DAOs: MolochDAO discusses v2 upgrade, Uniswap resolves governance upgrade bug, Aave cross-chain governance, Curve gauge voting app, Polychain chimes in on Compound governance, Gitcoin + Bankless DAO worker survey, and more!
Biweekly report on decentralized autonomous organizations vol.7, 21st August — 4th September
TL;DR
- MolochDAO is rising amongst the shadows and discussing a v2 upgrade
- Uniswap resolves governance upgrade bug. While Uniswap’s community enabled analytics vote. At the same time, Uniswap Labs faces SEC investigation. Uniswap’s proposal to support stable UNI is live for voting
- Andre Cronje releases trustless Curve voting bribery mechanism. Curve’s brand new gauge voting app allows checking bribes, biggest movers, new votes, etc
- Cross-chain governance and open-sourcing the Aave UI. Aave adopts broader liquidity incentive scheme
- Index Coop votes on a framework for submitting proposals in underlying governance systems
- Polychain shares perspective on improving Compound governance through more focus and organization. While Compound’s proposal 057 passes
- Decentralization at Balancer Labs. Community considering sourcecred program activation and staking of BPT for economic and governance benefits
- Gitcoin and Bankless released DAO worker survey to better understand contributor experience. Gitcoin Grants Round 11 begins Sept 8th with the biggest matching pool yet
- Idle DAO’s IIP-12 proposal lands in the forum. New members’ elections successfully passed
- Synthetix V2x revisited. SCCP-137: reduce L2 target c-ratio to 750% is live for voting
- ‘A DAO defined: The Big Picture’ by Aragon. Check out the Aragon August project updates and the second ‘How to…’ series
- PoolTogether proposal #21 passes. PoolTogether on Celo
- Commons Stack & ixo foundation partner up to build the Internet of impact
- Following approval of KIP-12, Kyber DMM and Rainmaker liquidity mining is now launched on Binance Chain. Moreover, KIP-13 passed
- API3 announced the partnership with EQ8 network
- PieDAO organizational roadmap Q3/Q4 2021
- Controversy over Etherium gas limit token voting mechanism
- Polygon’s DAO announcement
- a16z delegate disclosure
- Active proposals: Aave, Balancer, GitcoinDAO, Index Coop, Synthetix, PieDAO, Uniswap
- New & ongoing discussions: Compound, mStable, MakerDAO, Yam Finance, Curve, Yearn Finance, Nexus Mutual, LidoDAO, BancorDAO, Akropolis, GnosisDAO, PoolTogether, API3, Idle, KyberDAO, Kleros
- The importance of DAO tooling for social cohesion
- Podcasts on DAOs
- And more!
Overview
Blockchain technology is already radically transforming the financial system. However, properties such as trustlessness and immutability aren’t only useful in monetary applications. Another potential application is governance. Blockchains could enable entirely new types of organizations that can run autonomously without the need for coordination by a central entity.
“Instead of a hierarchical structure managed by a set of humans interacting in person and controlling property via the legal system, a decentralized organization involves a set of humans interacting with each other according to a protocol specified in code, and enforced on the blockchain.” — Vitalik Buterin
DAO stands for “decentralized autonomous organization” and can be described as an open-source blockchain protocol governed by a set of rules, created by its elected members, that automatically execute certain actions without the need for intermediaries.
In simple terms, a DAO is an organization that is governed by computer code and programs. As such, it has the ability to function autonomously, without the need for a central authority.
Like how DeFi is programmable money and how NFTs are programmable media, DAOs are programmable organizations of people.
DAOs Ecosystem Statistics
- Top active organizations this week sorted by decisions:
- Top active organizations this week sorted by discussions:
Read & Listen
- What Are DAOs? The Future of Global Organizations Explained by Nathan van der Heyden on Crypto Briefing
- Community DAOs by Patrick Rivera on p.mirror.xyz
- The Importance of DAO Tooling for Social Cohesion by Federico Daffina Minicucci on ff.mirror.xyz
- A peek into DAOs: Part 1 of 3 by Annika Lewis on annika.mirror.xyz
- Scaling DAOs Won’t Be Easy: Five Major Challenges to Overcome by Connor Spelliscy on The Defiant
- We’re (in) the money by David Phelps on Three Quarks
- The New Creator Economy — DAOs, Community Ownership, and Cryptoeconomics by Nader Dabit on dev.to
- A better design for defi grant programs on Cryptoeconomics Medium
- Uniswap Research Report: Discord, Governance, Community on Other Internet
- Crypto’s Consumer Era by Kinjal Shah on kinjal.mirror.xyz
- Social Token Paradox by Gaby Goldberg on gaby.mirror.xyz
- Bankless Podcast: DAO Panel | Kain Warwick, CoopahTroopah, Tracheopteryx
- Epicenter Podcast: BadgerDAO — Bridging Bitcoin and DeFi with Chris Spadafora
- Epicenter Podcast: VitaDAO — The Collective Funding Longevity Research with Paul Kohlhaas & Tyler Golato
- Conversations with the Coop: Cooper Turley from Audius
- Layer One Podcast: PieDAO, Passive Wealth Creation, $DOUGH Staking, Investing in a Metaverse Index, DAO Explained
Frameworks
Aragon
A DAO Defined: The Big Picture: DAOs are internet-native organizations, and their time has come.
