Landholders are fairly compensated for any fuel they transfered below the intended minimum rail, maintaining trust and fairness in the system.

Additionally, this proposal aligns with the broader overhaul of Overworld’s economy, which will introduce new progression mechanics, acquisition rates, and balance adjustments. The goal is to ensure fairness across all in-game systems while maintaining trust in the DAO’s governance.

Full post: https://docs.google.com/document/d/1AMsZibFWOcJGkZtJwp16frFdTGhBmwrGngB1t--0X6w/edit?pli=1&tab=t.0

[lusty solstice]

Will be nice when we are past all this and into a new economic era.

Hopefully there won't ever be a need for an emergency proposal again. Proposals that happens out of sight of the community have unforeseen consequences that can be just as damaging as what and EP proposes to fix.

I think we all know that positive community and sentiment are the most valuable currency. That should always be a consideration when making major changes that affect everyone.

[wheat valve]

<@&1107754780744487002> FYI

[modern hill]

Uploading it now to Github!

Thank you to everyone actively participating in Governance!

[mint rose]

I just want you to know that I really truly hear this feedback, thank you.

[hoary gulch]

am i understanding it right, that the 70eth are on the imx wallet and those who get a refund will get the refund during the implementation of the economic overhaul?

---

Can someone elaborate on that?
What is meant exactly, transferred fuel to the ranger?
If so, what price is taken to refund those transferres?

---

What is happening with the fuel still sitting in Zero ?

[daring veldt]

I am very interested in the answer to this question. I don't see any valid reason for taking fuel from landowners as part of the change to one fuel. Landowners accumulated our fuel playing Illuvium Zero since launch, and as I understand it, the 3 fuel types will still exist in Illuvium Zero, so why would any of our stored fuel, which was not involved in the bonus system at all, be taken from our land?

[wheat valve]

any fuel above certain amount in the plot will be transfered out before the migration

[wheat valve]

at 25% of top rail

[daring veldt]

Why? What is the justification for taking the fuel from our land?

[hoary gulch]

this is wild 😄
it is arguable if a missing bottom rail actually is a flaw or not. Or if the only flaw was that the games were not ready for the economy being started.
I feel in general, those who played the economical part of the ecosystem are put in such a bad light in this proposal that it almost sounds like they were abusers while infact they took part in an system that was working as intended.

[wheat valve]

You dnt prefer to get eth instead?

[hoary gulch]

might wana add that instead of just doing it.
What conversion rate? or will it also be refunded?

[wheat valve]

theres is no conversion rate

just the dao paying for the fuel

[hoary gulch]

so 1:1?

[wheat valve]

yea

[hoary gulch]

so it gets refunded?

[daring veldt]

We are talking about 2 different things. This proposal does not address the fuel that is currently in storage ON OUR LAND. There is no reason to pull that fuel out since there will still be 3 fuel types and our fuel in storage was not part of the flawed bonus system.

[hoary gulch]

can you make a complete sentence to what is happening if i have a Land with 101K fuel on it.
What do i have after the economic overhaul?

[wheat valve]

yes, maybe get bought by the dao is a more accurate term

so yea its a really good deal

[hoary gulch]

mentioning landholders and talking about good deal with that economy overhaul is wild 😄

[wheat valve]

cmon getting eth is a better deal than 1:89

haha

[hoary gulch]

x being better than y doesn't make it a good deal...

a good deal would have been to transfer that fuel 1:1 and give landholders a goodie for totally wrecking Zero with the economy overhaul

[wheat valve]

it is 1:1

and then the dao is paying for that fuel

your fuel is basically getting bought at 25% from top rail lol

[hoary gulch]

ok, nice

so if i had 101k fuel in zero, i will have just 1k fuel left in zero but get 1k$ in eth on my account?

[wheat valve]

yea

idk how much fuel gonna be left in the plot

thats up to perry

and i didnt check your math so

[hoary gulch]

nice, so what about the transferred fuel?
All fuel that was transferred at any given time and is still left in the OW account gets refunded for 25% of the top rail?

[wheat valve]

yes

its just impossible for anyone not to be happy with this proposal

[hoary gulch]

oh i'm not

not at all

and those who love the IP should be scared aswell

[wheat valve]

ur not wrong about what u said

but its time for us to move on

and close this issue

just bury the hatchet, enjoy the eth

and fight for another day

crypto is full of risk, i wish i got a refund on my fartcoin but hey

[hoary gulch]

very sad to see we are going the route of a refund instead of a proper conversion rate or a vesting schedule for fuel bought below the new fixed price.

