What is Exit to Commons?

Exit to Commons is a financial strategy where incoming revenue from tokenized access rights sales is used to retire debt, gradually eliminating all private claims on the land. The "exit" is achieved when debt is cleared, not through asset sale.

This creates a path to full commons ownership without commodifying land. Rather than selling land to pay debt, the community uses ongoing token sales to gradually eliminate debt, eventually owning the land free and clear in perpetual commons.

How Exit to Commons Works

Initial Financing

Projects typically start with debt—loans to acquire land and build initial infrastructure. This debt creates private claims on the project that must be serviced.

Token Sales

As the project develops, tokenized access rights are sold through bonding curve mechanisms. These sales generate revenue that can be used for operations, development, and debt retirement.

Debt Retirement

A portion of token sale revenue is allocated to retiring debt. As debt is paid down, private claims on the land decrease. Eventually, all debt is cleared, and the land is owned free and clear by the commons entity.

Full Commons Ownership

Once debt is retired, the land is fully owned by the nonprofit commons entity, held in perpetual trust. There are no remaining private claims, and the land can never be sold.

Exit to Commons Debt Retirement

Debt retirement is the mechanism through which exit to commons is achieved. Rather than extracting profits or selling assets, revenue is used to eliminate debt, creating a path to full commons ownership.

This differs from traditional exits in several ways:

• No Asset Sale: Land is never sold to pay debt
• Gradual Process: Debt is retired over time as revenue comes in
• Commons Ownership: Goal is full commons ownership, not profit extraction
• Perpetual Trust: Once debt-free, land remains in perpetual trust

Benefits of Exit to Commons

• No Land Commodification: Land is never sold, maintaining commons structure
• Gradual Ownership: Path to full commons ownership without asset sales
• Community Control: As debt decreases, community control increases
• Perpetual Protection: Once debt-free, land is protected in perpetual trust
• Regenerative Finance: Aligns with regenerative finance principles

Exit to Commons vs. Traditional Exits

Traditional exits typically involve:

• Selling assets to pay debt or generate returns
• Extracting profits for investors
• Commodifying land and resources
• Creating incentives for short-term gains

Exit to Commons:

• Uses ongoing revenue to retire debt
• Maintains land in commons, never selling
• Creates path to full commons ownership
• Aligns incentives with long-term regeneration

OASA's Exit to Commons Model

OASA projects use exit to commons to finance regenerative commons while maintaining land in perpetual trust. Through tokenized access rights sales, projects can:

• Acquire land and build infrastructure
• Gradually retire debt through token sales
• Achieve full commons ownership without asset sales
• Maintain land in perpetual trust forever

At Traditional Dream Factory, this model has enabled financing of regenerative infrastructure while keeping 25 hectares in perpetual commons, demonstrating how exit to commons can fund regeneration without commodifying land.

Related Terms

• Exit to Commons Debt Retirement - Debt retirement mechanism
• Regenerative Finance - ReFi movement
• Tokenized Access Rights - Financing mechanism
• Perpetual Commons - Land held in trust forever
• Regenerative Commons Economics - Economic model