How to Start a Charity (from your Bedroom): In the second of ‘How to…’ series, learn how Elimu is using an Aragon DAO to disrupt the nonprofit sector and bring quality basic education to children all over the world.
Aragon Community Call #5 | September 1st, 2021:
Aragon AMA #1 — UMA | August 24th, 2021:
Colony
There were no essential news and updates these weeks.
The Commons Stack
Commons Stack & ixo Foundation Partner Up to Build the Internet of Impact: Commons Stack is collaborating with ixo to build the Tokenized Impact Economy on ixo-Cosmos Blockchain networks, and partner in launching Earth State, a member-driven information sharing platform.
Commons: The Heart of The Creation Era: How Elinor Ostrom and Web3 technologies are the key to Commons Stack’s work.
Moloch
Moloch is going through some major changes.The upgrade procedures to v2 are underway!
Join Discord to share your voice on the matter:
OpenLaw
OpenLaw’s Aaron Wright: Powering DAOs with the Smart Contract Stack: In this SmartCon presentation, Aaron gives his insights into the future of DAOs powered using a combination of smart contracts, oracles, and Ricardian contracts:
Discussions on the Tribute DAO are active! Share your ideas on Discord:
Governance
Aave
Cross-chain governance and open-sourcing the Aave UI: The Aave Companies are committed to creating open source software that empowers users’ financial, social and cultural independence. For this software, decentralization and — most specifically decentralized governance — will be a core feature; and it is this decentralization that allows community members to contribute to the larger social, cultural and financial ecosystem growing around any software protocol.
For any governance proposal, the key components of the Aave Governance architecture are:
- The main governance contract, which allows users to create proposals and allows AAVE holders to vote on those proposals; as well as
- The executor contracts, which implement and execute any proposal approved by AAVE holders through a time-lock (the time period of which varies based upon the particular proposal) and defines the parameters by which each specific proposal is implemented (if approved).
Aave Cross-Chain Governance: Aave released a set of open source tools “to enable true cross-chain governance on Ethereum.” They also announced that they are open sourcing the main front-end interface to the Aave Protocol, allowing anyone to “build an alternative front-end with a different or enhanced user experience.” [Announcement]
Aave’s governance cross-chain bridges are a significant innovation for the Ethereum ecosystem, which is increasingly going multi-chain via networks like Polygon.
A vote to “test a cross-chain transaction workflow that would enable the Ethereum based smart contract for governance for the Aave Protocol (the ‘Aave Ethereum Governance’) to control the deployment of the Aave Protocol on Polygon (the ‘Aave Polygon market’),” ended Aug 29, 2021.
Active proposals
- AMPL interest rate curve adjustment [end Sep 7: Vote]
- What should be the LTV/Liquidation Threshold level for Aave V2? [end Sep 7: Vote]
Closed proposals
- Liquidation Bonus Updates [end Sep 3: View]
- Polygon Cross-chain Governance Test [Meta] [Vote] [end Aug 29: View]
- Add DPI on Aave V2 [end Aug 21: View]
- Extend Liquidity Incentives for Aave v2 [Development] [end Aug 23: View]
- Add FRAX to Aave V2 [end Aug 30: View]
- Aave Centrifuge Permissioned “RWA” Market Proposal [end Aug 31: View]
- Should liquidation bonuses be reduced for ten (10) Aave V2 assets? [end Aug 27: View]
Ongoing discussions
- ARC: Update AMPL interest rate curve to account for over-approximation in compounded interest [Development] [Discuss]
- Proposal: Aave Risk DAO [Strategy] [Discuss]
- The Aave Treasury Management Vision [Treasury] [Discuss]
- Proposal : A decentralized and public Aave frontend [Development] [Discuss]
- Announcement: Aave Snapshot Space [Meta] [Discuss]
Latest governance topics on governance forum.
Mark your calendar 📆
- Aave Grants Community Call 4 — September 14th at 4pm UTC
- #ETHOnline by ETH Global — September 17th to October 15th
Aave adopts broader liquidity incentive scheme:
Akropolis
There were no active proposals these weeks.
Ongoing discussions
- AIP-011: New $AKRO Staking Tokenomics With Token Burns And Lock [Discuss]
- [Pending] AFR 002: Capital Gains, Losses, and Income Screen [Discuss]
Latest governance topics on governance forum.
API3 DAO
Announcing the Partnership with EQ8 Network: API3 is pleased to announce a partnership with EQ8 Network, a blockchain based assessment and data monetization platform. EQ8 Network will be deploying an Airnode to supply their assessment data to dapps, and will also leverage API3’s existing network of data providers for a planned prediction market.