Many of us made decisions based on the old system... speculating and playing the market, buy low, plan for future demand. With a refund, that entire process was effectively erased. We didn't lose, but we also didn't gain. It creates a sense that strategic thinking and taking risk aren't valued, which is especially tough in player-driven game economy.

Beyond just Eth, a lot of us put time and thought into navigating the market, reading every news post, meeting minutes etc. trying to understand how fuel would integrate into the broader economy, playing and observing the fuel markets etc.
That time has now been wiped aswell. For players who engage deeply, time is part of the investment and it feels that gets totally overlooked with the refund option.

This change also sets a precedent that major economic mechanics can be rewritten and even refunded retroactively at any time. It introduces a level of uncertainty that makes it difficult to fully commit to future systems.
If i engage again deeply, will those rules hold or will they shift once the game evolves further?
Refunding users removes short term pain, but it also signals that major rules of the game can be rewritten at any point. That uncertainty impacts future confidence. If customers feel that the foundation isn't stable and can be changed retroactively, they’ll hesitate to engage or invest time and capital again.

Reputation isn’t just about how a system works today, but whether the community believes it will hold tomorrow. And that’s what’s at stake when big retroactive changes happen even if they're done fairly.
I hope everyone who worked on that proposal and upvotes it is aware of that.

[wheat valve]

we do what we have to do given the circumstances

some people got tons of shards that they can no longer sell

we are all taking a hit, mostly landowners, but it is to improve the whole ecosytem, hopefully we will get more players out of this

if ur not happy, maybe u can opt out the refund?

[hoary gulch]

taking everyone on the same level of taking a hit is not really accurate.
You have some that benefit, those who wana leave the ecosystem. They get their funds back and can move on.
You have some more who benefit, those who had the time to farm 14hours a day and are now sitting on a shit ton of good stat illuvials
You have some who get a hit, those who crafted a lot, which wasn't really happening, which you saw mirroring in solon prices.
You have some who got a big hit, those who invested time in fuel markets.
You have some who got last hit and are now 3 feet under, those who hold land during all the time.

[wheat valve]

cmon man, you made speculation and ur not getting the outcome u wanted

[hoary gulch]

that's not what is happening, ser and you know it

[wheat valve]

idk man 52 people seems ok with this

[hoary gulch]

anyways, looks like it is done with already reaching upvotes.

we shall see how it all turns out

[quiet musk]

@hoary gulch I understand the frustration, i speculated on every single facet of illuvium through the years and thought my fuel purchases through the months of delay was an obvious good move for once but now it gets "canceled"

Like you said the flaw was having the economy start without the demand side (arena), and without lower rail price fuel was insanely cheap. Cheap to the point where it makes 0 sense and the DAO could never generate revenue

Its a rough spot for the DAO here because like Kieran says in the IIP if they were to swap 1:1 it would give a giant advantage to people that held the old fuel and break our economy. It would also be a giant unsustainable debt to the DAO

I understand you would have like to see a conversion rate that rewards, at least a little, the speculation here but even there it would be result in a very big debt for the DAO. Even here, just a straight refund is 70ETH for the DAO

Thats a lot of money, but community sentiment is the most important currency like @lusty solstice beautifully said

Im personally very happy and grateful that my fuel purchases will get refund. Even if my speculation didnt pay off, at least im not getting totally rekt with 89:1

I believe this proposal is a very fair middle ground and shows that the team cares about the community

[hoary gulch]

You don't know the "giant advantage" you never got numbers presented
It's not really a debt to the DAO, that money would have never flowed in and according to revenue numbers we are talking about missing revenue of sub 1% of the playerbase needed to get to a sustainable revenue. (basically an insignificant low amount of players we are talking about)

i get that many now feel realeased and happy after hearing about the 89:1 ratio..It's easy to fall for such traps... it's kinda like the words a very wise man once said...nobody wants to be a slave, but threaten a free man with death and he will gladly accept lifetime slavery

[daring veldt]

Thanks for this, I agree with your comments here.

I would appreciate hearing your take on the issue of fuel that is to be taken from storage on our land. I was reluctant to bring it up here because I believe it is a seperate issue from this proposal, which I upvoted and I agree with. I want to understand why fuel we have earned in Illuvium Zero, that is still in storage on our land, and was not part of the flawed bonus system, should be taken from landowners?