API3 DAO Tracker: API3 DAO currently involves 2,789 members participated in 8 votings
New and ongoing discussions (Sentiment Check)
- [SC] — Making the DAO own Liquidity on DEXes [Discuss]
- [SC] — Commissioning Research through the Messari Hub [Discuss]
- [SC] QuiDAO<>dAPI Team Undertaking #1 [Discuss]
- [Secondary Proposal 7] dAPI Undertaking #1 [View]
- [Secondary Proposal 6] Core Technical Team, August–October 2021 [View]
Latest governance topics on governance forum.
Introducing API3: new video material to highlight the project:
Badger DAO
Convex Helper Vaults: Suboptimal Harvest Paths Post-Mortem: In mid August, community members flagged an ongoing issue with the ROI showing for the CVX and cvxCRV Helper Vaults.
There were no active Badger Improvement Proposals (BIPs) these weeks.
To read more about the different proposals and take part in the decision, check out the governance forum.
DIGG Dojo — Options Redemption, TCL Injection & Stability Vault:
DeFi By Design EP #47: Earn Interest On Your Bitcoin w Badger:
Balancer
Decentralization at Balancer Labs: Balancer Labs’ COO Kristen Stone goes in-depth about how the company is thinking about decentralization.
In the near term, Balancer Lab’s is committed to setting the foundation for decentralization by:
(1) Drawing Balancer Labs’ actions back to the purpose of decentralization by consistently asking & answering: 1) Does this improve Balancer Protocol’s resiliency & innovation? 2)Does this further decentralize data, wealth, and/or power?
(2) Creating a transparent, two-way dialogue between Balancer Labs and the community through monthly updates, community halls, and public posts.
(3) Empowering the community to explore different paths than the ones opened by Balancer Labs. We will do this by fostering and facilitating the development of a thriving ecosystem of independent strategies & applications built on Balancer Protocol.
Fernando Martinelli, Balancer Labs CEO, on How DeFi is Turning Traditional Finance on Its Head: There is rarely a day that Bitcoin is not in the news. However, Bitcoin, which set the ball rolling for cryptos as we know them today, comes with its own set of issues.
Balancer Protocol Live on Arbitrum to Scale DeFi Liquidity: Balancer launches on highly anticipated Layer-2 solution Arbitrum.
Spectre Receives Grant To Build New Type of Pool on Balancer Protocol: Balancer Labs has awarded a grant to Spectre to build a new type of liquidity pool for crypto art NFTs using Balancer Smart Pools.
Active proposals
- Activate Sourcecred Program [end Sep 6: Vote]
- Staking of BPT for Economic and Governance Benefits [end Sep 6: Vote]
Closed proposals
- Increase BAL Reward Flexibility for LM Committee [end Aug 29: View]
- Fund Vested Payments for Ballers [end Aug 23: View]
New and ongoing discussions
- [Proposal] New grant to incentivise SOR integrations (eg aggregators, wallets) [Discuss]
- [Proposal] Staking of BPT for Economic and Governance Benefits [Discuss]
- [Proposal] Treasury Swap: Balancer <> Indexed [Discuss]
- [Proposal] Activate Sourcecred Program [Discuss]
- [Proposal] Increase BAL Reward Flexibility for LM Committee [Discuss]
Latest governance topics on governance forum.
Fireside Chat with Balancer: Kila & Ben from the QiDao team chat with the Co-founder & CEO of Balancer — Fernando Martinelli:
Bancor
Community Call Summary — August 22, 2021: Nate hosted the call and was joined by Mark, Yudi and Dingo from the Saffron Finance team. [Recording]
Closed proposals
- Bancor Improvement Proposal ETH/BNT Fee to 0.05% [closed Sep 1: View]
- Increase eRSDL (UnFederal Reserve) Co-Invest to 500,000 BNT [closed Sep 1: View]
- Proposal: Whitelist Bridge Mutual (BMI) with 500K BNT Co-Investment [closed Sep 1: View]
- Proposal to Whitelist Token (EDEN) + 250K Co-Invest [closed Aug 27: View]
- POWR Whitelist Proposal & BNT co-investment 250,000 [closed Aug 25: View]
- Proposal: Extend LM Rewards on COMP-BNT (Compound) Pool for an Additional Six Weeks [closed Aug 25: View]
- Proposal: Extend LM rewards on 0Chain (ZCN/BNT) [closed Aug 25: View]
- BancorDAO Whitelist Proposal for unFederalReserve (eRSDL) [closed Aug 25: View]
- Proposal: Whitelist DeXe Network (DEXE) — 200K BNT Co-Investment [closed Aug 25: View]
New and ongoing discussions
- Proposal: Whitelist iExec RLC (RLC) Plus 200K BNT Co-Investment Limit — 2nd Attempt [Discuss]
- Proposal: Increase Co-investment Limit to 350K BNT on DIGITALAX Monavale (MONA) Pool [Discuss]
- Proposal: Whitelist MASK with 100K BNT Co-Investment [Discuss]
- Proposal: Whitelist InstaDapp (INST) with 900K BNT Co-Investment [Discuss]
- BancorDAO Whitelist Proposal: Forward Protocol (FWD) [Discuss]
To read more about the different proposals and take part in the decision, check out the forum.
Compound
Compound Developer Community Call — Aug 25: summary / recording.
Polychain Chimes in on Compound Governance: Jacob Phillips, researcher at major crypto VC firm Polychain Capital, shared a report in the Compound governance forum entitled “COMP Summer Cleaning: Time to get organized.” In it, Phillips consolidates a list of issues with Compound governance and proposes some potential solutions. [COMP Summer Cleaning]
In the ensuing discussion, several comments and suggestions have been made that are worth reading whether you’re specifically interested in Compound or simply decentralized governance in general. After all, Compound was one of the first DeFi projects to hand governance over to its community of token holders. There is much to learn from its experience. [Read/Join the Forum Discussion]
Closed proposals
- Return Accidentally Sent Funds [Treasury] [end Aud 27: View]
- Proposal 057: Set Pause Guardian to Community Multi-Sig [Meta/Development] [end Aug 24: View]
New discussions
Ongoing discussions
- Permissionless Listing / Isolated Markets [Development] [Discuss]
- Dynamic COMP reward distribution [Development] [Discuss]
- Community Multisig (4-of-6) Deployment [Development] [Discuss]
- Formal process for new collateral assets [Meta/Product] [Discuss]
- RFP 16: Dynamic COMP reward distribution [Development] [Discuss]
- Official COMP token(s) on Arbitrum & Optimism [Development] [Discuss]
Latest governance topics on governance forum.
Curve
A brand new CurveFinance gauge voting app :
There were no active proposals these weeks.
New and ongoing discussions
- Increase Admin Fee on pools which receive rewards from the CRV gauge [Discuss]
- Proposal to add OUSD+3crv pool gauge [Discuss]
- Proposal to whitelist Earning.Farm contract [Discuss]
- Proposal to add gauges for ibEUR, ibKRW, ibJPY, ibAUD, ibGBP, and ibCHF [Discuss]
To read more about the different proposals and take part in the decision, check out the forum.
Gitcoin
Bankless + Gitcoin Survey: As such, as crypto continues to grow, more and more people find themselves working for DAOs. GitcoinDAO and Bankless DAO teamed up to start mapping this new frontier of “work”. They released a survey, linked below, calling all DAO workers to “contribute to the discussion and help inform the ecosystem + hopefully help the ecosystem coordinate to create better infrastructure for ‘the internet of jobs’.”
Active proposals
- Ratify GR11 Matching Pool Allocations [end Sep 6: Vote]
- Issue a 40k GTC grant to CLR.fund [end Sep 4: Vote]
Closed proposals
- FDD (aka. Anti-Fraud, Sybil, & Collusion) workstream allocation — Q3 2021 budget request [end Aug 22: View]
New and ongoing discussions
- Gitcoin Round 11 Matching Pool Allocations [Discuss]
- Proposal: Issue CLR.Fund a 40k GTC Grant [Discuss]
- Decentralize Gitcoin — Workstream Budget Request [Discuss]
- Proposal — FDD-WG (Anti-Fraud, Sybil, & Collusion) Q3 Budget Request [Discuss]
To read more about the different proposals and take part in the decision, check out the governance forum.
Sperax Hackathon AMA:
Gnosis
There were no active GnosisDAO Improvement Proposals (GIPs) these weeks.
New and ongoing discussions
- BAL rewards for GNO liquidity providers on Balancer V2 start August 16th [Discuss]
- Treasury Swaps Program GNO x BAL [Discuss]
Find out the latest GnosisDAO proposals here.
Idle
Closed proposals
- [Temperature Check] — Idle and Polygon $700k partnership [end Sep 3: View]
- [Temperature Check] — Contributors Extensions for the Treasury League New Mandate [end Sep 1: View]
New members’ elections. Leagues closed the application window and launched several Temperature Checks to let the community vote which candidate would join the committees:
- C&M League — UI/UX Designer Election [end Aug 30: View]
- Dev League — Frontend Developer Election [end Aug 30: View]
- Dev League — Smart Contract Developer Election [end Aug 30: View]
- Treasury League — Advisor Election [end Aug 30: View]
- Treasury League — Contributor Election [end Aug 30: View]
New and ongoing discussions
- [IIP-12] Enable $IDLE LM on idleRAI and fund Leagues mandate [Discuss]
- Contributors Extensions for the Treasury League New Mandate [Discuss]
- [Proposal] Idle and Polygon $700k partnership to jointly scale DeFi yield aggregation [Discuss]
- [JOB] Dev League v2.0 — Open Applications [Discuss]
- [JOB] Communication & Marketing League v2.0 — Open Applications [Discuss]
- [JOB] Treasury League v2.0 — Open Applications [Discuss]
To read more about the different proposals and take part in the decision, check out the governance forum.