[hoary gulch]

Thats literally the only good thing mal, don't worry about it.
You get a good price for the fuel... Revenue will stay low for a Long time. Probably taking years before you get more $ for your fuel

[tropic bolt]

We would also need buyers to have this "advantage", aka need a game people would spend enough money on.
Just assuming that those would exist and that people "exploited" anything is wild yeah.

I think this is super unfair wording, but after seeing council talk about this before, and the fact they wanted to do the 89:1 thing, not surpised.

[hoary gulch]

Ya

[twilit yacht]

Right or wrong.... crypto is ever moving forward and time is short. A tonne of updates are waiting on what happens with the new economic updates. If we are going to talk about changing the proposed refund and economy changes we won't even give illuvium a chance to succeed this cycle.

This seems like a fair proposal and allows us all to get moving.

I want to see what Illuvium can do. Succeed or fail

[tropic bolt]

No the refund is imo the best option for everyone involved currently.
The wording though is tough to read if you are someone who essentially just played the economy game by the rules presented at the time.

[wheat valve]

Hi ive seen the number and a 1:1 conversion is just crazy. we'll hardly recover from that

[hoary gulch]

Source: trust me bro

Ive Seen not the Final number, but one from january... Got explained as detrimental for economy and revenue lost.
Was a laughable low number if you actually Start thinking about what we really need to get to a sustainable revenue level for labs to keep developping

Thats why i'm so frustrated tbh.
We as an ip take all These negative Hits to Save and economy that didn't need to be saved.
And nobody is talking about 1:1... Maybe 2 or 3 crazy people.... Just talking about a fair conversion Rate which would have lowered that laugable low amount of fuel drastically aswell

[tropic bolt]

Isn´t worst case something like roughly 20x those 70eth, likely less, as that assumes 80X bonus buys.
So if we speculate, prob some 10-20x of that 70 eth, aka 1.5-3mil?

obv lots of worst case kinda level assumptions in that number even

[wheat valve]

it wasnt 1:89 in early december when we voted on it

[tropic bolt]

I am pretty sure this is also a number, that could be researched on chain, so idk why it shouldn´t be public.

[quiet musk]

Thats a good question Mal

I guess it has not been integrated here because fuel on land usually is to build/research and people sell the excess

I can see how some people chose not to sell all extra and max their storages because fuel was dirt cheap though

I only have a T2 so its not a lot of fuel and i could actually never get to the point of selling extra even after all those months ahah but spoon said he has 101k on 1 plot 👀

I do not know the answer though, maybe @quasi socket or @halcyon sage can shed some light here 🙏

[hoary gulch]

You still voted on the Formula that came to that Rate.
We would have had the Same discussions just talking about lower numbers

[hoary gulch]

Was just an example for easy calculation

[wheat valve]

eth was 4k, and the bonus was half.
about 1:20 is pretty fair dnt u think

[hoary gulch]

fuel is off chain, i guess it would be hard to figure it out

[tropic bolt]

Fair, we can see how much people spend but not the bonus

We could see orders in the order book, thought that was viewable, maybe not.

[hoary gulch]

was viewable 🙃

from my memory there were on average like roughly 20 orders a day mostly for low amounts.

the last 2 months (Jan+feb)

[warm cloud]

Jag brought up all the people who spent money and time collecting shards, ingots, suits, weapons etc. That all still needs to be addressed.
Any idea when that will be disclosed to us?

[hoary gulch]

think it got mostly adressed in the blogpost, or what other information you are looking for?

[lusty solstice]

We should still be able to use nft shards right?

[radiant badger]

The flaw was having the economy start without the demand side (arena), and without lower rail price fuel.

It's amazing how you guys still think this was the problem and can't grasp this entire system was flawed from the get go...

There was zero economic foresight on this entire fuel system. We wanted a free-market but then we manipulate the supply by changing fuel production rates. We wanted a free-market but at the same time expected a ridiculously high fair value for fuel and design the OW with insane fuel costs. We wanted a free-market but then we implement price rails and we're still to this day talking about the lack of a lower rail...

If there was a lower rail, fuel would basically always be at that price. And that would mean land holders would be selling fuel most of the time to the DAO and not to other players.

And even if there was a huge demand from arena, demand is a variable not a constant. There would come a time when the interest in the game would dwindle and we would be in the same position we are today.

I'm just glad we're moving on from this sh1t show. I hope this marks the beginning of a new phase in this project, with more transparency, and that the council/team never makes such a rogue move again like they did with EP-1.