Idle Finance DeFi Workshop | Web3 Fashion Week
Index Coop
Recent blog topics:
Active proposals
- IIP-80: Meta Governance Proposals [MGP] Process [end Sep 4: View]
- IIP-081 — Meta Governance Autonomy [end Sep 4: View]
Closed proposals
- IIP-75: Web3 Engineer — Full Time offer [end Sep 2: View]
- [AAVE-34] Liquidation Bonus Updates [end Sep 2: View]
- [AAVE-28] Polygon Cross-chain Governance Test [Meta-Governance] [end Aug 28: View]
- IIP-79: Authorize the Operations Account for Aave, Balancer, Compound, and PoolTogether Strategies [Treasury] [end Aug 27: View]
- IIP-72 Redirect FLI Revenue to Operations Account [end Aug 26: View]
- [COMPOUND-57] Set Pause Guardian to Community Multi-Sig The [Pause Guardian] [end Aug 23: Vote]
- [AAVE-32] Extend Liquidity Incentives for Aave v2 [end Aug 22: Vote]
New discussions
- Meta Governance Proposals — Structuring a Process [Meta] [Discuss]
- Index 2.0: Autonomy Next Steps [Strategy] [Discuss]
- IIP-75: Web3 Engineer — Full Time offer [Staffing] [Discuss]
- INDEX 2.0 — The Community Treasury Autonomy Workshop Prior Reading [Treasury] [Discuss]
- [UPDATED] Proposal: Market Making Proposal from Wintermute Trading [Product] [Discuss]
- IIP-80: Meta Governance Proposals [MGP] Process [Meta] [Discuss]
- IIP-81: Meta Governance Autonomy [Meta] [Discuss]
Ongoing discussions
- Flipside UNI Delegation Post-Mortem [Meta] [Discuss]
- IIP-XX: FLI Metagovernance Vote Delegation to Multisig [Meta] [Discuss]
- Why is the Index Coop Proposing to launch our own suite of leveraged indices? [Strategy] [Discuss]
- IIP-58: Launching Pulse Aggregate Yield (PAY) [Product/Strategy] [Discuss]
- IIP-78: Launch The Yield Hunter Index ($YHI) [Product] [Discuss]
- IIP-XX: Launch a LINK2x Leveraged Product [Product] [Discuss]
- Launching the next wave of FLIs [Product/Strategy] [Discuss]
- IIP-71 : Launching the Robot Index (iRobot) [Product] [Discuss]
Find latest Index Coop proposals here.
To read more about the different proposals and take part in the decision, check out the governance forum.
Kleros
Clr Spotlight Series with Clement Lesaege, cofounder of Kleros, decentralized arbitration service for the disputes of the new economy:
There were no active KIPs these weeks.
To read more about the different proposals and take part in the decision, check out the governance forum.
KyberDAO
KyberDMM Launches on Binance Smart Chain with $4M in Liquidity Mining Rewards: DeFi’s first multi-chain dynamic market maker will enable dynamic fees and higher capital efficiency for liquidity providers on BSC.
Closed proposals
- KIP-13: KyberDMM Expansion and Liquidity Mining on Avalanche [end Aug 31: View]
Find out all proposals here. Check them out on GitHub.
KyberDAO Community Call 6:
Lido
Recent blog topics
Closed proposals
- Lido Execution Client Grant [end Sep 3: View]
- Increase bug bounty bounds and make bounties more discreet [end Sep 1: View]
- Lido for Polygon — Proposal by Shard Labs [end Aug 26: View]
- Should the Lido DAO add the 5 shortlisted Ethereum and 15 shortlisted Solana staking provider organizations as node operators? [end Aug 23: View]
- Lido for Kusama+Polkadot by MixBytes() [end Aug 25: View]
New and ongoing discussions
- LIP-3: Easy Track Motions for DAO routine operations [Discuss]
- Proposal to Use Visor Finance for Liquidity Mining on Uniswap v3 [Discuss]
- Diversification of DAO Treasury [Discuss]
- Integration with Tokemak [Discuss]
- Smart contract withdrawal (non-custodial) [Discuss]
To read more about the different proposals and take part in the decision, check out the governance forum.
MakerDAO
New and ongoing discussions on Maker Improvement Proposals (MIPs)
- MIP39c2-SP19: Adding the StarkNet Engineering Core Unit (SNE-001) [Discuss]
- MIP39c2-SP21: Adding MakerLabs Core Unit [Discuss]
- MIP41c4-SP22: Facilitator Onboarding (MakerLabs) [Discuss]
- MIP40c3-SP32: Adding MakerLabs Core Unit Budget [Discuss]
- MIP40c3-SP16: The Strategic Happiness Core Unit Budget, SH-001 [Discuss]
- MIP40c3-SP25: Risk Core Unit MKR Compensation (RISK-001) [Discuss]
- MIP58: RWA Foundations [Discuss]
and many more!
Read more about the different proposals and take part in the decision.
Governance Portal, Governance Forum
The Maker community hosts weekly governance Q & A sessions. All are welcome to attend and learn more about how Maker governance works.
MakerDAO events calendar here.
mStable
Recent blog topics
Closed proposals
- MDP22 — BadgerDAO Loan for Bootstrapping Vault Boost [end Aug 29: View]
- Cat Herder Full-Time Role Upgrade [end Aug 29: View]
- PDP 28: Reward distribution for weeks 35–41 [end Aug 27: View]
- BadgerDAO Loan for Bootstrapping Vault Boost — Motion [end Aug 22: View]
New and ongoing discussions
- PDP 29: Staking V2 [Discuss]
- [Proposal] Creation & Initial Funding of the mStableDAO Asset Management subDAO [Discuss]
- MDP24.2 — Strategy for Incentivized Liquidity Provision on Convex Finance [Discuss]
- MDP24.1 — Incentivized Liquidity Provision on Convex Finance [Discuss]
- MDP23.2 — Strategy for Incentivized Liquidity Provision on Balancer Finance [Discuss]
- MDP23.1 — Incentivized Liquidity Provision on Balancer Finance [Discuss]
To read more about the different proposals and take part in the decision, check out the governance forum.
Nexus Mutual
There were no active proposals these weeks.
Vote on governance proposals to decide the future of the protocol here.
To read more about the different proposals and take part in the decision, check out the governance forum.
Synthetix
V2x Revisited: The transition to decentralized governance has been constant within the Synthetix community for a number of years, and V2x contains many changes that will prepare the project for the transition to V3 governance early next year. Firstly the synthetixDAO (SIP-155) will be deprecated, this proposal recently passed and a vote for the new Treasury Council is expected to be initiated soon. (SIP-161) establishes the Core Contributor Committee, this is a crucial component of governance that was sorely missing as I stepped back from the project earlier this year. One of the most pressing aspects of governance that I set out to address was coordination within the CC’s. I believe this SIP is the first step in that direction and look forward to seeing it presented to the Council soon. (SIP-167) allows the current L1 governance process to also control L2, this is crucial as the value of SNX on L2 increases. Finally, V3 Governance (SIP-172) takes a lot of the learnings from the last 18 months and identifies numerous improvements to the governance process in a holistic way.
Active proposals
- SCCP-137: Reduce L2 Target C-Ratio To 750% [end Sep 5: Vote]
Closed proposals
- SIP-169: Deprecate Low Volume L1 Synths [Development] [end Aug 29: View]
- SIP-120: Atomic Exchange Function [Product] [end Aug 29: View]
- SCCP-135: Open Account Merging Continuously [Development] [end Aug 28: View]
- SCCP-136: Increase L2 Inflationary Rewards to 50k [Product] [end Aug 28: View]
- SIP-155: Deprecating the synthetixDAO (ratifying the Treasury Council) [Treasury] [end Aug 28: View]
- SIP-174: Redeem Deprecated Synths [Development] [end Aug 23: View]
New and ongoing discussions
- SIP: Kwenta Independence [Discuss]
To read more about the different proposals and take part in the decision, check out the governance forum.
Pie DAO
PieDAO | Organizational Roadmap Q3/Q4 2021:
Active proposals
- [PIP-59bis] $PLAY Assets inclusion/removal [end Aug 25: Vote]
Closed proposals
- [PIP-60] DOUGH Staking & Governance Mining [end Aug 25: View]
- Decentralize PieDAO website proposal [end Aug 25: View]
- PIP-59 $PLAY Index prospectus [end Aug 25: View]
- Proposal to create a Community Contribution Initiative [end Aug 25: View]
Ongoing discussions
- [PIP-59] $PLAY Metaverse Index — Prospectus [Discuss]
- PIP 3 — AWP++DeFi [Discuss]
- [PIP-60] DOUGH Staking & Governance Mining [Discuss]
- [Proposal] Form a Meta-Governance Committee [Discuss]
To read more about the different proposals and take part in the decision, check out the governance forum.
PieDAO, Passive Wealth Creation, $DOUGH Staking, Investing in a Metaverse Index, DAO Explained:
PoolTogether
Recent blog topics
Closed proposals
- PTIP 32/34/35 Bundle [end Sep 1: View]
New and ongoing discussions
- PTIP-35: Polygon Incentives! [Discuss]
- PTIP-34 Grants Program Q2 Funding [Discuss]
- Gamifying PoolTogether [Strategy/Product] [Discuss]
- PTIP-32: Ethereum Operations Team [Staffing] [Discuss]
To read more about the different proposals and take part in the decision, check out the governance forum.