[radiant badger]

I'm giving this a 👎 cause the rationale for this is just awful.

[warm cloud]

Everyone is OK with the fact that we spent time and money collecting/buying/forging these items and now they won't exist or may not exist? Some of those suits and weapons weren't that cheap to make even with the low forging costs.

They say they will provide utility to the items in the MMO only if they enhance gameplay, if they don't then what?

[radiant badger]

I'm not okay at all. I would like to see all weapons/suits/drone upgrades crafted be refunded as well.

[tropic bolt]

Is overworld going to be entirely removed?
Or can those be used there?

[modern hill]

Overworld is coming back with the unified fuel as far as I'm aware.

[tropic bolt]

Will Drone upgrades, weapons/suits exist there?

[modern hill]

Unchanged I believe.

Same Overworld

[tropic bolt]

Just new versions of those aren´t NFTs?

but same items?

[modern hill]

This is not implemented yet, they are not de-nft'd yet I think.

[modern hill]

All those assets will still have some value in future games, the analogy used was similar to how heirloom items work in wow. Not the part that they boost your exp. gained but rather in how they are usefull items that have a usecase besides being endgame assets.

That was at least one option that I heard of, what happens to all the legacy items once we get the MMO Lite has not been set in stone yet.

[modern hill]

But yes, once those are de-nft'd I think they retain their usecase until MMO Lite

[tropic bolt]

What is the reason to de-nft them if they stay as playable things in overworld?

[warm cloud]

We don't know. We do know that Weapons, Suits and Drone attachments won't be NFTs. Also looks like there won't be as many in a line. Not sure when skins will be implemented or how that will work. As for the shards, gems etc. They will still be usable so we can assume that the money we spent on getting those in OW or open market balances to what it would cost to get the unified fuel to get them in OW now.

I know all of this doesn't even belong in this thread but I guess I am feeling a little lost. Many of us spent money in good faith. We purchased extra builders for our plots thinking we were doing so in order to sell fuel and or make skins for NFTs. We were building suits and weapons thinking they were NFTs. We were making skins and forging the suits to put them on. Buying S1 Illuvials to level up to make those skins (now fusing is going to cost a lot more). All of it cost money and I am hoping that the DAO takes that into consideration.

I won't say more for now as I want to give DAO and team time to come to decisions on how to move forward with OW items but I also would like to know whether we are waiting weeks or months to find out what will be happening with them.

[modern hill]

The Overworld will make way for the MMO-Lite at some point. This means some of these items will become obsolete or be legacy items. Providing a niche use case like in the example of the weapons above.

You wouldn't want those items from the forgotten past on your marketplace I assume.
I can see that for example with ingots if you don't craft stuff anymore.

For weapons it feels not quite like the answer, because if those retain some value in future versions of the game, you might still want to be able to acquire them, and therefore also be able to sell them.

[tropic bolt]

I see, different topic compared to fuel I guess, but still somewhat related in terms of customers spend money on X.
Difference I guess is, people got to play a game with those items, unfortunate that game/economy didn´t check out and something new is being pursued for owners of those. Kinda falls back to this basic anti-nft argument of if the game isn´t played, items become worthless anyways.

Would be cool to drop owners of such things something in that new MMO or some free in-game currency maybe.

[modern hill]

Yeah, I think the team has shown that even though sometimes investors/players need to be burned when trying to improve the current game, they won't allow major unfair burns like the one that would have happened if this refund wasn't issued. Personally, this gives me hope that the DAO and team will find a way to make it up to the community in some shape or form, regarding this OW assets issue, providing a middle ground that delivers value to players without corrupting the ILV economy with for example too big of an IOU debt.

[warm cloud]

When did the DAO know that suits/weapons wouldn't be NFTs and may not have utility in the MMO-lite?

[radiant badger]

early February.

[warm cloud]

Did community know that as well?
I knew they were talking changes to the suit lines but did we know the extent?

[radiant badger]

I have no inside info 😅 it was communicated through the blog and the town hall with Perry.

[quartz flax]

Misunderstood the proposal - It seems we get refund + fuel. Sorry for the disturbance.

[warm cloud]

Townhall with Perry was only 3 weeks ago.

[radiant badger]

you're right, was early March not February, my bad.

[hoary gulch]

I guess one could have assumed it from the gauntlet dev blog End of january, but the Details we know now, were mostly public just since ep-1 as far as i remember.

[warm cloud]

Here's the thing I am trying to figure out and why.