Uniswap
SEC is investigating decentralized crypto exchange developer Uniswap Labs: The U.S. Securities and Exchange Commission (SEC) is reportedly investigating Uniswap Labs. The Wall Street Journal reported the news, citing “people familiar with the matter.” Enforcement attorneys are said to be seeking information about how investors use Uniswap and how it is marketed.
Uniswap Resolves Governance Upgrade Bug: Proposal 8, which upgraded governance contracts, contained an undiscovered flaw which could have prevented proposals from executing properly.
Governance changes are some of the most critical upgrades for defi protocols, as governance contracts control all of the other admin privileges and upgrade paths available to the protocol. In the past week, Uniswap faced a close call where their governance upgrade almost caused significant issues.
Proposal 8 upgraded Uniswap governance from Governor Alpha to Governor Bravo, a newer version of the contract developed by the Compound community. Governor Bravo offers easier upgradability for governance in the future without requiring contract migrations, along with a few other user experience and safety features.
The proposal received broad support from voters, but despite the high visibility a bug was able to slip into production. In this case, the governor contract was initialized with incorrect variables, which would have rendered the first 8 proposals submitted to the new contract invalid. Luckily, submitting 8 placeholder proposals was able to resync the “proposal count” and “initial proposal count” values to allow future proposals to execute properly.
While this bug was resolved without further issues, it points towards the importance of code reviews for governance proposals. In a worst case scenario, faulty proposals could lock governance and render protocol admin privileges and funds inaccessible. And while one might expect large holders and funds to independently check upgrades, in truth many of these actors lack the capacity and direct incentives to undertake deeper reviews. Protocols may consider retaining auditors or hiring an in-house dev team to provide an additional layer of security for critical code changes.
Uniswap Analytics Proposal Stirs Controversy: Proposal 7 saw considerable opposition at the last minute due to concern over spending oversight.
Proposal 7 continues Uniswap’s history of contentious governance votes. Driven by analytics provider Flipside Crypto, the Community Enabled Analytics proposal sought up to $25 million worth of UNI tokens to bootstrap a new analyst focused grants program. Instead of directly using the tokens for grants, Flipside proposed to invest the tokens into a Uniswap v3 liquidity position to generate yield for continuous funding. 50% of the yield generated would be withheld to cover Flipside’s program management and operating costs.
The proposal initially met little resistance, sailing through two consecutive Snapshotpolls with over 99% of participating tokens voting in favor. And the initial phases of the on chain governance vote proceeded similarly, with early voters offering nearly unanimous support.
However, once the proposal reached the minimum 40 million UNI votes in favor to pass quorum, the level of engagement on the “against” side picked up considerably. This was partly catalyzed by a call to action from another prominent data platform, Dune Analytics.
Opposition focused on a few areas. First, some considered the operating expenses going to Flipside to be excessive, representing 50% of the generated revenue (estimated to be around $90,000 per month). Dune objected to the analytics grant program focusing solely on Flipside and excluding other providers. While Flipside had mentioned grantees would be free to use other data platforms, the proposal didn’t allocate any funding for this. And there was also some concern about the sheer size of the grant and management frameworks. While spending from yield was intended to lower the long term cost of the program (through less token dilution), this involved significant investment risk from providing Uniswap liquidity as well as trust requirements for the 3 member multisig committee managing funds.
Following Dune’s widely shared objections, the “against” side took the lead. The proposal was then disrupted somewhat by a technical issue impacting the Tally voting interface, causing some “against” votes to be erroneously submitted to the governor contract as “for” votes. The issue was quickly resolved, and didn’t impact the vote outcome as the proposer had dropped below the required 2.5 million UNI threshold during the voting period, allowing the proposal to be cancelled.
With the proposal shelved for the time being, Flipside is now considering their next move. Some potential changes to the proposal include a more independent oversight committee, removing yield generation and asset management from the scope, and potentially even adopting a consortium approach to data platform participation.
Active proposals
- Consensus Check — Support Stable UNI [end Sep 9: Vote]
Closed proposals
- Upgrade Governance Contract to Compound’s Governor Bravo [end Aug 26: View]
- Temperature Check: Support $oneUNI Stablecoin [Product] [end Aug 29: View]
New discussions
- Consensus Check — Support Stable UNI [Strategy/Treasury] [Discuss]
- A soft proposal to increase transparency for the Uniswap Grants Program [Meta/Treasury] [Discuss]
- Proposal: Uniswap Liquidity Program v0.1 [Treasury] [Discuss]
Ongoing discussions
- Temperature Check: Support $oneUNI Stablecoin [Product] [Discuss]
- Governance Proposal UP1.2: Community-Enabled Analytics [Treasury] [Discuss]
- Deploy Uniswap v3 to Arbitrum Mainnet [Development] [Discuss]
- UNI should become an oracle token [Product/Strategy] [Discuss]
To read more about the different proposals and take part in the decision, check out the governance forum.
Yam Finance
Closed proposals
- YIP-83 Treasury Allocation after Rebalance [end Sep 1: View]
- Stream Renewal of Jim [end Sep 1: View]
- YIP-82: Move yUSD funds to yDAI Vault [end Aug 22: View]
- YIP-81: Remove Strategic Assets from YDS [end Aug 22: View]
- YIP-80 Treasury Rebalance [end Aug 22: View]
New and ongoing discussions
- YIP-84: Update to Contributor Compensation Guidelines [Discuss]
- YIP-85: Create new Human Resources Group [Discuss]
- YIP 77: Bootstrapping Yam Fuse Pools [Discuss]
- YIP-83 Re-allocation of Assets Post Rebalancing [Discuss]
Check out the latest YIPs discussions here.
Yearn Finance
There were no active proposals these weeks.
Check out the latest YIPs discussions here.
MISC
Ethereum Gas Limit Project Stokes Disagreement Among Core Developers:
EGL voting and incentives challenge the “rough consensus” process used for Ethereum base layer governance.
Historically, changes to the Ethereum protocol have been managed via the Ethereum Improvement Proposal (EIP) process. This relies on “rough consensus” being reached among Ethereum core developers, including network researchers and client teams.
Changes to the network’s gas limit (determining the maximum amount of transactions that can be processed) has been handled slightly differently. Miners have been empowered to vote on changes to the gas limit with their hashpower, which gives greater flexibility to respond to spam or denial of service attacks. But they have historically followed core devs’ recommendations on safe maximum gas limits.
This paradigm is now being challenged by the Ethereum Gas Limit (EGL) project. Depending on perspective, the project is variously considered a way to empower the community or a bribery mechanism that undermines Ethereum governance. It works by creating an on chain, token based voting mechanism for users to signal their preferred gas limit. Miners who vote for the gas limit proposed by token holders receive a share of EGL inflation, which they can then sell into the market to improve their profitability.
In the short period since EGL launched, it has already gained significant traction with over 21% of mining hash power collecting EGL token rewards. There may be some risk of incentive misalignment though, as miners will be made obsolete when Ethereum switches to proof of stake consensus (expected in 2022) while the expanded state size from larger blocks imposes a long term cost on network participants beyond this time.
As discussions progressed, it became clear that support for EGL was largely determined by participants’ technical positioning. For example, several members of the Erigon client team (which excels at managing growth in state size) expressed their support, and suggested the existing governance process is dysfunctional and fails to accommodate technical advances.
The development team behind EGL, bloXroute, also has a vested interest in increasing the block size, as their primary product for improving block and transaction propagation across nodes is currently not necessary due to relatively low gas limits.
Discussion continues on the relative benefits and risks of tokenizing aspects of Ethereum’s base layer governance. But on a more general level, this represents an important example of extrinsic incentives being overlaid on existing governance frameworks. Other mechanisms for vote renting or trustless bribery are also beginning to emerge for DAOs and application layer protocols, which can challenge some of the game theoretical assumptions underlying governance security. As these mechanisms progress, projects may need to reevaluate their voting systems to respond to adverse incentives.
- Polygon’s DAO Announcement: Polygon announced their intention to launch a DAO, of some kind, to promote the adoption of DeFi and Polygon. [Read the Announcement Blog]
The details are not yet decided but, as one can read more about in the announcement blog linked above, the general idea is to bring together the various DeFi protocols that use Polygon’s PoS chain to promote the DeFi ecosystem. To join the conversation and contribute to the DAO’s design, visit this forum.
- SwingDAO: SwingDAO launched this week with an announcement that they are building a protocol that allows users to buy and sell votes. Following the recent release of bribe.crv.finance and Vitalik’s essay criticizing coin voting, Swing is striking at the heart of a hot topic in DAO governance these days: “coin voting reform [and] the need for transparency in currently existing — and unavoidable — bribing practices.”
Swing protocol is still in development but the blog post linked below outlines its preliminary model for “developing fluid voting markets on top of existing coin voting systems where users can sell their votes for DAI in order to extract value from their governance tokens.” [Introducing Swing Protocol]
- Paxos renames PAX stablecoin to USDP, potentially causing confusion with Unit Protocol’s stablecoin:
- Centre switching USDC back to all cash reserve policy by end of September:
- a16z Delegate Disclosure: Another story related to crypto VC firms engaging with DAO governance popped up when a16z released details around their governance rights delegation program. [Read a16z’s Blog Post]
Governance Researchers: Exploring Challenges in DAOs: In this SmartCon panel discussion, knowledgeable academics and researchers explore the challenges in decentralizing hierarchical organizations and the intricacies of understanding collective decision-making at scale:
- DAO Day: A conference day of speakers and workshops helping attendees understand what DAO’s are and how they will play a role in the future:
Subscribe to Paradigm!
Medium. Twitter. Telegram. Telegram Chat. Reddit. LinkedIn.
Main Sources
Projects’ blogs and forums
Research articles
That’s all for today! Your feedback is highly appreciated!👥