I bought my land years ago. It's disappointing to me that it didn't work out the way it was told to us that it would, but I believe that when the DAO sold me that land they had good intentions.

However, all of this with suits/weapons/skins is different because of the time frame it happened in. If the DAO knew all this would take place and yet let us spend money making all these things well, that doesn't sit right with me.

I don't know maybe I am being unreasonable.

Maybe I should have known and this is on me.

[tropic bolt]

Yeah, it is tough on that one I think, in theory everything we do/spend money on has the disclaimer it is only worth something if Labs makes a game that uses those well and people want/need them, also those things could be used to play overworld+ then get illuvials at cheap cost I guess.
Anyone playing at the cheap prices and farming Illuvials was a big winner from all of this, right?

I´d agree for sure, that it would be messed up if council/labs knew those won´t have the utility that people currently on good faith assume they will have and don´t let players know.
That´s why I said some kinda future benefit would be nice to those, but then we have the problem of close to everything you could give in a tradeable economy could reduce revenue, which wouldn´t be in the interest of the DAO, so we are back at the question what´s to the biggest benefit of the DAO, catering to/rewarding the early guys or targeting new users/making a product they use anyways even if they feel treated poorly here.

[warm cloud]

This isn't about catering to/rewarding early guys. It's about retaining loyal customers and increasing their spending by maintaining customer confidence.

[tropic bolt]

(I could note again, that my proposal from dec/jan would fix all that, as you could simply introduce some point gain weight or w.e. system you want and then anything can have a relevant utility in form of "farming" rewards)

[tropic bolt]

yeah, I didn´t choose the nicest wording there, but from actions taken, I assume this is the pov that exists

[wooden helm]

I fail to see how spending any money in illuvium is good value anymore.

[lusty solstice]

Idk... Beyond is doing pretty well. Been giving Leaderboard rewards for what a couple years now? I'd argue Beyond has been the best and will continue to be for a while. Unless Arena rewards are just as good or better. But this is maybe for a different topic.

[hoary gulch]

https://tenor.com/view/slightly-rugged-robin-james-rugged-look-slightly-rough-rough-around-the-edges-gif-24900238

[wheat valve]

[lusty solstice]

Wait
So fuel in Zero has been converted at 89:1 today
I thought that fuel in Zero sas going to be part of the refund as well
Is that not the case?

[wheat valve]

it is

[lusty solstice]

Ahh yah I thought so
Thank you for clarifying

[wheat valve]

we have given the amount of fuel from zero and the price of refund which results in how much eth to be refunded to landowners

[wheat rapids]

We will have more details with the refund blog

[lusty solstice]

Submitted my refund request

[scenic totem]

Is the fuel purchased before the bonus started to get out of control eligible? I remember bonus was not that high at those date.

https://docs.google.com/spreadsheets/d/1nQtyjnkcQBtWkkiJxQLx5saXODA6NF8i8sPmsxbkLBE/edit?pli=1&gid=0#gid=0

[scenic totem]

Do the people need to take action from it ?

[scenic totem]

It's getting complicated 🫣 😅 , a huge mistake which is costy in the end...

[hoary gulch]

can you elaborate?

[scenic totem]

Sure all I can do is wait now.

It shouldn’t have taken that long to fix it. I was busy with life, and when I came back to the Illuvium universe, the bonus was +50k… like, I feel like no one was at the helm.

Price have been fix now. Just need some wind in the sails!

[scenic totem]

Got some questions
• If I buy Unified Fuel now and use it to play, will it be considered lost and ineligible for a refund?

• What if I want to play but can't because of the "Refund for Unused Fuel Purchased Below Minimum Rail"?

• If I bought Unified Fuel to play without using my "old fuel," what happens?

• I would like to play but only use my old fuel. Is that possible?

[lusty solstice]

I've been using a second accound as to not touch the main with fuel cuz there is no clarity around refunds right now

[warm cloud]

I've been only doing T0 runs. I figure it is a good time to build my Atippo Army.

[hoary gulch]

did you get exp on t0 runs?

[warm cloud]

Very little but yes, my Caradulo managed to climb to the next level that she was close to.

All illuvials are visible on the map now too in T0 which is great.

[lusty solstice]

Well there must be some progress on refund... all my fuel is gone XD

[quiet musk]

Not gone for me, did you get the ETH in exchange yet?

[scenic totem]

Still there for me as well

[lusty solstice]

Nevermind... just logged out and back in... must have timed out

Still fuel there

Sorry for the false alarm